Peter Bakker, president and chief executive of the World Business Council for Sustainable Development (WBCSD), has been at the forefront of corporate sustainability efforts for years and is no stranger to the challenges companies face in raising sustainability standards. But, in his view, the drive for ambitious policies and radical action has never been as strong as it is today.
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For a long time, the private sector’s efforts to operate more sustainably have been largely confined to corporate social responsibility (CSR) or standalone green initiatives, says Bakker. But national-level pledges made by some of the world’s largest emitters last year - including a deal between the United States and China to cut their carbon emissions - will send the private sector the right signals to propel climate action, he says.
Bakker, who led Dutch logistics giant TNT as chief executive before taking the helm at WBCSD in January 2012, has been rallying businesses to act on sustainability issues before sustainability became a buzzword.
He helped TNT achieve a high position on the Dow Jones sustainability index through setting ambitious emission-reduction targets for the company and launching social programmes such as one with the UN World Food Programme (WFP) where TNT provided financial and logistics support to the organisation.
Today, Bakker leads WBCSD’s efforts to develop solutions for pressing sustainability challenges such as in energy efficiency, forest management, emissions reductions, and low-carbon transport. The council engages its 200 members - senior leaders of companies from more than 30 countries and 20 industrial sectors - to collaborate on solutions that drive sustainable development.
Bakker, who received the Clinton Global Citizen Award in 2009 for his contribution to solving global hunger through his work at TNT, says that solving problems in a resource-constrained world will require innovative thinking from the business world - a goal that will remain on top of the corporate agenda this year.
As we look back on the year, what do you think were the biggest headlines that had a significant impact on business and sustainability?
Climate change was high on the sustainability agenda, with the 5th IPCC assessment report signalling disastrous consequences if greenhouse gas emissions continue. It is therefore necessary for energy, industry, agriculture, and forestry ecosystems to transform to more low-emission operations.
The UN Climate Summit in New York in September was an important milestone, where businesses joined governments, academia, and civil society to mobilize action and political will towards a global climate agreement in 2015.
Earlier in June, the World Bank also released a statement that underscored the importance of putting a price on carbon, which gathered support from 73 countries and over 1,000 companies and investors. This demonstrated that carbon pricing will be a key instrument in driving the shift towards a low-carbon economy.
Separately in July, the European Commission published its circular economy package, a set of laws to boost recycling, reduce waste and inspire new zero-waste business models which are crucial for a sustainable future. Intiatives which minimise waste and increase reuse of resources are estimated to yield €600 billion in annual savings and create 180,000 jobs by 2030.
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Now that the two largest economies of the world agree that the climate has changed, the drive for ambitious policies and radical action has never been as strong.
Peter Bakker, president and chief executive, World Business Council for Sustainable Development
What do you think are the key themes that will dominate the corporate agenda as we go into 2015?
The new economic, environmental and social landscape requires business to provide innovative solutions to complex systemic challenges. Today, the collective CSR and sustainability activities of businesses have not yet achieved the scale and impact needed to reverse negative environmental, economic and societal trends. Addressing these challenges in an efficient manner will continue to be on top of the corporate agenda in 2015.
As the concept of business ‘value’ expands beyond financial gains to long-term economic, social, environmental and ethical factors, more sustainable companies will be recognised and rewarded. This will motivate more companies to scale up their own sustainability efforts.
Tackling climate change will also remain a high priority for business. Achieving the ambitious goals required to keep the planet within the safe limits of temperature increase to 2 degrees Celsius will require smart policies and collaboration among various stakeholders. WBCSD will be supporting an on-going dialogue with policymakers and other stakeholders to help create scale fast.
What is your outlook on the progress of sustainable development specifically in Asia?
I foresee positive progress on sustainability in Asia in 2015. A key development that will drive this is the expansion of WBCSD’s Action 2020 platform in Southeast Asia. The platform is an actionable agenda for business to drive sustainable development, and six partner organisations of the WBCSD (Indonesia, Singapore, Vietnam, Thailand, Malaysia and the Philippines) have recently joined forces to launch this programme in the region.
This partnership will help scale up business solutions to solve environmental and social problems and serve as a dialogue partner for stakeholders such as the Asean (Association of Southeast Asian Nations) secretariat, governments, institutions and other NGOs.
China’s 13th Five-Year Plan (2016-2020) for economic and social development is another source of optimism for sustainability in Asia. It is expected to integrate measures to boost energy efficiency and environmental protection, building on the positive development of China’s recent agreement with the US to increase the non-fossil fuel share of all energy to 20 per cent and to peak its carbon dioxide emissions by 2030. Innovative Chinese companies are already making significant progress in the clean energy sector
What are your hopes for the coming year as we approach the December deadline for a global agreement on climate change in Paris?
The political momentum for an ambitious global climate agreement has been growing. In October, EU leaders agreed to a domestic greenhouse gas reduction target of at least 40 per cent compared to 1990, along with an aim to both increase the market share of renewable energy and increase energy efficiency by 27 per cent. The recent deal between US and China further strengthened this momentum.
Bold policies on climate action will be key in driving investment in innovative low-carbon business solutions to achieve the scale required. WBCSD is calling for a universal, ambitious and balanced climate agreement with a long-term goal to achieve global net-zero emissions within the 21st century, backed by national contributions that create an upward spiral of ambition.
More national and international regulators must follow this lead and offer the private sector the right signals to propel climate action. Now that the two largest economies of the world agree that the climate has changed, the drive for ambitious policies and radical action has never been so strong.
What will you and your organisation be working on this year?
WBCSD has played a key role in putting the private sector at the core of the discussions for a global climate agreement and will continue to lead business in Paris and beyond, with several collaborative projects to support the transition to a low-carbon economy.
Our initiatives in the coming year include a series of business and technology roundtables on removing obstacles to scaling up action on climate change and the development of a Natural Capital Protocol which aims to help companies understand the value of natural resources and services to their business.
We are also working with the Global Reporting Initiative to develop an implementation guide on impact assessment, selection of key performance indicators and goal setting to assess how far business operations align with the Sustainable Development Goals.
This interview is part of the “15 on 15” series by Eco-Business where we interview 15 global and Asian leaders on their thoughts on the year ahead. Read all the interviews in the latest issue of the Eco-Business magazine here.
