It is a slow news day, and my Saturday newspaper is full of ‘here today gone tomorrow’ media stories of little consequence or real importance.  Tucked away at the bottom of page 15 was a small article with caught my attention, not only because of its global impact but my faith in one of the most responsible global actions taken by Governments to date.

University of Bristol researchers, led by Dr Matt Rigby, have identified that significant emissions containing banned ozone depleting chemicals were being emitted from eastern China.  These findings may go a long way in explaining why global emissions of such substances have not continued their atmospheric decline but have stalled over the last few years.  It is estimated that 40,000 tonnes of these substances are still released into the atmosphere annually, with over half now believed to come from a region within eastern China between 2009 and 2016.

This is so disappointing as the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer (a protocol to the Vienna Convention for the Protection of the Ozone Layer) is an international treaty designed to protect the ozone layer by phasing out the production of numerous substances that are responsible for ozone depletion.  Since then, it has undergone eight revisions, the last as recently in 2016  which has been adopted but is yet in force.   Th Protocol is the first universally ratified treaty in United Nations history, having been ratified by 197 parties (196 nation states and the European Union). It has been a fantastic example of the world’s policy makers getting their act together cooperatively to address a very clear and real global risk.  That is what makes this research so dismaying.  

To produce emissions on such a scale you either have to be producing them intentionally or inadvertently:

If it is intentionally, then it means that there is:

• a Business (or sector) out there who are openly flouting the rules and have been do so openly for some time.
• A plant that has been licensed by a regional authority or environmental regulatory agency to operate as a production facility for the production of some activity that is actively releasing ozone depleting substances (probably carbon tetrachloride).  It also suggests that it has no pollution monitoring regime or emission reporting schemes:
• There is a supply chain supplying the feedstock, supporting the maintenance and operations of the plant in the knowledge of what it is doing:
• A marketing team in this business actively looking for customers to either use the facility or act as a supply outlet for its products, and finally:
• An established customer base out there for the products, with again I suspect business owners who knowingly understand what they are procuring.

If it is inadvertent, and these are ‘accidental’ releases then it means that there is:

• a Business (or series of businesses out there) who have no apparent awareness of what they doing, have no environmental management system or monitoring regime by any name, and who are handling waste tonnes of material with no understanding of their nation’s legal international obligations.  Neither has their marketing, engineering or facility teams an awareness of the presence of ozone depleting substances.
• A plant or series of operational activities  that is not being regulated by a regional authority or environmental regulatory agency, and that those agencies have no effective inspection regime, monitoring or understanding of pollution issues, or have sought to deliberately turn a blind eye to an international treaty its central government has openly signed up to.
• A supply chain out there that is ‘inadvertently’ supplying these operations with material that ‘inadvertently’ contains ozone depleting substances in vast quantities of which they are unaware, and finally:
• An established customer base out there for the service, products or operations with no understanding of what they are procuring.

The lesson for business

The whole story is a dramatic illustration of either a business deliberately turning a blind eye to the environmental consequences of its activities or a significant governance breakdown in the business leaders, the regulating agency and the supply/client chain of these organisations.  Cumulatively it demonstrates that poor governance, ethics and an absence of social responsibility can have a global impact.

The Montreal protocol is also noteworthy for the speed of its implementation, with only 14 years between the basic scientific research discovery (1973) and the international agreement signed (1987).  When I first led on the Corporate Social Responsibility (CSR) reporting of CFC and other ozone depleting substances for a Scottish power company in 1990, I remember our surprise at the level of emissions that were inadvertently escaping from our electricity transmission systems.  This knowledge led to a tightening up of protocols to record, safeguard and eventually mitigate the usage of substances.  We were supported in this action by the Business leadership group, although they were initially wary of the action, and were one of the first power companies to openly report on the issue.

Are all the business leaders responsible for these releases ‘bad’ , are they so economically greedy, environmentally unaware or have they simply become stuck in that high risk management black spot of ‘groupthink’.  They may individually or cumulatively know their actions are wrong and may think about speaking up in the boardroom about what they are doing but have decided against it because they did not wish to lose face, isolate themselves from the rest of the Board, risk their position within it or appear ‘disloyal’ to the business.

Think about the parallels with the VW emission fixing scandal in Europe and the US?  There was a collective decision to keep on even as the evidence increasingly pointed to a significant variation between predicted air quality and monitored air quality in California and other major cities.  The wheels were literally about to come off the lie.  Traditional profit-centred business seeks to maximise profit and return on investment with no particular regard for how the profits are made and what the social effects of the business activities are.  I presume that this is the ‘business model’ being followed by the companies knowingly releasing banned or excessive air pollutants into the atmosphere without regard for local or global consequences.

As a business leader, what can you do when you become aware of CSR or Environmental social governance (ESG) issues that are intentionally or inadvertently caught up with your business or its supply chains, and that form of a degree of future reputation risk to yourself and the business?   

Interestingly what is considered unethical in present times, rapidly becomes unlawful in the near future.  The behaviour of one part of society in terms of its apparent risk to other parts of society tends to pioneer social and civilization change.  With business impacts to the environment and society rapidly moving up the global agenda, and with the speed of media communication within society, there lies substantial advantage for corporations and other leadership in business groups which anticipate such changes in advance.  They adapt quicker, and are seen generally to lead rather than follow. They also manage change more successfully, since they have time to do it.  Organisations and institutions which fall behind public ethical expectations find catching up a lot more difficult, and rapidly go into decline or administration.

So what can you do?

Firstly consult widely – especially with independent and knowledgeable people, and especially beyond your close circle of (normally) biased and friendly colleagues.   Build up your own detailed awareness of the situation, it will help formulate subsequent communication and options for action.

Consider cause and effect in the deepest possible sense – the ongoing actions may affect many people and aspects of life, now and into the future.

Aim for solutions – Can I defuse the situation through my own leadership actions.  The ‘Broken Windows’ theory championed by former Mayor of New York, Rudolph Giuliani, promotes an ideology where individuals report or fix a broken window. This means rectifying issues and seeking to instill similar responsibilities in others.

Ultimately leadership and ethical decision-making are the basis of an ethical executive and as an ethically responsible member of society.  If the organisation has wandered so far from your own ethical standards then it may be time to sever the connection.  You can do this without further reference to the issues at hand – if you are happy leave an ongoing scenario that may have continued impacts on communities and their environments, or you may wish to whistle blow.  Whistleblowing can be a divisive topic and, while most would agree with the value of reporting wrongdoing.  The whistleblower is ultimately torn between loyalty to their employer (or the subject of their revelation) and their moral commitment to the law and society at large. As long as the whistleblower is sure that their motivations are sound and that they are confident in the system then they should not hesitate to relay such information.

When it comes to gross negligence, compliance in pollution with a risk to society and the environment, or the allowance of unregulated actions then Government, Business and Society  must adopt the “it-takes-a-village” mentality — everyone is involved as everyone is affected by the eventual outcome when it involves global environmental risks.  Organizational leaders should never be exempt from their behaviours and governments should never be exempt from their international responsibilities.  Both are ultimately accountable to themselves and thier societal stakeholders.