15 Nov 2017
Corporations, governments and NGOs need to work together for mankind to exist sustainably, says the former Prime Minister of the Netherlands
Within six months of taking office, U.S. president Donald Trump announced the decision to pull the United States out of the Paris Agreement on climate change mitigation. Reaction from international reaction was predictably negative, culminating in thinly veiled criticism at the United Nations General Assembly where British Prime Minister spoke of “states deliberately flouting – for their own gain – the rules and standards that have secured our collective prosperity and security”.
“Of course it’s disappointing that President Trump is pulling the United States out of the Paris Agreement,” says Jan Peter Balkenende, former Prime Minister of the Netherlands. “But there are still 30 [U.S.] states who stand behind the Paris Agreement. There are also lots of companies who do so. In the U.S. it’s a mixed picture.
“The geopolitical picture is a bit different. If the U.S. is not in the picture, people, countries, governments will look at other countries. People are looking to China. Very rapidly after the remarks of President Trump, there was a climate agreement between the European Union and China. That’s just an example.”
Balkenende was responding to questions in a Q&A session following his recent SMU Presidential Distinguished Lecturer Series talk titled “Partnership towards sustainable business” where he laid out the need to re-evaluate the modern economy and adjust consumption to save the Earth.
“We live in fascinating times,” he says. “We have opportunities and challenges. The global agenda is clear: sustainable goals and climate change and the circular economy. We cannot go on with the current production and consumption styles. We have to rethink our business models.
“We have work together. We need a circular economy. It is out obligation to do the right thing for society. It starts with everyone – governments, NGOs, businesses, universities.”
THE BUSINESS OF BUSINESS
Citing Milton Friedman’s famous statement that “the business of business is business”, Balkenende followed up by pointing to Michael Porter’s vision of creating shared value as the new goal of business leaders.
“A company must create economic value otherwise you cannot invest, and you cannot keep people employed,” says Balkenende, now Professor of Governance, Institutions and Internationalisation at Erasmus University Rotterdam. “But at the same time you have to generate societal value by addressing the needs of society. That means the companies are not just there to create profit, they must also address environmental issues, human rights issues, energy issues. In fact, all these elements should be integrated in the role you have as a company. “
Balkenende, who also chairs the Dutch Sustainable Growth Coalition (DSGC), points out how companies of the DSGC - AkzoNobel, DSM, FrieslandCampina, Heineken, KLM, Philips, Shell and Unilever – promote sustainable growth strategies and ‘share the conviction that long-term financial and economic value is inextricably linked to minimized environmental impact, social progress and inclusiveness’.