Politics Archives

November 13, 2016

Make A Trump Presidency Like Y2K

Conservative commentator David Frum has seemingly been as worried about a Trump presidency as any liberal. He tweeted something important a few days ago...

Frum%20tweet.jpg

This idea reminds me of Y2K. For my younger Millennial friends out there who may be hazy on the details, a quick refresher. A quirk in programming made it possible that computer systems all over the world would glitch -- perhaps disastrously -- when the date switched to Jan 1, 2000.

After the ball dropped, the grid didn't go down and planes didn't drop from the sky. Phew. Many people said, in essence, "see, there was nothing to worry about." That was a deep misunderstanding of reality. Multinational companies and governments, with the help of thousands of programmers, had fixed the date tracking in computer systems globally.

While it's possible the fears were overblown, a huge reason nothing went wrong was that a lot of people worked really hard on it.

For those 60 million of us who are very concerned about Trump's world view, beliefs, and lack of qualifications for the world's hardest, most powerful job, we may end up surprised. What if racial and income inequality don't get worse, global action on climate change continues, US emissions drop, companies continue to buy lots of renewable energy, and many more positive things happen?

There are plenty of reasons it could happen. Perhaps the economy and markets continue to progress toward a low-carbon world (i.e., Trump can't stop the clean economy). Or, as so many of us hope -- and many Trump voters i've heard seem to believe -- his positions in the campaign were mostly bluster (let's skip over the logic that the best case scenario then is that he was lying constantly). Or a 70-year-old narcissist under incredible stress has a change of heart.

All of that is possible I suppose.

But even if we end up doing ok, it does not mean that, as Frum says, "the danger was imagined." No, it's far more likely that we citizens will save the day, again.

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January 1, 2017

My 2017 Resolutions for Building a Just, Honest, Thriving World

Happy New Years all.
In a couple of days, I'll be posting my 2016 list of most important sustainable business stories. But today is a time of reflection, so I got to thinking about my resolutions for 2017, given all that happened in 2016. We need to think differently and reach across divides, all while vigorously defending decency, rights, and truth.

I've posted my thoughts on the path forward (for me at least) on medium. Please check out the full piece, but here's the short version of the 5 resolutions I'm making:

1. Spread truth. Facts matter...
2. Defend decency and truth (the “Billy Bush” rule). Call out lies and vileness.
3. Ask questions and listen…but don’t be afraid to “block” someone. Endeavor to understand each other, but don't accept base and offensive ideas, or the people who spread them.
4. Fact-check before forwarding/spreading a story. Fight fake news, do my own research, and demand media do the same.
5. Don’t just kvetch — share the positive and get moving. Venting is good and needed, but just complaining is soul-sucking.

There will be some big battles coming this year. So let's work together and bring along everyone we can to build a better world.

May your 2017 be more sane and just than 2016.

If you enjoyed this article, please sign up for Andrew Winston's RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston)

(Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.

January 4, 2017

9 Sustainable Business Stories That Shaped 2016

In 2015, the world pivoted in a historic way toward sustainability. Debates about climate change melted away. Every country committed to action in the form of the Paris Agreement. Even the Pope spoke to the issue, reminding us that we’re all connected. It was a productive 12 months, to say the least.

Then came 2016.

Every year, I find big themes or specific company stories that I feel are impressive, important, or indicative of where the world is going. In 2016, two dwarf the rest: the election of Donald Trump and significant action on climate change. The context for sustainable business in 2017 may center on the competition between these two stories; that is, how will Trump and his team impact or impede progress on climate and other sustainability issues? So let’s focus on these two first, and then run quickly through seven other interesting stories.

Trump%20and%20climate.jpeg

1. Trump Shocked the World

It’s not yet clear what Trump’s election means for issues that impact companies’ efforts to manage environmental and social issues. Climate change, building a clean economy, reducing inequality and raising wages, providing health care to support general wellbeing — all are big unknowns now. The early signs from the Trump team are not promising, in my view. He wants to appoint as head of the EPA a man who denies climate change and led legal battles against the EPA. His pick for Labor Secretary is staunchly opposed to covering overtime pay or increasing minimum wages (something many leading companies have been doing on their own since 2014. His choice for Secretary of State is the CEO of ExxonMobil, a company that has, for decades, attacked climate science when it knew better. A leaked memo from the Trump transition team shows an intention to move away from the Paris agreement and almost all climate and clean economy action.

