On Our Radar: Fossil Fuel Divestment and Emerging Market Branding

07 Aug 2013 Rida Bilgrami

Greenpeace’s recent scaling of London’s Shard shone a light on the continuing lack of engagement by fossil fuel companies, but could targeting investors bring more tangible results? Photography courtesy of Sandison/Greenpeace.

Between traditional news channels, blogs, and social media, it can be hard to keep up with what’s making waves in the field of sustainable development. In this roundup we aim to cut through the noise with a handful of highlights that have caught our eye.

Fossil Fuel Divestment Gathers Momentum

Last fall, climate activist Bill McKibben’s organisation, 350.org. supported the launch of fossil-free divestment campaigns across cities and college campuses. Modelled on the South Africa anti-apartheid divestment movement of the 1980s, the campaign has reached over 100 US cities and 300 colleges. Similar versions are also taking hold in Australia, the Netherlands and the UK.

Storebrand, a Norwegian pension fund and life insurance firm, has announced its divestment from 19 coal and oil sands companies to “reduce fossil fuel and CO2 exposure and ensure long-term stable returns” for its members. These stocks, the company says, will be “worthless financially” in the future.

In The Guardian. Naomi Klein raises questions on the role of environmental organisations in the divestment discourse. She argues that some of the world’s largest green groups invest millions of dollars in fossil fuel companies and are not divesting their large, publicly-traded investments from these corporations. Following the recent move by six Greenpeace activists to climb the Shard in London in protest against Shell’s exploration in the Arctic, Alex Blackburne contends in Blue & Green Tomorrow that “divestment might be more effective than climbing a building.” Could Greenpeace’s protests have greater impact if its campaigns engaged investors by positioning investing in fossil fuels stocks as a myopic financial decision rather than continuing with its brand of “civil disobedience”?

Emerging Market Brands Sphere of Influence

In The Economist. Schumpeter spotlights a new book, “Brand Breakout” by academics Nirmalya Kumar and Jan-Benedict Steenkamp. The authors argue that emerging economy brands such as Haier of China, Natura of Brazil and Mahindra & Mahindra of India, are evolving into global forces to be reckoned by providing specifics about how companies in these markets are advancing.

In an article from the Financial Times Magazine. Simon Kuper offers a view that counters emerging market dominance. He posits that while Western brands are increasingly being bought by emerging market companies, the West still dominates the global discourse, especially on topics such as education and popular culture, and the gap is likely to widen. In order for emerging economy brands to exert the sort of cultural influence that developed countries have done for centuries, they need to broaden their approach by engaging with global consumers through language, freedom of expression, and the creation of an aspirational lifestyle.

At SustainAbility, we have been watching this emerging market space with interest, especially given the opportunities that brands create to engage and reshape fundamental values and mind sets. As important as it is to shift dominant Western cultural discourse, emerging markets need to utilize their brand power to engage their consumers in sustainable change. Changing Tack . a report recently launched by GlobeScan and SustainAbility, highlights Brazilian cosmetics company Natura as one company who is using its brand effectively to drive change. Its brand proposition conveys its environmental commitment to purchasing 30% of its inputs from sustainable sources in the Amazon and its core strategy to leverage socio-biodiversity as the primary innovation platform for its products.

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