Corporate Social (ir)Responsibility in the Face of Climate Change

What do the “natural solutions” to climate change used in many corporate responsibility initiatives actually entail?

Megafires are becoming more and more frequent globally. Every summer, this type of phenomenon, defined as a “conflagration that burns an area of at least 100,000 acres”, sweeps across Mediterranean Europe and large areas of South and North America, sparking heated discussions as to whether these fires are caused by climate change or by poor forest stewardship.

A paradigmatic instance of this controversy was sparked in 2020 between the then-US president, Donald Trump, and the Governor of California, Gavin Newsom, with the former blaming the latter for the wave of fires in the state and accusing him of allegedly poor land management. In turn, Newsom hit back, shifting the blame to Trump for his denialism and lack of initiatives on climate change. For whatever it is worth, the United States is still a global political benchmark, and other countries have ended up copying these arguments to shift the blame. We saw this happen in Spain earlier this year when the central and regional governments replicated the same debate after a wave of megafires, though in this case the roles were reversed.

The current model: under scrutiny

Many of the age-old national forestry policies that have been pursued in developed countries under the aegis of protecting the environment, claiming to be models for the world to copy, have ended up aggravating the problem of climate change through the creation of forest landscapes that are prone to megafires.

Policymakers at the time obviously could not have predicted that their well-intentioned efforts would unfold as they did, but as the heirs to their legacy, and the designers of future climate change mitigation policies, we must learn from their mistakes so as not to repeat them, in this case, with so-called “nature-based solutions to tackling climate change”.

These nature-based solutions are defined as the strategic use of natural processes and systems for climate change mitigation. The non-profit organization WWF, drawing on UN data, estimates that 30% of man-made greenhouse gas emissions between now and 2050 could be avoided by deploying these solutions, which largely consist of getting large corporations to fund projects such as tree planting through their corporate social responsibility initiatives to offset the carbon footprints generated by their business models.

If we take a closer look at the idea of “nature-based solutions to climate change”, we see that one of the main added values of the concept lies in the cultural framework it aims to create. Who in their right mind would not choose a “natural solution” to any kind of environmental issue, and therefore to climate change? “Natural” and “green” these days conjure up all sorts of positive thinking and psychologies thanks to the media power of an environmental movement whose top 10 NGOs in the United States have an annual budget of more than half a billion dollars. Politicians who have found a cause in environmentalism that transcends traditional ideologies also contribute to this vision. Chinese President Xi Jinping has said he wants to lead the world toward a new “ecological civilization“. This vision certainly sounds appealing and manages to momentarily distract us from the multiple environmental problems generated by the current Chinese model of economic development, which is not much different from that of the West.

Beyond their obvious cultural appeal, what exactly do these miraculous “natural solutions” to climate change really entail? On closer examination, they mostly seem to be based on preserving existing natural carbon sinks such as coral reefs, mangroves, wetlands, and forests, and especially on expanding some of these natural land-based sinks through mass tree planting, which is how these actions become more visible to the public and, therefore, more politically relevant. The issue of tree planting deserves particular attention, since most of the theoretical funds generated by large organizations through corporate social responsibility programs are earmarked for this type of initiative.

The idea of mass tree planting as a strategy to mitigate greenhouse gas emissions emerged at the beginning of the 21st century, in the now somewhat obsolete Stern Review on the Economics of Climate Change. This document brought ideas together from policy networks tied to the world of investment banking at that time, proposing a financial engineering strategy as opposed to an economic one, in the scientific sense of the word, to tackle the climate challenge.

One of the economic initiatives proposed in this report was the mass planting of trees all over the planet, but especially in developing countries, where this measure could be carried out cheaply, according to the Review, taking advantage of the rural exodus to the cities in a theoretical phenomenon known as “land sparing”. Without engaging in an in-depth critique of the Stern Review’s proposals, which has already been conducted by the recent winner of the Nobel Prize for Economics William Nordhaus, and by more recent works that recycle the same idea, the concept of mass tree planting at global level deserves a long, thorough review of the specialized scientific literature, which we do not have room for here.

The model must be completely rethought, stripped of doctrine, cloaked in science and, most importantly, imagined as an initiative based not on “nature” but on human beings.

However, there are two other aspects that are closely related to this issue and need to be addressed. First, the consequence of mass tree planting on the fire ecology cycle worldwide which, in turn, feeds global warming. Second, its implications for the corporate social responsibility plans that are slowly being put together around this concept, particularly in developed countries.

Let us take the example of Spain. Many of the forests that have burned recently were planted from the 1950s onwards, under the auspices of the various governments in existence in the country. I say various governments because, in essence, all the autonomous regions, despite their different political leanings, have been pursuing the same forestry policies since they were introduced by the central government in 1950. These programs can be summarized as follows: planting trees on municipal or common land abandoned by the rural population who migrated to the cities in the second half of the twentieth century. In some cases, this migration was driven by these same reforestation initiatives and by the European Union’s current land policies, since these forests were incompatible with other more profitable agricultural and livestock uses which were preferred by the local communities. How and where were these tree plantings carried out? In historically unheard-of locations and with historically unheard-of commercially valuable tree species, as well as behind the backs of the population and their social and economic interests, which unquestionably contributed to rural migration to the cities.

In short, thick new forests emerged in areas where in some cases no forests had ever existed, and for which the local communities have found no social or economic use. In addition, given the perceived urgency of the task at hand, fast-growing trees were planted, especially native conifers, as well as some exotic hardwoods such as eucalyptus, which were expected to provide an ecological return in the form of erosion control, reservoir protection, and financial returns in the shape of timber for industry.

In some cases, it is true to say that some industries have taken economic advantage of this raw material to generate employment and business, but their profits fall extremely short of what it is costing taxpayers to extinguish the megafires that these planted forests are causing, and the additional cost of the increased carbon emissions they have generated. Current spending on putting out forest fires in Spain exceeds €1 billion per year, paid for by the various governments, compared to the recurring losses of the largest company in the sector (-€190 million in 2021). These were only partially offset by the profits of the second largest company in the sector of €108 million in the same year. Similar dynamics are repeated in other countries around the world where firefighting costs grow year after year, decreasing the meager profits of an increasingly problematic economic and ecological forestry model.

Therefore, what is being proposed globally as “nature-based solutions to climate change”, i.e., mass tree planting through corporate social responsibility projects, is simply a rehash of the global reforestation policies that have been implemented in Spain over the last century. Chances are that if the same methods used in the past continue to be followed, these new forests will end up burning down and generating net greenhouse gas emissions.

To prevent this act of corporate social irresponsibility from occurring, the model must be completely rethought, stripped of doctrine, cloaked in science and, most importantly, imagined as an initiative based not on “nature” but on the human beings who will have to coexist for centuries with these carbon sink forests. Trees can be planted, of course, and to some extent they can contribute to mitigating climate change, but for these actions to be effectively “responsible”, and not just an advertising hyperlink on corporate websites, the companies funding them need to take the issue seriously and not just use these initiatives as a diversionary maneuver to continue with their age-old carbon-emitting models.

Nevertheless, even if this succeeds, we need to be prepared for many more summers of high temperatures and megafires. No “natural solution” can save us from climate change.


© IE Insights.