Covid-19: the threat to social purpose

by Martin MacConnol – Sep 04, 2020

What is going to happen to social purpose and sustainability now corporates globally are struggling with the fallout of coronavirus?

When I talk to friends over Zoom the one big upside of the pandemic seems to be a feeling that the world is rebooting – getting greener. Someone showed me newspaper pictures of the Solent recently looking positively Mediterranean compared to normal. It was a shorthand to say the planet is healing itself.

But of course, that’s massively simplistic and whatever positive blip is being created by the global economy being switched off will be wiped out in rapid time when the ‘on’ button is pressed once again.

At that point we will be back in the hands of global big business and it’s going to be interesting to see what route the corporates take.

Back in the day, when we were a comms partner to Unilever and I was still my 20s, I remember properly understanding the sustainability argument for the first time. At that time Unilever still owned Bird’s Eye and my client patiently explained that no fish in the sea was not just a disaster for the planet but also a big problem for a business that makes fish fingers. QED: the planet’s interests and the firm’s interests were aligned for the long-term and Unilever needed to invest a lot in supporting marine stewardship initiatives.

Covid-19 risks changing that mutual benefit argument though. What is in most companies’ best interests at the moment is now simply survival. And if you are dying of thirst in the desert are you going to turn down water in a plastic bottle because it fails the green test…?

A short-term focus on survival risks seeing sustainability and good governance priorities slide off the table in the years to come. Just before lockdown it was a rare day when some Wardour client wasn’t referring to the UN Sustainability Development Goals, but will that remain true when board directors are looking to rebuild profits?

There are two things that keep me positive on this. The first is the view of ‘we the people’. The fact that people still care about nature rebooting during a time of pandemic and death is very powerful. We are the customers of big business. Such companies only exist because we give them a right to do so, and if we don’t like the way they behave we can put them out of business by turning elsewhere. We can hold their feet to the fire.

The second is the role of the big institutional investors – we are proud to work with Legal and General which has social purpose at the heart of its asset management strategy. Similarly, it was powerful to see BlackRock saying last month that it would still hold company directors to account over their governance and sustainability agendas.

When I first read about BlackRock’s position in the FT it felt as sensible as someone saying they would judge the success of the Titanic’s maiden voyage on the provenance of the food offered to passengers. But I’ve come to realise that BlackRock was right. We cannot let the business world sink back into a morass of unsustainable practices because of the virus.

Published Sep 04, 2020

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