In response to Trump’s election and his statements doubting climate change, many countries that signed the Paris climate accords in 2015 made it clear they would power on (China in particular — see story number three, below). Former French president Nicolas Sarkozy even proposed taxing U.S. goods if the country pulled out the Paris agreement. And throwing his weight in, former New York Mayor Michael Bloomberg publicly declared that cities would fight on, with or without Trump. Finally, hundreds of companies signed the latest declaration from Ceres showing their support for Paris. This is all promising. For this and many other reasons, the sustainability journey in business will continue.

But given Trump’s likely stance, any global progress on climate will happen in spite of headwinds from the U.S. federal government. In the U.S., the action will have to move to states, cities, and the private sector. Businesses in particular will need to lead in a way they never have before — and they will.

2. Public and Private Sector Action on Climate Change Increased

For most of 2016, the world moved quickly on climate. I’ve already mentioned the historic Paris agreement, but there are more positive steps worth noting. With the support of chemical companies, more than 170 countries also agreed to phase out HFCs, the high global-warming-potential chemicals used in air-conditioners and refrigerators everywhere. The UN also agreed to slash emissions from the airline industry. Norway banned deforestation and both Norway and Germany moved toward banning fossil-fuel-powered cars. This week, Canada announced it would tax carbon nationally by 2018.

In the U.S., the Obama administration started to incorporate the “social cost of carbon” in decision-making and the Pentagon made climate change a military priority. President Obama, with his counterparts in Canada and Mexico, agreed to some aggressive regional targets on renewable energy and efficiency. At the state level, New Jersey passed a big new gas tax, and Oregon, Illinois, and California developed robust energy and climate policies. All of this will affect companies of all stripes.

Business itself wasn’t quiet on the climate front either. Many invested heavily in renewable energy (see number five on this list), and some big companies dove into policy debates this year. More than 100 companies called for action on the Clean Power Plan (Obama’s big move to reduce power sector emissions), with tech giants Apple, Google, Amazon, and Microsoft even filing a legal brief in support of the policy. Nine big brands with operations in Ohio publicly pressed the state to reinstate energy efficiency and renewable energy portfolio standards. Many previously quiet companies, like food giant General Mills, spoke out about how important it was to their business to tackle climate change.

Why all this progress? First, evidence of a radically altered climate system has become crystal clear. After 2015 shattered climate records, 2016 got even hotter and more extreme, creating weather events that brought physical destruction, massive economic costs, and loss of life. Second, the financial world is getting better at evaluating what’s at stake. The World Bank estimates that $158 trillionworth of assets are at risk from increased natural disasters. The London School of Economics tells us trillions of financial assets are also vulnerable. And in the U.S. alone, floods in Louisiana and North Carolina caused $10 to $20 billion in damage.

3. China Stepped Up

While many countries accelerated their climate and clean economy work this year, China is a special case. Early in the year, China said it would halt new coal mine approvals, close 1,000 mines, increase wind and solar by 21% in 2016, and even eat less meat to control carbon emissions. But last month the country also indicated coal use would rise until 2020 (albeit at a slower rate than the growth of renewables). So it’s not totally clear where China’s emissions will head. But the country clearly wants to lead the world in the clean economy transition. Speaking from this year’s UN global climate meeting – which happened to coincide with the U.S. election — Chinese ministers sent a message to Trump that climate change is no hoax. Then China’s President Xi said he’ll be attending the annual bigwig gathering in Davos for the first time, with reports of China’s interest in filling trade gaps left by Brexit and possible leadership gaps on climate left by Trump.

4. Renewables Kept Growing and Getting Cheaper

Renewables have been trouncing fossil fuels for a few years as the costs of the newer technologies have dropped remarkably fast. The world record for cheapest solar plant was set in Mexico… and then broken within weeks in Dubai with a bid of 2.99 cents per kilowatt-hour. Countries with big investments in renewables are reaping the rewards. For four days in May, Portugal was 100% powered by renewables, and on a single windy day Denmark’s windfarms gave the country 140% of what it needed. The U.S. finally got into offshore wind near Rhode Island. In a subtle tipping point, the total global generating capacity from renewables passed coal this year.

As prices dropped, companies noticed, and corporate purchases and commitments to clean energy grew. Walmart set a 50% renewable target for 2025. In the last few weeks, Microsoft and Avery Dennison announced big purchases of clean power, and GM and Google said they’d target 100% renewable energy within a year. A growing number of companies signed the RE100 commitment to go for 100%. And in Nevada, both MGM and Caesars filed papers to stop purchasing power from their utility, NV Energy, because it doesn’t support renewables. New capital is still flowing to the clean tech — Bill Gates, Jeff Bezos, and some other business leaders just announced a $1 billion fund to invest in “next generation energy technologies.” All of this activity convinces me that Trump can’t stop the clean economy.

