Businesses can no longer afford to ignore the opportunities presented by the green economy, says Oxford Innovation business coach Jonet Walldock
The Low Carbon Economy offers new business opportunities and new jobs as Government policy and incentives create new markets. The global market for low carbon goods and servicesis currently estimated to be worth £3.2 trillion and is estimated to grow to over £4 trillion by 2015.
With escalating fuel costs, the risks and opportunities presented by climate change, greater competition for scarce resources and increasingly aware and concerned customers, business can no longer afford to do what they have always done. Sustainability needs to be at the heart of business decision making for businesses to survive and thrive in the emerging green economy.
In the Government’s drive towards a low carbon economy they have implemented a range of incentives to reduce greenhouse gas emissions through energy efficiency and renewable energy generation.
The Green Deal, Feed in Tariff and Renewable Heat Incentive have created new business opportunities by stimulating demand for home insulation, renewable energy installations and the development of energy efficient lighting and equipment.
Legislation relating to waste, water, energy and climate change is increasing and business is being charged various levies associated with their energy use and carbon emissions. The landfill tax escalator is making the disposal of waste to landfill progressively more expensive and improving environmental standards for water quality requires greater on-site effluent treatment.
Whilst an increasing cost to business it also presents an opportunity for a business to revisit its operations and develop more efficient ways of working.
The money saved through reduced energy, water and materials use and lower waste disposal costs can be spent or reinvested in the business. The reduced reliance on fossil fuels, finite materials and long supply chains also makes business less susceptible to problems with security of supply.
Marketing the environmental credentials of your business or products can be a powerful tool to gain competitive advantage and win market share. As Government, consumers and businesses become increasingly aware of environmental issues they seek to buy from, or work with, organisations that can demonstrate that sustainability sits at the heart of their decision making and have in place robust systems (such as ISO14001) to manage and reduce their environmental impact.
Winning environmental awards, gaining recognised standards and using environmental labelling can enhance your reputation and demonstrate that you are a responsible organisation. By providing information on how your products are made, and advice on how to dispose of them, will also help your customers to make an informed choice on what to buy and who to buy from.
The business benefits do not end there; by improving and marketing your environmental performance you can also attract and retain high quality staff. The Stanford Graduate School of Business student survey in June 2008 found that 75% of MBA students surveyed felt a reputation for ethical conduct was as important as a job with intellectual challenge and good salary.
When fully implemented and integrated in the business ethos, sustainability saves money by improving productivity and reducing costs, improves competitive advantage by reaching new markets and fulfilling customer demands, and helps to attract and retain talented employees.
Canyou afford to ignore it?
This article first appeared in the October 2011 issue of Business Cornwall magazine