Post relating to the Transition Agenda
First published in the Huffington Post, September 8th, 2015
Since Julius Caesar pronounced his famous words, “Veni, Vidi, Vici” — “I came, I saw, I conquered” — it has been the mantra for financial progress, military victory, and sexual success.
But a few months ago, Pope Francis eloquently and convincingly called for a different relationship to our common home: “Each community can take from the bounty of the earth…but it also has the duty to protect the earth and to ensure its fruitfulness for coming generations.” Many other spiritual and secular leaders have echoed his sentiments.
As a secular Jewish fan of the Pope, and with a big dash of chutzpah, I’d summarize his proposed paradigm as follows:
Veni, vidi, vigilo.
I came, I saw, I protect.
“Veni, Vidi, Vici” has delivered us to the precipice of a planet where chaos looms. Conquering and dominating nature guides most commerce and development in the world. From Arizona to Dubai, we build where there is no food and water as if we can just overcome the problem, and eat and consume goods as if they are inexhaustible resources useful for our pleasure and convenience alone.
There is another way.
Veni, vidi, vigilo demands that we notice our surroundings, both natural and manmade, and take responsibility for our place in the picture. “Vigilo” in Latin has two meanings: “I protect” and “I keep watch.” Just as eternal vigilance is the price of liberty, keeping watch over our common home is the price of our survival. This new paradigm holds the keys to a habitable planet where plenty has a new meaning and our children and grandchildren have a shot at a stable world.
Winona LaDuke, the Native American leader, defines a warrior as “one who sacrifices himself for the good of others. His task is to take care of the elderly, the defenseless, those who cannot provide for themselves and above all, the children, the future of humanity.” Almost every moral code, religious and secular, implores us to claim this responsibility — to be ferocious protectors, as opposed to ferocious conquerors. It’s not always so easy.
But surprising protectors have emerged in recent years. A few examples are in the IT industry. The data centers that power, inform and govern our lives use huge quantities of energy, over 10% of global electricity usage. Google, Facebook and Apple are all investing their time, money, and political capital in moving rapidly to 100% clean energy. Their just rewards are predictable costs, as well as stable energy sources for a future where fossil fuels will be expensive or unavailable.
In addition, some more unusual suspects have taken exceptional steps. This is not a fantasy column that pronounces multinationals as benign world saviors. But credit is due for those that step up to protect instead of conquer, at least in some areas. McDonald’s, working with Greenpeace, led the moratorium on soy from newly deforested land in the Amazon in 2006. Interface Carpet, the world’s largest carpet company, used biomimicry to create its signature modular carpet products that have eliminated nearly all of its landfill waste and greenhouse gas emissions. And in the health industry, the exemplar of a corporation stepping up remains CVS’s 2014 decision to step away from the sale of cigarettes, a $2 billion annual revenue hit. All of these companies still need massive changes. But they have each in their own way moved outside their comfort zones on behalf of our common home.
And in the public arena, one can never be too grateful to the Democratic and Republican United States senators (working together!) who passed the revolutionary Clean Air Act in 1970. This law remains the biggest reason the air in the United States is not as dirty as the air in India or China. And today, many of the largest school districts in the United States are beginning to collaborate through the Green Schools Alliance to transform markets and policy, shift behavior, and maintain and power buildings to the highest standards. These school districts are actually claiming responsibility for protecting the future of the children they teach. Veni, vidi, vigilo.
Somehow, all of us have to begin protecting the planet as part of daily life. From small actions (turning off switches and gizmos) to lifestyle changes (eating less meat, consuming less stuff, and commuting differently), to larger actions (long term political activism, conscious investing, and integrating environmental impacts into every financial, social, and political transaction), protecting our planet first requires connection to our planet. With the help of social media, we can make matching commitments, transforming our individual habits into massive reform.
