# Triple Bottom Line Reporting

*Exported from [Holy-Writings.com](https://www.holy-writings.com/) on 2026-06-20 — 1 clipping.*

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> Source: Bahá'í Library Online (bahai-library.com), curated by Jonah Winters. Used by permission of the curator. Original citation: Robert Rubenstein, Triple Bottom Line Reporting, bahai-library.com.
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> 
> TRIPLE BOTTOM LINE REPORTING
> 
> Mr Robert Rubenstein
> 
> © EBBF, 2001
> Friday 26-10-2001
> 
> This is a transcript of the lecture as it was presented at the conference
> and has not been edited for content or grammar.
> 
> *****
> 
> “My focus is to make sure they feel continuous, excruciating pain. And I do that by
> allying with the financial market. So, they have the money, they’ve got the power, when <not
> audible> was mentioning that UBS and access centre CEO’s there, that might not say very
> much to you, but those two companies combined have about nearly three thousand billion
> dollars in assets, those two, just those two. And if you look at the top twenty five asset
> management companies in the world the number one is twenty five hundred billion dollars
> (that’s the Japanese postal bank system), then it’s UBS, then it’s <not audible> and it goes
> down… you get to twenty five or thirty and it jumps to thirty billion dollars. So the whole
> financial world is really controlled by a very, very small group of people. I can influence that
> because there aren’t that many to influence – that’s why I do the conference. So, that’s why I
> focus specifically on the finance community, and I’m going to give a short talk about triple
> bottom line or triple bottom line investing, which is basically looking at a company in a
> holistic way, looking at their social impact, weighing what is the social performance of a
> company, looking at their environmental performance, what is the environmental performance
> – I agree totally with the previous speaker except the fact that the airline industry is subsidised
> eight hundred billion dollars a year. So you are all paying for airlines, by, if you buy a bicycle
> in this county, there is nineteen per cent sales tax – if you buy a plane ticket, there is no sales
> tax. If you buy a litre of gasoline for your car it’s about two and a half Guilders a litre, if you
> buy a litre of kerosene for the airline, it’s about fifty cents a litre. So, under those conditions
> of course there’ll be growth, but if you did it the other way, and you say ‘well, let’s take away
> VAT for cars’, we’ll take away sales tax and tax for gasoline’, there’d also by a lot of car
> sales, and a lot of traffic. So the growth of the tourism is very, very heavily subsidised,
> particularly airline industry, so that’s the only thing I have an exception – for the rest I totally
> agree with everything that you said.
> So, that is the concept of the triple bottom line – looking at a company, their financial
> performance – they have to make money, you know, having gone bankrupt myself twice,
> that’s the most irresponsible thing you can do – so, I know that – you have make money, and
> you also have to improve, at least, the social and environmental performance. Many
> companies are saying ‘we’re socially responsible’ – because they don’t know what it is. They
> want a very, mediocre, low- level definition of what is responsible business. And the
> fundamental classic definition, which I’m sure you work with, is basically; are your products
> and services worsening, maintaining or improving the social/environmental balance?
> If you’re not improving it, in my eyes, you are not responsible. If you’re maintaining it
> at best, you’re not really a criminal, but you’re certainly not resolving the problem. And most
> companies, ninety five per cent, are worsening it. They are not maintaining the balance. Most
> companies are worsening the social/environmental balance. You know, when you consume
> and produce there is a lot of pollution.
> So the forces that are pushing this whole corporate social responsibility, or triple
> bottom line, are three: finance, personnel, (so the value of the shares, or the value of the
> company if you look at it in a little bit more enlightened way, personnel – finding and keeping
> the best and the brightest) and reputation. I can influence finance and personnel by focusing
> on those twenty- five super tankers, and I teach at some MBA schools, and if I get through to
> students that about the strategic importance of sustainability, I give them a questionnaire, next
> time you go for a job interview, you interview the interviewer, you try to find out what are the
> values of that company. Usually international MBA’s are very, very highly wanted large
> multi- nationals, so if that only happens two or three or four times, that recruiter reports back
> to the director and says ‘there is something strange going on, the re are students who don’t
> want to die rich, and there are students who are not really motivated by a big car’.
