At the World Economic Forum (WEF), world political and business elites met to discuss the state of the climate and what actions should be taken to rectify the current situation. Though the forum witnessed a lot of debates, the underlying theme was that climate change is a real and present danger and needs to be checked. The clear message is that everyone needs to do their part. This is not surprising, and it includes businesses across the globe, irrespective of industry, irrespective of size. However, this raises a number of issues for, and questions from businesses. Do small businesses matter in this fight? Can employees contribute? Can I grow or maintain profits while focusing on climate change? Below are some important facts that we feel businesses need to remember/ be aware of in order to address some of these questions:
Small business can contribute as well: It is the usual belief that climate change reversal will be positively impacted when large businesses get involved. This might be true however, small and medium size businesses can also have a positive impact on the climate by altering their purchasing preferences. Small businesses can alter their energy suppliers or transportation suppliers to more sustainable companies, they can insist their vendors use sustainable practices, etc.
People will want green products but, will want them cheap: This is usually the dichotomy of businesses, customers say they want green products but continue to buy something that is cheap. Manufacturers will have to find a balance between good quality green products and price. The belief that customers are willing to pay premium for an enviro-friendly product is incorrect. We work with a large Japanese bio-economy Unicorn who is pioneering the creation bio-friendly material, and their big focus at the moment is not just the performance of the product, but also how to reduce the price to be comparable to fast fashion. This is to our minds is key, focusing on the business sense of it as well.
Real sustainability might not make business sense, but we need to do it anyway: Though it is believed that businesses make decisions basis “triple bottom line” considerations – profit, people and planet, this is far removed from the truth. More often than not, these three contradict. “what will happen to our bottom line if we switch to a more sustainable electricity supplier?”, “what will happen to the margin if we insisted on using only fair-trade products?”, etc. Hence, we should stop pretending and acknowledge that the reason a business should take this step is care for the future generations and the environment. We need to acknowledge this till the world moves into “green taxes” and laws against ecocide are introduced.
It’s not just up to the C-suite of companies, employees can play a significant role to: The GenZ is certainly more vocal than the older generation, even in matters related to climate change. World over there have been instances of employees insisting that their companies adopt sustainable practices and actually affecting the change.
Though, there is a lot more that companies can do, it is increasingly becoming difficult to be optimistic about the situation we are in. Climate change is very serious and tremendous effort will be required from all stakeholders to arrest the damage. However, it is important to note that we have come ahead in our awareness of the issue. Till very recently climate change was a side issue for the business community, and now almost all large companies have it on their agenda. Another thing to note is that the cost of the clean economies (building green buildings, solar power, etc.) has radically reduced in the recent past. This gives us hope for sustainable products and their competitive abilities. Lastly, the youth, the kids on the street and their awareness has grown significantly. We refer to not just Greta Thunberg, but also all the millennials that are clearly more conscious and voicing their opinion without fear. Though climate change poses one of mankind’s largest threat at the moment, we believe it also provides opportunities to businesses to evolve and innovate.