Populist
thinking

What does the rise in populism mean for sustainability?


Protest March

The anti-elite mood is growing, and it is not just politicians who should be worried. The sentiment is squarely focused on big business and corporate leadership, too.

What’s driving this rise in populism?

The ’shock’ results of both Brexit and the US election have demonstrated how removed the political and business elite have become from their audiences; and just how little the concerns and aspirations of the masses have been heard and understood.

Social inequality

The perceived gap between the world's richest and poorest continues to widen. In late January, Oxfam reported that wealth equal to that of the poorest half of the world’s population now sits in the hands of just 62 ultra-rich individuals. A mind-blowing statistic and a dramatic increase from 388 reported in 20101.

While the Oxfam research, undeniably has its critics.  It does highlight the existence of inequality gaps. These inequality gaps exist in all markets, emerging and advanced alike; and on many levels, with divides clear between national regions, generations and genders.

For business, the current spotlight is on the remuneration gap and the significant impact this has on morale, health, retention and productivity in mid-January the UK’s Guardian newspaper reported that by January 3rd top Canadian CEOs had already earned the equivalent of their average worker’s salary2. The issue has been seized by politicians and legislators in the UK to drive equal pay between genders and deeper disclosure around extremes.

Declining trust

Overall public trust is at an all-time low.  This sentiment has been reflected in multiple, high-profile reports, including the Ipsos MORI Veracity Index, and is again high on the agenda at Davos3. The corporate world is well aware of this problem. Re-building trust has become the Holy Grail for many sectors, with 65% of the global CEOs surveyed by PwC in 2016 stating that they were concerned about the lack of trust in business4.

Sustainability, too, has struggled. Last year saw high-profile sustainability exposés across all industries. However, more worryingly, a significant scandal around disclosure cheating: VW’s emissions gaffe is set to cost them dearly in both reputation and compensation claims, but its ripples reverberate more broadly, throwing the integrity of the sustainability agenda into question for some.

What does this mean for business? Moreover, what can business do to bridge the gap?

Re-engaging the majority

There is a need for businesses to reach, engage and listen to its broader audiences. Achieving this will require a change in the way it engages and communicates, as well as what it targets.

To absorb wider and more representative views, decision-makers on all levels must broaden their networks and welcome the outliers. Selecting external partnerships and advisors that reflect the societies in which they operate, and the challenges that these communities face will also improve their grasp on public opinion.

However, it is not all about seeking out new debate and opinion. Businesses can also benefit from making the insight that they do have work harder. Forward-thinkers are using multi-stakeholder insight to inform sustainability decisions, but few are capturing the value that it can add to communications. This insight can identify the issues in need of better articulation and focus, and guide the initiatives businesses choose to drive, the stories they want to tell, the soundbites they decide to amplify, and the influencers they seek to target.

Creating communications that resonate with this wider audience is critical. Making key messaging personally relatable and featuring real-life, impact-focused stories will help to demonstrate that concerns are heard and valued. Businesses must also demystify and de-jargon. Sustainability is a specialism often guilty of using unnecessary terminology.

Demonstrating integrity

There is a fear that populism will spell disaster for sustainability. With multiple environmental and human rights laws under threat, this concern is understandable. However, studies continue to highlight a positive financial and reputational impact for companies that truly embrace sustainability, as well as increased access to capital.

Whatever the future holds, for sustainability to remain valuable to business it must be credible to the outside world.

Business must start to demonstrate integrity rather than just talk about trust – trust, after all, is the outcome, not the action. To enhance credibility, it should focus on communicating the issues and impacts that matter most - even when they are friction points - and embrace balanced disclosure. Going further, KPIs should, increasingly, be material, reflecting the business as a whole and the issues on which it has the greatest impact. Moreover, targets, to drive real change, should be stretching and impact-focused.

Is there any good news for sustainability?

Let’s end on a positive note. Sustainability leaders remain optimistic about the impact that business can make. Paul Polman, CEO of Unilever, for example, continues to champion the UN’s Sustainable Development Goals as the pathway to addressing the world’s global issues. Alignment to a consistent framework against which to set targets, launch initiatives, campaigns, and benchmark peers would certainly drive faster and bolder progress.

If you would like to discuss this topic further or talk to us about how we can help you with you sustainability communications, please email [email protected]

 

Sources:

  1. The Guardian, 18.01.17: https://www.theguardian.com/business/2016/jan/19/world-economic-forum-davos-2016-eight-key-themes-robotics-migration-markets-climate-change-europe-medicine-inequality-cybercrime
  2. The Guardian, 03.01.17: https://www.theguardian.com/world/2017/jan/03/canada-ceo-pay-2017-earnings-average-worker
  3. 2016 Ipsos MORI Veracity Index 2016: https://www.ipsos-mori.com/researchpublications/publications/1896/Enough-of-Experts-Ipsos-MORI-Veracity-Index-2016.aspx
  4. PwC Global CEO Survey 2016: http://www.pwc.com/gx/en/ceo-agenda/ceosurvey/2017/gb