We keep hearing it– incremental improvement won’t keep the world on track for the Paris Agreement, nor will it achieve the UN SDGs. We need transformational change. This is the view of scientists, civil society and an increasing number of businesses and political leaders. But perhaps most importantly, this is what people are demanding. Indeed five million of them around the world striking as they don’t believe their leaders are anywhere near serious enough about fighting climate change.
The Paris Agreement and the UN SDGs are the most ambitious agenda the world has ever seen. To achieve this we need to transform our systems in areas like energy, food, digital, urban, circular, social and finance. This require us to focus on pulling the right levers – ensuring both public and private institutions act. As the World Benchmarking Alliance, we focus on the private sector. More specifically we focus on ‘Keystone’ companies – a global group of 2000 companies that have a disproportionate influence on their industry and therefore the word around us. The term ‘Keystone’ is derived from biology, referring to keystone species with an unusually large ripple effect on the ecosystems they inhabit.
We are using the example from the re-introduction of wolves in the Yellowstone park which has transformed the ecosystem. Wolves at the top of the food chain started hunting for deer. This not only reduces the number of deer but changes their behaviour too. As a result trees and shrubs could regenerate which stopped soil erosion and changed the flow of the rivers ultimately transforming the ecosystem and creating new life. We believe ‘Keystone’ companies shape our world in a similar way to these wolves. Given the outsized influence of these 2000 keystone companies one question becomes very urgent. Will these companies be driven by an instinct of profit maximization – like the Wolves of Wall street, for those that have seen the film – or instead pursue a societal purpose?
Companies do have this choice. Unlike wolves, companies are led by people, with values and the ability to make conscious decisions about how they seek to shape the world around us. But it’s not an easy choice.Pursuing a social purpose instead of pure profit maximization requires courageous leaders. We will be asking and showing this through our benchmarks if for example, these companies have eliminated all their emissions and paid a living wage. We need new ways to reward companies’ courage by the contribution they make to their employees, customers and the communities they serve. We want to hold those that drag their feet to account. This is why we will make our benchmarks freely available to investors, the media, regulators, governments, employees, civil society and consumers. We will all be empowered to choose who we work for, buy from and invest in or not as we get closer to these companies influencing our world.
Benchmarking for a better world
We only have one decade left so we need to move fast. In January 2020 we will announce the full list of 2,000 keystone companies across the 7 systems transformations. By the end of next year, we will have assessed the first 500 companies, adding 500 companies every year. By 2023 we will have all 2000 keystone companies ranked on an annual basis across the system transformations closest to their core business and needed to get the world to where it needs to be.
Strength in numbers
No matter how large or complex a system is, change is always the result of decisions made by individuals and the institutions they lead and shape. Individuals facing pressures and barriers not just on the outside of their businesses but on the inside too. As we ask business leaders to be courageous we also need to understand how to support them as an alliance, in close collaboration with companies and their stakeholders. Since we launched our alliance a year ago we have grown to over 100 institutions across sectors and geographies. Each helping us develop these benchmarks and act on the results. Action starts today by asking as a true leader and influencer what will your ripple effect be and how can you impact your ecosystem?
Gerbrand Haverkamp is Executive Director of the World Benchmarking Alliance.