Sustainable Growth -- Who Is Responsible?

Paul Polman, CEO, Unilever

"Because we have become global so quickly, politics is changing rapidly in terms of the interdependence between different countries. In the past, you could solve the major issues in the world either within your own country or with a small group of countries. Now, some issues - like security, climate change, and transparency in financial markets - require the cooperation of all countries. Institutions historically designed to deal with that, like the World Bank or the International Monetary Fund, are based on the old model of how the world functions. We haven't been able to evolve our political system to deal with these more complex problems. Responsible companies, which have a more long-term vision than politicians and work in multiple countries across the world, often deal with these issues on a daily basis. Within their own business model they will have to be more proactive. I call that de-risking the political process. For individual governments, for example, it's very difficult to work on deforestation because there are many different factors involved. But if companies work together and say 'we only want sustainably sourced soy, beef or palm oil,' that sends an enormous signal to governments to start acting. If politicians know there's a big enough group of companies that want that, they are more likely to put themselves behind it. If they don't have that assurance, it's very difficult to move things forward.

This happened for a long time on climate change. The business community was divided, to some extent still is, but the majority now says we need to start acting. When governments hear this, they are willing to take more bold decisions to come to agreements. But you will always need governments, because businesses are not a body that is elected by people."

Photo: Caroline Marti

Connie Hedegaard, former EU Commissioner for Climate Action

"It is true that businesses have a tremendous responsibility and I respect a lot of what Paul Polman personally is doing and how much he's engaged in this. If all businesspeople were made from the same stuff as Polman, I would subscribe to his argument, but I think the time factor matters. If we say leave the politicians out of this and just rely on the market and the businesses, I'm absolutely
sure that things would slow down. And here it actually does matter whether we act sooner rather than later. I think you must not underestimate what political engagement on the climate issue means. Just take an example. Europe has discussed greenhouse gas emissions for many years now, setting binding targets.

Today, Europe leads the world in emissions reduction: down 19% compared to 1999, while we have grown our GDP 45%. In the US, they've had no targets, no regulation and no policy for many years, and today the fact is that in their own best-case scenarios by 2020 they will have reduced 3% compared to 1999. For me, this is just an indication that politics help business to stay focused on this challenge. With regulations, everybody has to make an effort. Businesses have to come up with the solutions, because they're extremely good at cost efficiencies, but politicians have to make sure that the incentives are good. We have to create a fair playing field, a healthy economic system that consistently calculates the cost to the environment. This cannot be dictated by businesses, but it can also not be done without businesses. Businesses are not changing for goodness' sake. They only change if it makes sense businesswise."

Growth - The good, the bad, and the ugly will be debated in the light of the 46th&nbspSt.&nbspGallen Symposium&nbsp(11-13&nbspMay&nbsp2016).