Should big brands be leaders in the fight for a sustainable future?

Last week, a senior banker at HSBC was suspended after referring to the climate emergency as “shrill” and “unsubstantiated.” This incident highlights the ability of big brands to house potentially problematic opinions of a variety of employees, which may go unchecked. So, should well-known brands be leaders in the fight for a sustainable future? Business Leader investigates…

HSBC’s former Head of Responsible Investing, Stuart Kirk, gave a presentation in London entitled ‘why investors need not worry about climate risk’ where he reportedly complained about having to look “at something that’s going to happen in 20 or 40 years”. He continued: “Who cares if Miami is six metres underwater in 100 years? Amsterdam has been six metres underwater for ages and that’s a really nice place.” As a result, Kirk has been suspended until further notice, with the banking giant’s chief executive denouncing his remarks.

More people than ever are aware of the negative impact big brands have on the environment, and these brands have come under immense pressure, particularly from the public, to adopt sustainable practices. In a report from 2019, it was found that 100 energy companies have been responsible for 71% of industrial emissions. Additionally, the top 15 US food and beverage companies generate 630 million metric tons of greenhouse gases every year – a bigger emitter than Australia.

Many businesses have set ESG targets, and institutions have committed to net-zero promises in line with the Paris Agreement. Despite this, the fight for a sustainable future is likely to not be achieved unless the biggest brands on our planet commit wholeheartedly to mitigating their environmental impact – comments made by HSBC’s Head of Responsible Investing suggest that a lot more needs to be done to get big brands to implement sustainability into every aspect of their business.

Nicola Stopps, Founder of ESG consultancy Simply Sustainable, comments: “The statement given by HSBC’s head of responsible investing is severely damaging. Global corporates with influence like HSBC should be leading by example with their sustainability efforts, especially given the lack of action which has been taken to deliver on current climate concerns so far. Already, there are too many obstacles the industry is trying to overcome – from laggards to greenwashing – but overtly dismissing the realities of climate risk altogether is contemptible.

“Rather than opting for suspension, HSBC should instead rehire for this position and choose an individual who possesses the necessary skills and passion in bringing transformational change to the corporate world.”

Government pressure or consumer power?

Alternatively, many believe the blame falls in the laps of the government, who don’t put enough pressure on large corporations to limit their environmental impact. Mass protests from groups such as Extinction Rebellion suggest public dissatisfaction with the government’s actions towards addressing the climate emergency. However, policies aiming to tackle the emergency have made little progress.

In The Business Leader Podcast, Martin Chilcott expressed his view that governments aren’t doing enough to pressure businesses to adopt sustainable practices. He said: “Nobody’s doing enough. Businesses aren’t doing enough, but the government isn’t doing enough either. Even if you take all the pledges from Paris and Glasgow, we’re still off target.

“Governments need to seize these opportunities. There are times when change is going to have to happen when consumers and citizens recognise change and the need for change. So, the government needs to step up to the plate and turn crisis into opportunity, and it’s not doing that at the moment.”

On the other hand, Tobias Buxhoidt, Founder and CEO of parcelLab, believes consumers have the power to sway businesses, particularly in retail, to make sustainable choices. He comments: “All it will take is a concerted effort to fight the narrative of misalignment between business and sustainability. Consumers do care about sustainability, and this does have a significant bearing in their choice of retailer.

“Brands that ignore this are missing a trick in not doing the basics: offering carbon neutral delivery, paperless returns and sufficient information which will empower the consumer to make environmentally friendly choices throughout the delivery and order process. Investing in the technology that can enable a more sustainable retail experience is the key first step to take.”

But should large corporations lead by example in the fight for a sustainable future? Arguably, large corporations should lead by example in sustainability, simply because they produce the largest number of emissions. In an analysis by The Climate Accountability Institute, the worst offending corporations have contributed to 35% of all energy-related carbon dioxide and methane worldwide, totalling 480bn tonnes of carbon dioxide since 1965.

Many of these companies are oil companies, but many of them are state-owned. This suggests that the government can do more to put pressure on large corporations to align their values with that of the Paris Agreement, as if big corporations aren’t putting in enough effort to be sustainable, then we are unlikely to reach desired targets.