The Climate-Equity Connection

A little over a year ago, Syracuse University flew me all the way from Colorado to give a talk on climate change, and not a single grad student showed up. I asked my host professor why. He told me that the students think capitalism is bankrupt. They don’t want to hear from a corporation on climate. Business has nothing credible to offer them, he said. The students felt that absent a clear and nontoken effort to solve the two crushing problems of our time — climate and equity — business wasn’t relevant anymore. I was taken aback. As a career corporate environmentalist with 25 years of experience building and writing about sustainable business, I care about the same issues the students do. At the organization I work for, Aspen Skiing Company, we believe our role in the green universe is not only to keep our house in order by reducing our impact but to wield the substantial power we have as a world-renowned brand. To that end, we have blown the whistle on greenwashing and tokenism many times (including on ourselves, on the cover of Businessweek), and we’ve published widely on the tendency of business to implement small operational tweaks but miss meaningful action. I also care because I’m a progressive. In my view, government, laws, and tax policies are not a burden but instead impose consensus limits on freedom so that we can thrive as a society: Free markets are good, and therefore pollution should cost money. Free speech is bedrock, but you can’t incite people to do harm. But I’m not a wonky idealist — I simply think climate and equity issues can’t be ignored. Americans today seem to agree — a majority across the political spectrum support much of President Biden’s progressive agenda and beyond. Still, I understood the students’ ire. Companies’ action on climate and its sister issue — equity — has always been what my poet friend Mark Scott might describe as being like “an air conditioner on low,” which is to say nominal, ineffective, hardly denting the problem. Their actions will fail to catalyze the broader change that an increasing number of people, especially young people (also known as “future customers”), care about. Take Microsoft’s announcement to go carbon negative by 2030. The statement made no mention of a commensurate push for climate legislation, arguably the only real path to a systemic solution. As a recent Newsweek column by two experts asked, “Why — in the face of Big Oil’s continued, if repackaged climate obstructionism — does Big Tech fail to show up on climate policy? Why, on the brink of such a high stakes struggle over climate policy, is Big Tech still devoting only a measly 4% of its lobbying activities to climate?” Climate touches everything we do. It’s the everything problem. On the equity front, leading Georgia companies participated in conversations with legislators about a new restrictive voting law in the state but didn’t publicly oppose it until it passed. They tried to appear on the side of justice, but only after the fact. Sometimes, the press even seems to bless this strategy. A 2019 New York Times headline, “Shareholder Value No Longer Everything, Top CEOs Say,” appeared to signal that many Fortune 500 CEOs are leaders of a new progressive business movement that values the environment and employees. But some of those CEOs run banks that have invested more in fossil fuels than any other entities on earth. And shortly after making those commitments, many of the same businesses responded to Covid-19 with furloughs and layoffs. No wonder the students are mad. They want to reform a system that has overt, entrenched flaws. Indeed, the problems with capitalism as currently practiced were a major theme of the 2020 U.S. Democratic presidential primary, thanks in large part to Bernie Sanders, Elizabeth Warren, and Alexandria Ocasio-Cortez. Most people believe that modern-day capitalism does “more harm than good in the world,” according to the 20th annual Edelman Trust Barometer. That fact alone ought to be quite a wake-up call for the architects of that world, as well as for businesses, including ours. Climate Is a Stakeholder Whether Companies Like It or Not The reality is that climate is pushing on business as usual — on our entire economic system — from all sides. In my office, for example, our international sales guy took me aside last winter and said (I’m paraphrasing), “Hey, Auden. Thanks to Greta Thunberg, European visitors to our resort are saying they don’t want to fly here. They’re flight shamed. What should I tell them?” This is real: The mere idea of climate change — not even its actual impact — and the quality of our response is affecting our workers’ jobs and our ability to attract business. That same day, the risk and complexity of our own activism emerged: Our insurance lawyer warned we probably shouldn’t lean on our carrier to reduce its support for fossil fuel projects, as we’d been considering. He told me that insurance companies are so hammered by the effects of natural disasters (like the wildfires we’ve experienced in the last two years, which closed our airport) that rates are rising sharply. The companies are looking to drop clients, not appease them, and we couldn’t afford to lose our insurance in a tight market. Together, these two stories show that climate is not a side project that’s part of a CSR effort; it’s central to our strategy and decision-making. It touches everything we do. It’s the everything problem. In the face of this evolution, the connection between climate, equity, and business doesn’t seem all that radical. The Green New Deal — elements of which are in President Biden’s infrastructure bill, and which seems to have new traction of late — has been criticized by centrists for trying to do too much. Instead of just tackling carbon and climate, it rolls up social equity, Medicare for All, and job guarantees. But that’s exactly the point. With a new climate-equity coalition…businesses will actually have to step up. After I was stood up in Syracuse, my host professor handed me a paper by Matt Huber, an award-winning associate professor of geography and the environment at the university. He has published in many left-leaning journals and is the author of the forthcoming book Climate Change as Class War: Building Socialism on a Warming Planet. Huber’s paper, called “Ecological Politics for the Working Class,” argues that “the key is to build a movement where masses of people connect the dots to see the solutions to all our crises of climate, health care, and housing require building mass social power to combat the industries profiting from these very crises.” And this is precisely what the Green New Deal does, offering all Americans a job with family-sustaining wages, adequate family and medical leave, paid vacations, and retirement security — which sounds a lot like real stakeholder capitalism. If nothing else, it is a direct assault on the corporate status quo. A key takeaway for business leaders who are trying to stay on top of social responsibility issues and climate at the same time: Fixing climate requires fixing equity. Stakeholders know this and will increasingly call foul if a business doesn’t demonstrate its understanding of this connection. Climate Is Equity Is Climate It may seem like we’re talking about a sliver of the population here — a group of university students and few others. But that would be misleading. The