5. Investors Focused on Climate, Sustainability, and Short-Termism

Larry Fink, the CEO of Blackrock — the world’s largest asset owner — followed up his 2015 letter to S&P 500 CEOs with another treatise against short-term focus. He disparaged the “quarterly earnings hysteria” and asked companies to submit long-term strategy plans and address environmental, social, and governance (ESG) issues. BlackRock also issued a “climate change warning,” telling investors to adapt their portfolios to fight global warming. Many banks heeded the advice, pulling funding from coal. The London School of Economics also estimated that climate change could slash trillions from financial asset values. Because of this economic and systemic risk, a high-powered task force from the G20’s Financial Stability Board issued important guidelines for companies to make climate-related disclosures. To help investors evaluate their holdings, Morningstar launched sustainability ratings for 20,000 funds, and 21 stock exchanges introduced sustainability reporting standards. Finally, to educate the next generation of analysts, the CFA exam will now include a focus on ESG issues.

6. Business Defended Employees’ and Customers’ Human Rights

Companies are getting more vocal on human rights issues for many reasons. For some, it’s about the commercial opportunity to appeal to a new or growing market of rights-focused consumers. Others want to attract and retain diverse talent. But in general, society is expecting companies to broaden their mission. In one survey, 78% of Americans agreed that “companies should take action to address important issues facing society.” Millennials feel even stronger. A global survey this year showed that 87% of Millennials around the world believe that “the success of business should be measured in terms of more than just its financial performance.” This generation — which will be 50% of the workforce by 2020 — seeks employers that share their values.

And so, after a divisive U.S. election, many CEOs felt the need to email employees, restating their commitment to diversity and inclusion. Earlier in the year, when Gov. Pat McCrory of North Carolina passed a bizarre law to control which bathroom transgender people use, many companies spoke up. The CEOs of dozens of big brands — including Alcoa, Apple, Bank of America, Citibank, IBM, Kellogg, Marriott, PwC, and Starbucks — signed an open letter to defend “protections for LGBT people.” Paypal and Deutsche Bank canceled plans to expand and hire in the state, and the NCAA actually relocated some championship events. (In an important side note, after costing the state $600 million in business, the law is widely credited for losing McCrory his reelection bid.)

7. More Evidence Emerged That Economies Can Grow Without Increasing Carbon Emissions

So far this century, more than 20 large countries, as well as 33 U.S. states, have “decoupled” GDP growth from GHGs. One energy hog, the IT sector, has managed to level off energy use in data centers. There’s serious talk again about “peak oil” — not of supply, but of demand.

We’re seeing a fundamental shift in our relationship with energy for many reasons, including the improving economics of efficiency and clean tech (see #5). But companies are also getting more systematic, strategic, and fun — yes fun — in slashing energy. More organizations are using some old tools like “treasure hunts” and reimagining them as “energy marathons” (26.2 days of innovation). Others are competing to slash energy use — see Hilton and Whole Foods energy teams go head-to-head in a streaming reality show.

8. Levi’s Shared What It Knows about Water

Big themes are great, but periodically a specific example of leadership seems worthy of extra attention. In this case, Levi’s had spent a decade identifying great ways to cut water use in the apparel value chain. Realizing that water issues are too big to tackle alone, Levi’s celebrated World Water Day this year by open sourcing its best practices in water management. In essence, the company decided to promote system change and even invited competitors to its innovation lab for the first time in its history.

9. The Circular Economy Inched Closer

With a growing population and ever-rising demand for resources, it’s becoming necessary to find ways to eliminate waste and reuse valuable materials endlessly. We’re seeing some interesting innovation in policy and business practice. Sweden is planning to offer tax breaks for fixing things instead of throwing them away, and six EU countries started a four-year project to help small and medium-size enterprises move to circular models.

A number of companies also made moves into this space. A supermarket opened in the UK filled with only food that would’ve been thrown out. IKEA is expanding its circular offerings like reselling used furniture and creating new products from leftover textiles. More than 25 companies in Minnesota, including 3M, Aveda, and Target, launched a circular initiative to share expertise. The Ellen MacArthur Foundation and Kering both created curricula in circular thinking for fashion and design students. And finally, the Closed Loop Fund, which invests in recycling infrastructure (using funds from some large retail and CPG brands), reported on substantial progress, including launching single stream recycling across Memphis.

