In my last post I listed 10 books of the Noughties that make the case that contemporary capitalism is failing most of us. So what if you are convinced that business has to change: how do you set about changing it?

This second list features ten of the best titles published over the last decade on the subject of advancing sustainability in business.

The first five books help you make the case for change within your organization. Whereas the majority of books on sustainability argue that change should be advocated using the argument that “being good generates more profit”, - an argument that fails to bring about necessary change in those cases where behaving responsibly costs money - the selected books make the case that business has to change because society’s expectations of business have changed – with social and political consequences if business resists.

The second five books present management frameworks, perspectives and skills that will help to transform a business into a more responsible and sustainable organization.

1.  Value Shift: Why Companies Must Merge Social and Financial Imperatives to Achieve Superior Performance by Lynn Sharp Paine

Written by one of the only business school professors around with the intellectual integrity to point out the devastating flaw in the argument that you can rely on the pursuit of profit to motivate business to act responsibly. Paine argues clearly that there is something beyond shareholder value changing the business landscape, though she stops short of detailing what those other forces might be.

2.  The Moral Underground: How Ordinary Americans Subvert an Unfair Economy by Lisa Dodson

This book looks at the consequences of failing to reconcile business practices and ideologies with the better side of human nature. Put people in a situation where their freedom of conscience is restricted and they will find opportunities to resist. People like Bank of America’s Jackie Ramos.

3.  The Age of Empathy: Nature's Lessons for a Kinder Society by Frans De Waal

De Waal's latest exploration of what makes people tick. Why is it here on a list of books about business sustainability? Because the ideology and institutions of contemporary capitalism systematically undermine the application of empathy, and I argue that is a core reason why capitalism is in crisis, and why we will increasingly witness resistance like that illustrated in The Moral Underground above.

4.  The Market for Virtue: The Potential And Limits of Corporate Social Responsibility by David Vogel

David Vogel's book is here because he articulates clearly the limits of the supposed "business case" for responsible business behavior on which 90% of corporate responsibility advocates rely.

5.  The Civil Corporation: The New Economy of Corporate Citizenship by Simon Zadek

Zadek does a great job of describing the phenomenon of civil regulation - the pressures being brought to bear on business to improve its conduct. My only criticism is that Zadek is too focused on non-governmental organizations engaged in civil regulation, and ignores the more organic way in which individuals inside and outside business are advancing the movement for responsibility

6.  Social Intelligence: The New Science of Human Relationships by Daniel Goleman

Daniel Goleman is best known for his old book on Emotional Intelligence, but this newer book is more than an excuse to include Goleman's work in the present list. Social Intelligence brings the focus to bear on the importance of relationships at work, and what it takes to nourish them. Crucial for those seeking ways to move from business based on transactions to one of relationships.

7.  Making Sustainability Work: Best Practices in Managing and Measuring Corporate Social, Environmental and Economic Impacts by Marc J. Epstein

A very solid, reasonably comprehensive sustainability management framework in a single volume. The main criticism is that the case for action relies on the business case, and Epstein pays almost no attention to questions of character and empathy.

8.  Managing for Stakeholders: Survival, Reputation, and Success (The Business Roundtable Institute for Corporate Ethics Series in Ethics and Lead) by R. Edward Freeman

This book is the most recent encapsulation of Edward Freeman's stakeholder view of the firm. Freeman is the father of stakeholder theory.

9.  Cradle to Cradle: Remaking the Way We Make Things by William McDonough

A simple but popular book that is great simply for throwing into question the way in which products are designed. Simple and radical.

10.  Natural Capitalism: Creating the Next Industrial Revolution by L. Hunter Lovins

Add together these new ways of doing business and what kind of economy will take shape? This book presents a now classic vision of sustainable business.

If you have enjoyed these two selections of books, do take a look at the other selections available at the APEsphere bookshop. This is an Amazon affiliate focused on responsible business and engaged, sustainable living. By buying your books from our bookshop you help cover the costs of running APEsphere – and you pay the same price that you would on the main Amazon site. Please take a visit and support APEsphere.

