Can corporate-NGO partnerships save the environment? Part 1

The World Summit on Sustainable Development in September 2002 was an anti-climactic conclusion to three decades of global environmental activism. Delegates agreed few new targets for governmental action, save a welcome pledge to halve the number of people without access to sanitation and safe drinking water by the year 2015.

What did emerge from Johannesburg was a new debate. Many governments and some non-governmental organisations (NGOs) argued that voluntary partnerships between business, governments, and NGOs were the best way to make concrete progress on sustainable development

Ten years earlier the 1992 Earth Summit in Rio de Janeiro generated a long list of official commitments and optimism that governments could protect the environment and reduce poverty. Johannesburg symbolised the extent to which Globalisation has scrambled the interests and capabilities of governments, corporations, and activists. Now former antagonists are drawn to work together in ways that are uncomfortable, controversial, and yet often highly effective. It is an era of strange bedfellows.

The New Global Context for Environmental Action

Thirty years of effort to restore and protect the environment has left a mixed record. While many local environments are on the mend key global trends are worsening

The Kyoto Protocol, which will likely enter into force after 2002, will not solve the problem of global warming. Leaving aside the intransigence of the U.S. (the largest single source of greenhouse gases) the Protocol does not commit the developing countries (collectively the world's largest source of future greenhouse gasses) to reduce emissions.

There are good reasons for omitting developing countries from the Kyoto mandate. The developed nations are responsible for the current high levels of greenhouse gases in the atmosphere, and they have greater financial and technological capabilities to reduce emissions. Ultimately, however, the solution to climate change and other global environmental problems will depend on the active participation of the developing world.

Globalisation has proved a two-edged sword for business and the environment. As the political will and capabilities of governments to address environmental issues has waned, private capital has become the main source of foreign investment in many developing countries. The multinational companies whose investments have helped to create economic gains and environmental stresses in the developing world now face pressure to improve their environmental performance. Similarly in the United States, a trickle of voluntary initiatives has become a flood.

The contrast between Johannesburg and Rio illustrates the extent to which the institutional context for addressing environmental problems has changed. Broadly speaking, governments came to Johannesburg with less interest and fewer resources than they brought to Rio. Business, on the other hand came ready to do business and enter into partnerships with environmental organisations and governments.

Some NGOs want government to reassume a strong hand in regulating the growing influence of global corporations. Others are trying to surf the new waves; aligning with the corporations who seem more motivated than governments to take action on environmental issues.

STRANGE BEDFELLOWS

In one sense, partnerships between corporations and environmental organisations are not new. Companies have provided charitable grants for the programs of environmental organisations for decades. The controversy in Johannesburg surrounded a new type of partnership in which the common interest of the company and the NGO has grown beyond philanthropy. Now both organisations seek to solve an environmental problem associated with the company's core business without waiting for a government mandate. These partnerships are a significant departure from the ways in which NGOs and businesses have typically behaved.

The Pioneers: Environmental Defense and McDonald's

Two of the first organisations to break this tradition were Environmental Defense (formerly known as the Environmental Defense Fund or EDF) and McDonald's, who launched a landmark partnership in 1990 to reduce waste in McDonald's restaurants and supply chain. This reduced more than 150,000 tons of packaging, recycled more than two million tons of corrugated cardboard, and purchased more than $4 billion worth of products made from recycled materials. It has been followed by similar initiatives to reduce water and energy consumption and a new partnership with the Center for Environmental Leadership in Business at Conservation International to promote conservation and sustainable agricultural practices among suppliers of commodities, such as fish, beef, potatoes, and oils.

While difficult to prove, it is likely that the McDonald's-Environmental Defense initiative spurred other companies and NGOs to partner on voluntary environmental action. EDF in 1994 launched the Alliance for Environmental Innovation, which has undertaken similar waste-reduction initiatives. The U.S. Environmental Protection Agency has launched more than 30 voluntary programs to encourage the private sector to act above and beyond regulatory requirements (pdf 139Kb). EPA's Project XL grants companies the flexibility to test alternative approaches that achieve better environmental results more efficiently than existing regulatory requirements. Other EPA voluntary programs promote pollution prevention, energy efficiency, water efficiency, waste minimisation, mass transit, watershed conservation, sustainable agriculture, and more.