fundamental reason climate and equity are politically tied is that any attempt to tackle climate alone won’t have the support of a big-enough movement. That sentiment was confirmed in a report on decarbonization in the U.S. by the National Academies of Science, Engineering, and Medicine, which emphasized that the costs and benefits of the transition must be shared equitably. Why? It’s necessary, as Vox reported, for “getting buy-in from a wide coalition for the major changes needed to eliminate greenhouse gas emissions. Otherwise, there could be strong resistance that would undermine progress.” Professor Huber agrees with that argument. Historically, he notes, environmentalism has been the hobby of the elite, who feel guilty about their role in global warming and also have the time and money to care on the margins — “save the whales!” As a result, this movement, such as it is, has been small. And its message has been unappealing to Americans — drive less, eat tofu, don’t use plastic bags. To become part of the climate movement, the huge swath of people facing debt, stagnant wages, and job insecurity need to see that joining up would help more of their needs be met. The fact that the Green New Deal has traction is just one sign that this approach is beginning to play out on the ground. Business ignores this at its peril. Corporations that zero out their carbon footprints through offsets are assuaging a very small slice of society and possibly enraging the rest by ignoring the things employees and customers need to live dignified lives. Maybe sustainability programs have been weak because, in truth, customers simply didn’t care. But combine sustainability with equity, and suddenly your customers and workers have a compelling reason to pay attention. In Aspen, this is starkly evident. We place huge priority on sustainability, but equity issues — availability of housing and level of pay — literally determine if we have enough staff to run our restaurants. Meanwhile, other stakeholders, including visitors to our ski resorts and hotels, are starting to understand that the causes of the climate crisis — a capitalist system that in many aspects fails to value life and cost-out pollution — are some of the same causes of inequity. This has been brought starkly to the fore in the Covid-19 pandemic, where death rates for people of color far exceed that of any other group. And the movement sparked by George Floyd’s murder is in direct response to the same capitalist system, one that the systemic oppression of Black people is built into. In a sense, the social justice revolution now happening in American streets is the climate revolution, because the goals are effectively the same; the candidates who would support those goals are the same; and the solutions to justice and climate issues are often the same too. Indeed, true stakeholder capitalism, which most broadly is about equity, almost always helps solve the climate problem. For example, as Huber points out, public or employee housing can integrate green building techniques that save residents money; expanded mass transit, and incentives by businesses for employees to use it, could cut carbon and reduce dependence on cars. Additional investment in electrical grid improvements (which comes from government but also from the automobile sector) and clean energy creates jobs lost from the decline of oil, gas, and coal. At the same time, bending the curve of emissions will eventually ameliorate the impacts from flood, fire, food security, and disease that will disproportionately affect poorer members of society. If society and government were to take on climate and equity in meaningful ways, there would be economy-wide implications; trying to imagine how those changes might affect business has long been the role of “scenario planning,” done so effectively by Shell since the 1970s. To make a measurable impact on our biggest problems, the U.S. would have to accept more-progressive taxation or a wealth tax and restructured priorities in government spending; move away from natural gas, oil, and coal subsidies; cut down our massive military expenditure; and reprioritize programs like rebuilding public education funding, reducing college costs and debt, and perhaps providing guaranteed minimum income, a form of which came in both Trump’s and Biden’s stimulus bills. Given that there is public support for much of the above, it’s a perfect starting point for corporate planning. Opportunity at the Nexus In the end, the nexus of climate change and equity seems to be creating a societal movement, one supported by a majority of Americans and represented by a new base. According to the numbers from the last presidential election, that movement consists of young people, Americans of color, and college-educated progressive voters. To make this coalition more durable, it could add blue-collar workers, as they are numerous and uniquely able to wield power over the industries with undue influence on policy making. That won’t be easy, as many such workers are migrating to the right, aligning with a coalition that has been less receptive to a climate-equity argument. Still, one can imagine that, with a new climate-equity coalition buying (or not buying) their products, voting, and therefore making policy decisions, businesses will actually have to step up. There have already been some successes. Against much criticism, and at risk of alienating its customers, Major League Baseball pulled the All-Star Game from Atlanta, in response to Georgia’s restrictive new voting laws. That will help MLB’s brand catch up to the truly impressive equity and justice work done by the NBA. Equally important, it will shore up relationships with a key constituency: its employees, the players. (Not everyone agrees with this approach; Stacey Abrams of Fair Fight has urged companies to continue doing business in the state while speaking out against restrictive voting bills around the country.) Over in the tech industry, Salesforce recently added climate change as a key component of its public policy lobbying platform, meaning it has equal billing with more-mainstream corporate concerns. Of course, there continue to be failures. After making loud statements in support of Black Lives Matter, Wall Street banks urged shareholders to vote against racial equity resolutions. That, on top of banks’ empty statements in support of climate action, may further sink their credibility in the public eye. Time will tell. The changes that are happening shouldn’t scare business. They’re a golden opportunity to reinvent the economy it does commerce in; to rebrand itself around issues of vital interest to current and future customers; and to stabilize both society and climate — key elements to staying in business forever. The upside is huge. After all, this isn’t the first time Americans recognized, and then responded together to, the systemic nature of their problems. The aftermath of the Great Depression and the rollout of social security and the New Deal was one example. A second was Johnson’s Great Society, which created Medicaid and Medicare. Yet another was the Declaration of Independence — and what it produced was a new nation and a better world. It would be smart for business to anticipate the future of that new land and assist in its formation.

The Climate-Equity Connection

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