Monday, February 13, 2017

50 Sustainability Drivers for 2017

This will be a challenging year for sustainability but there are reasons for optimism. Sustainability will not be killed by the new American administration and this post contains fifty compelling reasons why it is unstoppable. Despite some disconcerting global events, optimism pervaded the World Economic Forum earlier this year in Davos, Switzerland.

The sheer size of the opportunity is a powerful incentive. A report called The Death of Environmentalism: Global Warming Politics in a Post-Environmental World says that the UN's Sustainable Development Goals (SDGs) could unlock $12 trillion in market opportunities by 2030 and create up to 380 million jobs.

Although it is important to see beyond the next four years, we must acknowledge that the election of Donald Trump represents a very dark period in American history. In addition to Trump the world faces some serious issues related to Brexit.  Other uncertainties include forthcoming elections in France, Germany and other EU countries.  Imbalances in China's economy and a hike in interest rates are two other issues that warrant concern. Nonetheless, there are reasons to believe that sustainability will keep growing and perhaps even serve as a bulwark against some of these threats.

For years the number of organizations adopting sustainability has been growing, and the depth of that involvement has also been increasing. The business community will not simply forget about years of investment in time and treasure just because a climate Luddite has assumed control of the Oval Office. Sustainability cannot even be stopped by a cabinet chocked full of billionaires and oil men. Nor can a legislature replete with Republicans beholden to the fossil fuel industry force business to abandon sustainability. It is here to stay even if it will face some serious headwinds.

The businesses community has played an increasingly prominent role working in consort with the Obama administration. Now American businesses have an even bigger role to play precisely because of the Trump administration's opposition to science, sustainability, climate action, and environmental regulations. The role of corporations has become even more important in 2017. Rather than just comply with the lessening of regulations promised by this administration many businesses can be expected to lead by going beyond the bare minimum stipulated by government mandates.

Business Case

1. Sustainability has consistently moved up in the value chain
2. Sustainability is already a mainstream phenomena
3. Studies prove that there is a strong ROI associated with sustainability (operational efficiencies)
4. A cost benefit analyses prove that the cost of action is far less than the cost of inaction
5. CEOs, boards of directors, senior executives and top management have already inculcated sustainability into their thinking.
6. Some leading firms have already woven sustainability into their corporate DNA
7. Many corporate cultures are now steeped in sustainability
6. Pressure on business to become responsible social actors will grow not diminish
9. Adopting sustainability is a competitive necessity that means corporations can either adapt or risk dying

Human Resources

10. Sustainability is important to employees who want a sense of purpose in what they do
11. A sustainability-focused workforce is a happy workforce and this contributes to loyalty and productivity
12. Sustainability can also attract talent to an organization
13. Sustainability can contribute to employee retention and decrease churn

Reputational benefits 

14. Sustainability offers brand value and recognition
15. Sustainability can be a powerful marketing focus
16. Corporations that conduct themselves responsibly also stand to reap a reputational windfall
17. Businesses that eschew sustainability risk alienating the public
18. Sustainability helps companies to mitigate against reputational risks
19. There is a growing public appetite for sustainability

Supply chain

20. Changes to supply chain dynamics frequently mean that suppliers and vendors must comply with the sustainability criteria of those they do business with

Investors
 
21. Stakeholders and investors are interested in sustainability as a prophylactic against risk
22. Institutional and individual investors want more non-financial information and transparency, they want to see an assessment of risk and a coordinated sustainability plan
23. Investors are attracted by the returns associated with sustainability focused investments
24. Interest in so called externalities related to climate and environment continue to increase 

New tools and guidance

25. New sustainability tools and guidance like the GRI reporting standards and supply chain guidance
26. The growth of sustainability-focused best practice

Global pressure
 
27. The Paris Agreement has come into force and heralded a new era of climate action
28. World leaders recognize the need for coordinated climate action
29. International sustainability focused cooperation agreements will continue
30. The G20 has stressed the importance of greening the financial system
31. The implementation of the UN's Sustainable Development Goals (SDGs)

Sub-national action

32. Cities and states will continue to be sustainability leaders independent of the position of their national governments
33. The US military continues to see climate change as a national security threat and this is driving their sustainability efforts

Facts on the ground

34. The science of climate change remains unassailable
35. The decoupling between growth and emissions is already well underway this will accelerate as a growing number of businesses implement their pledge to meed science based emissions targets
36. The window of opportunity we have to act on climate change is closing so there is a growing urgency to action.

Burgeoning public awareness

37. According to the most recent polls concerns about climate and the environment continue to grow
38. There are a growing number of sustainability focused learning opportunities 

Changing demographics

39. Young people and millennials in particular are sustainability minded and they are participating in the work force and voting
40. Old people are far more likely to resist climate action and they are retiring or dying

Clean (renewable) energy

41. The cost of clean energy is rapidly deceasing and solar is now one of the cheapest forms of electricity on Earth and this is being supported by the decreasing costs of battery storage.
42. Clean energy has achieved grid competitiveness in terms of the levelized cost of electricity (LCOE)
43. We can expect these prices to decline further as related equipment prices are expected to keep declining

Non-financial interest

44. Corporate citizenship incorporating sustainability gives a firm a social license to operate
45. Rising rates of inequality are a threat to businesses as such this they have a vested interest
46. Sustainability has been shown to drive innovation
47. Cross-industry collaboration premised on sustainability will continue
48. The ongoing growth of Corporate Social Responsibility (CSR)
49. Sustainability can help companies to anticipate and manage disruption
50. As we have seen in Romania the war against corruption will continue and sustainability is key