 

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This decade’s end almost passed me by – so immersed I have been in writing projects. That would have been a shame. The period of the Noughties marks precisely the period following my departure from the world of financial services when, after some false starts, I set about writing full time about the place of business in society.

It was a decade that began with the dotcom boom and bust, the Enron and WorldCom scandals, New York Attorney General Eliot Spitzer’s investigation of deep-rooted conflicts of interest on Wall Street and the investment houses, the rise and stagnation of the World Social Forum, the crystallization of mainstream concern about man-made climate change, and the high stakes game of financial pass-the-parcel-bomb that precipitated the global financial crisis, the Great Recession and with it placed over 100 million people around the world into a state of severe poverty and hunger.

I would like to share with readers of this blog the best of the books  I have read about these crises of capitalism and those which signpost the way forward. In this post I will list my favourite ten books of the Noughties that have drawn attention to what is deeply wrong with the particular incarnation of capitalism that has taken root over the last 30 or so years. In the next post I will list the ten books published during the decade that I feel help best to lay the foundations of a new approach to business management that is genuinely sustainable.

So, first to the selection covering the crisis of capitalism.

1. No Logo: No Space, No Choice, No Jobs by Naomi Klein

For younger generations awareness of the cultural problems stemming from contemporary capitalism began with this book, and for earlier generations it updated older concerns by addressing the impact of economic globalization.

2. Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System---and Themselves by Andrew Ross Sorkin

This is the most comprehensive account yet produced on how the current financial crisis happened.

3.  The Corporation: The Pathological Pursuit of Profit and Power by Joel Bakan

A smart analysis of what is wrong with the corporate form using the even smarter metaphor of psychopathy to bring out what those flaws mean for the real world. There is also a great documentary based on the book.

4.  Supercapitalism: The Transformation of Business, Democracy, and Everyday Life by Robert B. Reich

Reich - Secretary of Labor in the Clinton administration - does a solid job of describing precisely how big business is undermining democracy. He is also dismissive of the claim made by many corporate responsibility consultants that the profit motive can drive responsibility, in other words that it costs you nothing to act responsibly with due regard to the impacts of your actions.

5. Globalization and Its Discontents by Joseph E. Stiglitz

This is the book that brought the academically lauded economist Stiglitz to a much broader audience. He cuts through the free market rhetoric to identify how the institutions of global capitalism undermine its promise of higher standards of living for all, everywhere.

6. Nickel and Dimed: On (Not) Getting By in America by Barbara Ehrenreich

Ehrenreich went undercover to research this account of how hard it is for working class Americans to get by or to improve their situation. US capitalism does not offer opportunity to everyone.

7.  The Shock Doctrine: The Rise of Disaster Capitalism by Naomi Klein

Of course business always knows how to turn a crisis into opportunity, but what happens when they gather sufficient power to influence the shape of crises as they emerge? Klein's detailed analysis of this disturbing new trend earns her a second book on the list.

8. The Divine Right of Capital: Dethroning the Corporate Aristocracy by Marjorie Kelly

This book by the founder of Business Ethics magazine represents one of the earlier and better analyses of how the focus on profit maximization costs society dear. She then sets out a vision of how the course of business can be reset.

9. The Loss of Happiness in Market Democracies by Robert Edwards Lane

Much of the defence of contemporary capitalism rests on the argument that for all its undoubted flaws we are much better off for it. This book comprehensively rebuts that complacency by reviewing what has happened to happiness within western market economies.

10. The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron by Peter Elkind

While Wall Street heads back to business as usual, insisting that the financial crisis cannot be repeated, this wonderful report on the fall of Enron reminds us (and I hope honest politicians) why good regulation is needed.

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So what is the real story? Has the Great Recession dented ethical consumerism, or has the ethical consumer remained constant?

Consumers in the UK appear to be as ethical as ever, and the most ethical in Europe, according to a survey by IDG.

So how about this rival report by Mintel that says consumers are shying away from paying a premium for ethical or sustainable goods while they are under under the yoke of recession.

Can any readers resolve the apparent contradiction here?

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I was struck on reading about a Scientific American study that rates China's Three Gorges dam as one of the world's 10 best renewables projects.

