The TakeAway: Last year we became conscious of the breakdown in public trust and its civic moral and economic consequences—and what average people can do to make a difference. This year more of us will get off the couch and work to refuel the engines of democracy and capitalism, of liberty and prosperity, to promote community well being, for decades to come. Here’s the beginning of a series on how.
“2011 set the table. 2012 has the potential to accelerate the ‘revolution’ toward the new corporation agenda,” Allen White wrote to a group of us the day after New Year’s. “Growing wealth disparities between managers and workers, regressive taxes, privatizing gains while socializing losses, ‘too big to fail’, hyper-leveraged organizations linked to financial destabilization and dislocation—these are among the many, linked conditions that are bringing unprecedented scrutiny of the purpose and design of corporations,” he said.
White, who’s a Senior Fellow with Boston-based Tellus Institute for a Great Transition, was referring to the fact that, despite the “volatility and hardship” of 2011, it was a year that also provided hope—perhaps falling short of “urgently needed systemic change,” yet offering “glimpses of the possible.” He also drew upon remarks made at last year’s World Economic Forum by U.N. Secretary General Ban Ki-moon, which underscored the importance of “revolutionary thinking and action” to bring about sustainable development in all aspects of modern life. White was signaling to those of us affiliated with Tellus’ Corporation 20/20 project – now in its tenth year – that 2012 bodes well for redefining the purpose of business within a larger public interest context, in which questions about purpose and meaning – affecting economic, political, and civic life – are raised and, more importantly, addressed.
I couldn’t agree more. The signs are everywhere. Just yesterday, President Obama appointed former Ohio attorney general Richard Cordray to fill the long-vacant director position at the Consumer Financial Protection Bureau (CFPB). A battleground for Congressional Republicans and opponents of financial reform, the watchdog CFPB is a centerpiece of 2010’s Dodd-Frank Wall Street Reform and Consumer Protection Act. Obama set a precedent by using his recess powers (a controversial move that likely will face a legal challenge) to install Cordray, whom he nominated last July but whose confirmation was held up by a Senate filibuster—despite the 53 votes supporting him.
Obama’s action infuriates CFPB opponents, who claim the country is being ill-served. But Cordray’s appointment activates the CFPB’s powers, which will make clear, he said in prepared remarks made today at the Brookings Institution, that there are “real consequences to breaking the law.” According to the New York Times, Cordray laid out a vigorous oversight and enforcement agenda, which is good news at a time when 77% of Americans believe that rich people and large corporations have too much power and that the economic system is unfair.
“This appointment was long overdue and is essential to helping restore the frayed sense of confidence that Americans have in many financial institutions and consumer financial products,” said Lisa Woll, CEO of the U.S. Forum for Sustainable and Responsible Investment (formerly the Social Investment Forum). “Attorney General Cordray brings strong pro-consumer credentials to this important job. His background will help ensure that consumer financial products and services are fairer for all Americans.”
Instability and Outrage
Having this new cop on the beat is a refreshing change from a year of massive instability where no one seemed to be in charge. In fact, it was a pretty bad year for authority: as the recession continued its dampening effect (now extended to the Eurozone), authoritarian governments were toppled, and those who play by their own self-serving rules were confronted by collective outrage. The peoples’ cry “Enough!” produced regime change in places where political conflicts previously were muffled by fear and brute force. (Whether or not the new regimes are any better is another question, as we’re seeing in Iraq, Egypt, and Afghanistan; perhaps counter-revolution is part of the yin yang force found in physics and nature.) In other places – Spain, Greece, Israel, France, Britain, Russia, China, Syria – protesters sick of economic disparities and corruption called for reform.
Meanwhile, as Occupy Wall Street (OWS) protestors turned out in droves throughout the world, those who stayed home continued to wonder why cheaters and lawbreakers never get punished, despite the collateral damage. It was a year when we learned that 1 of 2 Americans are poor or low-income, that even wealthy suburbs are hit with poverty, and that many aging Americans turn to their families for financial aid.
Whatever we feel about OWS, most of us agree with their premise, according to the Pew Research Center. That’s why it’s time to get off the couch and hold this country accountable for its stated values, says famed TV and film producer and unabashed patriot Norman Lear. The Occupy movement has given us a “born again American” moment, Lear opined recently in the Los Angeles Times. “In calling attention to the country’s widening chasm between rich and poor, the Occupiers have unleashed decades of pent-up patriotic outrage against the systematic violation of our nation’s core principles by the ‘say good-bye to the middle class’ alliance of the neocons, theocons and corporate America.