What’s in Store for 2017?

Given how far off pundits and prognosticators were this year, I have to proceed with caution. Who really knows what a Trump presidency will bring to the U.S. and the world, or what the corporate sustainability agenda will look like with so much uncertainty?

I do believe companies will expand their horizons, looking more at systems, not just their operations and value chains. They will increasingly partner to tackle big global targets like the UN’s Sustainable Development goals. Demands for more transparency about how everything is made — from consumers, employees, investors, and other stakeholders — are unlikely to slow down. The food and agriculture sectors in particular will feel even more pressure to cut carbon and food waste and simplify ingredients.

And no matter who’s in charge politically, macro trends are hard to stop — a changing climate; increasing challenges around water and other resources; higher expectations of companies; rising concern about inequality and wages; and technological disruption from AI, machine learning, and autonomous everything. These trends will continue and companies will need to adapt — fast.

(This post first appeared at Harvard Business Review online.)

If you enjoyed this article, please sign up for Andrew Winston's RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston)

(Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.

June 2, 2017

U.S. Business Leaders Want to Stay in the Paris Climate Accord

(2 days ago I wrote the below for HBR about Trump's impending decision to exit the global climate accord. The whole point is that he would be ignoring business leaders if he did so. Well, he did. The news is moving fast these days. The response from business and other leaders was swift and strong. I'll post a 2nd article summarizing that in a bit.)

According to reports, President Trump is expected to pull the U.S. out of the Paris climate agreement. This is a horrible decision for business, the United States, and humanity.

In this moment, running through the details of the agreement itself, which commits nearly every country in the world to significant energy and carbon reductions, is not vital. Nor is what we could analyze — from what will actually change in how the U.S. uses energy or emits carbon if the agreement is abandoned (it’s not a straightforward discussion by any means) to what states, cities, and citizens can do as a result.

But the key point I want to make here is that the business community does not want to leave the Paris climate agreement. Let me repeat: Even though Trump and his team keep telling everyone that climate action is somehow bad for the economy, most companies don’t agree with that assessment.

On May 10, in an attempt to influence the president’s thinking, 30 CEOs wrote an open letter to Trump, taking out a full-page ad in the Wall Street Journal. The opening reads, “We are writing to express our strong support for the U.S. remaining in the Paris Climate Agreement.” I won’t reprint the whole letter here, but please read it.

It is, however, worth taking a moment to look at the companies whose CEOs made their views known:

3M Company
Allianz SE
Bank of America Corp.
BROAD Group
Campbell Soup Company
Cargill Inc.
Citigroup Inc.
The Coca-Cola Company
Corning Incorporated
Cummins Inc.
Dana Incorporated
The Dow Chemical Company
E.I. DuPont de Nemours & Company
General Electric
The Goldman Sachs Group, Inc.
Harris Corporation
Johnson & Johnson
JP Morgan Chase
Kering
Morgan Stanley
Newell Brands Inc.
Pacific Gas and Electric Company
Procter & Gamble Company
Royal DSM
Salesforce
Solvay
Tesla Inc.
Unilever
Virgin Group
The Walt Disney Company

This is not a tree-hugger group. And it’s not a list of usual suspects from consumer-facing brands that may want to impress consumers or seem like they don’t have a huge carbon footprint. Nor is it a list that makes you think the money men want out of Paris. Heavy industrials are here. The biggest banks are here, and in other communications, too — see the letter to G7 leaders from hundreds of institutional investors, representing $17 trillion in assets.

Finally, I can say confidently, the list does not even remotely cover all the companies that feel this way. The CEO of Dow corralled fellow CEOs over just a couple of days to get these signatories. Many more agree but couldn’t move that fast on the letter, and many other executives have made their feelings known through back channels to Trump and his team. Public statements of support for the Paris agreement have even come in from the CEO of Exxon. Yes, Exxon. And just look at the hundreds of companies that have already committed to science-based carbon reduction goals and 100% renewable energy.

And yet the president seems to be ignoring this clear message coming from our titans of industry. He has claimed for a long time that he wants to put America first. But by withdrawing we would join a short list of UN member states that have not signed the agreement: Nicaragua and Syria. That’s it.

The U.S. cannot lead the world in any dimension if it abdicates responsibility and leadership for the greatest challenge facing humanity.

(This post first appeared at Harvard Business Review online.)

If you enjoyed this article, please sign up for Andrew Winston's RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston

Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.

