For business to fully take on the role of provider of goods and services that address global challenges, markets and market mechanisms need to be designed to promote sustainable development. The Business Role Focus Area is in particular trying to influence two key stakeholders—investors and consumers—whose “framework setting” (along with policy-makers) is crucial for how and to what extent our members and other companies can develop and deliver sustainable business.
Markets & Valuation
Over 140 companies and financial institutions (convened by the UNEP Finance Initiative) participated in six workshops around the world in 2008 on how to most effectively incorporate sustainability in the valuation of companies. Member companies have since expressed their desire to continue to work together with the investment community on this.
In 2009, this workstream follows two tracks of activity. One focuses on items that provide immediate value for company managers. The second focuses on longer term thought leadership, and leverages the Vision 2050 project.
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Track 1 - Field Guide: Investor-relevant sustainability value: Company-investor dialogues in 2008 highlighted the need, and potential, for companies to step forward and explicitly tell investors how and why their sustainability actions are financially material – and therefore how sustainability should be included in company valuation. Drawing on these learnings, a “field guide” document has been developed. It aims to outline what company managers and investment managers can do today to better communicate material sustainability value (investee companies) and to better incorporate material sustainability value in investment decisions and company valuations (investor companies);
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Track 2 - Corporate perspective on a sustainable financial system: This workstream has been exploring a business perspective on what a sustainable finance system could look like, using the company-investor platform to facilitate immediate feedback from the investment community.
Consumers & Consumption
The Sustainable Consumption: Facts and Trends from a Business Perspective report reveals that companies are realizing that consumption issues are a central concern for their business and that they are willing to use their expertise with consumers to help solve today’s problems.
In 2009, this work is focused in two main areas. The first is to advocate the key messages of the Facts & trends report with identified stakeholders. The second is to further explore how companies can use their marketing and communications expertise to work with consumers towards more sustainable consumption.
Two issues are in focus:
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Enabling sustainable products and consumption: What are the parameters of transparency needed to determine the sustainability of a product? Companies have highlighted that many stakeholders are being given the authority to decide what product is more sustainable than another (such as policy-makers, retailers or consumer groups). However, in most cases these stakeholders do not have a sophisticated understanding of how the sustainability of a product is determined (through such processes as life-cycle analysis). How can business improve the communication of these sustainability factors to stakeholders? In 2009 this work has been developing a framework of best practice for decision-makers;
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Influencing consumer behavior & sustainable lifestyles: A key learning from the work in 2008 identified the opportunities for companies to use marketing and communications expertise to influence consumer behavior. But what is the end game? Understanding the lifestyles and consumer behavior that will support a sustainable world is critical. In 2009 this work has been exploring a business perspective on sustainable lifestyles.
