Monday, April 6, 2015

What is Next for Sustainable Business Now that the Low Hanging Fruit has been Harvested (The State of Green Business 2015)

Business sustainability efforts appear to have plateaued due to the fact they harvested the low hanging fruit and they have not yet understood what it will take to move on to the next tier. This is a simplified summary of the eighth State of Green Business report for 2015. It offers an annual assessment of the environmental performance of companies around the world, along with the trends to watch in the year ahead. Greenbiz produces the report in conjunction with Trucost.

According to the report company performance (GHGs, emissions, air pollution, water use and solid wastes) is leveling off or even declining. Even cleantech patents are not posting the numbers that they once did.

Despite the bad news there are some highlights including the fact that companies are getting innovative with water management and they are increasing their efforts to reduce deforestation.  The palm oil industry is the primary, although not the only driver of progress in deforestation.

A large scale effort is underway to track and trace company supply chains across a range of commodities. This is being assisted by technological advances like cheaper and smaller sensors. There are also a range of new technologies and tools to assess risks, revise strategies and implement solutions.

The report suggests that companies have harvested the low hanging fruit. This includes things with an attractive financial payback such as facilities and fleet management. Although much remains to be done, the new big impact frontier appears to be in managing supply chain impacts.

Corporate sustainability goals are getting more attention. Rather than a wait and see approach, goals are getting more scrutiny at the outset. In response to questions from activists, investors and others, companies must be prepared to provide the scientific rationale for their sustainability goals.

The big question is whether companies will move beyond efforts at the fringes and begin to get really serious about sustainability issues. One of the central tenants of this concern involves how proactive companies will be pushing for the kind of political change that can make all the difference in the the transition to a more sustainable, low carbon economy. They can either actively lobby or wait passively for things like a carbon pricing scheme, accelerated support for renewable energy and cleantech.

Corporate mettle will be tested with the launch of the new sustainable development goals in New York this fall, along with the United Nations climate talks in Paris in December.

To get the full report click here.

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