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Image: John Fullerton discusses the workings of regenerative capitalism | Sustainable brands
Last week at SB’22 San Diego, more than a thousand sustainability practitioners converged to share ideas, tools, inspiration and opportunities to collaborate with the goal of building a regenerative future for all. Here we hear highlights from our Day Four keynote addresses, which featured glimpses of the next frontier of finance and capitalism.
Inherent to the theme of SB’22 San Diego“Refocus and Accelerateis the ability not only to draw on past successes, but also to leave behind what is not working. Rather than implementing incremental fixes to a broken system, we can now reimagine and rebuild the system as a whole. On Thursday afternoon, a series of plenary discussions explored opportunities for new ways of thinking about leadership, economic systems and collaboration.
Finance must seize the potential for sustainable growth
A promising development in recent years is the increased engagement of Chief Financial Officers (CFOs) as main conductors
Environment, Social Governance (ESG) strategies. Procter & Gamble CFO
André Schulten and Net positive
co-author and master of ceremonies Andre Winston
discussed CFO’s role in opening up new sources of funding for greater sustainability.
New climate disclosure requirements proposed by the SECOND putting sustainability first for many CFOs; So, ready or not, CFOs need to acquire ESG knowledge as more and more investors seek answers on climate-related business risks. But understanding and communicating risk is only part of the new job description, Schulten said; and CFOs need to embrace the growth potential that can be generated through sustainability and learn to think about long-term ROI versus quarterly earnings alone.
Left to right: Andrew Winston, Nelson Switzer of Climate Innovation Capital and Dave Stangis of Apollo
Speakers from Goldman Sachs, Capital of Climate Innovation and
Apollo then discussed the massive amount of capital credit and investment companies provide to ESG. Traditionally conservative, the financial world needs to expand key performance indicators and metrics to increase the materiality of long-term investments. Extended materiality must also be effectively communicated to investors. Governance – the G of ESG – must play a key role in structuring rapidly changing securities, ratings and frameworks that create data anarchy.
Regenerative Capitalism—The Next Frontier
The growing gap between ESG commitments and actual actions is a result of the sustainability world asking the wrong questions, said John Fullertonfounder of the
Capital Institute. Ironically, emissions still skyrocket in proportion to ESG engagements.
“Obviously, if ESG is our strategy to fight climate change, it’s not working,” he said.
The destination, he said, is an economy that works the way life works – the process of living systems that create thriving, intimate connections as a result. But the owners of our companies don’t even have a relationship with us. Self-help participation by all is necessary for planetary and social health, Fullerton said.
As Winston pointed out, “What we are fighting against is history, the narrative that what matters is short-term shareholder value, GDP, the stock market – and that is all.”
Stuart Williams is founder, CEO and president of Impact in place. For him, modern business leaders, owners and managers are the most important people in the field of sustainability because of the massive scale and influence of business in everyday life. Therefore, business should be the primary driver for building stronger, fairer communities and safeguarding the climate.
“Should business be additive? Yes. Should capitalism be more inclusive? Yes. But [business and capitalism] are not the problems; those are actually the solutions,” Williams said.
A model of inclusive and regenerative capitalism must use intersectionality, Williams explained – ensuring that all stakeholders have a clear line of sight to each other.
Finding Common Ground Through Business and Empathy
LR: Leonard Robinson, Danielle Azoulay and Kevin Wilhelm of Columbia University
Finally, the discussions shifted from financial aspects to interpersonal relationships – in particular, the importance of taking the time to deliberately interact with those who have opposing points of view, which can create incredible opportunities that are often missed when we pursue our own lofty goals. As
Kevin Guillaume of B-spot pointed out, deadlock occurs when we focus only on changing mindsets; but finding out what people value most and connecting your solution to their pain points is how partnerships can stretch across the aisle. Climate change can be about soil health, water and business resilience – all of which are linked to climate and business solutions.
But, he added, some non-negotiables are needed to save the planet. So building common ground should never distract from implementing the solutions the world needs now.