> Reputation I can’t influence. That’s a factor of many, many, many, many pressure points, but
> for finance and personnel, I can influence, particularly finance.
> Let me go through, just briefly, what is happened in the last year, which is pushing this
> whole movement very rapidly, in spite of the fact that the media has not discovered this – this
> is probably the largest quite revolution going on, and it’s encouraging to hear there are some
> positive things also happening.
> There’s been massive, but I really, massive growth in responsible investing, or triple bottom
> line investing. In some countries, like <not audible> management are starting five or six funds
> in the last year, UBS has started quite a few funds, the pension funds are shifting more and
> more of their money towards green funds, not because they want to save the world, because
> the more they know about a company, the lower the risk. Some of them actually believe that
> there is no point in having a pension if you can’t breathe, but in general most of them are
> understanding that it’s an issue that there’s the man from the consumer, and the more we
> know, the lower our risk. And also they looked at the figures that in the worst case some of
> these funds do just as well, and sometimes they do better, so why not. So, there you’re seeing
> on the retail side, institution side, massive growth. You’ve had probably the most important
> legislation ever created in the world, in the UK about twelve or fourteen months ago, which
> said to pension funds, ‘you do not have to invest your money responsibly, we don’t require it.
> You just have to say whether you’re doing it or not’.
> So when you require pension funds, whic h, you know, own most, a lot of the shares on
> the stock market, that you have to say ‘we are screening our investments, we are investing our
> money responsibly’, it’s politically incorrect to say ‘we’re doing nothing’. So by actually that
> law, had a dramatic influence in creating the groundwork for getting a shift in the mentality of
> the pension funds. I’m not saying that they’ve all shifted all of their money everywhere - that
> will not happen that quickly. You have people invested in private equity, you have people
> invested in real estate, you have people invested in bonds, you have people listed in the stock
> market, so it’s going to take a long process, but the fact that many of them came to Rotterdam
> - you would have never, ever seen that type of dialogue before. It’s becoming a very
> important issue for them. France changed their pension law. I’m still trying to figure out is
> there an SRI coefficient in there, but there is some wording about responsible investing.
> Germany changed their pension law. Australia requires now companies to invest pension
> funds, to invest money responsibly. So you’re going to see in the next five years, what was
> very, very small market of maybe five or five billion dollars, or ten, you’re going to see going
> up to five hundred and eight hundred billion Euro. So that tidal wave of money is going to put
> massive pressure on companies that I can do a thousand lectures at (no Exxon is bad example
> because they’re not interested at all), but let’s say Dupont: One phone call from the head of
> financial investment from the capital group or UBS asking ‘may I please see your
> environmental audit externally verified, and your social audit externally verified’ has much
> more impact. You get their attention. They wake up. The problem comes, is that when they
> wake up and they call their accountant, KPMG or Cooper, and say ‘send us your best people’,
> if you add up all, globally, all of the qualified consultants to carry out the institutionalisation
> of this process, they are not there. So those companies that started late, are really late. That’s
> another pressure point. That’s another fear factor. You’re not going to get companies to do
> anything unless they feel pain. As much as you’d like them to do the right thing, they won’t, if
> they were going to do the right thing they would have done it a long time ago.
> You’re having also success of some of the investment funds. Reputation is becoming
> incredibly important to companies – they can build up their reputation for twenty- five years
> and lose them in ten minutes. So the larger the company is, the more vulnerable they become.
> You’re having consumer demand is rapidly increasing. The EU is rather unique in the
> world. The EU is fundamentally funding many, many, many projects on responsible
> investing. They are the only government organisation I know in the world that is funding a
> network for social responsible investing for Europe, the European Social Investment Forum is
> funded by the EU. They’re funding a large research project, which we’re part of, to develop a
> better model to determine a company’s responsible as triple bottom line. They’re funding a
> guideline for all the screening organisations to determine that they have to work in a certain
> way. It’s very, very unique, its not really being publicised very much, but they’ve put up
> twenty two million Euros to get this process moving. And if you know that, if you speak to
> any screening agency, the total amount of money needed to do a proper establishment, of
> getting a better model, is between five and seven million dollars. And then you can
> immediately screen all of the companies properly. It’s a very small amount of money, and the
> EU is putting up twenty two million Euros toward that.
