In the fight against climate change, belligerents can be divided into those working from the private sector and those working from the public sector, with the private sector often seeming an ineffective weapon. This article tackles the issues of what we mean by ‘environmental sustainability’, and how this idea must be mediated to better reverse climate change through the private sector.
It was on June 4th, 2017 that the mainstream media, largely, ceased to care about Michael Bloomberg’s fight against climate change. Before that, on June 1st, The New York Times published Bucking Trump, These Cities, States, and Companies Commit to Paris Accord. On the second and third of June, outlets like CNN, USAToday, and NPR followed suit, similarly hailing Bloomberg as the leader of that particular fight against Trump. Following The President’s decision to pull out of the Paris Climate Accords, therefore, it appeared wholly likely that the American private sector would take up the burden of rectifying climate change, with Bloomberg as its leader.
The radio silence that has followed is hard to explain—it is almost impossible to find anything on the issue now and, therefore, difficult to know if Bloomberg has stayed true to his crusade against Trump. Why this story is now apparently dead is wildly puzzling, and it seems that the solution to combatting climate change has proved to be equally elusive through Bloomberg’s vanishing act. In fact, Bloomberg’s involvement with climate change policy is made even more interesting by his status as a former mayor of New York and, thus, the fact that he continues to straddle the gap between the public and private sector. One begins to wonder how effective the private sector can be in combating climate change, and why they have been ineffective so far.
In December of 2016, Peter Lacy, Global Managing Director of Accenture Strategy wrote in the World Economic Forum: “When people talk about the circular economy, they focus on eliminating waste by reimagining the product lifecycle—from design to end of life. And yes, that’s one aspect. But circular approaches are also about tapping into new sources of value, turning waste into wealth in ways that were impossible before the advent of digital technology.” The article that Lacy was writing continued to examine five of the companies that had, in 2016, shown themselves as market leaders in what is known as the “circular economy”. Topping the list was LanzaTech, a company that embodies Lacy’s sentiment by literally turning waste into wealth— they use patented microbes to help turn waste from industrial processes into fuel that can be re-used. Lanzatech also topped the list of 50 Hottest Companies in the Advanced Bioeconomy rankings, published in The Digest, in both 2015 and 2017, and accrued $112 million in Series D funding in 2014. On the company’s website, it is reported that independent research “has shown Life Cycle Analysis results of 76.6% greenhouse gas (GHG) reduction for LanzaTech’s steel mill to ethanol process.” On paper, the company seems wildly successful. Both the interest in LanzaTech from third parties and the actual results achieved are coherent with a picture of a company that is thriving and healthy. Of course, however, these statements confirm each other. The health of LanzaTech originates from its economic status, and the efficiency of its processes has grown from that status.
This statement highlights the underlying problem in private-sector companies built around a model of renewable energy or sustainable development. People, investors and the media, care about LanzaTech because the company continues to show promise in terms of profitability, not because they are generating global change regarding the environment. This is not to say that they are not doing a good job of looking after the earth, but that their appeal to investors is seemingly grounded in economic measures. Of course, this raises questions about what it is that investors are and should be concerned with. Plenty could be said to inform such a debate, but, for the case of LanzaTech, I argue that if companies are built around a model of ‘environmental sustainability’, the environmental sustainability of those companies should constitute a considerable par—if not all— of its investors’ interests.
The issue of investors’ motives is confirmed by the report 2017 Global 100 Most Sustainable Corporations in the World, published annually since 2005 , by the Toronto-based company, Corporate Knights. Most interestingly, to even qualify for the list, all companies were required to “have a market capitalization in excess of $US 2 billion”. This restriction is pragmatic on the part of Corporate Knights, intended to reasonably limit the list, but does reveal the fact that the market somewhat relegates environmental sustainability in its hierarchy of what sustainability entails. Though the criteria in the list are much more complex than simple economic wealth, the fact that the first barrier for entry is financial valuation proves that there is some inherent problem with how the media and the public view sustainability.
The size of a company, in fact, has absolutely nothing to do with environmental sustainability. There is no theoretical correlation between the two, and no apparent practical correlation either, but, rather, the veto of a $2 billion profit simply shows us that we are only willing to consider a company worthwhile if it is beneficial to our instant needs. This is to say that agents in a free market—as represented by large corporations in this case—are so enraptured by the notion of finance that they often turn their gaze from the significance of a company combatting climate change. It is worth noting that Siemens AG tops the list for fair enough reasons; it is a technology company investing in renewable technologies. However, the appearance of Enagas SA at the number nine spot is nonsensical in terms of Enagas’ environmental awareness; it is a company specifically dealing with the production and sale of energy using natural gas and other fossil fuels.
Having said this, one must concede that this investigation reveals, in part, why the media forgot about Bloomberg so quickly. The fact that Bloomberg’s venture was in no way profitable is the precise reason why it seemed so uninteresting and the direct cause of the media’s sudden lack of interest in the story. The media’s ceasing to report on the story can be attributed, with near certainty, to the lack of profitability in his mission, with that lack of profitability transferring to their own stories.
The most recent coverage of the story available online can be found in Bloomberg Philanthropies’ official website. It claims that “California Governor Jerry Brown and Michael Bloomberg launched America’s Pledge on climate change, a new initiative to compile and quantify the actions of states, cities, and businesses in the United States to drive down their greenhouse gas emissions consistent with the goals of the Paris Agreement.” This was published on July 12th, 2017. On June 3rd, however, the Washington Post had claimed that “the U.S. Conference of Mayors, a bipartisan group of more than 1,000 mayors, denounced Trump’s decision and affirmed their cities’ commitment to meet climate-change goals”. Just over a month later, that group had seemingly shrunk to a governor and an ex-mayor. At the very least, any other parties involved in the endeavor were, suddenly, no longer reported by Bloomberg’s own press. The problem is not quite that no one cares about the planet, but that no one cares until the planet is profitable. To effect changes on a global scale, perhaps we need to recall that humans can be hopelessly short-sighted when it comes to their own futures.