Business is about being green, say FTSE 100 leaders

Modern business is about more than producing vacuum cleaners and shampoo, say Unilever and Dyson bosses

Source: Flickr/Hartwig HKD

Source: Flickr/Hartwig HKD

By Sophie Yeo

Market liberalisation and a policy certainty will allow green business to flourish, say the chief executives of Unilever, Dyson and Kingfisher.

Paul Polman, James Dyson and Sir Ian Cheshire all dismiss the view that environmentalism is anti-green, arguing that it’s in a company’s best interest invest in new technologies and energy efficiency.

Their views are part of a series of essays published today by the London-based Conservative Environment Network, part of an effort to engage right wing voters and politicians in the green debate.

Here’s a selection of their views…

Paul Polman, CEO of Unilever PLC

While businesses like Unilever can and are reorientating their business models to enable them to grow sustainably, there are limits to how much we can do on our own. The big social and environmental problems that the world faces today are too complex and inter-connected for any one government or any one company – however large or powerful – to tackle alone.

Even if we exceed every sustainability target we set ourselves, if no one follows us, we will have failed by meeting the target but not solving the overall problem. Deforestation is a good example. We are on track to meet our target of 100% sustainable agricultural commodities by 2020 yet, despite our size, we know that if we want to ensure zero net deforestation we have to work with others to transform the entire consumer goods industry. This will have profound implications both for the sector and for forested nations like Brazil and Indonesia.

Sir Ian Cheshire, CEO of Kingfisher PLC

There are no quick and cost-free fixes to reduce energy costs. Instead, we need long-term downward pressure that reduces both energy demand and wastage. That means improving the energy efficiency of the UK’s housing stock, with priority being given to protecting the most vulnerable…

We have therefore backed efforts to ensure that government schemes – such as the Energy Company Obligation (ECO) – are delivered as cost-effectively as possible. We recently launched an energy-saving business in the UK both to help homeowners protect themselves from rising energy bill and to help reduce domestic carbon emissions, a quarter of the UK’s total.

Sir James Dyson, founder of Dyson Ltd

It is engineers, not politicians who will save the planet – and not by peddling green wash but by putting their faith in long-term research and development of new and better technology…

There is even a point to be made on the seemingly mundane point of drying your hands. Traditional hand dryers are useless. They rely on energy-hungry heating elements which are slow and inefficient. You could tweak around the edges and only attain a marginal improvement. But by going back to the drawing board and starting from scratch, Dyson engineers improved energy efficiency by 80% while ensuring that the machine actually dries your hands in the process.

Sir Stuart Rose, former CEO of Marks & Spencer

Transparency and trust can now be added to the traditional drivers of corporate reputation, namely product quality and financial returns. This is a dramatic shift but one which is here to stay. Sustainability in particular is no longer an optional extra for consumers – it is increasingly a given, and not one for which they are not willing to pay a premium.

As such, it is no different from food safety. Consumers will not now pay more for a product because it claims to avoid exploiting people or natural resources – any more than they will pay more for a product that claims to be safe. Business leaders should forget the pursuit of a so-called ‘green premium’, as sustainability is now the baseline for retaining the trust and confidence of your customers and thereby remaining a viable business.

Michael Liebreich, CEO of Bloomberg New Energy Finance

Where is the self-confidence with which [the right] transformed the world’s other major industries? Time and again we were told that telecoms, airlines, steel, cars, mainframe computers, yoghurt – or whatever – were natural monopolies and strategic industries which had to be protected from competition; and that only central planning could provide stable outcomes. In short, that leftist, statist solutions were the only ones available. Luckily Thatcher, Reagan and their successors rejected that narrative and the results are history.

The time has come to apply this sort of rigour to the energy sector. Where is the Easyjet of clean energy, or the Virgin Atlantic? Where is the Vodafone, the Safaricom? Where are the new services, the new providers?

The answer is they don’t exist because policy is being written with the state and industry incumbents in mind, using mainly the tools of the left. Only by releasing a maelstrom of entrepreneurial and competitive activity will the world be able to build a high-performing clean energy system without driving costs to unacceptable levels. And only by leading the process will the right find its natural voice on energy and the environment.

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