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Opinion Sustainable Swiss businesses, politics and the ‘Greta Effect’

16 year-old Swedish climate activist Greta Thunberg

Swedish climate activist Greta Thunberg arrives to attend the 49th Annual Meeting of the World Economic Forum, WEF, in Davos, Switzerland. Will the “Greta Effect” have long-lasting consequences for global political and economic systems? ponders sustainability expert Gretel Gambarelli.

(© Keystone/ Valentin Flauraud)

How serious are businesses and institutions about environmental and social issues? Sustainability and environmental expert Gretel Gambarelli gives her insights, as officials and politicians gather in Madrid and Bern this week to examine how to better tackle the climate crisis.

point of view

2019 will be remembered as the year of heightened global awareness of environmental and social issues. This is mainly thanks to Greta Thunberg, a Swedish teenage environmental activist, who has managed to mobilize millions of people worldwide to demand action against climate change. Citizens’ concerns about these issues have had an impact on the political landscape in several countries, including Switzerland, where on October 20, 2019 the left-wing Greens and the more centrist Liberal Greens made historic gains in the Swiss parliamentary electionsexternal link.

These recent developments have raised numerous questions. The most important is probably: Will the “Greta Effect” have long-lasting consequences for global political and economic systems? From the perspective of consumers and investors, one big worry is that many businesses are jumping on the sustainability bandwagon and ‘greenwashing’ their communication without any real commitment to individuals or the environment. How is it possible to distinguish between serious and the fake sustainability champions? Finally, in Switzerland, the newly elected political class will soon have to decide how the country is doing in the field of sustainability and what can be done to push the private sector in the right direction.

Gretel Gambarelli is an experienced sustainability and climate change risk consultant. She has a PhD in sustainable development from the Università Ca Foscari and the Università Iuav di Venezia in Venice, Italy.

(Gretel Gambarelli)

I believe the global economy has entered a new era, from which there is no coming back. The private sector is slowly but surely assuming a lead role in the sustainability agenda, but in Switzerland, like elsewhere, the picture is very mixed, and greenwashing is common. The new Swiss political class has a very important role to play to increase private sector transparency and accountability in sustainability. A few, concrete policy measures can make a huge contribution.

Is environmental and social responsibility a fad, or will it have long-lasting effects on the global economy?

The following examples – among others - show clear trends among the most influential economic and financial institutions towards mainstreaming sustainability in the private sector.

The Geneva-based World Economic Forumexternal link (WEF), for example, currently hosts 18 “Shaping the Future” platforms, covering issues from financial and monetary systems, to cities, infrastructure and blockchain technology. Whenever you read WEF reports, descriptions of the platforms or information about upcoming WEF events like the annual Davos meeting, words such as “social impact”, “environmental degradation” or “sustainable value chain” jump out.

In 2015, the WEF adopted comprehensive policies on sustainability and sustainable procurement. More recently, it developed a strategy “to ensure the highest level of sustainability for its offices and events, as well as to strengthen the integration of sustainability into its global operations and business processes”. In January 2018, the annual Davos gathering was awarded international certification ISO 20121 for “sustainable event management”. Since then, audits have been carried out to monitor and measure the WEF’s efforts in the field of sustainability at the Davos meeting.

Elsewhere in Switzerland, the Financial Stability Board, an international body based in Basel that monitors and makes recommendations about the global financial system, established the Task Force on Climate-Related Financial Disclosuresexternal link in 2015. As of September 2019, 867 businesses – including 19 in Switzerland – have signed up to this industry-led initiative that brings together a wide range of sectors from G20 countries. Its aim is to incentivize the major economic and financial players to disclose climate-related financial risk information, for use by investors, clients and other stakeholders.

The taskforce’s mission, according to its founder Michael R. Bloomberg, is to “make markets more efficient, and economies more stable and resilient”, by helping companies better measure and evaluate their own climate-related risks and those of their suppliers and competitors. It also aims to help investors make better-informed decisions on where and how to allocate their capital, and for lenders, insurers and underwriters to be better able to evaluate their risks and exposures over the short, medium, and long-term.

Finally the International Finance Corporation (IFC), a branch of the World Bank Group dedicated to financing the private sector in developing countries, this summer carried out an important restructuringexternal link resulting in the creation of an “Environmental and Social Policy and Risk” Department. This is under the direct supervision of the CEO, while internal expertise on environment, society and governance has been transferred from the legal department to the operations.

Reading between the lines, it means that the environmental and social risks of private sector investments financed by IFC have become a major concern within the institution and appropriate measures are being taken. According to the Brettonwoods Projectexternal link, a UK-based NGO that provides “critical voices on the World Bank and IMF”, the move may be related to “a historic United States Supreme Court ruling in February, which found that the IFC does not benefit from absolute immunity from prosecution in the US, opening the door to the possibility that the IFC may be held liable for the harms from projects it finances”. If this is the case, it would be a great example of the crucial role that legal liability can have in promoting sustainability.

How can you distinguish between real commitment to sustainability and greenwashing?