But our most important collective action — and it’s a warrior-scale action — is to convince the fossil fuel industry, its shareholders and political stakeholders that they must change their business models, and accept that they cannot sell (and we cannot burn) trillions of dollars of assets on their books. The world is already suffering too much at the behest of these profits. The first oil company that commits to divesting (stranding many of its assets) and rebuilding itself based on renewable energy will be the company that history remembers as worthy of its value. And governments have to eliminate their hundreds of dollars of direct and indirect subsidies to fossil fuel companies. Instead, governments should support the complex and difficult economic transition away from fossil fuels. Only a great political and financial wind will make this happen.
In August 2015, the Islamic Declaration on Climate Change was as compelling as the Pope’s Encyclical. “But the same fossil fuels that helped us achieve most of the prosperity we see today are the main cause of climate change. Excessive pollution from fossil fuels threatens to destroy the gifts bestowed on us by God, whom we know as Allah – gifts such as a functioning climate, healthy air to breathe, regular seasons, and living oceans. But our attitude to these gifts has been short-sighted, and we have abused them. What will future generations say of us, who leave them a degraded planet as our legacy?”
We can only save our magnificent planet and habitat if we turn our ingenuity to it with full commitment and radical cooperation as warriors for the future.
Veni, vidi, vigilo.
First published in the Guardian on April 10th, 2015
It’s hard to overestimate the appalling environmental and economic crisis that’s brewing in Brazil right now. The country is in the grip of a crippling megadrought – the result of pollution, deforestation and climate change – that deeply threatens its economy, society and environment. And the damage may be permanent: São Paulo, Brazil’s largest city and industrial center, has begun rationing water and is discussing whether or not it will need to depopulate in the near future.
But if Brazil’s drought is shocking, Wall Street’s shortsighted approach to the country is appalling. Institutional investors’ reports on the country – the seventh largest economy in the world – cite worries about inflation, government cutbacks and low consumer confidence. But I could not find a single analysis that mentioned the existential threat facing the country: the megadrought that is expected to last decades and could destroy the Brazilian economy. Not a single analysis cited the brutal global impact that this will cause.
In other words, a host of institutional investors have found worrisome things to say about Brazil, but none seem to be aware of – or, at least, willing to face – the country’s greatest threat.
Attempting to separate economies from environment – as many of these analysts seem to do – is like trying to separate mind and body. It simply doesn’t work.
We will never repair our business models and government policies to conform to the real environmental constraints of the 21st century until we repair this fundamental flaw in our economic system. Investors and analysts regularly review a host of factors – including national debt, inflation, currency devaluation and other financial considerations – when they formulate their economic predictions. Their decision to omit the environment as a fundamental economic consideration is willfully ignorant and negligent.
Economies are cyclical, with periods of boom and bust. But a lack of water can cause permanent damage. São Paolo, which is one of the richest cities in the world, serves as the financial center for most of South America. The consequences of this drought are hard to calculate, but one can get an idea by imagining how water rationing in New York City – and the attendant population drop, public outcry and social instability – would affect the world’s economy.
This lack of foresight on the part of financial analysts is nothing new. They are overlooking this high risk situation, just as they did with the dotcom boom and bust, the subprime global meltdown, and a host of other financial crises. This willful delusion is also cyclical, and also a significant threat to the world’s economy.
I have worked with dozens of multinational corporations on transformative projects and initiatives that cut or eliminate waste, water usage, emissions and energy consumption. Every single company has had the same complaint: they do something spectacularly difficult and smart that enhances their company’s long-term financial security. But, when it comes time for the quarterly earnings calls with Wall Street, no one ever asks about it.
Executives are responsible for maintaining a stable supply chain, a predictable P&L, a respectable brand image, and a keen awareness of competition and regulations. Sustainable business innovation connects with all of these, and is one of the pillars needed to keep a modern financial house in order. Unfortunately, Wall Street doesn’t seem to notice.
This is as egregious as ignoring subprime debt in 2007. In India – the world’s fastest-growing economy and the darling of Wall Street – one out of six deaths each year is caused by air pollution. Factor in water and pesticide issues, and the death toll creeps higher. (I guess all that economic growth will help pay for all those health care costs.)
Just as in China, India’s wealthy people are moving their kids away from the big cities and centers of pollution. But clean air and water ought to be human rights, not luxuries reserved for the rich.
