Leadership Optimism Meeting Reality: Can Corporate Leaders Face the Truth about the Cost of Profit?

The United Nations released a groundbreaking report that demonstrates that no industry could report a profit if they accounted for the cost of environmental damage.

The report comes amid growing concern that no one is made to pay for most of the use, loss and damage of the environment, which is reaching crisis proportions in the form of pollution and the rapid loss of freshwater, fisheries and fertile soils.

Later this year, another huge UN study – dubbed the “Stern for nature” after the influential report on the economics of climate change by Sir Nicholas Stern – will attempt to put a price on such global environmental damage, and suggest ways to prevent it. The report, led by economist Pavan Sukhdev, is likely to argue for abolition of billions of dollars of subsidies to harmful industries like agriculture, energy and transport, tougher regulations and more taxes on companies that cause the damage.

It’s devastating, and yet, time to pay the piper for industrial destruction in the name of profit.  Here’s a picture to help visualize the real costs of industrial production….

Environment_Costs_1902.gif

FROM: THE GUARDIAN

But the report comes from a sense of optimism, of hope that knowledge really is transformative. In a culture where the bottom line rules us all, this new assessment of our self-interested, industrial revolution era understanding of profit might actually shift some industry practices.

“It can make the difference between profit and loss,” Sukhdev told the annual Earthwatch Oxford lecture last week. “That sense of foreboding is there with many, many [chief executives], and that potential is a good thing because it leads to solutions.”

The aim of the study is to encourage and help investors lobby companies to reduce their environmental impact before concerned governments act to restrict them through taxes or regulations, said Mattison.

How can leaders in the arenas of power address this ongoing loss of safety, food and health? First and foremost, we must work together, from grassroots organizations to investors and to lawmakers and CEOs with a conscience.

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Award winning photo by  Sony Ramany of Bangladesh, documenting results of chemical dumping in Dhaka’s rivers. Source

One leadership collaboration is through investors, setting a goal to exercise power is through responsible investing that supports companies minimizing or reducing their damage on the environment. That’s a way for people to team up and make a difference, through integrity and core principles to guide action and oversight.

Another is through consumer collaborations that boycott products that cause environmental devastation, and support safe products produced with environmental integrity. These coalitions can raise the bar with an idea of “green justice.”

And if we pay attention to the report, it’s time for leadership on all levels that awakens a sense of green justice in consumers, manufacturers and politicians.

This is an issue I hope to work on in my Leadership Honeycomb project, gatherings of connected groups of leaders who find common ground and inspiration to be both optimistic and realistic.

Every positive action begins with optimism and grows with knowledge. Sustainable change happens step by step, fueled from this foundation. The crisis has been made terrifyingly clear in this UN report. The solution has to come from collaboration and a paradigm shift in the way we understand our responsibilities as leaders, and our economy.

2 comments

  1. this is stunning, and not in a good way. I have never seen quantification of the true cost of our modern life made so explicit. It is my heartfelt prayer that those with the power to make change will heed this.

    Like

    1. I agree! It’s so powerful to me to see it stated so clearly, monetized so strategically. It has made me question a lot of my own assumptions, as well as see very clearly the assumptions that big corporations make about profitability — the smallness of that story!

      Like

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