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The CEO says regulation is needed to keep businesses in line with sustainability

by SuperiorInvest

In the past few years, we’ve seen a huge number of companies adopt zero commitments and other sustainability-related goals.

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According to the CEO of SDG Monitor, a company focused on measuring performance in this area, companies need regulation and greater accountability to ensure they meet sustainability-related goals.

Tuuli-Anna Tiuttu argued at CNBC’s Sustainable Future Forum on Friday that CEOs and management must be “accountable” for the sustainability goals they set.

Their long-term goals also needed to be broken down into “short-term actions” that were “more specific and realistic to execute and achieve,” she added.

In the past few years, we’ve seen a huge number of companies adopt zero commitments and other sustainability-related goals.

While such commitments attract attention, actually achieving them is a huge task with significant financial and logistical hurdles. The devil is in the details and targets can often be easy.

While many large firms now publish details of their emissions and progress towards targets, establishing a single set of criteria that they can all adhere to and measure their efforts against is a significant challenge.

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During an interview with CNBC, SDG Monitor’s Tiuttu was asked what specific type of regulation is needed to encourage opinion and get businesses and industries moving.

Her answer was about the bigger picture of corporations.

“Absolutely … there is a need for regulation, I think so,” she said. “Because we don’t know where companies are right now in their sustainability programs,” she told CNBC’s Steve Sedgwick.

“Are they on their way? Are they… behind? Maybe they’re ahead.” [in moving] to your goals? That’s something we don’t know because without regulation, everybody’s doing their own thing and it’s pretty much the wild, wild west out there.”

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That, Tiuttu said, created “a lot of cherry picking, maybe also greenwashing, because … they don’t necessarily show performance and their data in a similar format that’s recognizable.”

Greenwashing is a term that environmental group Greenpeace UK calls a “PR tactic” used “to make a company or product appear environmentally friendly without significantly reducing its environmental impact”.

The debate around this is increasingly fierce, with the blame often directed at multinational companies with huge resources and a significant carbon footprint.

Tiuttu further stated that regulation is necessary because “we need [these] … common shared practices and we need data that is collected and calculated in a similar way from one year to the next.”

This would create databases that would in turn begin to show trends in performance, she explained. “And this is all business can do.

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