There are so many parables about the cost of money, from Midas who died of starvation and killed his beloved daughter when he valued nothing more than gold, to the New Testament, where Jesus teaches about the price of a rich man’s soul. But we don’t have to get religious to agree that without clean air, land and water, and a stable climate, we all suffer. And of course, as with everything else, the least privileged among us suffer most.
Wall Street investors: please put your money where your mouth is.
First published in the Guardian on April 6th, 2015
Humans are predictable. We routinely create extraordinary things and then disregard their impact and consequences because of our desire for convenience, comfort or profit. It’s easy to see why we’d want to take the shortsighted view: these pleasures and conveniences are compelling, at least until we realize they’re inflicting death by a thousand cuts on the world that we inhabit.
What do these extraordinary things look like? Well, antibiotics is a prime example. As someone who survived a dozen cases of childhood strep throat – not to mention surgery several months ago – I am eternally grateful for these drugs. Then again, while antibiotics saved my life after my surgery, the fear of an antibiotic-resistant infection propelled me to get out of the hospital as quickly as possible. These all-too-common infections, which are caused by our overuse of antibiotics, plague health care facilities around the world, driving up costs and mortality rates.
The problem extends well beyond hospitals: 80% of antibiotics in the US are used to induce rapid growth in healthy animals, and 95% of our meat is full of them. Meanwhile, unnecessary antibiotic use for common colds and respiratory infections also helps spur antibiotic-resistant infections.
The companies that produce and sell antibiotics are ignoring their collateral damage, dangers that they have known about for decades.
It’s time to sharpen our wits and use our intellect to overcome our basest instincts and reinvigorate our survival instinct. The only way companies will stop overselling these products is if we stop over-buying them.
Health-conscious consumers are already pressuring producers and retailers to eliminate antibiotics in their meat, and some of the biggest companies are listening. Tyson and Perdue are moving away from routine antibiotic use, Chik-Fil-A is cutting antibiotic-laden chicken from its menu, and Target stopped sourcing farmed salmon in 2010.
After McDonald’s committed last month to phasing out antibiotics in its chicken, it is likely that the whole industry will follow. These changes will increase the price of fish and chicken a bit, but they will also increase the effectiveness of antibiotics and decrease the scourge of antibiotic-resistant diseases.
Consumers are also pushing for changes in medical protocols – and some doctors are listening and refusing to prescribe antibiotics as a default.
Antibiotics aren’t the only seemingly miraculous technology that has inflicted untold damage on the environment: since the 1940s, the pesticide and fertilizer industry has followed a similar trajectory. The original impulse to use vanguard science to help feed the world was a noble impulse, a phenomenal business strategy, and a seemingly brilliant solution to global hunger. Within 20 years, however, scientific evidence began to reveal the environmental implications of this agricultural revolution.
The rampant overuse of pesticides and fertilizers has endangered whole ecosystems, as evidenced in the dead zones in the world’s seas. Pesticides definitively contribute to cancer, developmental disabilities, and reproductive and hormone disruption.
Unfortunately, by the time we began to understand the impact of artificial pesticides and fertilizers, we had become accustomed to cheap, plentiful food, and our agricultural system had begun its transformation from small farms to industrial agribusiness. Today, although we know better, we continue to follow the current, dangerous business model, wherein businesses and consumers do not pay the real cost of the comfort, convenience, and profit of conventional agriculture.
Again, health-conscious consumers and pioneer businesses have led the way to a solution, pushing for organic agriculture, which is a rapidly growing sector of the food market. Meanwhile, small farmers are improving traditional technologies such as crop cover, crop rotation, and integrated pest management; in the process, they’re also revolutionizing yields and price models.
Organic products still cost more than conventional foods, but market growth has made the price differencefar less severe than it was a decade ago. The premium price is worth it: by dramatically reducing pesticides and fertilizers, we are using our brains to save our skins – partly because we understand that the socialized costs of these chemicals hits tax payers and families hard.
