Business Day (Johannesburg)

12 June 2002

South Africa: Revisiting Sustainable Development Concept

Johannesburg — Environmentalists worldwide march under banner of idea that is, in fact, flawed

IT's hard to contest the virtues of sustainable development, the banner under which environmentalists march these days: it's good for the planet, it's ethically correct, and it's now irreversibly rooted in the policies of the industrial world.

However, since we shall have our brains washed with the concept over the coming weeks with the Johannesburg Earth Summit, it behoves us to treat it with caution.

Not least of the many problems associated with it is that it does not brook dissent: sustainable development is so self-evidently "good" that it escapes rigorous scrutiny.

But sustainable development is a flawed concept. First of all, what do we actually mean by it? A handy definition is organising human activity so that it does not impoverish the planet for future generations.

But, by its very nature, human activity consumes resources. To be sure, you can consume less of things, or replace them with renewables. However, you can never make sustainable development anything more than a relative concept. Humanity will always leave its mark.

The vagueness of the concept also raises questions about the value of events like the forthcoming summit. Where is the line drawn on sustainable development? At environmental issues (managing of resources), economic issues (placing a value on sustainability)? Are human rights, poverty and globalisation included? If so, where do you stop?

The agenda has got so wildly out of hand it has lost any sharpness. Come August, Johannesburg will be packed with activists confusing the debate. One reason for the modest results of the original Earth Summit in Rio in 1992 was that the "action plan" it produced was so vast it gave little spur or guidance.

However, even narrowing the concept down to the core issues of economics and the environment, does it make sense to strive to make the world more "sustainable"?

Somewhere within the sustainable development movement there lurks, I suspect, a fear of change and an absence of trust in the ability of nature and humankind to adapt. To press for sustainability is to try and slow the process of change.

Some may say that that is not a bad thing. But change is deeply rooted in nature, it lies at the heart of evolution. We should not fear it, but view it as a driver of progress.

Despite all the fears one hears about "the day the oil runs out", that is the last thing that will ever happen. The world will have moved on from oil long before the last drop is sucked out of the ground. To try to stop change will create greater distortions and damage than allowing change to happen.

My other main reason for doubting the value of sustainability is it does not engage man's true nature.

We are all willing to support its goals, but the great majority of us will not make the personal sacrifices necessary to achieve them. How many of this newspaper's readers are driving their cars less, turning off the tap while they brush their teeth, or buying electricity off wind farms?

More especially, sustainability will fail to engage the business community. That is a bold prediction because, at the moment, things seem to be moving the other way. More and more companies are committing themselves to "corporate social responsibility" and adopting "sustainable" practices. The ethical stock indices are proliferating, ethical funds are growing in size.

But much of the activity is driven by public relations rather than real commitment. And many of the companies taking that route have not fully thought through the implications if sustainable practices conflict with the creation of value for shareholders, which they frequently do. When that crunch comes, those companies will face tough choices.

By the same token, investors will have to think hard if investment in "ethical" companies fails to deliver superior returns. And so far, there is little evidence it does. Companies with a high ethical reputation do not enjoy any "green premium" on the markets, and the performance of ethical indices is patchy.

But there is another sense in which sustainability is incompatible with business.

There is a belief in the sustainability movement that businesses move along a fixed track: that makers of piston engines will always make them, light bulb makers will always make light bulbs, and so on. This produces the argument that piston engine makers and light bulb makers will one day wake up to find that their markets have been killed off by global warming.

The real business world is rather different. Far from operating on a fixed track, it is in a constant process of adaptation and change. Business success comes from spotting new opportunities and shutting off ones that look to be dying. The reality of the stock market is investors are looking out for companies that can make better mousetraps, or develop keener strategies than rivals, not necessarily ones that can go chugging on for ever. And if "sustainable" firms earn no reward in the stock market, why should they bother?

The danger in the drive for sustainability is that it will impose huge costs on society in the form of additional taxes and regulation that will produce only marginal gains. It has been calculated, for example, a tenth of the money needed to fight global warming would solve global health and sanitation problems.

If our aim is to make the world a better place to live in, let us get our priorities right. Sustainability is neither practical nor desirable as it would entail devoting vast sums to a vague and unachievable concept.

If Johannesburg is to make any contribution to this debate it can by bringing some hard-nosed realism to our environmental priorities, and how we should confront them: a brief and practical plan. To conclude with yet another giant action programme to satisfy the burgeoning sustainability agenda would be little more than a waste of time.

David Lascelles is a former Resources Editor of the Financial Times, for whom he covered the 1992 Earth Summit in Rio de Janeiro.

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