From the outside, it is hard to assess the true importance of sustainability within a firm’s business culture. Nevertheless, the examples mentioned above provide several clues to help distinguish between a company or organisation’s serious commitment towards sustainability versus marketing and communication “greenwashing”.

The first hint in the WEF example is “measure, monitor and audit”. Commitment to sustainability is indicated by ambitious sustainability objectives and indicators that measure progress, quantitative measurement of these indicators’ value changes over time, and transparent communication; and this is even better if certified by independent auditors.

The second hint, seen in the IFC example, is the placement of the sustainability office within a firm’s structure. When such an office exists but is within a communication or legal/compliance department, this is often a sign that sustainability has not been given a central role in the business. On the other hand, if it is given a more prominent position, such as directly under the CEO, this is generally an indication that sustainability is of relatively high importance.

How is the Swiss private sector responding to these major global developments?

The picture is mixed. On the positive side, some major Swiss economic and financial players seem to be taking sustainability seriously. For example, UBS bank has an “Environmental and Social Risk” unit to identify and manage risks related to environmental and human rights issues and to make sure the bank complies with responsible banking standards. UBS applies an environmental and social risk frameworkexternal link to all transactions, products, services and activities. In 2018 it reduced its carbon-related assets by 60% and made other steps towards meeting its sustainability targetsexternal link. On the other hand, much remains to be done. UBS’s 2018 annual reportexternal link does not quantify environmental and social risks, such as climate-related financial risks, thus preventing its stakeholders from having a clear picture of the relevance of these risks for the group. Moreover, no external auditor certifies the group’s commitment and progress towards its sustainability targets.

On the negative side, some Swiss companies make huge efforts to “greenwash” their communication. At the same time, it can be hard to argue they are doing their utmost to prevent harm to individuals or the environment. For example, every year the Basel-based agrochemical giant Syngenta publishes a thick sustainable business reportexternal link. Unfortunately, in the 2018 version, the group’s sustainability-related priorities, targets and monitoring indicators cannot be easily identified. Looking at Syngenta’s corporate structureexternal link, you cannot find a risk or sustainability department or director. More importantly, Syngenta was recently accused by the Swiss NGO Public Eye of playing a key role in selling highly hazardous pesticides – above all in low and middle-income countriesexternal link. The suspicion remains that sustainability is a priority only for Syngenta’s public relations and communication.

What’s the role of the new Swiss political class?

One of the main problems in Switzerland is that the liberal approach of Swiss politics (at least until now) hasn’t helped. In a recent exchange I had with the sustainability team working for the Swiss branch of a leading global consulting and audit firm, I was told that sustainability and climate change issues are gaining momentum within Swiss firms, but they are not among the key concerns of CEOs, mainly due to the lack of national policies and regulations.

For example, there is no regulatory guidance about sustainability or climate change for the Swiss financial sector, arguably one of the country’s most important economic sectors. The Swiss financial watchdog, FINMA, has joined the Network for Greening the Financial Systemexternal link, a network of international central banks and supervisors committed to better understanding and managing the financial risks of climate change. However, national laws and federal regulations must change in order for the financial sector to account for sustainability or climate change risks in disclosures and for the supervisory authority to receive the mandate to check on compliance.  

Citizen protest and initiatives are trying to challenge the traditional “hands-off” approach of the Swiss politics on these issues. This year’s climate strikes have been widely attended in Switzerland, especially by young people, aimed at creating political pressure and public awareness so that appropriate measures can be taken. Meanwhile, the Responsible Business Initiativeexternal link wants Swiss multinationals to be legally obliged to respect human rights and the environment during their activities abroad. In June 2018, the Swiss House of Representatives decided to accept a counterproposal, viewed by the supporters of the initiative as “a compromise between the initiators, the forces of parliament and those of the economy”. At the time of writing, things are still open while we await a final decision by the Senate.

The newly elected parliament can drive the Swiss economy in the right direction. For this to happen, effective policies need to be approved. To become a credible sustainability leader in the coming years, Switzerland should improve the liability of Swiss corporations regarding any environmental and social damages caused abroad, have clear rules for the disclosure of climate and other sustainability-related risks in the financial sector, and prevent greenwashing via mandatory audits of the biggest businesses that claim to be sustainable.

Environmental and social responsibility is not a fad. Greta Thunberg has helped accelerate the ongoing process towards increased global awareness of the need to take immediate action to protect our planet and its inhabitants. When the media stop following her and other climate strikers, the process will still continue. But the situation cannot be left entirely to voluntary actions by the private sector, otherwise progress will not be fast enough and it may be hindered by greenwashing. With the exception of a handful sustainability champions, clear policies, incentives and regulations aimed at making the Swiss economy more sustainable are badly needed. Swiss citizens who voted “green” on October 20 are relying on the new political class to do exactly what it was elected for. 

The views expressed in this article are solely those of the author, and do not necessarily reflect the views of

Opinion series publishes op-ed articles by contributors writing on a wide range of topics – Swiss issues or those that impact Switzerland. The selection of articles presents a diversity of opinions designed to enrich the debate on the issues discussed. If you would like to submit an idea for an opinion piece, please e-mail 

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