SD and CSR The mis-match Jan Bebbington (Professor of Accounting & Sustainable Development; Director, St Andrews Sustainability Institute)

Quick CV  Background Accountant then academia Accountant then academia Social & Environmental accountant (focusing on SD) & CSEAR Social & Environmental accountant (focusing on SD) & CSEAR St Andrews Sustainability Institute St Andrews Sustainability Institute Vice-Chair (Scotland) Sustainable Development Commission Vice-Chair (Scotland) Sustainable Development Commission  Research interests Reporting on SD (what the narratives tell us) Accounting for externalities (in project decision making … BP + construction + public sector) Governance for SD (& ‘technologies’ used) Carbon accounting (just starting)

Points I want to highlight  Beyond Brundtland – SD conceptualisation & realisation  CF 10 principles of SD (ICMM)  Issues in linking CSR to SD Entity focus Entity focus SD & systems change SD & systems change social sustainability social sustainability

4 The five principles of sustainable development (UK framework) LIVING WITHIN ENVIRONMENTAL LIMITS ENSURING A STRONG, HEALTHY AND JUST SOCIETY ACHIEVING A SUSTAINABLE ECONOMY PROMOTING GOOD GOVERNANCE USING SOUND SCIENCE RESPONSIBLY

How are we doing? - I  Living within environmental limits Where do you start! Where do you start! Every living system is exhibiting signs of considerable stress (Millennium Eco- System assessment & biodiversity collapse) Every living system is exhibiting signs of considerable stress (Millennium Eco- System assessment & biodiversity collapse) Disruption of climate system is a lynch-pin issue Disruption of climate system is a lynch-pin issue  Strong, healthy and just economy No, not even in narrow conventional terms Gaps between rich/poor in countries are becoming entrenched Internationally this is no way near being achieved (Millennium Development Goals)

How are we doing? - II  Achieving a sustainable economy See previous slide … can’t be a sustainable economy because outcomes are not achieved See previous slide … can’t be a sustainable economy because outcomes are not achieved Some progress re pricing (carbon) but (eg) most eco-systems services at risk is off market Some progress re pricing (carbon) but (eg) most eco-systems services at risk is off market  Promoting good governance Some new institutions exist and are effective (IPCC) But majority of core governing has yet to be appropriately transformed All elements of governing needs transformation

How are we doing? - III  Using sound science responsibly At times … but even with climate change this is lacking At times … but even with climate change this is lacking 80% reduction GHG by % reduction GHG by 2050 Will come to about 550 CO 2 e ppmWill come to about 550 CO 2 e ppm 99% – 77% probability of exceeding 2 o C99% – 77% probability of exceeding 2 o C 9% - 24% probability of exceeding 4 o C9% - 24% probability of exceeding 4 o C  In summary Sorry … but there is no sign that we have done anything but scratch the surface and play around with the SD agenda This has implications for how content we would be with CSR efforts

ICMM – SD framework, 10 principles  Ethical business practices & governance  Integrate in decision making  Human rights & respect  Risk management  Continual improvement (Health & Safety)  Continual performance (Environmental)  Biodiversity & land use  Product design, use, reuse, disposal  Community interaction  Transparent engagement, communication & verification … in reporting

The mis-matches - I  Entity focus Ecological integrity is a systems concept vs CSR which is organisationally focused Ecological integrity is a systems concept vs CSR which is organisationally focused But, some hope vis a vis site reporting But, some hope vis a vis site reporting Definition of ecological sustainability criteria & comparison of performance to that standard (cf continual improvement or performance within a corporate risk context) Definition of ecological sustainability criteria & comparison of performance to that standard (cf continual improvement or performance within a corporate risk context)

The mis-matches - II  SD & systems change Activities of one entity may be fine but … Activities of one entity may be fine but … Measuring & reporting on cumulative impacts is relevant for eco-systems (& up-stream & down-stream activities) Measuring & reporting on cumulative impacts is relevant for eco-systems (& up-stream & down-stream activities) Who can produce these accounts? Who can produce these accounts? How to deal with conflicts of interests that arise from such maps? How to deal with conflicts of interests that arise from such maps?

The mis-matches - III  Social sustainability Multiple interactions (with in-built conflict & power differentials) Multiple interactions (with in-built conflict & power differentials) Defining social sustainability standards is highly problematic Defining social sustainability standards is highly problematic What is social equivalent of carrying capacity? What is social equivalent of carrying capacity? Oxfam American study on social sustainability & having extractive/minerals sector (negative correlation) Oxfam American study on social sustainability & having extractive/minerals sector (negative correlation)

Eg of an account of SD - ecological  Eco-system functioning data & critical limits etc  A systems wide map of organisational & community impacts on eco-system  Nesting of corporate (CSR) performance against systems and mapping data  THEN – could say something about SD performance (& remaining externalities created by corporate activity)  That needs to be centre of decision making context (cf added on with profitability at the core)  Most ‘easily’ developed in GHG … but needed for all

Concluding  SD and CSR are currently quite different things but are connected  SD requires a more systemic evaluation  We are a long way from SD, the clock is ticking … scale of transformation is considerable