Time to rewrite capitalism? Why not? Nick Main, Deloitte's global head of sustainability, spreads a message of purpose, profit and carbon constraints. Is he serious?
Welcome home. What do you do these days?
I’m global managing director of sustainability and climate change services. We have about 750 staff and offices in most countries.
Gosh, that sounds grand. Can we still call you Nick?
There are worse things to call me, I suppose.
How about ‘compromised'? You promote sustainability yet your customers are mostly big, filthy capitalists.
We had this very discussion at the World Economic Forum in Davos, Switzerland, talking about ‘sustainable consumerism’, which, I’ll grant, is slightly oxymoronic. But who’s going to lead this? Government will set regulations, civil society and the market will set the price, but business needs to sort out the solutions.
What do you mean by solutions?
Well, take Unilever, which is asking, ‘How do you improve quality of life without negatively affecting the environment?’ or, ‘How do we improve the quality of the lives of the one billion people at the bottom of the pyramid?’ The solutions are being delivered through things like water purification treatments and hygiene products. But it’s also about business process, like lifecycle analysis, whole-of-supply chain and closed-loop manufacturing.
Driven by a profit motive, though.
It’s more sustainable that way. Business is the mechanism that has delivered unprecedented improvements in quality of life in the last century. So if business isn’t part of the solution, then I don’t know what is.
Copenhagen’s failure slowed things down a bit.
Yes, but the agenda hasn’t changed. And it’s not just about climate change. It’s also about water, ecosystems, biodiversity, ethics, corruption, fair trade, fair treatment of employees and social engagement.
Big business seems divided on this subject. I mean oil companies don’t seem so, er, enlightened.
There’s a curve of engagement. There’s the group at the forefront—I call them activist CEOs—who are really committed to making the change. They’re looking at how their own companies can win in the new, carbon-constrained world. Which is great, because if the most sustainable businesses win, that’s good for everyone. Then there are companies dragging the chain, which can’t imagine what their business model looks like in the new environment. Even within one industry, like oil, you’ll find the same spread.
It’s all sounding a bit romantic.
Does it? And we’re not even drinking. No, it goes back to when public companies first formed. Companies like Nestlé and Quaker, although paternalistic, had virtue as their motivation. They had to look after customers, employees and society. Business has got too focused on the generation of profit. If that’s the predominant requirement then you’ll generate the kind of bad behaviour we’ve seen in the last decade.
Is this just you or is everyone having this conversation?
There’s a requirement for us all to talk about it. The review of the GFC is not over yet. We lurch from crisis to crisis, and it’s getting worse. We have to be careful that the next one is not disastrous. And we need to discuss it at a country level.
How does New Zealand look now you’re abroad?
We have some huge competitive advantages; for example, water is the next carbon and we have lots of that. We’re a food producer when there are food shortages.
One of our assets we don’t leverage is a reputation for integrity and honesty. The new environment requires openness and sharing across supply chains.