From Philanthropy to Net Positive

Fishing for Better Business

My week started with an exploration of  the mansions of some of the richest families in history. This was an interesting contrast with my preparation for a session on sustainable consumption that I will be moderating at this week’s BSR Conference here in New York City, which involved reading through IKEA‘s new sustainability plan, announced today. There is an interesting connection between last century’s mega-rich and today’s most responsible companies, and I hope that there will be implications for business in Bhutan.

I started a crisp autumn Sunday in the Hudson Valley about two hours north of New York City. The rolling hills glowed with an autumnal gold – an appropriate backdrop for the place where the Rockefellers and the Vanderbilts defined the structure of modern philanthropy. After making a fortune as the founder of Standard Oil, John D. Rockefeller retired in 1897 as the richest man in the world (sometimes regarded as the richest man is history). Throughout his career, Rockefeller donated 10% of every pay check to charity, and following his retirement, he spent 40 years dedicating his life to philanthropic causes in medicine, education, science and the arts. In total, it is estimated that Rockefeller donated over half his accumulated wealth – more than USD 550 million – to charitable causes. While this generosity should certainly be celebrated, does giving half your wealth to charity make up for the fact that your wealth was generated through business activities that caused environmental destruction beyond repair?

Hydro: Bhutan’s blue gold

This important question has indeed led to what I consider a positive shift of thinking in how business can, and should give back. What started as a company or an individual donating money to a cause through philanthropy, slowly evolved into the idea of “Corporate Social Responsibility”, in which a company takes responsibility for the impacts of their activities on the environment and society. Having worked in the field of sustainability for over 10 years now, I like to think of CSR as “doing less bad”. Doing less bad is certainly better than doing more bad. It is also better than giving money to a cause unrelated to your business to make up for it as did philanthropists 100 years ago, and as many continue to do today. At the same time, doing less bad is still a long way from actually having a net positive impact on society, and this, I believe, should be the ultimate goal of business.

Can companies actually leave the world a better place? In many ways, I am here in New York to celebrate the evolution in Corporate Social Responsibility, and debate this important question during this week’s 20th anniversary Business for Social Responsibility Conference where I will be moderating a session on sustainable consumption.

This will be part of the discussions here in NY at the BSR Conference. It’s certainly a challenge, but there are companies willing to try. IKEA is now looking at sustainability as a core business strategy, not a side show, and will measure progress in terms of “People and Planet Positive“. Kingfisher, a European home improvement retailer aims to have a “Net Positive” impact; Royal DSM, a Dutch chemical company, has a line of “Eco+” products, and is starting to evaluate in terms of “People+” as well; Marks & Spencer has “Plan A“.

Happiness is a place – and a way of business?

Over the past six weeks living in Bhutan, the general attitude towards business seems quite sceptical. I have often found myself in the position of defending random companies, and ultimately defending capitalism in the home of Gross National Happiness. This is a defense I am perhaps bound to lose in conversation, but happy to undertake.

Only time will tell whether the leading companies can be successful at making a positive impact, but having the ambitions and vision to aim high is certainly a first step. In Bhutan, they are halfway there, and in many ways the difficult half has been tackled first. By seeking to measure overall progress by the principles of Gross National Happiness rather than the uni-dimensional measure of GDP, the government is setting the right macroeconomic rules of the game.

With proper execution, these will encourage business to aspire to more than quarterly profits, or even century-old principles of philanthropy. Business can and must be employers and caretakers of the people, responsible stewards of nature’s resources. In doing so, success will not be measured by the amount of money given to charity, but by the positive social and environmental impact that a business can have through its core business.

Only when sustainability is embedded within the core of a business, the DNA of corporate culture, and the spirit of every employee, will sustainability be truly sustainable, both in Bhutan and the world.


2 responses to “From Philanthropy to Net Positive

    • Thanks Adam. Interesting article. Bhutan is not quite as rosy as most visitors portray it, and there continue to be struggles between mad and nature. Most weeks there are stories in the papers about attacks by big cats on farmer’s livestock or chickens. (Antonia is currently trekking and just called to say that a young yak was attacked by a snow leopard near their camp last night and may not survive!) Even with 60% forest cover mandated in the Bhutanese constitution, there is still a long way to go here to involve and engage the local populations as stewards of biodiversity, and when it comes to man vs. beast, that will not always be easy!

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