And not just for the greater good. The future of Coca-Cola—and all companies that pursue such a strategy—will be brighter. In a world dominated by heavy consumption and minimal recycling of valuable resources, sustainable business experts foresee a future of depleted resources that slowly cripples businesses’ functionality. Global conversations have opened up, but action hasn’t always followed. Last year, The Guardian reported that more than half of all businesses are failing to make meaningful strides toward the UN’s Sustainable Development Goals for 2030.
Cramer, president and CEO of global nonprofit Business for Social Responsibility, understands the risks businesses run by ignoring these problems. But when he talks about what it’s like to really work with companies, he strikes a more positive tone. Cramer’s organization doesn’t just seek out a list of corporations that say they aim to be responsible. The group helps companies innovate and develop strategies for becoming truly sustainable businesses.
I spoke to Cramer about BSR’s goals, and how the organization works with Coca-Cola and others to ensure both a sustainable future for companies and a sustainable economy that works for everyone.
What’s holding businesses back from investing in sustainable practices?
There are two structural barriers. One is capital. Companies do not embrace the long term often enough. Changing the way markets work is important; our capital flows need to be directed toward sustainable outcomes, and this will create a virtuous circle in which longer-term considerations are taken into account more and more by companies. Also, our capital markets demand short-term returns. They do not reward long-term thinking fully enough. Sustainability dividends over the long run don’t give companies the capital they need to thrive. We need to find ways to redefine how value is measured, and when that takes hold, more capital will begin to flow through sustainable business.
Waste is a huge issue that companies have to be a part of. Are there any innovations in sustainability right now that give you confidence in the business world potentially being able to play a big part in reducing waste?
Yes. One of the important things, I think, on this question is the emergence of the concept of the circular economy. The circular economy goes well beyond recycling and goes on to reinvent the process of product design, product use and re-use of materials. There are now dozens of companies looking to apply this to the way they source materials and to their manufacturing processes. The vision is, instead of having a linear model of consumption with waste coming out the back, we have one where every single model is being used for a particular product. I think it’s exciting. As more companies get onboard, we can radically reduce the amount of resources being used and of course reduce ocean waste.
The other one is demand from consumers. Companies and consumers together haven’t figured out what produces great outcomes. The average power tool is used for nine minutes. Consumers and companies are not on the same page as far as sustainability goes.
I read an article on BSR’s website about the connections between women and climate change. Statistically, women are more likely to die than men in the case of disaster or extreme weather. Besides strengthening its efforts in water use and sustainable agriculture, the Coca-Cola system has, for example, started investing in empowerment of women in struggling communities. Are companies coming around to the need for this holistic approach to creating a more sustainable world, or do you think that’s more of an exception right now?
There’s no significant company in the world anymore that doesn’t understand the significance of climate change. What’s developed more recently is that climate change is now viewed as a social issue and an economic issue, as well as an environmental issue. For Coca-Cola, the company won’t have a stable operating environment if climate change continues unchecked. To the degree that water resources are unavailable and unreliable, the company can’t function. Also, there’s growing recognition that women are disproportionately affected by climate change around the world. These are critical elements of the world’s economy—and society—that are disproportionately disrupted by climate change. So I think awareness of these things is important. We’re helping companies understand the impact of disruptive climate change on their own operations, and where they live and work. We also help companies lend their voice to policy debates. The Paris Agreement would not have been possible without a strong voice coming from business. We help companies have their voice heard in these kinds of environments.
How does BSR work with companies, and Coca-Cola specifically?
We have more than 200 member companies. We help them translate their sustainability commitments into action, and we’ve had the privilege of working with Coca-Cola for 20 years. We helped develop the company’s most recent sustainability strategy, helping them understand how to aim high and in a way that will be received well by stakeholders, and, of course, strengthen the business. We also helped the company do an assessment on water replenishment and how to achieve its goals in that space. We’ve been pleased to have the work of Bea Perez (Coca-Cola’s Chief Public Affairs, Communications and Sustainability Officer) and April Crow (Coca-Cola’s Global Director of Environment and Sustainability).
In what area do you want to see Coca-Cola become a more sustainable business? In what areas have you seen the company excel?
It all starts with products. It's interesting to see how the company has evolved its product portfolio to provide a more diverse array of products, including more healthy options. I think that’ll continue to be a great opportunity for Coca-Cola to move forward. I think they’ve done a great job and will continue to do so. One thing I’d like to see Coca-Cola do is use the power of the brand to help bring consumers along on this journey; I think consumers can provide a lot of good, as well.
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