After Rio, is a sustainability 'holding pattern' our best hope?

After Rio, is a sustainability 'holding pattern' our best hope?

It's tempting to use the peace after Rio to craft a single coherent summary of the week's events. But that could never do justice to the cacophony from the event that continues to ring in our ears. So let me fall back to the testimony of a dialogue between Pascal Lamy, managing director of the World Trade Organization (WTO) and Unilever's CEO Paul Polman.

There's a consensus that international negotiations are struggling to deliver concrete outcomes, whether it's at Rio, Mexico's B20/G20 summit or the continuing but stalled WTO negotiations. At a dinner hosted by the International Centre for Trade and Sustainable Development (ICTSD), Pascal Lamy said: "The economic crisis has shrunk political energy to act internationally" and triggered a "return to domestic agendas."

What he means is that, despite positive economic growth and continued globalization, the ongoing economic crisis has made it difficult for political leaders, even the willing, to support decisions that might harm their domestic standings by undermining short-term economic performance or the competitiveness of their domestic champions.

The consequence, Lamy suggests, is the hidden resurgence of protectionist behavior -- despite the overwhelming conviction across leaders that free trade is good for the world's economic growth, particularly for emerging markets. He does not appear optimistic about the short-term future of multilateral negotiations.

 

What do we do? Lamy recommends what he labels "a holding strategy" to at least avoid slipping backwards. Focus on the positive components of what many regard as a weak common declaration in Rio, the little concrete progressive steps. For example, trade negotiations around fossil fuel subsidies elimination and free trade facilitation for green goods and services.

Paul Polman's address and response began with the diagnosis that the economic crisis was in fact a crisis of ethics. Hence his affirmation of the fundamental management principle of refocusing business on morality and values and the need to reinvent a moral framework for capitalism. He also reminds us that leaders must "see the reality in the eye," noting having recognized or accepted that they are not the cause of the crisis, they should focus their energy on inventing the required innovative solutions.

And he also talks of courageous leadership: "we can decide what to do, we don't have to accept the lowest common denominator," as is reflected in Unilever's call for the elimination of "illegal deforestation." Or its proactive involvement in reinforcing food security and agriculture, a sector that is essential to consumer goods organizations and to world growth, since it accounts for 40 percent of jobs globally.

So what can we make of this apparent failure of multilateralism and the possible loss of the original and fundamental principles of capitalism, which Adam Smith tells us, unites profit and purpose?

The power of social media holds some of the answer, according to Ricardo Melendez-Ortiz, co-founder of ICTSD, who represented the views of many at the discussion. As stated powerfully by David Jones, in his book, "Who cares wins," social media will not allow inappropriate management behaviors -- from business, civil society or government -- to go unpunished. And that is as true in places like China as it is in mature economies.

As for the challenges of multilateralism, there was consensus that bottom-up approaches will be crucial. Business leaders must push their own initiatives to transform their economic model while political leaders progress on pragmatic or bilateral negotiations that can be implemented faster and more effectively without being held back by recrimination or a lack of a global political consensus.

Some would argue that a marriage of these two disruptive trends could lead us to more constructive outcomes in the long run. A more active and socially conscious public coupled with a myriad of pragmatic efforts may challenge the traditional epicenters of influence and the structure of global decision-making.

But that, perhaps, is welcome. Not as an alternative necessarily, but as a complement. The evolution and expansion of the network economy and of network-based negotiations will give rise to more virtual interactions between a greater multiplicity of parties.

Consider Rio+40 in 2032 and the possibility of a more dynamic roadmap and innovative push and pull process leading to a series of progressive outcomes that may be not fall into the well defined parameters of traditional negotiations, but which may nevertheless yield concrete results and underpin sustainable and inclusive growth.

Airplane holding pattern over Rio photo via Shutterstock.