SustainAbility has often helped companies grapple with questions relating to advocacy, typically when an issue has become acute (such as climate change) or the world is reminded that considerable funds are directed by companies on advocacy with perennial updates on “lobbying spend.”
SustainAbility first addressed the issue in a research report titled Politics and Persuasion published in 2001, followed by additional research reports in 2005 and 2007, with advocacy as a key feature in the All In model of sustainability leadership since. With the 2030 time horizon looming, it couldn’t be more necessary.
We are encouraged by some recent business developments.
For instance ArcelorMittal, the world’s leading integrated steelmaker and one of the biggest industrial CO2 emitters, published its Climate Action Report in 2019. In the report the company provides a comprehensive response to the TCFD recommendations, responds to stakeholder interests in the company’s plans to reduce its carbon footprint and (of particular interest here) establishes a new dialogue with policymakers about the changes that will be needed to bring about a rapid low-carbon transition.
Another example is Shell in 2019 publishing its Industry Associations Climate Review, which assessed the company’s Shell’s alignment with 19 key industry associations on climate-related policy. Notably, the report detailed new governance principles to improve the management of memberships of industry associations on climate. Shell also decided not to renew its membership in the American Fuel & Petrochemical Manufacturers trade association, citing the group’s opposition to carbon and other emissions pricing.
So, what should or shouldn’t the corporate sector do to shape policies that affect not only business but all of society?
A useful corporate framework suggested back in 2011 for aligning policy and sustainability is also reflected in the UN Global Compact’s Guide for Responsible Corporate Engagement in Climate Policy and includes five key components:
- Legitimacy: Are the means of influence deployed through proper uses of corporate power? What policies do you have, if any, on things like political donations, sponsorship and association?
- Transparency: Do you disclose your corporate positions on key public policy issues? Do you disclose your external memberships, donations and methods of influence?
- Consistency: Do you have systems in place to ensure that any advocacy activities and positions are aligned with your environmental, social and ethical principles, policies and commitments, and that they are consistent across borders and functions? Have you assessed memberships, donations, partners and methods of influence for alignment with your sustainability strategy (e.g. climate ambitions)?
- Accountability: Do you take responsibility for the impacts of your company on public policy through your advocacy memberships, donations, partnerships and other activities?
- Opportunity: Do you proactively attempt to influence public policy to support the societal transition towards sustainable development? Have you fully explored how more effective public policy on sustainability issues could be a source of competitive advantage?
Read on for more perspectives on the evolving nature of the corporate advocacy we need for a more sustainable future.