> You’re also seeing, finally, some private equity funds starting, venture capital
> organisations starting to invest their money according to sustainability principles, or triple
> bottom line. Kioto went through without the US, which I was quite sure that it would, but it
> went through, and the large ECO was not at the table, but it still went through. That
> happened also last year.
> There’s a screening guidelines project going on from the EU at the moment. They’re having
> also; trade unions are finally discovering that they have a lot of social capital. That all of their
> money that is tied up in pension funds, they’re deciding now ‘well, if we don’t want a French
> company to build a pipeline in Burma, should we not load the ship? Or should we divest our
> money from that company?’. So, that is also happening now.
> All of that is developing – so you’re having this very, very rapid moving calice highspeed train. And business is riding in an oldish vo in front of the train. They are just totally
> out of touch with what is going on, and believe it or not - you probably won’t – the finance
> community is way out in front. Finance is much further than business, and government,
> except for the EC social employment, is behind. That’s kind of the groundwork that’s going
> on now. It’s very, very encouraging because when I, you know, three years ago, I could n’t get
> anybody who was really managing any serious money, to come. Now they’re calling me –
> ‘we want to come and tell you what we’re doing, we’re moving much further, and we want to
> do micro-credits, etc, etc, etc’.
> 
> (Audience member: “What about the green paper?”)
> 
> The EU likes those types of statements, but they’re not always in touch with reality.
> I’ve been trying to get the Dutch government. Holland, eight years ago, had a very large lead
> over the rest of Europe – they’ve gone from second place to about eleventh place with relation
> to sustainability, because this government is not interested, you know, so I think the issue is
> forcing companies to be transparent. You can’t legislate that they have to be responsible
> because then you have to quantify that – I don’t think a government is able to do that yet
> because there are a lot of screening agencies that can’t do that yet. So what I think is more
> needed is requirement of procurement from government – don’t buy from companies that are
> blatantly being irresponsible and require pension funds, and asset managements to be
> transparent as to whether they do or they don’t invest their money responsibly. Don’t require
> them to do it, but let them be very frank, whether they do it or don’t. And then the market will
> beat them up because the market, you know, as horrible as the world is, the market is moving
> into the direction of sustainability – there aren’t any companies that I know of who wants to
> pollute more, who wants to use more energy for the same amount of turnover, who wants to
> exploit more people, who wants to have more child labour. No company I can think of,
> perhaps some of mafia involving toxic waste transport, is concerned about that, but most
> general companies are not interested – they’re not going in that direction. For that, it’s very,
> very interesting.
> Then we had the World Trade Centre bombing (show’s picture) I don’t know if you can see
> that. It’s next to the Brooklyn Bridge. And that should have been a very powerful signal that
> we need much more social investing. You know, there’s no point in going after mosquitoes –
> you’ve got to clean the swamp, drain the swamp, clean it, plant some trees. So, unfortunately,
> that’s not being talked about very much now.
> The market went down, so there’s a lot of panic, in spite of that panic, we have the largest
> turnouts we’ve ever had. Maybe because the finance community has discovered it’s in their
> interest – it’s in their interest to invest their money like this – the consumer is demanding that.
> They haven’t got the complete mandate; earn less, but make the planet more habitable. They
> haven’t got that mandate yet. But, that’s a question of communication to people who have a
> pension, or people who invest – you can do both.
> I’d like to read one quote as a reaction to what happened:
> 
> “ It is of vast importance that our people reach some general understanding of what the
> complications really are, rather than react from a passion, or prejudice, or an emotion of the
> moment. It is virtually impossible, at this distance, merely by reading, listening or even seeing
> photographs, or motion pictures, to grasp, at all, the real significance of the situation. Yet, the
> whole world of the future hangs on a proper judgment. Possibilities of disturbances arise as a
> result of the desperation of the people concerned. There could be no political stability and no
> assured peace without economic security, and that US policy was not directed against any
> country or doctrine, but against hunger, poverty, desperation and chaos.”
