Discussion Dinner with Professor Robert Ecces, visiting professor at the University of Oxford’s Saïd Business School,
12 October, Sidney Sussex College, University of Cambridge
Following an engaging public lecture in Cambridge on how ESG (Environmental, Social and Governance) issues have become politicised, the CCE hosted Bob Eccles, visiting professor at the University of Oxford’s Saïd Business School, for a discussion dinner at Sidney Sussex College, Cambridge, on 12 October 2023. Bob has advised governments, intergovernmental organisations and businesses on integrating sustainability into corporate and financial objectives, and his work has received both academic acclaim and media publicity. Experts from academia, law and business joined Bob to reflect on topics discussed in the lecture and consider how different levers can drive climate action in companies, particularly on corporate boards.
Bob’s experiences of discussing climate change with Republican lawmakers were interesting to attendees and may help inform ways of approaching similar conversations in the UK as sustainability becomes more politically divisive. This discussion was also important to attendees as American politics can have implications far beyond the country’s borders, as evidenced by global withdrawals from sustainability collaborations being partly driven by political pressure in certain US states.
Moving beyond the political conversation, attendees delved into the range of mechanisms that public and private sector actors can take to drive corporate sustainability. Sustainability reporting and disclosure requirements have become a legal requirement in many jurisdictions and are increasingly familiar to corporates. Some attendees questioned the extent to which these rules have made an impact, pointing to evidence demonstrating that even companies that report their climate impacts often fail to achieve meaningful emissions reductions. Others argued that we cannot expect significant results so quickly after these practices have become commonplace, as behavioural change will occur when businesses more fully grasp their impact on the environment.
On the subject of directors’ duties, to which the CCE has paid close attention given its links to board directors around the world, guests agreed that board directors must consider the organisation’s exposure to climate risks in order to fulfil their obligations to the company. However, cases brought on these grounds in the UK have not been successful to date, and practitioners in the room suggested that the way these duties are discussed in the boardroom does not always align with the theoretical framework. It may be easier to show a clear link between systemic risks like climate change and the success of investors with portfolios that span across the entire economy, sometimes known as ‘universal asset owners’. Staying on the topic of investment, and reflecting on some of the debates around the term ‘ESG’ that Bob has witnessed from both sides of the political aisle, attendees further considered the impact of green taxonomies and other rules aimed at providing clarity to those who wish to make sustainable investments.
By bringing together experts from an array of fields and backgrounds united by sustainability goals, the CCE gained valuable insight into many complex debates influencing climate action in companies. In 2024, the CCE will continue to explore multiple threads of this conversation, including through in-depth discussion and writing on legal issues impacting sustainable finance, working with directors to understand how the mechanisms discussed can be better implemented on boards in practice, and analysing how policymakers can support corporate sustainability in the UK and in other jurisdictions across the world.
Slingshot