A UN study released earlier this year proves once again what many of us have long known—that big companies are not being held accountable for the environmental damage they cause. Industry tends to earn immunity from judgment based on the fact that they produce jobs, and because penalizing them would supposedly be bad for the economy. But according to this report, the reality is that there are financial ramifications for these companies’ actions, and right now they’re skipping out on the bill.
Meanwhile, another report released more recently argues that the world would benefit by nixing subsidies to the biggest polluters and imposing taxes upon companies that can’t get their act together.
The first survey looked at 3,000 of the biggest companies in the world, including many that are household names and prominently placed on major global stock markets, and found that they were directly responsible for $2.2 trillion dollars’ worth of damage in 2008 alone. To put that figure in terms that are easy to understand, $2.2 trillion is roughly the gross domestic product of the U.K. This is a very big deal.
The damage caused by the 3,000 biggest companies is roughly equal to a third of their profits, which inspires at least marginal sympathy for the notion that these companies can’t afford to make the necessary changes on their own.
In the study, the financial damage caused by industry came in the form of global climate change, air particulates (which contribute to cancer and respiratory disease), and water pollution. The study didn’t even take into account factors that are harder to quantify in financial terms—for example, widespread migration caused by pollution, not to mention long term-effects that haven’t yet been discovered.
To be fair, many of the companies in the top 3,000 have been conscientious about reducing their environmental damage over the last few decades, but even more companies have continued with their pollution going all but unchecked. The biggest culprits tend to be power companies, companies that process waste, and companies that process and produce plastic and metals. In terms of companies that produce purchase-ready consumer goods, drink manufacturers and clothing companies cause the most damage.
Naturally, reports like this tend to raise alarms across all kinds of industry. Many company officials complain that any legislation resulting from these findings is going to significantly cut their profit margins. Of course, it is to be expected that industry officials won’t like these findings, but that doesn’t mean that they’re not true, or that change is not needed.
In fact, industry’s ambivalence to studies such as these makes it all the more apparent that change needs to come from without. Companies that make a profit from messing up the environment aren’t going to change on their own, so we need to have government organizations step in and set limits. Unless we can find the political will to make changes like this, global climate change is only going to get worse.
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