Profiles of Paris: Steve Howard on helping business be a force for good
Steve Howard, business leader and campaigner
Do you think business can be a force for good? I believe the answer is yes: I would like to share why and some lessons I learnt from my time in IKEA Group and setting up the We Mean Business coalition.
I joined IKEA to see if I could help a global business get on-track to be sustainable and to have a positive impact on the world. Not a little bit sustainable. Not just do some nice things alongside the business, not greenwashing, but to embed sustainability right through the core of the business. In my interview with CEO Mikael Ohlsson I remember saying, “if you want to be incrementally less bad I am the wrong guy, if you want to be transformational and good I might be the right guy.” Mikael smiled warmly and we had an instant understanding.
I left IKEA a few months before writing this and will do my best to be objective. IKEA is a great business, quirky, with very much its own way of doing things, but still great. The Swedish-influenced culture is strong and I was the first external hire into the executive team. This was not the place for an outsider to start with a hundred-day plan. I spent a year immersing myself in the business. I shut out much of the outside world, and spent my time getting to know the business, in stores and factories, with designers and business leaders and with my team. We asked co-workers about sustainability and they wanted us to help customers, to sort out our own backyard and to take leadership in tackling global problems. We sought to answer the question, what are the bold steps that IKEA could take to transform itself into a sustainable business and make a difference for customers and society? As our response in 2012 we launched People and Planet Positive, the IKEA sustainability strategy.
For sustainability strategies to succeed they need to be anchored in the core of the business, they need to drive profitability, growth and innovation. We committed to invest in and produce as much renewable energy as the energy we consume, turning energy from a cost into a profit center, we said we would switch to selling only LED bulbs, and that we would quadruple the sales of products that help customers save energy, water or reduce waste. We went on to set 100% targets for sustainable supply chains like cotton, timber and seafood. We launched veggie balls and retail solar PV, and we ended up owning more wind turbines than stores. It was a blast. The business made huge steps and I am proud of what many co-workers made happen. However, whilst there were other great companies out there pushing sustainable boundaries there is a limit to what any one business can do acting alone.
Before IKEA, I had set up the Climate Group. We had built coalitions of cities, states and businesses committed to climate action. When I co-founded the Climate Group in 2003 there were just a handful of organizations in the space. I looked out from inside IKEA ten years later and the world had become crowded with climate initiatives: many worthwhile, but few at scale. We were losing the war, time was running out and it was clear we needed to try something different. I called friend and fellow CSO Hannah Jones at Nike and said I think we need a super-coalition — will you help?
Hannah and I reached out to others, to leaders at the Climate Group, Ceres, WBCSD, BSR, and CDP, CLG and the B Team. Some of us met at the fringes of Climate Week NYC and then in October 2013, this group of busy people travelled to a small hotel in Wassenaar in the Netherlands to spend a weekend planning something different. We understood the problem: policy change is difficult and a small but powerful group of businesses and associations were deeply hostile to climate action and were out-spending and out-lobbying everyone else. Their message was simple, “the science is uncertain and we have brought you prosperity so limit carbon and you will destroy jobs and the economy”. In contrast, the climate action community’s messages were many and complex. Politicians, negotiators and policy makers believed that business was at least as much against climate action as for it.
Dominic Waughray and the WEF team supported us (a lot) at Davos where we met again. (The WEF team through initiatives such as the Alliance of CEO Climate Leaders have been hugely effective in promoting business action on climate). We reached out to other business leaders, friends in Unilever, Marks and Spencer, DSM, Swiss Re and others. We talked through our plans with, Andrew Steer at WRI, Kumi Nadoo in Greenpeace, Sam Smith in WWF and Sharan Burrow from ITUC and Christiana Figueres in the UNFCCC. Sam had worked with the Climate seven group of NGOs and was generous with her advice on coalition building. We met as a group with the climate seven. We needed to make sure that if we had a super business coalition on climate change that it was genuinely credible with civil society leaders and transparency was absolutely key.
We worked out we needed three things. Firstly, a common narrative, simple and compelling: the science is certain, we can cut carbon, grow the economy, generate new green jobs and the path to prosperity is low carbon. Secondly, we needed to demonstrate leadership through meaningful business action at scale. And finally, we needed to shape a common policy ask that all organizations and forward-thinking businesses could get behind: that would make it simple for policy makers to grasp what business wanted.
We said we needed a coalition, not a new organization. Coalitions can drive scale and efficiency but they also create new initiatives, whilst the staff and resources of partners are already committed. And we knew we needed a secretariat to glue the coalition together: which meant we needed funding. I spoke at length with Per Heggenes at IKEA Foundation and he could see we had a powerful idea. Per gave me a slot of the limited time at his next board meeting. The board was-well primed on climate change but it was not the focus of the foundation at that time. I remember walking in, they were running a few minutes late. One board member gave me a friendly growl “you’ve got seven minutes.” I remember saying, “seven minutes to save the world, we’d better get started.” A few minutes later the board agreed to 20 million Euros. We had discussed that if Paris failed we didn’t want to ask ourselves had we done everything we could and that if we had the means to help get the deal done wasn’t it our responsibility to do so.
