How To Make Saving The Planet Your Competitive Advantage
Climate change is a bigger talking point in company boardrooms than it has ever been. And it's not only because the future of the planet is at stake; the sustainable growth of almost all companies is reliant on slowing and reversing the effects of climate change.
There's consumer demand for it too. According to a survey conducted by Nielson, 81 percent of consumers strongly believe that companies must contribute to improving the environment.
The crux of the problem is that the global economy is still built on a model of perpetual growth, of unlimited access to resources. Only now are organisations starting to change their behaviours in recognition of the fact that there are limits and consequences to everything that we extract, manufacture, consume and waste.
Khairun Nisa Zabidi leads the UK’s International Climate Fund (ICF) in Malaysia, a multi-million-dollar technical assistance programme that helps countries to “accelerate their clean growth transitions and reduce carbon emissions”. Khairun says company executives need to start by evaluating their business model and considering how relevant the company's products or services will be in the next 50 to 100 years. “Unfortunately, many companies think in the short term and don’t forecast risk beyond three to five years, because of broad variables,” she says.
“We need to move away from whether climate change exists. That's not the question any more. It really is about us making decisions based on what science tells us. Consider what the world will look like in 20 years if we don’t act,” says the former sustainability and climate change consultant.
She warns that even long-established companies, family-owned business that have survived for generations, face an existential crisis today. To survive it, companies need to be transparent and collaborative. “If you think about companies like Coca-Cola, where most of their business is dependent on clean water, they cannot work in a silo to protect their water source. This is something that involves everyone, and establishing partnerships is crucial in determining what our future will look like."
“Things have changed since a decade ago. Companies that genuinely believe in sustainability will act sincerely and it will show”
According to research from the World Economic Forum and Boston Consulting Group, tackling supply chain emissions will be the game-changer in the global fight against climate change.
As of today, some of the biggest corporations in the world have committed to going carbon-neutral. This includes Amazon, which has committed to be carbon neutral by 2040. Both Microsoft and Apple plan to reach the milestone by 2030.
Even some of the world's biggest oil and gas companies, such as Petronas and ExxonMobil, have announced intent to be net-zero carbon emitters by 2050.
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Khairun says that commitments such as these, from the world's biggest companies, has a positive knock-on effect as they require all businesses in their supply chains to also roll out net-zero carbon plans.
Beyond these high-profile examples, Khairun says she sees more and more organisations shifting their business models behind closed doors. “Things have changed since a decade ago. Companies that genuinely believe in sustainability will act sincerely, and it will show.”
Companies are starting to realise that operating your business more sustainably isn't a competitive disadvantage, says Khairun; it will help those companies pull ahead over the next decade. “If you are going to be a leader, it's clear that those who move first will reap the biggest benefits, while those that are left behind will lose out.”
See more honourees from the Sustainability category of the Gen.T List 2020.