Foster, McIntyre: The Intersection of Corporate Sustainability, Environmental Justice

Krista McIntyre is partner in Stoel Rives LLP’s Boise, Idaho, office, where she practices in the areas of environmental law, enforcement defense and ESG. She is a member of the American College of Environmental Lawyers and currently serves as chair of ACOEL’s Environmental Justice Committee.

Wade Foster is an environmental attorney with Stoel Rives LLP in Boise, Idaho, where he practices environmental law, natural resource development and ESG. Prior to joining Stoel Rives, he clerked for the honorable B. Lynn Winmill, U.S. District Judge for the District of Idaho.

Corporate sustainability, meaning the ability of a business to manage risks and opportunities to promote long-term enterprise durability and value creation, is manifesting in many organizations through ESG commitments. The guiding principles of ESG are rooted in the United Nations Global Compact (2000) and subsequent report, “Who Cares Wins” (2004). Both encourage ESG-focused leaders to create a continuous improvement cycle that places measurable goals at the center of corporate decision-making and action to mitigate enterprise risks and emphasize enterprise opportunities.

As detailed by the International Financial Reporting Standards Foundation’s SASB Standards, which “guide the disclosure of financially material sustainability information by companies and their investors,” relevant environment factors within the oil and gas sector may include greenhouse gas emissions, wastewater management or ecological impacts. Relevant social factors focus on human rights and community relations. Relevant governance factors may address business ethics, regulatory compliance and incident management. At the convergence of the ESG categories lies Environmental Justice (EJ) and the role of businesses in improving the lived experiences of fence-line communities.

Environmental justice

The term “environmental justice” emerged during the civil rights movement of the 1960s, when the Rev. Dr. Martin Luther King Jr. brought attention to environmental injustices borne by predominately black garbage workers at a Memphis, Tennessee, sanitation facility. Later, a national study by the United Church of Christ’s Commission for Racial Justice, “Toxic Wastes and Race in the United States,” (1987) found a positive correlation between subjects’ race and their proximity to hazardous waste sites.

Overburdened communities are not only in black and brown or urban neighborhoods. EJ is defined by the U.S. Environmental Protection Agency (EPA) as the “fair treatment and meaningful involvement of all people regardless of race, color, national origin or income with respect to the development, implementation and enforcement of environmental laws, regulations and policies.”

Persistent gaps among communities with different lived experiences and varying access to meaningful involvement in environmental processes are the focus of recent reemphases on EJ across federal and state government. EJ is no longer only a subject of activism and academia. EJ is at the forefront of minds in the White House, state legislatures and even boardrooms. 

Unpacking the definitions of “environmental,” “justice” and “community” reveals meanings that are broader and more complex than generally understood. EJ touches nearly all aspects of society: pollution, food security, energy, disaster relief, housing access, internet access, tribal sovereignty, urban planning, socioeconomic growth, political representation, transportation, education, climate change and resiliency. EJ targets every facet of the lived experience and an individual’s ability to enjoy a safe, healthy community and to access opportunity, as Seema Kakade, a law professor at the University of Maryland, wrote in her article, “Defining environmental justice communities,” in the American Bar Association’s “Trends” newsletter.

Tools for identifying overburdened communities include EPA’s ECHO database and EJSCREEN, the Climate and Environmental Justice Screening Tool (CJEST), and the U.S. Census. No tool is perfect or complete. Additional data on health outcomes, education levels, access to healthy food and the Internet, plus language proficiency can supplement these tools and help identify EJ communities.

It’s just good business

Companies are implementing EJ strategies that yield real benefits to communities and support ESG objectives. Robert Harris, vice president of environmental affairs at Pacific Gas and Electric Company, wrote that implementing environmental and social justice strategies can improve long-term business durability. In his article, “Environmental Justice is Good Business,” in the American Bar Association’s “Human Rights Magazine,” Harris said that stakeholders, including shareholders, employees, supply (or value) chain partners, customers and community members are increasingly demanding that companies be good corporate citizens. Ahead of regulatory mandates, businesses are confronting pressure to articulate corporate sustainability principles and execute on them. Social impact assessments that include EJ evaluations are also emerging in transaction due diligence, influencing commercial dynamics.

Companies that support EJ initiatives can manifest real opportunities. In today’s tight labor market, for example, nearby communities represent a potential local pool of employees that can contribute to operating innovations that reduce impacts on the surrounding area. Implementing effective strategies that improve lives within nearby communities can reinforce ESG goals, leading to diversity in a company’s workforce and durable community-driven innovation.

Instead, many fence-line communities are experiencing barriers to economic advancement. Neglecting investment in disproportionately impacted communities deters growth of economic power, diminishes community welfare and slows advancement of the next generation of contributors, consumers and leaders. Ignoring environmental and social impacts on underserved communities perpetuates an unvirtuous cycle in which poor health outcomes, poverty and societal conditions repeat for generations—a cycle that is very much inconsistent with corporate sustainability.

Conclusion

As government and stakeholders urge business to narrow the disparities among communities in America, commitments to EJ can cultivate stakeholder support and fuel value creation. Weaving meaningful EJ objectives into ESG-driven business decision making will also better position a company for success when regulatory and policy changes inevitably emerge. Focusing on EJ complements ESG objectives, aligning environmental impacts, social equity and governance with community-centric investments and metrics to enhance corporate sustainability.