Marte Borhaug explores the ethical dilemmas and unintended consequences that can result from trying to do the right thing.
6 minute read
A package arrives in the post. A surge of dopamine courses through me: my expectations for this delivery are high. It should be a source of delight and pride; the result of endless hours researching the sustainability of straws. Aware I should get out more, I am nevertheless proud of the maze of information regarding suppliers and materials I have trawled through in the weeks leading up to this moment. I feel confident no stone has been left unturned.
My confidence is misguided.
I open the package and stare in disbelief. To my horror I find the plastic-free straws are wrapped in – yes, you guessed it – plastic! Worse still, despite assurances to the contrary, I find they have travelled thousands of miles, crossing continents to reach my door. Their carbon footprint alone is akin to that of the average citizen of a small country for a whole year.
At times I feel as if I need a degree in moral philosophy
This story is not meant to garner pity. It is merely another example to add to the moral scrapheap of decisions I have made; another example of the complexity involved in trying to do the right thing. I could have easily picked another, like the challenges I faced trying to go vegan.
My job requires me to think deeply about such matters. It can be overwhelming. At times I feel as if I need a degree in moral philosophy – or at least a sturdy handbook – to ensure I stay within the tramlines of good behaviour. But it is these moral dilemmas that should anchor our professional conduct; we should not shy away from them. Checking personal values at the office door will not end well. If we do, there are deeper issues at play – we should seriously question whether we have found the right match.
The rabbit holes of misinformation, cognitive overload and unintended consequences
Part of the problem is we have never had to measure the consequences of our actions as a species until now, because there have never been so many of us. Had the first million humans invented plastic, they would not have had to deal with the same fallout as 7.7 billion.1 Everything we now do can add to our footprint and we have to think hard about our choices. And while in theory the right information and data exist to help us make sensible choices, all too often our view is obscured by reams of irrelevant and distracting diversions.
Our view is obscured by reams of irrelevant and distracting diversions
This is one of the challenges of living in a complex world. As soon as we look a fraction harder, it seems almost every action we take to reduce our impact trails a host of unintended consequences in its wake. A combination of two forces are at work: some of our actions can lead to unintended harm, while in other cases it is a question of choosing between two goods – or the lesser of two evils – like meat versus avocados.
When it comes to the environment, worrying about the big picture of climate change can make us lose sight of smaller, closer effects; such as the loss of local wildlife that is happening irrespective of climate change and that can wreak havoc with our ecosystems in the long run, as Jonathan Franzen argues with passion in this New Yorker article.
This is not just a personal battle. Staying with the theme of plastics, companies now need to ensure the supply chain of paper straws is itself sustainable and there is adequate infrastructure to recycle them. The push to ban plastic straws has become emblematic of our concerns around environmental damage, yet recent articles in Wired and The Atlantic both demonstrate the move needs careful consideration.
There has always existed a delicate interplay between manufacturers and consumers
There has always existed a delicate interplay between manufacturers and consumers. Ultimately, the former are subservient to the latter, as we can vote with our respective wallets and make our feelings known through the corporate balance sheet. We all need to take more responsibility and technology will undoubtedly provide us with some wayfinding tools, like CoGo, an app that helps me choose companies, coffee places and restaurants that align with my values.
In search of the moral high ground
On a larger scale, Kenneth Rogoff recently lamented the World Bank’s decision to stop funding new fossil-fuel plants, including natural gas.2 The issue, even for emerging economies that are investing heavily in renewables, is that doing away with fossil fuels altogether will not allow them to meet their growing energy consumption. Cutting their funding for coal and gas plants would help reduce global greenhouse gas emissions but could restrict many countries’ economic growth and affect the welfare of millions.
Cutting coal and gas funding could affect the welfare of millions
The big trade-off here is should the ‘E’ in ESG trump the ‘S’? Even if it does, to what end should developed markets be made to pay for their previous plundering of the planet’s precious resources? Even the most seemingly straightforward of questions can be riddled with ethical complexity.
Indeed, how you balance economic development and job creation with environmental protection was a question that stared our business in the face recently. We were considering a loan to a major state-owned company in Ivory Coast to fund improvements to an existing oil refinery. On the face of it, lending money to a country with a high risk of corruption, and to finance fossil fuels, sounds mad. Yet after extremely careful consideration, we went ahead with the loan.