> 
> George Marshall, 1947
> 
> So, we do need a Marshall planet. The US was smart, after paying their dues, put up
> fifty billion dollars, Europe chipped in fifty billion dollars, Asia put in fifty billion, every
> year, because the amount of money is, as I said, eight hundred billion dollars a year for
> military, and it only costs (I have the figures here - 1998); nine billion dollars would provide
> water and sanitation globally. I’m talking about nine billion dollars NETTO, I’m not saying
> billion dollars given to the government, and it filters down to hundred million dollars –
> NETTO. If you spend nine billion dollars, twelve billion would cover reproductive health,
> thirteen billion would provide basic health for everybody, and six billion basic education.
> If you realise that in many places the only education provided – in places in Pakistan - are the
> ones that are being indoctrinated into violence. So if you can’t have any education you’ll go
> the other way. So it’s very cheap. And a war’s expensive – peace can be very, very cheap. So,
> from an investment point of view, it’s much smarter shifting a small amount, and you would
> probably win over more hearts and minds. Where we are now with respect to this whole
> process, if all this money is going in this direction, and the finance community wants to do
> that, then they also want to know ‘well, how do I know if a company is actually performing
> socially and environmentally well?’ That is where the major weaknesses occur now. If you
> listen to the screening marfio, the screening organisations, they believe they are doing a
> wonderful job. And it is a very poor, inferior job they are providing. And it was OK, you
> know, when it was five million dollars, or five billion dollars, but when you’re going into five
> hundred billion Euro – that’s very serious money, and when a pension fund says ‘we invest
> our money responsibly’ they don’t want to see on the headlines somewhere that the company
> those chose is actually a horrific polluter.
> So the method that’s used now, I call the O.J Simpson method, which is basically selfassessment. I send you, as a corp. multi- national a large form, and there are two people, or
> three for a company of three hundred thousand, that fills in all this information. None of it is
> verified. Most of the cases they have no externally verified environmental audit, or social
> audit. So I fill in this form, it comes back to the organisation, and they check it. And they
> check it with three organisations that know nothing of your company. They check the media.
> The media discovered, yes, the World Trade Centre was attacked. But they can never discover
> that it could happen, and most companies are basically a can of gasoline next to a burning
> cigarette. The issue is; how far is the burning cigarette from the gasoline, as an investor, that I
> can lower my risk? So the media knows nothing of a company – they process press releases.
> That’s their job. They don’t go out and actually start screening a company of three hundred
> thousand to find out what is the internal health of them. So this is one of the supporters to
> justify the data – the media. Second, NGO’s; If there’s not a conflict with an NGO the NGO
> knows nothing of what is going on within that organisation on an internal health issue.
> Thirdly, unions; if there’s not, again, a major conflict, the union does not know, and cannot
> determine what is life like for the people who are working in there among a hundred and fifty
> thousand employees - they just don’t know. So this very weak system is fuelling the decisions
> of hundreds of billions of Euros. So it’s very, very, very, very, very weak and very dangerous,
> because if they… well, that it’s basically illegal - what’s being done now. Because if you
> believe that triple bottom line, or responsible business is a competitive advantage, and I think
> most of you do, then the information that’s being given to a screening company is pricesensitive. Price-sensitive information, by definition, has to be put in public domain. So now
> it’s being given to one investment company by a screening organisation, from a company – so
> you’re going to have very serious problems coming up soon by one of the pension funds
> who’s going to declare that information must be put in public domain. Which is going to
> affect this whole process – it could slow it down. But in general, it has to be much more
> professional in getting insight – how well is a company doing? - Because at the moment most
> of them don’t have a handle on it. Some of them do. The one’s who have been doing it a
> while. They’re in a very strong position. But many of them – I had to do an article about a
> large Dutch retail company for the financial newspaper here, Aholt, and I know they’re doing
> a lousy job, but it sounds like they’re doing a great job, so I asked the person over there, I
> asked them five things: How much energy do you use? He couldn’t tell me. And he gives me
> this non-sense story ‘I can’t tell you because our energy supplier was not able to provide the
> information exactly how we want it’ I don’t know if you’ve ever supplied a retail supermarket
> chain, but they determine the size of the product, the cost of the product, the packaging of the
> product, when it’s delivered, how it’s delivered - and you’re telling me that this company
> can’t ask the energy company to provide the information that they need? It’s not an issue for
> them, it’s not important. If it were important, it would have been done. So getting that
> information out is often non-available, non- important, but now they are being pressured by
> the financial community, and they are very sensitive to that. So we have to do something
> about that. Unfortunately, I don’t think they will be able to provide that information in the
> time that the financial community requires. They are not willing to wait five years while you
> get your act together. For the investor the challenge is basically – they have to determine what
> is their legacy going to be?
