Reports from Davos: Climate Change, Circular Economy, Ethical Supply Chains

The annual  World Economic Forum in Davos, Switzerland, brings together the corporate and political elites  – this year’s theme from January 20 – 23rd is “The Fourth Industrial Revolution”. Yet climate change ranks high on the agenda and several reports relevant to climate change and labour have been released. Notably, the Global Challenge Initiative on Environment and Natural Resource Security project  produced The Global Risks Report 2016  , which ranks global risks, in terms of likelihood as : 1. Large-scale Involuntary migration; 2. Extreme weather events   3. Failure of climate change mitigation and adaptation. A project about the Circular Economy released a report commissioned by the Ellen MacArthur Foundation and conducted by McKinsey & Company: The New Plastics Economy: Rethinking the future of Plastics . ( press release here ). The new report addresses the problems identified in a 2014 report from the UNEP Plastics Disclosure Project, Valuing Plastic: The Business Case for Measuring, Managing and Disclosing Plastic Use in the Consumer Goods Industry , which projected that, “ in a business-as-usual scenario, by 2050 oceans are expected to contain more plastics than fish (by weight), and the entire plastics industry will consume 20% of total oil production, and 15% of the annual carbon budget. ”

Regarding supply chains, a report by an Accenture consulting firm, Beyond Supply Chain: Empowering Responsible Value Chains   discusses the “triple advantage” of ethical supply chains which include environmental goals. The Accenture report paints a favourable picture of corporate behaviour, in contrast to Scandal: Inside the Global Supply Chains of 50 Top Global Companies, a hard-hitting report from the International Trade Union Confederation (ITUC). The ITUC focuses mainly on working conditions and wages, as well as health and safety of workers. Bringing it all together and released in advance of Davos, research from the University of Sheffield concludes that “ Audits are ineffective tools for detecting, reporting, or correcting environmental and labour problems in supply chains. They reinforce existing business models and preserve the global production status quo…. The growth of the audit regime is carving out an ever greater role for corporations in global corporate governance and enforcing an ever smaller role for states.”  A summary of the Sheffield research appeared in The Guardian  on January 14; the full report is Ethical Audits and Supply Chains of Global Corporations  (registration required to download). A related article, focusing on the coffee industry, appeared in The Conversation (December 1): “Why corporate sustainability won’t solve climate change ” .

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