The evening opened with discussion by Chair Jim Woods of the complex views coming out of the survey on the consumer, namely that the audience has a broad confidence that companies with sustainable products and services will outperform their competition in the market place, and at the same time they have little faith in the consumer paying a premium for these goods. Basic microeconomic theory says that a producer will only change their product if associated with better margins – with higher costs usually being associated with sustainable products, this could mean switching to lower products and services. The Plenary session kept returning to this point throughout the evening.
We were lucky to have some entertaining and highly knowledgeable speakers for the evening.
Paul Dickinson, the Founder of the Carbon Disclosure Project, explained how the investors willingness to factor in sustainability in their decision-making comes down, ultimately, to the consumer shaping the commercial landscape. “Greed is good”, he announced in words reminiscent of a certain Mr. Gecko, and greed will lead us to better products, which are sustainable products.
Ed Gillespie, co-founder of communications agency Futerra and fresh from his first foray onto the UK comedy scene, started with a couple of jokes to get the audience going before sharing slides which case studied a number of companies using sustainability to impact decision-making. There is a hamburger company in Sweden, we learned, which puts the embedded carbon values on its menus and it has impacted demand profiles. Ed stressed the importance of regulating the messages coming out of companies, and gave some amusing but poignant examples of greenwash.
Adrian Northolt-Smith, Head of Corporate Public Affairs at Sony, offered some caution on being too reliant on the consumer to drive the agenda. He gave a personal illustration around the feel that high quality packaging can give, and questioned whether switching to “boring, green” packaging makes sense if the consumer feels a strong sense of deprivation. He also explained how sustainability is becoming an increasingly bigger part of his communications role at Sony.
There was, as usual, a lively question and answer sessions.
The chairman attempted to make sense of the consumer conundrum by focusing on the role of innovation, with reference to a plastic-from-corn manufacturer in the states called Plantic. When they launched in 2007 the charged their customers a premium for a sustainable product, but after several years of innovation they are now offering a superior product at a lower price. If consumer demand, jointly with policy, determine the direction of travel it makes sense to invest in sustainability in the knowledge that over time innovation will deliver a better product at a the same or lower price.
The Speakers table afterwards continued with the theme of the consumer, before moving onto the role that Corporate Marginal Abatement Curves could play in driving investment in the most commercially-valuable carbon abatement. All agreed this could be an exciting area for change in 2011.
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