> And I said that also to the UBS’s, ‘do you, or your clients want to support, profit and
> facilitate environmental and social destruction?’ That’s the question, the rest about ‘yeah,
> we’d like to lower our risk…’ Basically, do you want to profit from environmental and social
> destruction, or do you want to support, profit and facilitate environmental and social
> restoration? That’s an issue what all these financial people have to determine, and now that
> they’re discovering ‘hey, we made it very comfortable for all these unusual multi- national
> companies who were white-washing money through here to fund terrorist organisations or
> toxic waste, is not coming back to bite us, and it’s affecting our reputation, which means it
> might cost us customers.
> I don’t know if you know the story why the Swiss banks actually finally decided to pay the
> reparations to Jews, they were a perfect example of incredible pain. The controller of New
> York City said ‘if you don’t get it together, I’m going to take away your license and pull all of
> my assets out of your pension funds – period’ That got their attention.
> The risk factors, particularly for the financial community who is very focused on
> stability and predictability, is climate change, which is going to be very, very serious. If you
> realise that hurricane Andrew almost bankrupt Lloyds of London, and hurricane Andrew
> never reached a city – it never hit Miami, it only hit small towns – it almost bankrupt Lloyds
> of London. And I said that to the association of insurers here, and I told them the problems of
> climate change, and global warming, and the sea rising, and the head of a large Dutch
> insurance company stood up and said ‘that’s not a problem for us – we don’t cover salt water
> damage!’ So I said, ‘that’s true, but you sell mortgages. If a hundred thousand homes come
> under water, which are worthless now, and you have provided the mortgage, and those people
> can’t pay the mortgage, you have a problem’. So at that level of meltdown, that’s what we’re
> talking about, and the financial community has a lot of difficulty dealing with that. But they
> also change very quickly; when I gave a talk in France on this issue they weren’t interested.
> Two months later they had the biggest storm in their history, and now they’re very interested.
> So, things change when organisations feel pain – and I think that’s the same for us.
> I don’t want to go too much into all of the statistics to back it all up, and the concept is
> wealth is ‘urban sprawl of poverty and people having nothing to eat’, or success is a
> programme like ‘Big Brother’ or ‘Jerry Springer’, and failure is two and a half million people
> in prison in the United States. They’re also the largest contributor to California politicians is
> the prison association – not doctors or lawyers.
> One of the dark sides of the success, if we look at some of the figures, is that the Netherlands,
> which is a very successful country – fourteen per cent of the working population are on
> disability. Most of the health insurance company lost money, because as you have more
> climatic problems and the sperm count goes down, you have to in vitro for a large number of
> people, and that costs a lot more money. And because the stress factor has gone up a lot more
> people are sick, and it costs you more money in health insurance.
> I think the most important issue that happened in the last five or seven years, was the
> collapse of ‘Biosphere II’. I don’t know if you remember that – there was an attempt in
> Oracle, Arizona to replicate the earth, and it failed after about fourteen to sixteen months -
> Biosphere II. So they put about fourteen or sixteen people, locked them up. They had their
> own savannahs, they grew their own food, and everything collapsed! The air reached levels of
> Nitrogen Oxide, which is like the top of Everest – people couldn’t breathe. They had a plague
> of pests. Every living creature/system died. Plants, animals – they all died. And that should
> have been a very important signal. Biosphere I – the Earth does it for six billion people,
> everyday, twenty- four hours a day, and no one counts that in their balance sheets. You know,
> what is fresh air worth? What is clean water worth? If you are a brewery you know what it’s
> worth if you don’t have clean water. So that issue didn’t get through, and I think the further
> the deterioration of Biosphere I – the Earth, and the reaction of the financial community will
> just speed this process along. So I am extremely optimistic because I have basic confidence in
> the greed of people. And when people see that they can have better security, lower risk, better
> returns looking at companies this way, they’ll beat up the companies – that’s what the EU is
> doing now.