That swift non-bureaucratic funding decision meant we could quickly set the secretariat up. When you have to move fast there is little or no time for mistakes. I asked people I really trusted if they would step up and amongst others Jim Walker bravely agreed to be seconded from the Climate Group as secretariat CEO, and Callum Grieve, who I had worked with on the launch of Climate Week NYC a few years before, stepped in on communications.
We Mean Business launched at Climate Week NYC 2014. Together with the new IKEA Group CEO Peter Agnefjäll, we joined the Climate March, with other business leaders from Virgin, Unilever, NRG, Patagonia and many others. IKEA colleagues promoted the People’s Climate March on the IKEA home page in twenty countries. We had reached out to business contacts everywhere. Tim Cook from Apple joined us on the Climate Week stage to be interviewed by Christiana Figueres.
We needed powerful initiatives to cut through the noise. At IKEA, I had learnt the power of 100% targets. The day after we agreed to transition to 100% LED lighting we cancelled a plan to invest in slightly better compact fluorescents: all the effort of the business went in to improving LEDs and over four years we transformed the performance, lowering the price by a factor of ten and increasing sales by more than one hundred-fold. I can’t emphasize enough how much I like the clarity of 100% targets: if you are trying to drive transformational change it is an incredibly useful approach. With a 50% target are you building the future or defending the past? Even with a 90% target more than 10% of the business wants to be in the 10% that doesn’t have to change, because change is hard. When you set 100% targets it is clear what success looks like, you are going all in.
At IKEA, we had been in discussion with The Climate Group about a big push from companies to go for renewable energy and we were keen that we set the bar high at 100%. A few months later together with The Climate Group, Mars, Swiss Re and ourselves we announced the RE100 at Climate Week NYC as a flagship initiative for the coalition. I remember telling my counterpart at Mars we would be lonely on the stage at Climate Week if it was just Swiss Re and IKEA. The team at Mars did some heavy-lifting to get a quick decision internally for which I am grateful. It is no small task to commit a large corporate to 100% renewable energy.
As I write this over 130 companies have joined RE100 creating demand of around 162 TWh per year of renewable electricity: more than Poland or Malaysia and there are a similar number of companies with strong renewables targets alongside. Companies like IKEA, Google, Mars and Walmart are competing on renewable energy. Apple, Unilever and others have spread the renewables commitment across their supply chains. Radical, rapid change is possible.
Alongside We Mean Business, Hannah and I had been working with the communications and campaign organisation Purpose to set up a climate campaign lab. We wanted bold breakthrough messages that people would mobilize behind. Purpose were looking at the creation or amplification of ownerless memes and 100% renewable really caught their attention. It got wider traction. And on the final run up to Paris “100% Renewable” got lifted even further and became the call to action for Greenpeace, Avaaz and others. Hundreds of businesses and civil society organisations with the same message so loud and clear you could not miss it.
At the beginning of 2015, Jim Walker moved to manage the coalition’s funding and Nigel Topping jumped from CDP into the CEO role for the secretariat. The coalition partners doubled-down, supporting each other’s initiatives, encouraging companies to set science-based targets and step forwards, to join RE100, to commit to positive advocacy. The business community responded. They could see a broadly supported platform of credible actions. It helped clarify what business leadership on climate should look like. As I write this in March 2018, more than 700 companies, with a market capitalisation of over US$15.7 trillion have made more than 1,170 commitments. Over 390 companies have committed to set science-based targets consistent with keeping warming well below 2 degrees: these are not easy commitments to make but they have become the new normal.
A year before Paris I spoke to my super-assistant and said, let’s do what is needed for the business but if there is anything, anywhere, anytime we can do to help get Paris done let’s do it. After all you don’t tend to regret what you do rather you regret what you didn’t do. And it is not to believe that our individual actions tip the balance by themselves, but that the actions of many do. It may sound trite, but collective action challenges like climate change require collective action.
The June before Paris there was a climate finance meeting of negotiators in Bonn: negotiations were slow. After the decision on We Mean Business, the IKEA Foundation board had just decided to double its annual funding, with an extra 100 million Euros per year going to climate change by 2020. Alongside an IKEA group commitment to a further 600 million Euros into wind and solar energy we had a commitment of 1 billion Euros to finance climate action by 2020. Real, additional money. We announced the 1 billion Euros in Bonn. Yes, the press coverage was good, but we did it for the moment, to put positive pressure on governments.
We went to the Abu Dhabi Ascent: the pre-COP summit in January 2015. The dialogue between ministers and the private sector was a little limited. From memory, I think it was only Paul Polman (who was absolutely relentless on the run up to Paris) from Unilever and myself that spoke in plenary from the business community. The message was clear, business innovation and investment and good government policy and incentives could solve climate change and tackle jobs. For a business leader I made the rare interjection of saying, “you can regulate us, you can price carbon, you can tax us, but make it long, loud and legal.” We needed policy makers to understand, businesses do not like bureaucracy and red tape but they do like long-term well-designed policy frameworks that you can plan on and invest in.
