The Future of Governance: Reflections from COP26
By Katie Hill, Executive Chair of Management Board, B Lab Europe
Are you in for 1.5 degree climate? Of course you are. If so, you are likely to be questioning the role of business in helping us reach this target.
See these five stools awaiting an audience? Consider them each a stakeholder in any business — one for environment, suppliers, customers, employees and community. Directors of companies, we call on you to draw up a seat for each at the decision making table. Invert the standard decision making frame which puts the investor’s interest front first, and start with the impact of your decisions on each of these other parties. Of course there are going to be compromises — judgement is needed to make balanced long term decisions based on full understanding of what is at stake.
This was the theme of the panel discussion I was fortunate to be part of at COP26 this week. We discussed how such governance needs to be adopted URGENTLY by all businesses — we have left behind the space for some to adopt this approach on behalf of all. To this end, we have created a European Interdependence Coalition in collaboration with over 80 organisations.
Together we advocate for a pan European mandatory obligation of directors to consider these wider interests in the running of the company. Over 700 B Corps in Europe and 4,000 worldwide have already done the heavy lifting and proven this concept — now all that is needed is to adopt this model universally. Do check this out and join our efforts on www.interdependencecoalition.eu.
COP26 has had some strong moments — Mary Robinson called us all to use our imagination of far better future than the one we are heading for. Barack Obama encouraged young people to keep that anger and harness it for change. Antonio Guterres exclaimed that humans must resist from using nature as a toilet. There was a welcome attention to nature and bio-diversity on Saturday; ironically the “natural” element of our crisis is crowded out by attention on greenhouse gases, nature based solutions (including reforestation) receive only 3% of the climate funding. Instead we need to invest in it as a strong contributor to regenerative solutions, benefits from incredible new technologies and can help guide wise land use.
Another poor recipient of climate funding are those communities suffering
significant loss and damage from the effects of climate change. The impact on GDP is the wrong lens to consider how to protect what we value most — we need to move away from the focus on mitigation and move to what we value.
To get to our 1.5 degrees thriving world, we are going to need a very blended set of actions, finance packages, realised commitments, to understand each others’ reality and fear and build a new world on empathy, radical collaboration and diversity of talent and perspectives. I’d like to consider UNFCCC as UN Fit for Communities, Citizens and yes, for purpose led Companies.
Are you in?