I have no doubt that in terms of reduced-CO2 emitting energy sources this project deserves the accolade. But the Three Gorges project is infamous for the displacement of over 4 million people, as well as other forms of environmental damage.

There was perhaps no reason why the Three Gorges project should inevitably have led to rights violations. Perhaps it could have been pursued more slowly and on a slightly less ambitous scale and left rights intact. I don't know.

But clearly hard choices between different people's rights are going to have to be made and their conclusion pushed through with vigour. The not-in-my-back-yard attitude that is slowing installation of wind turbines across Europe has to be set against the fact that some 20 million people worldwide have been displaced from their homes by action of climate change. That - as the article points out - is slightly less than the population of Australia.

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It is certainly an ambitious exercise, looking at estimated carbon emissions, company environmental policies and reputation perceptions.

Newsweek defends its methodology on the customary point of criticism: how can you compare a utility, say, with a bank? They point out that over 50% of the score relates to the strength of green policies (which anyone can implement) and reputation, all of which evens out the score somewhat.

I would add that there is no problem comparing high emitting industries with low emitting industries and finding that there is a cluster of high emitters near the bottom of the ranking. That is how it should be. Dirty industries should appear as they are. This table is not a ranking of overall social utility but of environmental credentials. If a cluster of oil extraction companies appeared in the top 100 it would be more than suspect; it would be incredible.

A particular concern I had was whether indirect impacts were adequately taken into account. Financial services have small direct footprints, but are the ultimate dirty industry in that they choose to finance all the others. The analysis of green policies brings this factor into the equation but a lack of transparency about the carbon impact of their loan and investment portfolios reduces the quality of analysis. For me this is a more worrying weak spot than the ranking's validity in comparing companies across different sectors.

One last observation: it is great to see that Newsweek used the extensive experience of two firms whose founders I have had the pleasure to meet: Peter Kinder's KLD Analytics and Paul Scott's CorporateRegister.com. Great to see such high caliber teams involved in producing the detail of something this high profile. Well done both.

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So the joke goes like this: there's the World Bank - banker to the world's poor - standing on stage in a tux gleaming white...

Then the bank issues a report criticising global inertia in the face of impending climate catastrophe, and urging countries like India to find lower carbon methods of generating energy.

Then for a punchline our well dressed raconteur turns around, bends over and lets fly the filthiest, darkest cloud of coal soot that has ever made your eyes water and your water levels rise.

Hilarious.

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Just premiered in Venice...

UPDATE: The Guardian's review is here.

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The Waxman-Markey cap-and-trade bill has passed the House of Representatives late Friday night.  Although the bill is too watered-down for many progressives, it does seem indeed to be better than no bill at all; considering it only passed by 7 votes, it seems the US came very close to having no bill. 

Sam Stein: "The climate change bill would reset drastically the way the U.S. government approaches the issue of regulating pollution. Instituting a cap and trade system, the bill aims to cut America\'s production of greenhouse gases by 17 percent by 2020, and 83 percent by 2050. The legislation also includes provisions to create alternative energy sources and cleaner technologies, as well as more efficient building standards.

In an effort to recruit the support of lawmakers sitting on the fence, its authors, prominent progressive Reps. Henry Waxman (D-Calif) and Ed Markey (D-Mass), reduced goals for carbon emission reductions and threw in favors for the coal and agricultural industries."

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The Obama administration is to lend $5.9 billion to Ford Motor Co and $2.1 billion to Nissan and Tesla to develop fuel efficient vehicles.

The loans are the first to be made from a new $25 billion fund set up to spur green innovation in the auto industry.

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It is just one more step in the process of getting the Waxman-Markey climate-energy bill passed, but it is an important step.

You might think that getting a sufficient number of liberals to agree on legislation to brig into being a price for carbon emissions would not be hard, but the behind the scenes effort to get enough votes has been tough.

Sticking points have been Democrats that have recently taken seats from Republicans in more conservative parts of the US, and Democrats representing farming constituencies who stand to have their environmental impacts brought into the carbon count fully for the first time.

Nancy Pelosi is credited with having organized the strong arming.

If the agreement sticks, a vote on Friday should see the bill pass in the House of Representatives.

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