Sustainability - does size matter?
Charles Redfern - 06 February 2012
Is size a sustainability issue? Some people use the word sustainable in a financial sense but for me the right word is viable - financially viable.
Sustainability is about ecological and social continuity, resilience and respect.
There is an economic value that can be placed on sustainability in terms of the collateral damage to communities and the planet. It’s relatively easy to count an ecological externality. The pollination value that bees provide can be turned into cash and so can the cost of cleaning up a river. Accounting for social externalities is far more difficult.
But is size part of the problem? I’m naturally inclined to a Tescopoly
viewpoint. I think a large number of small diverse businesses are a good thing for society. I am constantly flabbergasted by the almost feudal system that our free market economic system looks like in reality, with monopoly or quasi-monopoly at critical parts of the chain, bribes for market access, or permission to sell, and the buying of political influence as routine.
Yet free market economic theorists from Adam Smith onwards emphasise that increased specialisation is a more efficient use of resources economically, and therefore increases total wealth and the mean standard of living. They will also quite rightly point out that the Titans of yesteryear are no more.
So maybe the Big Business feudalism point is just sour grapes along the lines of 'no system is perfect and this one is as good as we can get'. Furthermore, when a big company makes a good decision it of course has a far bigger positive impact.
I think the critical counter-point to this free market argument is that large companies are the biggest beneficiaries of the fact that economic efficiencies do not only drive down costs. They also shift those costs into the public or social sphere. You will have heard the quip about the banking crisis privatising profit and socialising cost but this is basically what market economics does, automatically.
So when a large company makes a bold sustainability claim, a good analogy is supermarket brown bread. A wholesome loaf is one that is prepared and baked traditionally with real yeast and from the whole grain (preferably grown organically!).
The supermarket brown bread is however processed like white bread with some of the wholegrain put back in. The end result: all the goodness is first taken away and then a little bit is returned.
This is how sustainability is working right now, and why it’s hard to take corporate social responsibility (CSR) claims seriously. Fundamentally, accounting of externalities will need to be done, and let’s have a free market - but let’s put responsibility in there at the start. Then someone with brighter brains than I have can answer the size question.
Charles is the founder of the ethical canned fish company, Fish4Ever, the sister company of Organico, both based in Reading. Fish4Ever's motto is Land, Sea and People. Its land ingredients are 100% organic - supporting traditional fishing communities is as important as saving the fish. He is currently involved in a number of awareness-raising campaigns working with WWF, Sustainable Fish City, the Environmental Justice Foundation and the Marine Conservation Society.