> I’d like to close with a short quote, also by Gamby:
> 
> ‘There is enough on the Earth to meet everyone’s need, but there is just not enough to satisfy
> all of our greeds’
> 
> But at the same time, I prefer working particularly with irresponsible business and
> irresponsible investors because they are often professional, and if you can get through to them
> and show them their security, their long term strategic survival depends upon them embracing
> sustainability, they will do it. They will do it. But you have to have to talk in their language.
> There is no point speaking Chinese to someone who speaks French. So you have to speak
> their language, and if you do, you’ll get somewhere. And it is happening, it’s happening very,
> very rapidly - but it is not a big, loud revolution. Not one person from the mainstream press,
> not one out of one hundred and fifteen invitations I sent came. Does that say more about us or
> does it say more about them?
> (Someone in audience asks inaudible question).
> I invited one hundred and fifteen press people from the mainstream financial press -
> none of them came. The only one that was going to come worked for the ‘Financial
> Dachbar’. She became ill. Her paper was a sponsor of our event and they didn’t find a
> replacement for her. That’s why I don’t focus very much with the press – I focus with the
> business and the finance community. And it is happening. You can see all the horrible
> statistics, but the other side it’s happening. And it’s happening very, very, very, very rapidly.
> Thank you. If you have any questions I’m very happy to answer them.
> 
> Questions from audience (all barely audible):
> 
> “I read in the paper about the ethical funds since September 11th and that they had the
> highest rate of return with the funds”
> 
> I don’t believe that. No, that’s not true. They’ve lost money like other funds. Some
> have done well - some have done poorly. The ones that were very focused on ICT because
> they thought well, you know, they were cleaner – they got a beating, just like everybody who
> was invested in information technology. Pension funds don’t look this weak. They’re not day
> traders – they have to think for twenty five years, which is why they invest in real estate and
> private property and they invest in private equity, they invest in stocks, and they invest in
> bonds. They have a long-term view. They’re not going to be excited that this week is done –
> day traders do that, people who’s goal in life is dying rich. And they think that’s an
> achievement. But most of the mainstream people have taken a very – if you look at how,
> unfortunately the woman from Alionce, which will probably be the biggest bank, she did not
> give a good presentation, but what many people did not know was that she is not from the
> finance community. She was an environmentalist. She was from the EU. She was given board
> approval; she was given money and staff to institutionalise sustainability within the entire
> Alionce network. I find that an incredible accomplishment, a major milestone, to get that.
> You try to get a few interview works for large companies, you try to get something, try to get
> money to go visit a conference somewhere now. So that was very important, and the major
> institutions have been looking at this for a long time, and they’re just trying to get a handle on
> it. They don’t feel comfortable in the screening process as it’s done now, because, I remember
> Adidas was kicked out of a fund because they say ‘Adidas deal is in military’. What happened
> was that Adidas also made training suits that was also purchased by the army. So are they
> promoting, are they in the military business? So some of the screening procedures are in the
> very, very infantile bases, and it’ll get bet. It’ll have to because the pressure is very large on
> getting the quantum leaps.
> 
> “You talked a lot about the actual investment of money manager himself, but less about the
> actual owner of the assets, either the private individual or the pension fund board or whoever
> is sitting there and controlling the assets. Can you decide the actual asset manager himself
> because ultimately he is the mobile; he has more work in the investment style. What is the
> driving force that is actually running through the mind of the asset owner that he says ‘I want
> to move more towards this, or what can we do to promote this thinking process that we as
> individuals with our own private assets that we have, or that we as individuals partly have
> with pension funds, that we can some how contribute towards this move’?”