June 2, 2017

Cities, States, and Business: Our True Climate Leaders

(Part II of the Trump Paris decision -- the aftermath with reactions from governors, mayors, and CEOs.)

After Trump’s historic blunder in pulling the U.S. out of the Paris climate accords, regional leaders, CEOs, and the rest of the world sent a clear message: We’re moving on climate change. And this is why I still have hope.

A couple of days ago, assuming Trump would do exactly what he did yesterday, I wrote an article for HBR about how “U.S. Business Leaders Want to Stay in the Paris Climate Accord.”

Then Trump, true to form, made one of the most economically, scientifically, and morally bankrupt decisions in modern U.S. history. Leaders around the world were ready. They spoke loudly.

Here are just some of the tweets.

1. FROM CEOs AND BUSINESS LEADERS

(These included messages from, as WIRED editor Nicholas Thompson pointed out, the “five most valuable companies on earth)…

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See, in particular, Jeff Immelt’s statement that “Industry must now lead.” Absolutely.

And two high-profile business leaders took Trump’s decision as a sign that their input was useless, so they left his CEO advisory boards.

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(Many commentators have pointed out that they should’ve been disgusted with Trump for many other things before this (misogyny, racism, etc.). That’s true, but I believe they genuinely thought they could influence him at least from the inside…but that’s clearly useless with someone like Trump.)

The Weather Channel in particular made their displeasure known…

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2. FROM CITIES AND STATES

Governors and Mayors acted fast, lighting monuments in green…

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Trump made a particular point in his speech about how he represents Pittsburgh, not Paris. Well, not so much.

The Governors of CA, NY, and WA were ready to go with a new alliance to show state-level commitment to Paris. Welcome to the world, United States Climate Alliance.

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3. FROM THE REST OF THE WORLD

I couldn’t remotely capture all that happened on the international front, but two messages in particular stuck out…

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The 3-minute video from French President Emmanuel Macron, in English, is historic-level trolling. He invites all scientists, engineers, entrepreneurs, and anyone else interested in building a clean economy, to come to France. And he ends with “Make the Planet Great Again.” Just watch it.

And Canadian Prime Minister Justin Trudeau chooses his words carefully, saying the “United States federal government” has withdrawn — meaning, we can assume, he’ll be happy to work with states and cities.

These reactions are just the immediate responses within hours. Trump has ensured that the U.S., as a federal entity, is a pariah on the world’s stage as the rest of the planet acts on its biggest challenge.

But our cities, states, and businesses will move forward despite his mythic blunder. And the rest of the world, luckily for us, will welcome the chance to work closely with our true leaders.

If you enjoyed this article, please sign up for Andrew Winston's RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston

Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.

December 31, 2017

The Top 10 Sustainable Business Stories of 2017

(I recently published my 9th annual roundup of top themes/stories impacting how business navigates environmental and social issues. See original at HBR. I've reposted it here with a couple smaller "honorable mention" stories at the end that got edited out of the HBR version. A few social media comments pointed out my list is perhaps too U.S. focused -- fair enough, I am U.S. based. And one big thing I definitely should've included here was Brexit. I was probably too focused on our own dysfunction in the U.S. Oops. But overall, readers have said they thought I was balanced and, surprisingly, fairly optimistic. See what you think and enjoy the New Year!)

The year 2017 has been a long, strange trip. The definition of sustainability in business evolved quickly — the topic in executive suites now covers a wide range of issues that address how a company navigates environmental and social challenges. From carbon footprint to taking a stand on human rights or immigration, companies need a position and strategy on all of this and more.

We saw big leaps both backward and forward this year, some of which weren’t especially surprising. In my year-end wrap up for 2016, for instance, I predicted that “the context for sustainable business in 2017 may center on the competition between two stories, the election of Donald Trump and significant action on climate change.” That’s pretty much what happened. Trump pulled the U.S. out of the Paris climate accord, the hard-won global agreement to tackle the greatest threat to humanity and the economy, becoming the only country in the world on the sidelines.

But the Newtonian equal-and-opposite reaction from business, states, and cities was nothing short of amazing. Their pushback on policy decisions is my #1 story of 2017. Here’s more on that, plus nine additional developments business leaders need to pay attention to.

Climate, Clean Tech, and the Environment

1. U.S. leaders from the public and private sectors rejected Trump’s decision on the Paris accord and committed to climate action.
On the day of the president’s announcement about the Paris climate accord, 25 multinationals — including Apple, Facebook, Google, HPE, Ingersoll Rand, Intel, Microsoft, PG&E, Tiffany, and Unilever — ran a full page ad in the Wall Street Journal asking Trump to stay committed to the agreement. By that weekend, dozens of big companies declared, We Are Still In. This public statement includes thousands of signatories — not just companies, but states, cities, and universities.

