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It is a great pleasure to be invited to attend the launch today of the Business Environment Council's new "Business Guide to Sustainable Development". This guide fills a much needed gap. The concept of sustainable development is reaching new levels of awareness and best practice in Hong Kong, involving government, business, and civil society. We could easily describe ourselves as pioneers. So much is happening, and so quickly, that it is nearly impossible to keep track of the full spectrum of activity. The BEC guide provides a rich mine of information on the activities of its members and on resources in Hong Kong and abroad. It offers concrete evidence of the benefits of putting sustainability to work. Whether we come from business, government, or civil society, we share a common purpose, which is to make Hong Kong a vibrant, healthy and creative city. This new guide is a significant step in that direction.

Let me take the next few minutes to give you my view on two topics - what sustainable development means for Hong Kong, and specifically what we are doing at the Sustainable Development Council and how we would like to work together with the business community and civil society. I would like to start, however, with a brief appreciation of the BEC's new guide.

BEC's Business Guide to Sustainable Development

Forgive me if I sound over-enthusiastic. This is simply a great contribution to the Hong Kong community. I like it for many reasons, but let me single out a few. It is based on the Internet, which makes possible inexpensive, widespread distribution. It is interactive, designed to grow as users contribute new ideas and information. It draws in multiple stakeholders, by inviting them to exchange ideas and experience. Finally, I very much like the use of case studies as a demonstration model.

There are more elaborate ways to encourage best practice, but this approach allows companies to share their experiences with sustainable development in their own way. I would like to see more Hong Kong companies adopt formal sustainability reporting, and seek listing on the Dow Jones Sustainability Index or the FTSE4Good Index Series. I would also like to see HongKongEx adopt a sustainability index, and will encourage this in my capacity as vice-chairman of the Sustainable Development Council.

Many Hong Kong companies carry on quietly and are doing a great deal to put sustainability to work within their businesses. Still, for one reason or another they don't seek to "advertise" their achievements. The case study method is an easy and effective way to reinforce best practice and, most importantly, it invites firms to think outside the box about the good things they do for the community and how those actions contribute to the bottom line.

These days it has become fashionable to talk about corporate social responsibility and the "triple bottom line", which one might also describe as the business approach to realizing sustainability. For business, sustainability is about creating long-term value, by enhancing reputation, managing liabilities, being a catalyst for innovation, and lifting employee morale. All of these help build brands in a rapidly changing and competitive world. Hong Kong companies have felt less pressure than multinationals from Europe, Japan or North America to demonstrate an open commitment to social as well as environmental responsibility, but this will inevitably change and some Hong Kong companies are taking the lead.

For example, I have learned from the BEC guide that Sailing Boat Catering Management Ltd., a caterer to schools, is saving money and helping the environment by switching from disposable lunch boxes to environmentally friendly, reusable containers. Swire Properties is saving HK$300,000 a year by sensible management of air-conditioning, which saves both energy and the environment. The list goes on, and I hope it keeps growing.

The more Hong Kong and mainland companies move up the curve to establish global brands, however, the more pressure there will be to meet the highest standards of external expectations with regard to sustainability and corporate social responsibility. There is a direct correlation between competitive companies and those that commit to corporate social responsibility. The more competitive a business is, the more it understands that it needs to look beyond short-term results.

What does sustainable development mean for Hong Kong?

There are many definitions of sustainable development. One of my favorites comes from Sir Crispin Tickell, former convener of the British government's Panel on Sustainable Development. Sir Crispin says that "Sustainable development is about treating the earth as if you intend to stay."

I very much share his view, but in the year that I've served as vice chairman of Hong Kong's Council for Sustainable Development, I've learned that sustainable development is much more about an attitude and a focus on outcomes than it is about definitions. The attitude is very well expressed by Sir Crispin's adage, and is also reflected in the Council's vision, which is:

"¡Kfor Hong Kong to be a healthy, economically vibrant and just society that respects the natural environment and values its cultural heritage. By engaging the community in the process of building a strategy for sustainable development, we aim to ensure that Hong Kong will be a city for all to share and enjoy, for this and future generations."

Hong Kong has one approach, appropriate to its own stage of development. This would not be the right approach for Africa, where sustainable development focuses on poverty alleviation. In Europe and North America, with a longer history of establishing and using democratic institutions, and where as a result there are a large number of civil society organizations and local government agencies, the approaches are quite different but even there the challenges of sustainable development are significant in relation to bringing about behavioral change. Clearly in China, with the world's largest population and a one-party political system, the key objective is to acquaint the bureaucracy with the concept and go about implementing and enforcing it through strong government policies.

In different countries and in different systems the concept of stakeholder engagement takes different forms depending on the political systems in place. In Hong Kong we are richly endowed with civil society, business, and government entities that do care about sustainability. In Hong Kong, at its current stage of political development, the challenge is how to develop a process that will help make decisions from the bottom up. This is also a problem for societies with full-fledged democracies. The relatively new debate over "deliberative democracy" reflects the concern that representative governments on four-year or five-year electoral timetables still cannot do enough to reflect local needs and problems, particularly those that have long-term implications.

In Hong Kong, many problems are compounded because of the ongoing process of institutional transition that began with the return of Hong Kong to mainland China in 1997. In Hong Kong, the key challenge is to bring stakeholders into a dialogue on issues that will shape the city's future, whether it is renewable energy policy, conservation policy, supporting an aging population or protecting Victoria Harbour. We need a way to harness the aspirations of the Hong Kong people to improve Hong Kong on a multitude of fronts.

Democracy, of course, is one aspiration. But in order for Hong Kong's political reform to be sustainable, we must do quite a bit more. There is a real threat that Hong Kong's assets could lose ground. I am not saying that Hong Kong could follow the reverse cycle of Shenzhen - going from a metropolis to a fishing village in a generation - but its core assets need to be cherished, renewed, and expanded.