Fossil fuels are perhaps our deadliest addiction. When the oil industry began over a century ago, it was populated by determined, courageous, creative wildcatters, dreamers, businessmen and world-builders. They laid the foundation for the industrial revolution that fundamentally altered – and in many, unimaginable ways, benefitted – our lives.
But somewhere around 50 years into this historical odyssey, the consequences of this fossil fuel addiction began to dawn. Vast land areas and numerous bodies of water became filthy. Across the globe, climate change began to rear its ugly head. However, instead of recognizing their products’ shadow, this industry has been ignoring, obfuscating, repudiating and dis-informing about their products for half a century, just like the pharmaceutical and pesticide industries.
Consumers haven’t helped. In love with the convenience, comfort, and pleasures of cheap energy, we have largely objected to any increase in price or any attempt at rationing or rational usage. We have voted out of office the courageous politician who offered truthful and difficult solutions.
Clearly, breaking an addiction is not for wimps. So, today, even as the world flirts with climate chaos, the oil industry continues to pursue its new territories, from the Arctic to the Canadian tar sands, as if it were 1900 and we didn’t know better. And, while this industry still has its share of tenacious dreamers, its lobbying groups are ignoring its biggest opportunities for leading the 21st century’s inevitable energy revolution.
We need to harness the fossil fuel industry’s brilliance and grit to create the low-carbon energy revolution. This change of course is not for the faint of heart – over $20trn dollars of oil and gas reserves are already on the industry’s balance sheets, and most cannot be safely burned if we are to remain within climate limits. With today’s oil prices pegged at $50 per barrel, much of these reserves are already devalued because the cost of extraction exceeds the market price.
Again, there are consumers and businesses leading the way. Solar and wind power are no longer oddities and they both now compete with coal on price. Some businesses like NRG, the nation’s second largest electricity provider, are embracing their role in bringing renewables to their customers. But in the US, many utilities are fighting the explosion of rooftop solar because it threatens their current profits.
Instead of cleaving to this completely unsustainable business model, governments, utilities and coal companies need to map out a transition agenda that ensures the explosion of rooftop solar and protects only those businesses that advance a low-carbon and distributed energy future.
Progress doesn’t come easily. Albert Schweitzer once wrote, “Man can hardly even recognize the devils of his own creation”. The question is, having recognized these devils, will we find the will to exorcise them?
Annoying and persistent activists – consumers, businesses, patients, farmers, fishermen, scientists, and environmentalists – stand firm on unpopular beliefs and inconvenient truths. But, rather than following the current path of killing the messengers and ignoring the dire state of our environment and climate, we can chart a new course.
We can redefine comfort, convenience and profit. We can find respect for the riches and limitations of nature. We can use our intellect, overcome our baser instincts, and launch a sea change in the right direction.
First published in the Guardian on June 20th, 2014
Throughout the 20th century, millions of people banded together in nonviolent revolutions across the globe to secure their freedom. From India to Czechoslovakia, South Africa to Poland, they declared their right to self-determination. Why, in the 21st century, are so few of us ready to fight together to secure our right to clean air and water?
To wake us from our fossil-fueled dreams, we need nothing less than radical cooperation.
Given the scope and importance of the conflict, it’s notable that many of the most poignant voices calling for a more holistic view of climate change are in fact battle-tested veterans of war. In a new report,National Security and the Accelerating Risks of Climate Change, an all-star array of retired US military brass weighs in, writing that “The potential security ramifications of global climate change should be serving as catalysts for cooperation and change. Instead, climate change impacts are already accelerating instability in vulnerable areas of the world and are serving as catalysts for conflict.”
What moves people to cooperative action? Environmental activists and scientists often ask how they can get Americans to care about climate change. And, on the other end of the spectrum, many business people are trying to encourage both their customers and Wall Street to work with them on solutions.
Meanwhile, those of us fighting to stave off climate chaos are working to send a palatable message, telling one another that we cannot scare people to death and that alarmism is ineffective. But watch The Weather Channel. Read the business news. Follow the agricultural commodity markets or your region’s farming news. Climate change’s high impact traumas and costs on people, planet and profits are already alarming. Scratch below the surface of anyone of any political stripe and the feeling is the same – something is not right.
