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July 13, 2002
Rio + 10 Series: Two UNEP Reports Chart Past, Present, and Future Course of Sustainable Development
    by William Baue

Assessments of the progress since the Rio Summit guide the blueprints for the Johannesburg Summit.


Two new reports from the United Nations Environment Programme Division of Technology, Industry, and Economics (UNEP DTIE) present sustainable development not as an optional business strategy but as an imperative for corporate (and human) survival. The reports, prepared specifically for presentation at the World Summit on Sustainable Development, encapsulate the past, present, and future status of sustainable development. These two reports offer a glimpse of the United Nations’ hopes in terms of the outcome of the Johannesburg Summit.

The first report, entitled 10 years after Rio: the UNEP assessment, appraises how the global business community has implemented Agenda 21. Agenda 21 is a global action plan to save the planet that was drafted at the Rio Earth Summit in 1992. The 22 sector reports composing the Industry as a Partner for Sustainable Development series, which were prepared by industry organizations in response to UNEP’s September 2000 request, inform the UNEP assessment.

These sector reports offer some evidence of advancements toward sustainability. However, UNEP’s overarching assessment posits that the business community as a whole has not taken the steps necessary to help alleviate environmental and social crises such as global warming and poverty.

“Despite many good examples of how industries are reducing waste and emissions, becoming more energy efficient, and helping poor communities to meet their basic needs, we have found that the majority of companies are still doing business as usual,” said UNEP Executive Director Klaus Topfer.

Of particular concern are small and medium-sized enterprises (SMEs), which often lack the resources and incentive to implement environmentally and socially sustainable business practices. The report 10 years after Rio also noted that the environmental and social improvements being made are often eclipsed by economic growth and increasing consumption. In order for economic development to be sustainable, business must protect the environment while also enhancing society. The environment harbors natural resources that serve as the raw materials for economic growth, and society grants business the “social license to operate.”

The report concludes by proposing priority areas for improvement that include corporate reporting and the integration of social, environmental and economic issues into core business strategies. The report also makes recommendations such as augmenting sustainability initiatives with regulatory action.

The second report, entitled Tomorrow’s Markets: Global Trends and Their Implications for Business, presents a blueprint for incorporating sustainable development initiatives into business. UNEP collaborated with the World Business Council for Sustainable Development (WBCSD) and the World Resources Institute (WRI) to produce the report.

Each of the 19 chapters focuses on a different topic, such as health, consumption, energy, emissions, and accountability. For example, the “Accountability” chapter charts the increase in the number of shareowner resolutions on social issues filed since 1973. There is also a graph that documents the rising percentage of resolutions that garnered more than three percent of the shares voted. Both of these figures are based on data provided by the Investor Responsibility Research Center (IRRC). This chapter also illustrates the proliferation of socially screened mutual funds, excluding variable annuities, over the past decade. The report states that social screens were applied to $2.34 trillion in the U.S., or approximately twelve percent of total managed assets, in 2001.

Each chapter also includes an “Implications for Business” section that extrapolates the corporate pertinence of the information. In the “Accountability” chapter, this section suggests how corporate social responsibility can enhance business.

“Active engagement with stakeholders and documented good performance can protect license-to-operate, drive product and service innovation, reduce legal liabilities, and improve business strategy,” the report states.

Ultimately, such suggestions may prove too general for relevant application by companies. However, the information in the report is specific enough to serve as a useful resource in the dialogue at the Rio + 10 Summit.

 

 
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