For Hong Kong to progress while enhancing sustainability principles, multiple stakeholders must be involved in the process of governance. Call it deliberative democracy, call it participatory governance, translating vision to actions, or just common sense, it is a way of building confidence and trust from the bottom up.

One of the most positive effects of the SARS crisis was that for a while, the Hong Kong community really did display a sense of shared purpose, to beat the virus, to help each other, and to restore our sense of balance. Post-SARS, we face a different and more insidious crisis. We know that in order to make the city a great place to live in and do business, we have to strike a balance between political, social and economic development. Talking about politics is not enough; talking about social development or economic development is not enough. Somehow we have to bring them together. We need to understand that there are trade-offs and different dreams. There are times when there are only choices, not absolutes.

The Sustainable Development Council

Let me spend a few minutes talking about the Sustainable Development Council, and why it is going to make a difference. It is almost one year since the inauguration of the Sustainable Development Council. In the next few months, we will finally begin to bring our work to the public.

Despite its name, the Council is not a grand new umbrella over multiple government departments and advisory committees. We are just one small corner of the big table of governance, but an important corner. I am comfortable with this relatively narrow remit, even though there has been pressure from the community to take a stand on current issues, particularly the reclamation of Victoria Harbour. But I would like to tell you how I think the Council will evolve over time within the framework we have been given.

Its first remit is very simple - to educate the community about sustainable development, based on the simplest of definitions, how to conduct ourselves in the present so that in years to come we will have something to leave for the next generation. If this simple definition could be instilled in people's minds, it would achieve quite a lot. The government has set aside HK$100 million for education on sustainability, and Christine Fang, who heads the Council's Education and Publicity Sub-Committee, is driving the message in schools, in the community, and in research.

The Council could take on issues like Victoria Harbour. But at this point it would be putting the cart before the horse. If we can finish our first task, which is to instill a mindset about sustainable development within the community, and establish a framework for policy formation which will perhaps overcome some of our current difficulties in Hong Kong, a year down the line, we may be able to use this to deal with the more contentious issues.

In order to instill a sustainable development mindset, we also need a process and a mechanism to bring the public into active dialogue with business, non-governmental organizations, and government. Thus, our second remit is to think strategically going forward.

The Council's prime responsibility is not simply to look at the current issues of the day. These are important but the reality is that there are plenty of other agencies, departments and advisory committees dedicated with the task. We should not be diluting our efforts at this stage but rather seek to complement by providing advice. Our job is to look over the horizon, to identify solutions that will make Hong Kong better for the next generation.

We want the Council to serve as a model for building trust, empowering the community, and serving as a platform for creative problem solving.

What we have done over the past year has in some senses been spadework of a mundane but necessary kind. The Council has established two sub-committees, namely the Education and Publicity Sub-Committee chaired by Christine Fang, and the Strategy Sub-Committee that I chair. In the two committees, and in the Sustainable Development Council itself, we have had long debates over how best to engage the community. We talked about approaches used elsewhere, and how best to formulate the issues. And we realized that we did not know enough to fix the issues without the community's help. As I've said earlier, Hong Kong's sustainability challenge of today, or the moment, is an issue of participatory governance. People want to be heard, indeed demand to be heard, on the many issues that shape their future.

We settled on a two tiered process, in which we would first engage a narrow group of opinion makers, and then go out to the wider public. This has taken time. Last November, we carried out a workshop of about seventy people who endorsed such a process. This process started with the government identifying three pilot areas that seemed - I have to admit it - relatively easy. The three areas are solid waste management, renewable energy and urban planning. In the future, we will seek to have the community identify priorities for sustainable development, but this seemed the most efficient way to handle things at this stage.

We then set up three task forces to develop public documents, called "invitation and response documents" that we could use to launch a broad community engagement process. Each of the task forces or support groups is comprised of experts in the subject matter, community outreach, and from government. Our solid waste management support group is run by a civil society activist and business man. The convener of our renewable energy support group is a leading engineer. Our urban planning group is chaired by an academic.

Over the last two months, the support groups have been discussing how best to present the trade-offs and the objectives in their areas. This in itself is a multiple stakeholder exercise of the sort we hope to conduct in the broader community. In the next phase, we will take the "invitation and response" documents to all sectors of the community, including to business, NGOs, academics, the housing projects, professional groups, and through web sites to the public at large. We are specifically looking for partners in the engagement process, who will help us move through their networks to bring as much of the Hong Kong community as possible into deliberations on the three pilot areas.

I would also like to say about the Council that we have four ministers heading up very prominent bureaus, including Mr. Michael Suen, Secretary for Housing, Planning and Lands; Dr. Liao Sau-tung, the Secretary for the Environment, Transport, and Works; Secretary for Economic Development and Labour Stephen Ip; and Dr. Yeoh Eng-kiong, the Secretary for Health, Welfare, and Food. We have had the pleasure of their support and know that they are all committed to working with each other and the community to deliver on the same cause. With their help, I am sure that we will start the ball rolling with the process I have outlined above.

Finally, in the context of the current discussion on advisory committees, we hope that the Sustainable Development Council, if it is successful, will serve as a model for other advisory committees grappling with similar issues.

Partners

We look to the Business Environment Council and its members as potential partners, as we move ahead with our first three pilot areas. We invite you to review our work plan to date, to offer feedback on the invitation and response documents that will soon go out to the public, and to help us spread the word through your networks and enthusiasm. Please contact the Sustainable Development Unit if you would like to participate, and we hope you will.

Conclusion

Congratulations once again on the new Hong Kong Business Guide to Sustainable Development. It's one more piece of evidence that we're on the right track.

Ends/Friday, April 23, 2004

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