Procurement must look beyond net zero to avoid 'graveyard of dinosaurs'

14 March 2022

Net zero policies are no longer enough and companies must instead adopt a “net positive” approach, according to former Unilever boss and author Paul Polman. 

Polman said the world cannot solve climate change without “an active involvement in business”, but criticised current net zero policies seen throughout businesses. 

Speaking at the EcoVadis Sustain 2022 conference, he said: “Most companies are still in the corporate, social, responsibility mode, which is really dealing with doing less bad, 'Let's cut our carbon emission a little bit. Let's cut our deforestation a little bit. Let's cut our plastics in the oceans a little bit'.

“But in a world that already has overshot tremendously its planetary boundaries, less bad is still bad. It's not good enough. 'I used to kill 10 people now I only kill five people, am I a better murderer?' We need to change our mindset from being less bad to being sustainable. But net zero doesn't do it anymore either.”

He said the only business model that will be successful in achieving desired sustainability goals will be “regenerative, restorative, and reparative”. He said regenerative policies and circular supply chains are the distinction between net zero and net positive practices. 

Polman continued: “The net positive companies are companies that take responsibility for their total impact on society and all consequences, intended or not [...] Companies that are positioning themselves on this net positive path will be doing well. The ones that don't, I think increasingly will be heading towards the graveyard of dinosaurs.”

He said business needs to work out how companies can “profit from solving the world's problems” rather than “​​creating the world's problems”.

He referenced research by the World Economic Forum, which found moving to sustainable supply chain practices can reduce the costs in the total value chain by 9-15%. He said 90% of sustainable standards lower the cost of capital.

“The cost of not acting is actually higher than the cost of acting. And when that is the case, it becomes such an attractive economic opportunity.”

He said consistency was key in achieving net positive goals. 

“You have to be consistent in all you do. You cannot just claim and celebrate one area where you think you're wonderful and forget all the other things. For example, we see now companies making enormous climate commitments to reduce their carbon emissions, but then still sponsoring trade associations to advocate the other thing.

“How you behave on these top tough issues like tax or human rights, or money in politics, or trade associations, and salaries and all the other things, is a very important part of building that trust.”

Polman said for these issues to be truly addressed, companies must work together and form broader partnerships to meet sustainability goals.

“There are definitely many issues that companies are held accountable to, but cannot solve alone. Issues of recycling require all of us, the issues of deforestation require all of us, to name just a few examples. And once you work on these broader industry partnerships, you need to move even to the higher level, which is really partnership between companies, civil society and governments.”

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