Harvard Business Review – Ken Pucker

The Lingering Costs of Instant Fashion

Ken Pucker — Tue, 27 Feb 2024 21:34:04 +0000

Instant fashion has exploded in recent years, led by Shein whose sales have multiplied by more than 20 times since it entered the U.S. less than six years ago. As Shein explores an IPO, the author reviews the social phenomena that have contributed to instant fashion, the factors that allow it to succeed, and the dangers of the industry’s model. While there’s clearly demand for these products, consumers and policy makers also need to be aware that the business model comes with side effects — particularly the privatization of profit and the socialization of costs, including social and environmental harm.

https://hbr.org/2024/02/the-lingering-cost-of-instant-fashion

Vanguard Confronts an Inconvenient Truth

Ken Pucker — Mon, 24 Apr 2023 17:50:49 +0000

Vanguard had previously joined the Net Zero Asset Manager’s initiative (NZAM) in 2021, but withdrew 21 months later, citing confusion about individual firms’ views. Vanguard is unique in its ownership structure, commitment to passive index-based low-fee funds, and focus on retail investors. It has taken a more cautious approach to ESG investing and doesn’t heavily rely on external ESG ratings services. Critics argue that Vanguard should compel companies to decarbonize to prevent portfolio losses, but this overlooks asset managers’ primary duty and overstates ESG investing’s impact. Vanguard believes that addressing climate change requires governmental action and that the industry should aggressively endorse this path. Regulatory changes clarifying sustainable investing and a bifurcation of ESG investing can enable more authentic decarbonization. Vanguard’s NZAM withdrawal acknowledges the limits of win-win ESG “solutions” and clarifies the path to urgent decarbonization.

https://hbr.org/2023/04/vanguard-confronts-an-inconvenient-truth

ESG Investing Isn’t Designed to Save the Planet

Ken Pucker — Tue, 02 Aug 2022 02:53:58 +0000

By: Ken Pucker & Andrew King

Harvard Business Review

Most people assume that ESG Investing is designed to reward companies that are helping the planet. In fact, ESG ratings which underlie ESG fund selection are based on “single materiality” — the impact of the changing world on a company P&L, not the reverse. Asset management firms have been happy to let the confusion go uncorrected — ESG funds are highly popular and come with higher management fees. The danger with ESG investing is that it might convince policy makers that the market can solve major societal challenges such as climate change — when in fact only government intervention can help the planet avoid a climate catastrophe

Read the full article: https://hbr.org/2022/08/esg-investing-isnt-designed-to-save-the-planet

Overselling Sustainability Reporting: We’re Confusing Output with Impact

Ken Pucker — Sun, 22 May 2022 14:28:11 +0000

Harvard Business Review, May – June 2021

For two decades progressive thinkers have argued that a more sustainable form of capitalism would arise if companies regularly measured and reported on their environmental, social, and governance (ESG) performance. But although such reporting has become widespread, and some firms are deriving benefits from it, environmental damage and social inequality are still growing.

This article, by Timberland’s former COO, outlines the problems with both sustainability reporting and sustainable investing. The author discusses nonstandard metrics, insufficient auditing, unreliable ESG ratings, and more. But real progress, he says, requires not just better measurement and reporting practices but also changes in regulations, investment incentives, and mindsets.

Read the full article: https://hbr.org/2021/05/overselling-sustainability-reporting

The Myth of Sustainable Fashion

Ken Pucker — Wed, 12 Jan 2022 14:45:40 +0000

Ryan McVay/Getty Images

Harvard Business Review

by Kenneth P. Pucker

January 13, 2022

Few industries tout their sustainability credentials more forcefully than the fashion industry. But the sad truth is that despite high-profile attempts at innovation, it’s failed to reduce its planetary impact in the past 25 years. Most items are still produced using non-biodegradable petroleum-based synthetics and end up in a landfill. So what can be done? New ESG strategies such as the use of bio-based materials, recycling, and “rent-the-runway” concepts have failed. Instead, we must stop thinking about sustainability as existing on a spectrum. Less unstainable is not sustainable. And governments need to step in to force companies to pay for their negative impact on the planet. The idea of “win-win” and market-based solutions has failed even in one of the most “progressive” industries.

https://hbr.org/2022/01/the-myth-of-sustainable-fashion

There Are No Easy Answers to our Biggest Global Problems

Ken Pucker — Mon, 27 Jul 2020 19:48:10 +0000

Harvard Business Review

by: Ken Pucker, Andrew King and Auden Schendler

Too many academics, commentators and experts have fallen victim to magical thinking regarding our ability to tackle the major societal challenges facing humanity. To wit: many of the signatories to a recent pledge to find societal purpose in business are furloughing employees during the Covid-19 pandemic, paying dividends to shareholders and provoking complaints from workers that they aren’t adequately protected from danger. It is time to give up on hopeful stories and get back to basics. If the global pandemic can teach us something, it is to remind us to return to those ideas, like regulation and good governance, that we know work, even if they are obvious or dull. Taxing carbon is not a shiny new idea, but it would redirect investment and effort to low carbon solutions. Mandating accounting and reporting standards for non-financial measures sounds like an notion from a previous century, but it works. Nobel Laureate James Heckman long ago showed that investing in early childhood education improves social justice and economic productivity. But it has upfront costs. Maybe it is time we listened to him, despite our dislike of taxes. For other global problems, proven interventions are available, but they require effort and sacrifice to deliver results

https://hbr.org/2020/06/there-are-no-easy-answers-for-our-biggest-global-problems