To those many millions of Americans whose guts tell them the Occupy movement is on to something but aren’t the sort to camp out or protest in the street, I say find another way to let your voice be heard in the new year. Work with others who share your passion for equal opportunity and equal justice for all Americans, and find ways to channel outrage into productive action. I’m betting you’ll find, as I have over my nearly four score plus 10, that you’ll form some of the most rewarding relationships and have some of the most meaningful experiences of your life.
Don’t Forget Mother Nature
As for climate change, 2011 was the year that Mother Nature fought back, because She couldn’t take it anymore. The evidence is everywhere, dominated by our insatiable demand for energy as demand patterns shift, an appetite that scientists claim outstrips available supplies while affecting our water systems and increasing business water risk. Yet we continue to overstep boundaries that we are told repeatedly will lead to environmental catastrophe. The permafrost continues to melt, and data on climate change show that greenhouse gas (GHG) emissions are rising faster than worse-case scenarios envisioned by the International Panel on Climate Change (IPCC) in its 2007 report. Meanwhile, wild weather wreaked havoc as storms, floods, and tornadoes capsized lives and destroyed property, and unusually mild weather redefined the winter landscape.
Yet, there are glimpses of the possible: As political leaders and mainstream media generally ignored the reality and implications of climate change – and its relation to poverty – a global grassroots movement continued to grow, helping to push the passage of new laws in Australia (carbon tax) and California (cap-and-trade), and even proposing human rights standing for Mother Nature.
In Durban, South Africa, inconclusive talks on climate change (despite a last-minute deal) motivated activists to tackle corporate power and the politics of energy. Writing in the Guardian, eminent sustainability expert Simon Zadek accused progressive companies of not doing enough, that they should “use their corporate muscle” and call out offenders. “Those working on the nexus of business and sustainability need to wake up to the fact that we have to deal with the ‘bad guys’. They are not persuaded by the fine examples of sustainability leaders, and shrug off the pleadings of the great and the good.” It’s time, Zadek said, for new behavior and alliances: “Good, indeed great, businesses and their respective leaders who embrace tomorrow’s sustainable markets need to move out of their comfort zone in outing and addressing this problem. Greenpeace and other campaigners, in turn, need to establish new alliances, including business, through which they can follow up on their own diagnosis, namely that sidelining resistant incumbents is the real deal.”
Alliances have clout. On January 12th, a group of nearly 500 institutional investors and other financial players representing trillions in combined assets will gather at the United Nations for the 5th Investor Summit on Climate Risk & Energy Solutions, sponsored by Ceres, the United Nations Foundation, and the United Nations Office for Partnerships (UNOP). Its purpose: showcase actions and discuss “promising trends to catalyze the large-scale investment needed to reduce carbon emissions and mitigate potentially catastrophic climate impacts.” According to the Investor Summit press release, “Investors are pouring more money than ever into the clean energy sector with total investment recently topping the $1 trillion mark since 2004.
The US solar industry experienced more growth in third quarter 2011 than it did in all of 2009. And leading investors are moving more decisively to price the risks and opportunities of climate change into their holdings and to develop creative financing mechanisms that encourage energy efficiency and address water and resource scarcity.
Calling Our Future
The failure of mainstream economic thinking. The breakdown in political representation. Disgust over the role of money in politics. Ruptures in global ecosystems and weather patterns. The list goes on.
Yet “glimpses of the possible” are everywhere. As we sail toward 2012’s horizon, we’ll see more enlightened citizen action, shareholder activism, employee and consumer behavior, and various campaigns to promote sustainability and social justice. “The forces driving companies to become more sustainable are getting stronger all the time,” writes veteran journalist Marc Gunther.
These efforts will be aided by the power of the worldwide web and digital media, due in part to smartphones, tablets, and various applications that enable broader real-time knowledge, reporting, participation, and influence on business decisions—and monitoring their outcomes. The social media landscape will continue to grow, with new intermediary organizations to help citizens filter information, facilitate meaning, and take action.
To help frame what 2012 has in store, the next Post will provide a brief rundown of twelve areas that I think will significantly advance the broad purpose of sustainable prosperity and justice. Some are familiar, others less so, and they’re at various stages of development, populated by different actors, yet share common elements and values. Over the coming days and weeks, I’ll elaborate on each and draw from various communities of experts in doing so. I’ll also give my take on who’s doing the most intriguing work, what lies at the cutting edge, and what are the implications for practice—both immediate and long term.
Time to get moving!