> 
> Give them very clear signals that you want that. The head of PGGM, which is a pretty
> big pension fund, it’s a third of the size of ABP. Both of them sent their chief investment
> officer they represent about two and a half million people who have pensions which is a lot
> for a country of sixteen million people. PGGM has one third of the assets but is much richer
> because they perform better and they have more discretion with money. But even that person,
> they’ve made the decision that eventually we’re going to shift all of the assets towards
> sustainable investments. They don’t know how they’re going to do it with their real estate
> investment, they don’t know how they are going to do it with private equity, because there are
> no major large-scale sustainable private equity. They are still only talking about these funds
> have to perform as well because they are not getting a mandate from the pensioner
> themselves. The one or two and a half million pensioners they’re not writing in letters – ‘you
> know what? Make less money. I don’t care if there’s a pension there in twenty- five years.
> Make less money, but put that money in micro-credits, and fix up the mess that we’ve
> created.’ Some do that. The ASN is probably one of the more unusual funds that have about
> one hundred and fifty thousand shareholders. They’re a publicly traded mutual fund. And they
> say specifically that the shareholders say ‘we don’t care if you have lower performance; we
> want to know what did you do to influence policy at companies to make the m more
> sustainable?’ So if the directors and the asset managers and the fund managers get those
> signals, they’re only doing what you’ve asked them to do. If you’re happy with five per cent
> or four per cent or three per cent or two per cent return, they’re happy also – it makes their job
> a bit easier. But at the moment their focus is very much ‘I’m hired and I have to jump so high
> to provide money for your returns, and until I get a signal fro you that you’re happy with less,
> I will do that and I will be sceptical of speeding up this process’. So if you have a pension
> somewhere tell them that you’re happy with less, or tell them ‘I want to be offered (I don’t
> know if they have it in Europe) a pension plan which does do sustainable screening of their
> investments’. They have to get signals from you. If they don’t get signals they’ll carry on the
> same story; ‘well, it’s got to perform as well’, and some of them say it’s got to perform better.
> Why that is, I have no idea – that’s just ignorance.
> 
> “There is an index of sustainable companies”…
> 
> (Reply – there are hundreds of sustainable index).
> “…But what is the idea to ask for a command? There was a speech this week, I think in New
> York, from the head of the institution responsible for development of the IAS standard: he was
> telling that he wanted to reduce the amount of time and money which is needed by the
> companies to report.”
> 
> Of course, in his perception it costs the money and it’s not a finished process. But the
> financial account system is not that told either. I remember when BMW bought Rover: Rover
> had a profit of, I think it was, one hundred and fifty million dollars or Euros, and after BMW
> bought it the same year, they had about an eighty million dollar loss - the same financial
> accounting. So the financial accounting system is not perfect. It’s developed over a relatively
> short period of time, and the environmental accounting is even shorter but it’s making much
> more progress. So people from the accounting system who have to put their signature on
> something feel uncomfortable with this because they don’t know very much and it’s a work in
> progress. So, if you’re a registered accountant and you’ve got to put your signature on
> something, which happened in the case of Shell and Heineken – the control was no that good,
> the information provided was not that accurate. So I can’t understand why IAS says ‘well, we
> don’t want to spend too much time on this’. You know, they’re going to have to be spending
> much more time. Until they integrate it totally into their yearly report, which is what the
> financial community wants, and one universal standard, with external verification, they’re just
> going to have a lot more phone calls from the UBS’s and the Axa’s in the world – and they’d
> better be ready for that.
> 
> “I was wondering whether there was any progress made in the criteria of the screening –
> standardising it in Europe?”
