Sustainable development – Business perspective
The world experiences an era of unsustainable patterns of global consumption. Globalization brings us an abundance of masses, with the aim to rise to the middle class, air conditioned homes, polluting cars and electronics of all kinds in their sights. The economic integration that happens globally convey us challenges that span across national boundaries. At the same time, we aspire ourselves with new traits of consumerism. Partly due to this phenomenon, social settings that were rather stagnant for decades now change rapidly particularly in countries around the South China Sea.
Definition of sustainability has been refined on various occasions across decades. In our time, we can define sustainable development as a need to meet the demand for goods and services without compromising the future generations, and offering them such resources to meet their children’s and grand children’s needs. Equality, empowerment, water supply, deforestation and food itself – the needs of sustainable development are essential for life on our planet. These necessities vary based on location, from isolated tribes in the rain forests of Amazon to Sahel African failed states. Global challenges; massive water shortages, lack of proper food, lost harvests and volatile social structures induce poverty. Developed countries have globally spanned challenges. Climate change, energy production, uncontrolled immigration and recently also security has topped the agenda that regional and global media has echoed. On a global level, one can define the challenge as “global equity” (1).
Where we are?
How did our planet end up in a situation that truly endangers existence for future generations? The culture of consumerism, surely propels the trend further, while global affluence acts as the main driver for masses. This amplifies the trend intensifying consumer driven lower middle class, that is expected to reach purchasing power of $5 trillion by 2030 (2). Simultaneously world GDP is expected to jump over three-fold by 2050. In the future the growing inequality widens the gap of diversity, urbanized conflicts continue between the needy and the one’s better-off. For governments, the response will get worse in terms of security, capacity and investment into infrastructure. The inequality is increasing with developed countries rushing further into exponential technologies. Luckily, technology creates reflections towards developed countries, such as cheap smartphones to cover over 80% of world population by 2020. These little windows of see-for- yourself, provide a framework to think for yourself, for your empowerment. The truth does not need to come out from a corrupted head of state in sub-Saharan Africa or a bribe-seeking the regional head of school district on the outskirts of the countryside of Cambodia. Independent thinking offers freedom by allowing the participant to join education but also takes the curious kind to become part of the global race for competence.
Challenges vs. Opportunities
While the challenges are enormous, so are related opportunities for businesses. Economic benefits reflect opportunity, and rising wealth play a crucial role in the development of solutions for sustainable development. Government guidance is needed to protect the environment, as economic growth and financial benefits are main incentives for businesses to dedicate resources for research and development of new products and services. As we can see, these concepts are inextricably linked. New forms of cooperation between governmental institutions, business and society itself are essential to reach goals. Creation of clean energy is crucial to stop global warming. Fossil fuel based energy creation is coming to an end, with countries such as Norway are likely to ban the operation of combustion engines from 2025 onwards. Germany and Sweden intend to reduce fossil fuel based energy creation and shut down nuclear production in 2022 – 2025, whereas China and India rely heavily on coal as the primary energy source for years to come (4). Free movement of labor, democratized education and global access to information foster innovation for the ecosystem as a whole. Products and services, packaging and brands need to reflect the mindset of the environment and relate further to production, visually and structurally. Businesses need to relay a message from the origin on the package and marketing messages to consumer, with recycling and production. Freely bred chickens provide better-tasting eggs, but they also live longer than the industrial standard of 12-months of their cage-bred counterparts.
Government adaptation to changes should allow reasonable time for business planning and implementation of investments, provided by capital markets. Capital markets are essential in the delivery of capital for businesses to enact the required research, product development and the implementation of marketing and sales efforts. Information delivery channeled through professional web services and government guided forums provide a framework for efficient communication between parties. As long as trade policies are open, they offer most efficient use of resources towards developed countries. However, at the same time consumers need to support participating actors; businesses, government and civil societies for efforts to make sense commercially.
The age of exponential finance takes over the cash societies. In part, this means that people in the outskirts of a global metropolis, with no access to banking services in the traditional sense, become empowered by locally distributed westerly goods and services. The rapid development of identification lagging citizenry provides every resident with an increased level of living. The former lag of product distribution, even for large goods, such as solar panels and household goods can be minimized to some days. The mother, at the end of the road of equality, is now able to sit atop a pedal operated an electric free washing machine, while overseeing plays and games of the next generation of a village.
Sustainable business is sound practice as it provides a competitive advantage with long-haul building and rapid life-cycles of business planning, development and eventually product delivery and sales. Without strong leadership, the opportunity fades for easier and geographically closer opportunities. Sustainable business models scale the efficiency, technology transfer and new modernized ways of thinking throughout the organization for everyone’s benefit (3). Therefore, business leaders are required to have sustained commitment translating challenges into business incentives, opportunities and execution. Consumers and businesses need to maintain a constant dialogue with policy makers and NGOs to welcome defined sustainable models of cooperation, as the citizens at the end of the road to equality are awaiting.
In Turku 9th of June 2016,
Head of Global Partnerships
Tapp Commerce is part of United Nations Development Program Business Call to Action.
- UN World Chronicle – The Magazine of The United Nations, Human induced Disasters, 2016 and 2007.
- World Business Council for Sustainable Development 2015, 2005
- Schmidheiny, Stephan, Changing Course: A Global Business Perspective of Development and The Environment 1998
- World Energy Index 2013 (http://www.worldenergy.org/).