Change is clearly called for, but our passive acceptance of extreme weather as the new normal has discouraged far too many of us from behaving outside of cultural norms. I recently spoke at a conference on National Security and Climate Change where government, military, academia, and civil society representatives explained the horrifying effects of climate change on global food, water and energy supplies. When I asked several presenters what they were doing to change the direction of their formidable institutions, the reply came, “Oh I can’t do anything radical”. But you just said “It’s an emergency”, I found myself thinking. Unfortunately, emergency or no, the cultures in these entrenched institutions accept inertia over action.
Instead of facing the music, most politicians and business people threaten consumers and citizens with dangerous economic repercussions unless we accelerate the extraction and exploitation of cheap American fossil fuels. Republican representative Bill Johnson of Ohio (Energy and Commerce Committee) pushes for the Keystone Pipeline and argues that the freedom to frack and drill anywhere in the US is the cornerstone of smart energy and economic policy. Meanwhile, even though it has an extremely low earthquake profile, his district had a recent quake linked by state geologists to oil and gas drilling. This connection between drilling and earthquakes is now beingmapped by the US Geological Survey.
Domestic oil and gas sound cheap until we add up the bills. Oil and gas extraction, transportation and combustion drive up the cost of maintaining emergency services, healthcare, infrastructure, insurance, water systems, habitats and agriculture. They drive up mortality and drive regional economies into the ground. These costs comprise the carbon tax that we are already paying. Those who resist a radical change in our energy infrastructure are willfully and wittingly leaving more of these bills to their kids.
There is no way to sugarcoat this story. It will cost real money to build a 21st century safe energy infrastructure. It will cost exponentially more money and devastation if we do not.
David Crane, CEO of NRG (one of the nations’ largest energy companies), recently wrote a shareholder letter that addresses his personal and corporate responsibility:
The day is coming when our children sit us down in our dotage, look us straight in the eye, with an acute sense of betrayal and disappointment in theirs, and whisper to us, “You knew… and you didn’t do anything about it. Why?” And for a long time, our string of excuses has run something like this: “We didn’t have the technology … it would have been ruinously expensive … the government didn’t make us do it …”
But now we have the technology – actually, the suite of technologies – and they are safe, reliable and affordable as well as sustainable … The time for action is now; we have run out of time for more excuses.
If the US president were to ask Americans to lower our energy usage by 20% in the next year, I am certain we could do it. Courageous cooperators are legion. They come in pin-striped suits, overalls, lab coats, nurse’s uniforms, skinny jeans, and aprons. They are found in classrooms, garage labs, farms, and even occasionally government offices. They are everywhere.
The world’s largest cities have already banded together through theC40 Cities Climate Leadership Group. But in the US, our leaders have not asked us to step up, nor is there federal coordination of wide-ranging efforts.
In 1989, 46 countries brought the Montreal Protocol into force (now ratified by 197 nations), pledging to eliminate CFCs that were burning a hole in the ozone. At the time, industry fought against that radical cooperation with much the same language that is being used today. The CEO of chemical giant Pennwalt talked of “economic chaos” if CFCs were phased out, and DuPont warned that “entire industries could fold”. None of this ensued. And if there were no Montreal Protocol, CFCs would have caused utter devastation.
Climate change is a similarly dire threat and the clock is ticking. Our last chance for a global deal – the UN Framework on Climate Change’s meeting in Paris in 2015 – is drawing near. The world’s scientists have weighed in clearly, stating that greenhouse gas emissions need to peak this decade, otherwise the stability of our climate and weather systems are in dire jeopardy.
Only a global treaty on climate that incentivizes a decarbonized economy can chart this course. Voluntary and good corporate actions will simply not suffice to reach the fundamental changes necessary. This climate treaty will only pass if the peoples and businesses of the world assure their governments that they support it. This is the radical cooperation needed to transition the world’s economy to a low-carbon future.
First published in the Guardian on April 24th, 2014.