> 
> Yes, but it’s still terrible. I’ll give you an example: when I had to write that article about this
> large multi- national and they had no statistical information at all. The three best screening
> companies in the world gave them huge high marks on sustainability. And I asked them ‘how
> do you do that – there are no figures, there is nothing to base it on? You can have a
> membership card for a fitness centre, but if you don’t get on the scale to weigh yourself you
> can’t say you lost weight. And that’s the issue – if you’re not measuring anything, you have
> no statistics to measure it, you’re not losing weight – you can’t claim that’. And they say
> ‘well, we had a factory visit’. Well, I had a factory visit too – I went to the same person too
> and sat around, and very charming, had some coffee, and they didn’t tell me anything. They
> didn’t say anything. They had no statistical information. But it’s all anecdotal and it’s cute,
> and it’s nice, but that’s not good enough, that’s not good enough. So the quality has gotten
> better but it’s by far a long way from where it is. I think one of your EBBF members, Richard
> has the best social audit – he’s got the best one. Of all of the ones I’ve seen, it works, he
> interviews all of the employees and he gets better insight into the internal health of the
> company. Richard Barry – he is excellent. He’s part of the project we’re doing now of trying
> to come up with a better mousetrap. What screening organisations do is they like to ask more
> questions, but it’s not an issue of more questions, it’s an issue of relevant questions and
> questions that can be externally verified. Until you get external verification, it’s totally
> meaningless what a company is saying – totally meaningless.
> 
> “This question about the number of different standards and the number of different sorts of
> indicators that everyone is looking for from companies is obviously causing a lot of
> confusion. I entirely agree with you that investors are the most powerful implements on
> businesses and the ones most likely to shift their behaviours, but is there any evidence of any
> consultation and working between the screening agencies, who are getting this information
> from investors, and all the others who are trying to collate information and present it to other
> state coolers, because there is a sense in which companies are being bombarded from lots of
> different directions, and of course that actually reduces the effectiveness…”
> 
> It’s brought into consideration the whole screening process. If you speak to the
> companies that are quite far, that have sold off entire divisions from nuclear power pla nts
> production, dam construction – sold it off. You don’t get, you know – I don’t see Phillip
> Morris selling off Marlboro - it doesn’t happen that often. So when a company does that and
> decides to focus much more on sustainable development, they’ve been doing it a long time.
> And they get thirty or forty or fifty questionnaires, all of which from companies that are not
> certified or carry any weight at all like a registered accountant. You don’t approach a publicly
> traded company and say ‘you do the bookkeeping yourself, you have a bookkeeping
> department, you don’t need a registered accountant. I as an investor will totally accept that’.
> That doesn’t exist. So because none of the screeners are certified or carry that weight there is
> a lot of reaction from the people who have been busy at this and said ‘this is not a process that
> we want to continue down this road’, and the alternative, which is GRI (which is Global
> Reporting Initiative) is going to take ten years at best before you have a certain number of
> companies that are reporting that way. You have to have two hundred and fifty, five hundred,
> seven hundred and fifty large companies starting to report for investors to have any relevance
> at all, and that will take minimum ten years or more, and so what are yo u supposed to do in
> the mean time? The companies that are further down the road are very dissatisfied. The ones
> that are early, the only thing they can say is ‘oh, I’m in the Dowe Jones sustainability index’
> – like that means something. They had two people screening two thousand companies, how
> much time do you think they had? And those companies had no information, but then they got
> great marks. So it’s by far not good enough, and if it doesn’t start to really move in another
> direction you’re going to have companies getting together to find another way because it’s
> creating a lot of friction, a lot of irritation.
> 
> “How does the security look in the central Eastern Europe… (rest I can’t discern)?”
> 
> “I gave a talk in Poland, and actually I was very, very surprised that people came and
> that I met the head of the employers association. The discussion relating to issues on social
> consciousness were much further advanced than, certainly the United States which is in the
> twilight zone compared to Europe, and they’re in a much worse position- they have to really
> make some very, very difficult decisions to get into the EU – very, very painful decisions to
> do that. Although I think that in Eastern Europe the entrepreneurs are often in the NGO scene,
> you see a lot of entrepreneurs in sustainability that come from the non-governmental
> organisations, and this whole development ‘a venture for anthropy’ which is going on in
> Eastern Europe, which is not in Western Europe. So I’m actually rather optimistic. The
> moment that people see that you can make a difference and be profitable, it’s not a trade off.
> At the moment the profit is coming at the cost of someone else. So all your profit that you’re
> making, someone else is paying for – either this generation or the next one. So that is also not
> a sustainable way. So I was rather encouraged by Eastern Europe who has a much more
> difficult time.
>
> — *Triple Bottom Line Reporting (Used by permission of the curator)*