On the governmental side, the states of California, Washington, New York, and others representing a third of the U.S. population and GDP announced the formation of the U.S. Climate Alliance. California Governor Jerry Brown emerged as the de facto climate leader for the United States, holding his own meetings in China and headlining a delegation to the global climate talks in Bonn. A growing list of 385 local leaders have joined the U.S. Climate Mayors pact as well. A group of high -profile business leaders offered their thoughts on the sustainability agenda right here at HBR (I am also an adviser to that effort). In total, the message to the rest of the world has been clear: “sub-national” support for climate action is very strong in the United States.

2. The deadly costs of climate change became even more obvious.
This year, the science got clearer about the connection between extreme weather and human-caused climate change. And that extreme weather was horrifying. Record-setting storms, floods, and drought-driven fires wreaked havoc around the world. Flooding in South Asia killed more than 1,200 people. Asia also experienced shocking heat, including a day in Pakistan that hit nearly 130 degrees Fahrenheit. Hurricane Harvey hit Houston hard (the before-and-after flooding pictures are mind-boggling), and the national weather service added colors to flood maps to reflect the record 30 inches of rain that fell. Hurricane Irma demolished Caribbean islands, and Hurricane Maria created an economic and humanitarian disaster in Puerto Rico. As of this writing, months after the storm, a third of the island is still without power, and 10% of these U.S. citizens have no water. On the U.S. mainland, unprecedented wildfires ripped through Napa and central California, as well as Los Angeles County.

These extreme weather events are primarily human tragedies, but they’re economic and business disasters as well. When entire regions are under water or lose power for months, it’s not good for local and national economies. In fact, the economic cost of extreme weather is vast and rising. In the 1980s, 27 weather events cost the U.S. more than $1 billion each (in today’s dollars). A little more than halfway through the current decade, we’ve already experienced 89 billion-dollar events, and they’re much, much larger. Hurricane Sandy in 2012 and the big trio of Hurricanes Harvey, Irma, and Maria this year are all $50 billion to $100 billion storms.

3. The Trump administration started dismantling environmental protections.
In the U.S., the new administration’s policy goes beyond pulling out of Paris. We’re seeing an all-out assault on our air, water, climate, and land. The EPA head, Scott Pruitt, spent years suing the agency and essentially intends on dismantling it. Pruitt and Trump, with assists from Interior Secretary Ryan Zinke and Energy Secretary Rick Perry, are working to, for example:

Bi-partisan groups of former energy commissioners and EPA heads have spoken out against every move. And while many companies may hope to save money in the short run with fewer regulatory hurdles, it’s also clear that an unhealthier environment is not great for businesses, its customers, its communities, or its employees in the long term.

4. Investors woke up about climate risk and benefits of sustainability.
I know, I know, Wall Street only cares about short-term earnings performance. And yet there’s something brewing among big institutional players, the economy’s risk assessors, and even some Wall Street types. For example, Larry Fink, the CEO of BlackRock (with $6 trillion in assets under its management) asked business leaders to focus on “long-term value creation” in his third annual letterto S&P 500 CEOs. BlackRock also said its “engagement priorities” for talking to CEOs would include climate risk and boardroom diversity.

Shareholder resolutions on climate disclosure and strategies succeeded for the first time at Occidental Petroleum and ExxonMobil as well. Fund giant Vanguard, which led the charge at Exxon, also declared climate risk and gender diversity “defining themes” of its investment strategy. Institutional investors continued to drive climate action also, with hundreds signing a statement of support for the Paris agreement. And Norway’s $1 trillion Wealth Fund is forcing banks to disclose the carbon footprint of loans and will divest from fossil fuels. In late-breaking news, the World Bank will stop financing upstream oil and gas projects after 2019.

Finally, a few big developing stories could create long-term ripples. First, the Financial Stability Board (FSB) Task Force on Climate-related Financial Disclosures (or TCFD) — chaired and led by financial giant and former New York City mayor Michael Bloomberg — issued a critical set of guidelines for investors and insurers to understand climate risks. On the heels of TCFD, a group of 225 global investors with $26 trillion under management launched “Climate Action 100+” to “engage” with large emitters on their management and disclosure of climate risks. And in fascinatings new on the debt financing front, Moody’s told cities to address climate risks or face downgrades on their bonds. Could shifting rates on company debt be far behind?