My colleagues in IKEA France wanted to connect the negotiations to people on the street. They lit the Champs-Elysees with LEDs, with a solar array and a wind-turbine. There were installations where people could generate power on bicycles, roundabouts and treadmills. It was a joy to watch.
By the time of Paris the coalition partners were in lock-step. Ed Cameron from BSR (with great support from the policy folk in CLG, CERES and other partners) was working as policy director for the coalition and had worked across the teams to craft a business brief with 8 common policy asks. Business leaders were supported and the forward-thinking business community had a common message for negotiators. I have just looked back at the coalition WhatsApp from Paris. A group of individuals from different organizations worked relentlessly as one team. There was total focus on the result. If a business voice was needed to meet a delegation, make a statement or make a phone call they found one, if a press conference was needed they did it. It was an incredible effort from an incredible team. Many, many, business leaders worked either on the stage or behind the scenes.
This was not all easy. Coalitions are hard. Organizations compete for members, funding, staff and share of voice. We knew there was a fierce urgency of the moment. We knew we were likely to fail if we did the same thing as before. The issue had to come first and organizations second. We were clear we were setting up a coalition not a new organization. We had to build the plane while flying it and co-creation built shared ownership. We understand our purpose and actions with a common narrative, an action platform of initiatives delivered by the partners and common policy asks. Busy people invested the time to meet to build deep trust and relationships. As independent co-chairs Hannah and I could help remind everyone of our objective and resolve any difficulties: I am hugely grateful to Hannah (who stepped down as co-chair last summer). A high-caliber secretariat, that could hit the ground not just running but sprinting, was essential and needed to be one of the strongest links in the coalition chain. The partners’ collaboration is deeper today than ever and would continue even without coalition funding. That said it is clear solid funding is a massive enabler. This may sound over the top but the continued collaboration in pursuit of a greater goal gives me hope for the future.
We were on the winning side. Paris was a huge step forward. Together we have done an amazing job, but it is still not enough. But we need to double down again. We need every major business to step up.
So, can business be a force for good? Yes of course it can. But it can also fight hard to defend its short-term interests. Forward-thinking businesses have to be at the table and policy makers must continue to set ever more ambitious long, loud and legal policy frameworks. Today, more than ever, leadership is distributed. As we go forwards I believe we need deep and transparent dialogue between business, policy makers and civil society: not meetings behind closed doors.
If you look at the Paris Agreement Paris and across the Sustainable Development Goals there is huge scope for coalitions like We Mean Business that can help us create common action platforms and deliver breakthrough scale.
We risk this century being defined by climate change, resource scarcity and inequality. But the future is not written and this can be the century in which we end global warming, act as stewards for life on earth and create a society where no one gets left behind. It’s our choice.
Some Thanks and Acknowledgements
I cannot tell the story of a coalition, where I have been one amongst many, without acknowledging some of the many people involved. My apologies for keeping it brief and leaving many people out. As the phrase goes, “success has many parents.” It is a phrase I live by because, at scale, change is truly a team sport.
Before thanking the coalition, I have to thank IKEA colleagues. There were hundreds of people across the business engaged in IKEA’s efforts. And the team (and board) at IKEA Foundation have been incredible. Our communications and public affairs teams were fantastic. Peter Agnefjäll and Derya Völlings, Heleen Vink and Jamie Rusby deserve my special thanks. The team in IKEA France did a particularly awesome job.
In We Mean Business, Jim Walker played a critical role on the initial set up and on deploying funds fast and effectively. Key people in the secretariat were seconded to the coalition or released by the partners at short notice, Nigel from CDP, Jim from the Climate Group, Ed from BSR: these are generous acts.
Nigel Topping has been a true leader in the challenging role at the heart of the coalition whom I simply cannot thank enough. And the secretariat team are relentless.
My greatest thanks go to the leaders of the partners, to Mindy Lubber, Peter Bakker, Aron Cramer, Paul Simpson, Raj Joshi, Keith Tuffley, Sandrine Dixson-Declève, Mark Kenber and Helen Clarkson. They took a risk. They took a more challenging path than going alone. Many others across the partners have played key roles, Leah Seligmann and Jean Oelwang, Anne Kelly, Jill Duggan, Eliot Whittington, Damian Ryan, Lance Pierce and Maria Mendiluce.
Others deserve our thanks for their partnership and encouragement, Andrew Steer at WRI, Kumi Nadoo then at Greenpeace, Achim Steiner, Dominic Waughray and the WEF team, Sam Smith and colleagues in WWF, the wider climate seven, Sharan Burrow from ITUC for always building bridges and community and Christiana Figueres and the team at the UNFCCC for creating space.
My last thanks go to the thousands of business leaders who have stepped up to take action on climate change. Far too many to thank here. Through their actions we have shown that together we really do mean business.