Today, tremendous work is being done to develop the metrics of natural capital. All kinds of very smart people and organizations are making the “business case” for sustainability, making tortuous calculations as they analyze the life cycles, carbon production and water footprints of a variety of products, all in an attempt to make the best possible business and marketing choices.
This arduous work is being done – finally – by gifted and smart accountants, economists and supply chain and manufacturing experts, from the Global Reporting Initiative to the Sustainability Accounting Standards Board to the Carbon Disclosure Project to the World Bank’sNatural Capital Accounting. I appreciate all of this work. We need it.
But, impressive as this work is, it is no replacement for having the courage to actually contemplate the state of the world around us. Right now, we are looking on with a mix of disbelief and ennui as extreme weather engulfs us. In some cases, we are trying to take what appear to be reasonable steps, mostly in order to protect our precarious perch in the world’s economy. The trouble is, the time for reasonable has passed. We have somehow forgotten that if there is no nature, there is no business.
We are in a global environmental emergency, but we are behaving as if incremental improvements to “business as usual” will do. Talk to a scientist, a fisherman, a native of a low-lying island or a farmer stymied by drought, heat or floods. Or for that matter, talk to anyone who has been flooded in southern England or Pakistan; or who is making flood insurance payments in New Jersey or Florida; or who is witnessing the effects of drought in the southwest US or Iran; or who is being scorched by heat waves in Australia or Argentina.
This ripple effects of these environmental disasters continue across the economy, hitting investors whose livelihood relies on predicting commodity prices, managers who are counting on seasonal hotel occupancies, and insurers who are facing double digit losses from catastrophes. Their jobs are getting harder – and many are scared to death.
Everything is upside down, a very very dangerous spiral has begun, and we’re nowhere near ready. Even in California, home of environmentally savvy governor Jerry Brown, voluntary statewide water rationing has only just begun three years into a drought. Voluntary!
My brother, a small businessman in Brooklyn, owns a factory that employs about 50 people. He makes a good living, pays his employees well and has been working in his field (construction parts and machinery) for 35 years. He’s much more conservative than I am, but he lives a fine life with a beloved family and demonstrates honor and courage in most everything he touches.
He took a very conservative approach to the recession and subsequent “end of any building at all” that he saw coming in 2008. Realizing that the boom years of the mid-2000s would not last, he saved for these rainy days, took care of his workers (kept them all on at four days a week despite virtually no new revenue for two years), invested his own money to support the business, slashed his own salary, and hoarded materials when times were flush. All this planning paid off: despite a very rough two years, he was able to withstand the recession. Now, business is booming again.
My brother’s tactics were not about sustainability – they were about survival. Conservative, in this case, essentially means conserving resources to ensure long-term security. In my brother’s case, from the time he became aware of the coming crisis, there was no “business as usual” in anything he did: he took emergency measures to protect his company, his workers and his future. And it worked.
Many companies are looking beyond sustainability to survivability in their radical approaches to environmental issues. KPMG calculated that the environmental degradation caused by the world’s 3,000 largest public companies totaled $2.15tn in 2008. This estimate undoubtedly antagonized many of the company’s biggest clients.
Some companies are addressing sustainability. Unilever committed to double sales and halve its footprint between 2010 and 2020, and created a global advocacy team to help it achieve that goal.
Sometimes, this new knowledge spurs even more aggressive action. When Puma measured its 2010 Environmental Profit and Loss (EP&L) with the help of PricewaterhouseCoopers and TruCost, it learned that its profit would have been reduced by 72% if it had integrated environmental costs into its accounting.
Puma’s parent company, Kering, is now pursuing an even deeper understanding of the company’s real costs, and is creating an EP&L for all of its 16 luxury brands, including Yves Saint Laurent, Gucci and Stella McCartney. And, in 2012, Kering’s vice-chair Jochen Zeitz and Sir Richard Branson formed the B Team, an organization tasked with creating a business model for the 21st century – with the understanding that the current model will not allow us to survive.
All of these corporate leaders are behaving as if their survival is at stake. They dared to read the weather pages and register that the world their businesses inhabit is trembling from environmental damage. And they instructed their companies to take commensurate action.
