Opinionista • Tracey Davies • 30 January 2020 Optimism is not enough: A response to Discovery’s Adrian Gore on the climate crisis Corporates and corporate leaders need to do much more than make well-intentioned statements about the climate crisis – they need to actively look at their business models to see whether they are doing enough to fight the crisis. Follow
There are two main reasons for this: first, Gore’s reasons for optimism involve the achievement of vast, unprecedented changes in the way we run our economies and our societies, but he frames them with no reference to the actors who must drive their implementation. Second, while hoping that “our biological coding will kick in” as climate change intensifies, and that “the market will drive change”, he makes no reference to the vested interests and market failures that will continue to work, as they have over the past two decades, against even the incremental progress that we are finally seeing now.
Climate change simply is not like many other challenges: you can’t just donate to your favourite climate change charity and sit back, knowing that the hard work will be done by someone else. Gore’s post could engender in those who read it a sense that everything is under control, and that there is no reason for most of us to worry because the important people who make the big decisions are sorting it all out.
In fact, in relation to climate change, every one of us has a role to play in changing our own behaviour if we stand any chance of mitigating its worst effects. We also have a potentially more important role to play in convincing those who have the power to drive systemic change to change *their* behaviour.
In a world – and a country – where there is still only a fraction of the political will we need to deal with the climate crisis, it is particularly important that powerful companies such as Gore’s show leadership – not just with words, but with action.
Discovery’s annual reports
“*Discovery recognises that an effective response to climate change will require an informed and collaborative approach informed by research initiatives aimed at enhancing understanding of the risks of climate change on our business model and assessing the implications thereof*”, and that “*Discovery is committed to using our sphere of influence to promote environmental awareness and drive behavioural change among all stakeholders, particularly staff and clients.”*
Discovery’s track record at developing ways to incentivise people to behave differently to improve their health and wellbeing puts it in a position to make a contribution to the fight against climate change, but it isn’t using the resources at its disposal to do this. In some respects, it is doing the opposite.
For example, Mr Gore references our temporal bias:
“Unless the threat is immediate and visible, it is ignored. So we make that international flight, in spite of the fact that just one return flight from London to New York
Gore is confident that “the market will drive change by allocating capital towards sustainable investing”. He refers to BlackRock – the world’s largest asset manager – “and its recent decision to make climate change a focus
In addition to being South Africa’s largest administrator of medical schemes, Discovery also has, among others, growing investment and life insurance companies. The company’s position as an asset owner and asset manager is another arena in which it could influence the fight against climate change. Does it, for example, support responsible investment by integrating environmental, social and governance (ESG) issues, including climate risk, into investment and asset allocation decisions?
There is still a huge amount of work to be done: most of the world’s financial institutions remain stubbornly immune to pressure to consider climate risk, and some of South Africa’s financial institutions are among the worst offenders.
Gore says “regulation and nudges will accelerate” and “corporate and public players will conceive new innovations”. These things don’t happen spontaneously: we need persistent, determined push-back against the significant vested interests in the status quo, and we need companies like Discovery to advocate for appropriate regulations and to innovate to incentivise customers to make the changes we need to make.
None of us can sit back and rest easy that the response to climate change is under control. Those with power and influence in the corporate sector should be directing significant time and attention to shifting their own behaviour, setting an example for their customers, creating the right incentives, and sending a united message to the government that they will not continue with business as usual