Are Green Businesses a Myth? CSR and Biodiversity Conservation

This is an adaptation of an essay that was published in Conservation Biology titled ‘Common and Conflicting Interests in the Engagements between Conservation Organizations and Corporations’ by John G Robinson of Wildlife Conservation Society (WCS). In it the author examines the development of corporate social responsibility (CSR) practices within the corporate community and looks at what drives conservation NGOs to engage with corporations, and the risks associated with that engagement.

Summarized for Conservation India by Prema Naraynen.

How are the interests of Corporations and NGOs aligned? And what are the limits to what they can do?

Motions for CSR and NGO Collaborations

Businesses push to increase profits, which depends in part on minimizing costs, which often leads to increased effects on natural systems. Companies argue that by adopting Corporate Social Responsibility practices, they could achieve a ‘triple bottom line’ – i.e. accountable to People, Planet, and Profit.

What Corporations Say:

• Corporations defend CSR as contributing to the public good and, more importantly, to profits, if not in the short term, then certainly in the long term.
• Corporations justify collaborations with NGOs as necessary to protect their reputations and as a way to open up new markets, given the ability of NGOs to influence consumers.
• Development of best business practices and standards. For example, the International Council on Mining and Metals promotes standards (although they are far from being universally adopted) for mining and protected areas.
• Product certification provides another way to establish standards. NGOs engage with certification processes by providing a third-party perspective. In the case of agricultural commodities, for instance, Rainforest Alliance pioneered the certification standards for bananas in 1993 through their ECO-OK label.

An Economics of Ecosystems and Biodiversity (TEEB) Report explicitly makes this case: “Purely charitable approaches to nature conservation, based on appeals to moral, ethical, or religious values, are unlikely to mobilize significant private investment in biodiversity conservation in market-dominated economies,” and “conservation and commerce… must work hand-in-hand if biodiversity loss and ecosystem decline are to be slowed and ultimately halted.”

Motions against CSR and NGO Collaborations

• Within the corporate community, critics argue that CSR could hurt profitability. Corporations, they say, should stick to what they do best. The Economist argued, “The proper business of business is business. No apology required.”
• Outside the corporate community, critics claim that capitalism is turning the environmental problems it creates into opportunities for further commodification and market expansion. Corporate engagements with NGOs, according to this argument, are a cynical and self-serving ways to maintain access to resources, find new markets, and increase profitability.
• Some conservationists are concerned that as components of nature enter the marketplace, the asymmetries in knowledge, skills, and power tend to work against poor or otherwise marginalized people.
• There is also the belief that NGOs involved in such collaborations are selling out to corporations to get access to their money. This blurring of the interests of corporations and NGOs is most fully expressed in joint ventures, a form of collaboration that has ethical and reputation risks for NGOs because complete endorsement of the private sector’s business practices may be assumed.

So do CSR initiatives contribute to conservation?

• Some businesses, such as those active in carbon trading or ecotourism, do contribute positively to conservation. In other instances, companies may seek to offset the negative effects of their activities at one site by furthering conservation at other sites. Most businesses, however, consume natural resources, and CSR initiatives are limited to promoting the sustainability or minimizing the environmental effects of corporate operations.

Is the adoption of CSR policies changing the operations of individual corporations in practice?

• Few studies have examined the effects of CSR on corporate practices. These few show a significant gap between theory and practice and between policy and implementation.

Is CSR being adopted widely enough across the corporate sector to have a substantial conservation effect?

• The proportion of the corporate sector that has adopted CSR policies is still tiny.

Has NGO engagement with corporations contributed significantly to the adoption of CSR policies and practices?

• Because of their disproportionate effect on the world’s resources, NGOs have focused on large corporations. In his 2010 TED lecture Jason Clay, vice president of WWF, said, “One hundred companies control 25% of the trade of all 15 of the most significant commodities on the planet. We can get our arms around 100 companies. 100 companies we can work with.”

Finally, Interests in Common or in Conflict?

• The effect of CSR has been limited because a very low proportion of companies have adopted CSR practices and reported on them. The ones that have tend to be large and leaders in the field. There has been little empirical evidence that engagement with corporations to promote CSR is an effective strategy to conserve biological diversity. The case for mitigation of negative environmental effects however is stronger.
• The focus of corporations on sustaining economic growth rather than conserving natural resources is unlikely to shift; to make such a shift runs counter to making a profit and shareholder interests. Without legal requirements and enforcement of CSR, corporations are unlikely to change corporate behaviour.
• There is a role for consumer activism and social movements to prod individual companies and whole corporate sectors in more socially and environmentally positive directions, but the control exerted by the private sector over information flow through advertising and media control make this a limited option.

Ultimately, conservation organizations should engage with companies but should not rely on them to meet conservation goals.

ROBINSON, J. G. (2012), Common and Conflicting Interests in the Engagements between Conservation Organizations and Corporations. Conservation Biology. doi: 10.1111/j.1523-1739.2012.01914.x
The full paper does not have free access.