In The Profiteers (PublicAffairs, May), Marquis examines how companies escape responsibility for their misdeeds.
The book explores “how and why we all pay for business’s free lunch.” What do you mean by that?
My core focus is “externalities,” an economic concept explaining how production costs are not borne by the producer, but by the community. Business works extensively and rigorously to avoid having any responsibility for these costs. Think about plastic. Corporate executives have worked hard to convince us that many things are recyclable, and the public goes ahead and recycles all their plastic, but 90% of it ends up in a landfill. All that money from lobbying and advertising should be put into revising packaging and delivery technology. It’s all gaslighting of the public. Companies are buying ads instead of investing in new technology. Of course we should put things in the right bin and use reusable shopping bags, but we’ve all come to think that sustainability is our responsibility because of
lobbying.
Have ESG—environmental, social, and governance—efforts made any difference?
A lot of times ESG is just about trying to make the public think that companies are doing well by doing good, and that business’s self-interest, rather than policy changes, will solve issues. We’re seeing so many examples of greenwashing where a company will say they’re doing something they’re not. On the other hand, innovative and thoughtful business leaders see the value in being responsible, with companies like Grove Collaborative, which sells sustainable home care products, working on going plastic-neutral. These entrepreneurs are thinking, “I don’t throw trash on my neighbor’s lawn, so why should my company pollute the world?” We’re at a breaking point with social and climate issues, which the public and government will be much more sensitive to in the future. It’s the companies engaging in these innovations today that will likely thrive then. But consumer pressure isn’t enough. Surveys show people care about these issues, but not a lot of research shows that they change their buying behavior accordingly. The more powerful levers are through policy. The European Union is implementing stringent laws and regulations, so if you’re Nike and now have to adhere to the Green Claims Directive laws in Europe, you have to do it everywhere you do business.
What can ordinary people do to make an impact?
Be involved locally in civic organizations and make policy demands on our governments. Push your representatives. Many state governments are introducing extended producer responsibility bills supporting companies that are on the forefront of this work.