Only by adding courage to sustainability will we survive.
First published in the Guardian, February 17th, 2014
Something – maybe a bat, although nobody was certain – recently bit my good friend Arnie. What happened next is an allegory for how short-term fixes can really screw up a system, whether it’s an ecosystem or an immune system or, while we’re at it, a financial system.
Erring on the side of caution, Arnie (not his real name) got the rabies vaccine, which consists of five shots. Shot number one went fine. But after shot number two, he immediately started feeling sick – his symptoms resembled the flu, but with some weird neurological symptoms – and he ended up in the emergency room.
A Benadryl drip seemed to relieve him somewhat, and he went home, still feeling pretty bad and non-functional, but not feeling like he would crumple into a ball on the floor. Then Arnie got the third shot, and got even sicker. I wanted to know why Arnie was so sick … scary sick. So I took to the internet and learned about adverse responses to rabies shots, how rare they are and, also, how serious they can be – kind of like a black swan event for business.
Twelve days after the initial shot, Arnie asked me to meet him at the emergency room because he thought he would pass out. He could barely move or keep his eyes open. At the hospital ER, the doctors seemed perplexed and checked for the “emergent” problems. Did he need to be intubated, coded, operated on? None of the above.
The doctors hydrated him and offered more Benadryl. Then they brought him steroids, which they explained would make him feel much better. I intervened directly – in fact, I stepped in front of the nurse to physically prevent the administration of the steroids.
I kept reminding the ER doctors that this severe adverse reaction was part of a longer-term response to the rabies vaccine and asked whether adding such potent systemic-altering drugs could complicate the problem. They couldn’t answer my question; they were focused on treating his symptoms and insisted that steroids would make him feel better in short order. I’m sure they would have. But nobody could tell me what they would do in the long term.
Finally, the hospital’s head of infectious diseases got involved, and agreed with me that the long-term risks of steroids far outweighed the short-term gain. Arnie would have to tolerate about three months of illness. He has now recovered, without the help of steroids.
Why am I writing about this saga in Guardian Sustainable Business? Just as steroids might have made Arnie feel better in the short term, strong quarterly earnings can make a business look great – potentially at the risk of ill effects in the long term.
Sometimes, great quarterly earnings result in environmental degradation – which, in turn, can lead to financial degradation. One day your coal assets look hardy on your books, and the next year they look like stranded assets. As I note in my book, Environmental Debt: The Hidden Costs of a Changing Global Economy:
Ratan Tata recently admitted that the energy from his company’s new massive coal power plant in India will bring energy to market at roughly the same price as new solar. Tata actually described this plant as a ‘non-performing asset’ due to the increasing unavailability and high cost of coal.
Tata is undoubtedly one of the world’s smartest businesspeople, and he certainly made this coal investment with due diligence and the smartest engineers. But they overlooked – or underplayed – the environmental risk in assessing coal’s future value.
Conversely, quarterly earnings can be the result of brilliant strategic investments that will save money, waste, water and energy to sustain financial health in the long term. If a company or regional utility invests in a smart grid that empowers renewable energy sources, it will cost more than cheap, subsidized natural gas or coal, but can be the foundation for future environmental, national and financial security.
Google’s aggressive – and expensive – investment in renewable energy provides the company with urgently needed energy stability over the long haul. Other IT companies are now following suit. This is not a do-good investment; this is basic long-term strategy.
The current approach is like being treated by a surgeon who fixes your knee or cuts out your cancer, but knows nothing about how surgical changes fit into your overall life, health and pain management. This shortsighted and siloed approach governs most analysis and evaluation of business.
We look at numbers that do not reflect the world that business inhabits, only the business as a separate entity. Most financial research now separates environmental, social and governance issues into a separate less-important part of overall findings. This ignores how the financial and environmental crises are inextricably connected, and we ignore one or the other at our peril.
Our bodies are miraculous arrangements of billions of cells residing in a wondrous web of nature. Everything we do and use and feel and express are parts of this web. Nothing is separate. Keeping these connections in mind can help heal our bodies, as well as our businesses.