5. China accelerated its clean tech advantage.
On the fifth day of 2017, China announced it would spend $360 billion on renewable energy by 2020. The rest of the year brought even more leadership: China cancelled 103 coal plants, committed to cut coal by 30%, made big moves in electric vehicles (see #9, below), erected the world’s largest land-basedand floating solar farms (becoming the world’s largest solar producer in the process), and – in one of the most fun stories of the year — built a solar farm in the shape of a giant panda just for the heck of it. Essentially, in 2017, China took over the role of global climate leader and then, to top it off, committed nearly a trillion dollars in infrastructure spending to connect China to the rest of the world.

6. Clean tech continued its relentless march (and coal continued to die).
As a whole, the economics of every major green technology got radically better. (Morgan Stanley predicted an “inflection point” in 2020, when renewables become the cheapest energy source globally.) But to focus on two intertwined areas, look at what happened with electric vehicles (EVs) and battery storage.

On the former, some large economies, including France, India, Britain, Norway, and China, committed to ban diesel and gas vehicles. Automakers moved quickly as well, with GM and Ford announcing major investments in EVs and Volvo phasing out conventional engines starting as soon as 2019. A group of multinationals with big logistics operations launched EV100, an initiative to speed up the switch to EVs. One big city, Shenzhen, China, moved its entire bus fleet to EV. In total, EV sales were up 63% globally.

The economics of batteries (needed for EVs and, critically, the grid so we can store clean energy) continued to get much better—50% cheaper since 2014. Tesla built grid-scale storage for Southern California and quickly erected the world’s largest lithium ion battery storage in Australia. The end result is going to be the end of coal, bolstered by commitments from states like Michigan to go coal-free—and the entire EU, which will build no new coal plants after 2020.

The Role of Business in Society

7. Famous CEOs took moral stands.
One group of business leaders faced a tough decision this year: stay in the president’s CEO advisory councils or protest his policies by pulling out. A few, like Tesla’s Elon Musk and Disney’s Robert Iger, left in the spring after the Paris climate decision. But most stayed on — that is, until the Charlottesville, Virginia white nationalist marches. When the president said there were “some very fine people” among the white supremacists, the CEO Advisory Councils disbanded quickly, with the leaders of Pepsi, IBM, GM, BCG, Merck, 3M, and others walking away (a few wanted to stay, but the momentum was clear).

One CEO in particular, Apple’s Tim Cook (who was not formally on the councils) denounced the “moral equivalence” of white supremacists and human rights protesters, but he also went on to say something more important about business: “We have a moral responsibility to help grow the economy, to help grow jobs, to contribute to this country and to other countries that we do business in.” In essence, Cook made a blended argument for sustainability that isn’t about philanthropy and the polar bears, but about the core business and its role in society. And yet, Apple had its own challenges. Proving that no company’s actions are black and white, the world discovered that Apple has stashed a quarter of a trillion dollars in cash outside the U.S. to avoid taxes. Yes, it’s legal, but is it right? Given Cook’s own argument, it’s an uncomfortable disconnect.

8. Companies went to court.
This year large companies dove into legal battles on social hot-button issues to an unusual degree. Tech companies big and small filed an “amicus brief” to fight the president’s first executive order on immigration (biotech firms spoke out as well). Fifty big companies asked a New York federal appeals court to fight discrimination based on sexual orientation. Companies also lobbied for pro-environmental and social policies. Companies went local as well, with seven big guns — Procter & Gamble, Walmart, Unilever, General Mills, Target, General Motors, and Nestle — pushing the state of Missouri to pass a bill to make it easier for them to buy renewable energy.

9. The super bowl of sustainability advertising was… the actual Super Bowl.
A surprising number of big brands used the most expensive, most viewed advertising time in the world to do something different this year: Instead of pitching products the old-fashioned way, focusing on how great it tastes or will make you feel, they chose to say something about an important aspect of social sustainability. And they took risky stands, in often not-so-veiled ways, against the policies of the new U.S. president.

Budweiser’s ad told the story of their founder and proudly pointed out his immigrant status. Little-known 84 Lumber went viral with a five-minute video about the journey of a family from central America. Coca-Cola focused on diversity and inclusion with its multi-lingual ad. And Audi’s ad “Daughter” lamented the lack of pay equity for women (though Audi then took heat for its own record on pay and women in leadership, showing that sustainability-focused ads can be risky).