First, there were robust guarantees, and Ivory Coast has been making real progress in tackling corruption. Second, the refinery already existed, and the improvements would help reduce its carbon footprint. But, more importantly, the project would create local jobs, and it was a key part of Ivory Coast’s National Development Plan to improve the domestic economy and reduce its reliance on energy imports. As such, it aligned extremely well with the UN’s Sustainable Development Goals.3
Monetary policy has contributed to income inequality
Economics yields another example. Following the global financial crisis, central banks in developed countries kept interest rates low in a bid to support jobs and growth. Yet while easy monetary policy allowed us to avoid a second Great Depression, an unintended consequence is that it has contributed significantly to income inequality by inflating the prices of assets (thus benefiting the richest) while wages have stagnated.
CEO pay, a source of visceral consternation among shareholders and the responsible investment community, provides yet another. Increased transparency on executive pay has turned out to be counterproductive. Comparisons between CEO compensation packages have driven up executive pay for years as CEOs have capitalised on the competition to attract talent.4
When you scratch below the surface, some "no-brainer" notions become questionable.
Don’t give up: Lessons from Thunberg, Pareto and Keynes
Frighteningly, some studies show that using “green” products encourages people to adopt less altruistic attitudes elsewhere.5 This is the moral equivalent of going for a run and then consuming a tub of ice cream. And, whether conscious or unconscious, the implications of our collective behaviour for society are huge.
This is the moral equivalent of going for a run and then consuming a tub of ice cream
Other statistics are equally discouraging. Even if we stopped emitting greenhouse gases today, oceans would continue warming and rising for years.6 Meanwhile, the energy we are adding to Earth’s atmosphere in excess of what it can radiate out to space is equivalent to 400,000 Hiroshima atomic bombs a day, every day of the year.7 If every action we take is likely to backfire in some way, it makes it even harder to turn the situation around.
But we shouldn’t give up. It is precisely because these statistics are so alarming that even the smallest of our decisions becomes more important. We need to fight the paralysis that accompanies the sense of being overwhelmed.
Hearteningly, we already have a blueprint in the UN’s Sustainable Development Goals. These have been carefully thought through to be mutually beneficial to all participants, and to support the planet and its inhabitants equally.
In my experience, issues tend to arise when governments, companies and investors think that things are simple and can be solved in a siloed way; for example, only tackling plastic waste, taxing sugar and the like alone, rather than thinking about them in their broader context. In a world obsessed with specialisation, we need more fox-like thinkers. As David Epstein argues in Finding range: An interview with David Epstein, we need people capable of seeing the bigger picture, of how things interrelate and connect. Design thinking and systems can help. As an example, under the leadership of Jacinda Ardern, ministers in New Zealand had to show how their budget initiatives would achieve the government’s wellbeing priorities, meaning all parts of the cabinet had to work far more closely together.8 More of these simple-but-effective initiatives are needed.
Being responsible should never be about creating an ethical straitjacket
Being responsible – in both life and investing – should never be about creating an ethical straitjacket, but there are a few guiding principles and rules of thumb that can help us all.
First, we can all make a difference. If we ever needed reminding that our individual actions count for something, Greta Thunberg’s inspirational stance on climate change provides us with strong proof.
Second, harness Pareto’s Principle. Pareto taught us that 20 per cent of our efforts account for 80 per cent of our results, or impact. Along with our core values, this should guide our behaviour and where we prioritise our time. We can identify the areas that will drive the most impact and focus our attention there. By doing this, daunting problems can become less so. Similarly, breaking down challenges, as the seven stabilisation wedges do for climate change, can help make the impossible seem more manageable.
Third, “It is better to be roughly right now, than perfectly right when it is too late.” Riffing on a famous John Maynard Keynes quote, Sarah Breeden from the Bank of England aptly highlighted the dangers of over-analysing the minutiae.9
The complexity of sustainability is not insurmountable. As we develop various coping strategies, and despite some inevitable and unintended hiccups like my plastic straw faux pas, we should remember that while we can’t be perfect, we can be better.