10. Unilever fights off a hostile takeover bid.
Unilever is the consensus corporate leader on managing sustainability for business and societal value. That’s why I consider the attempted takeover of Unilever by Kraft Heinz and 3G Capital an important sustainability story.

It is unlikely that a firm like 3G would continue supporting the sustainability strategy at the heart of Unilever, even though the strategy has been wildly successful (the company’s market cap was at an all-time high — and then went up another 20% after the takeover attempt). As Unilever’s CEO, Paul Polman told the Financial Times, it was “clearly a clash between a long-term, sustainable business model for multiple stakeholders and a model that is entirely focused on shareholder primacy.” Everyone interested in seeing companies lead the charge to a thriving world breathed a sigh of relief. (Full disclosure: I’ve been an advisor to Unilever North America, but I had zero involvement on this issue.)

Honorable mentions
- Big new sustainability goals. Kudos to Mars, Inc. for committing $1 billion toward becoming “sustainable in a generation” and to HPE and H&M for setting science-based and carbon neutral goals for their suppliers.
- More transparency and accountability. New technologies (hello, blockchain) are capturing more information about products. Transparency is increasing. Panera went 100% “clean label”, Target and Walmart leaned into chemical management, and Unilever set a for transparency on fragrances.
- Citizen action on a grand scale. The women’s march and #metoo revealed a lot of pent up frustration with the world’s businesses and institutions (and with men).

So what’s next?

It’s risky to say anything definitive about the future. But I do believe that some mega-trends have too much inertia for any one stakeholder to completely disrupt. So some light predictions for 2018:

  • The climate will continue to get more volatile. Any remaining business leaders who don’t understand climate as a systemic risk and opportunity will have to get on board.

  • Millennials and Gen Z will continue to push for purpose and meaning in work and life.

  • AI, big data, blockchain, and other tech will change how we understand companies, products, and services, leading even more to embrace “clean labels”.

  • To meet ever-rising expectations, and drive business value, companies will set more and more aggressive sustainability goals.

  • Clean tech will be under attack by the U.S. administration, but it will continue to prevail globally.

  • Finally, the #metoo movement against sexual harassment, which is sweeping through politics and media, will hit big business. We may see some senior Fortune 500 execs fall.
  • Onward to 2018. Have a happy, healthy, and sustainable New Year!

    *******

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    January 2, 2018

    The Only Resolution that Matters for 2018: Get Involved

    Happy New Year all. As I did last year, I wrote a January 1 piece focused on resolutions. This year, I think there's only one important resolution: getting involved in politics at all levels.
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    "Politics" is not just something for debating online -- it's about values and what kind of society we want. And it's about sustainability. Whatever priorities we sustainability-minded people might have -- tackling climate change or inequality, for example -- need supportive policies. We need political leaders who promote the common good.

    There is no way we can manage something as systematic as climate change without, to be blunt, changing who's in power in the United States. As I summed up in my year-end review of big sustainable business stories, the attack on our environment from our own EPA is historic. And this administration is fighting all action on the most pressing issue humanity faces, climate change. So we need new leaders at all levels. That requires millions of us to engage -- and to engage more from now on, for the rest of our lives.

    So, with that in mind, I wrote my own cheat sheet on the major steps for getting more engaged. The full, yet pretty short, piece is on Medium here. Please check it out.

    But to give my readers the gist, in short, here's my list, roughly from least effort to most.

    1. Know who your reps are. Google it, seriously.
    2. Educate yourself on what they stand for and vote for.
    3. Vote. Every time.
    4. Connect with your reps. Call them. Follow them online.
    5. Join your local Indivisible chapter and join your local Democratic party (let's not kid ourselves about which party, no matter its flaws, fights for action on climate, environmental protection, inequality, and many more pillars of the sustainability agenda).
    6. Donate to campaigns, the party, and organizations that defend our rights (like, e.g., the ACLU).
    7. Engage others. Talk to friends and neighbors and get them to vote.
    8. Run for office. I'm doing this now at the local level.

    I also list in the Medium article some key principles that I believe our leaders need to support to build a thriving world. I suppose it's a progressive wish list, but seems fundamental to me. It includes building an economy that works for all and defending freedoms that we all deserve. Please take a look.

    Let's make change happen to truly support sustainability in 2018.

    *****
    If you enjoyed this article, please sign up for Andrew Winston's RSS feed, or by email. Follow Andrew on Twitter @AndrewWinston

    Andrew's book, The Big Pivot, was named a Best Business Book of the Year by Strategy+Business Magazine! Get your copy here. See also Andrew's TED talk on The Big Pivot.