With more than $1 trillion at risk from climate impacts, global capitalists are beginning to parrot the concerns of environmentalists.
Climate Week NYC, the largest climate event in the world, kicks off this week ahead of the UN Sustainable Development Goals (SDGs) Summit. Nearly 150 events are scheduled across the city’s five boroughs—theatre and fashion to sustainable tourism and investment conferences. The resounding goal, according to the Financial Times, is a bold migration toward business with heart, or extensive green commitments from companies, investors and governments. Clearly, the economic impact of climate change is awakening around the world like a sleeping giant. What no one could anticipate, however, is how this budding economic identity could turn archenemies into allies.
As it turns out, both global capitalists and environmentalists can appreciate the idea of “moral money.” The recent inaugural Fortune Global Sustainability Forum by Fortune magazine revealed that businesses—Fortune 500 to millennial startups—are getting hip to the idea of a purpose-meets-profit mission and laying the foundation for a future circular economy in the process, whether turning wastewater into clean water or extracting carbon from trash. In China, considered a lynchpin for global sustainability, plans are underway to require publically listed companies in the country to disclose environmental data to investors as soon as next year. Even iconic institutions like the Bank of England and the ICBC are adding climate risk to their monetary policy frameworks, and issuing higher interest loans to those most at risk. Taking this a step further, a group of 140 banks worldwide just signed the UN Principles for Responsible Banking, which aligns with six of the 2030 UN SDGs.
How Will Climate Change Hurt My Bottom Line?
We’ve spoken in-depth about what sustainably is and isn’t; how the inseparability of poverty, inequality, climate, environmental degradation and justice are collectively framing the reality of future generations. A recent report by CDP, an international non-profit that drives corporate sustainability, flipped the script on the economic woes of climate risk by assessing the economic opportunities of mitigating climate change. Surveying the 500 biggest global companies by market cap, the CDP forecasted $1.2 trillion in potential revenue from low emissions products and services. Climate business opportunities were estimated at $2.1 trillion.
Surveying the 500 biggest global companies by market cap, the CDP forecasted $1.2 trillion in potential revenue from low emissions products and services. Climate business opportunities were estimated at $2.1 trillion.
The bottom line is changing.
If you happen to work at Enterprise, a global leading car rental provider, you may find your bottom line now includes feeding millions of vulnerable seniors and children. The company’s “Fill Your Tank” program marks the largest donation ever to Feeding America at $2.5 million every year for six years. Luxe car company Mercedes-Benz has found its purpose-meets-profit rhythm with a goal to make 50 percent of all 2030 cars either fully electric or plug-in hybrids, with a new fleet totally carbon neutral by 2039. Dow Chemical, meanwhile, is starting to turn plastic waste into open road, while Anheuser-Busch InBev is integrating blockchain into its supply chain software to help farmers in developing countries establish credit history and eventually financial independence. Others are looking back to bygone eras for practical solutions to climate change. Reminiscent of the ‘50s iconic milk delivery service, a new zero-waste company called Loop is delivering day-to-day staples like milk, toothpaste and detergent in reusable containers. The list goes on and on.
Events & the Purpose-Meets-Profit Economy
Investing in nature is the fastest and most obvious way to revitalize and stabilize the natural world. Fiona Pelham, CEO of Positive Impact Events, says the entry point for long-term sustainability in the events industry that would immediately begin to help revitalize the natural world and mitigate climate change is measurement.
“If as an industry we’ve been measuring for the last five years, we would be able to say ‘carpet waste is one of our biggest challenges,’ or food waste, carbon emissions from people traveling from the airport, or disgruntled local community people who are not involved in our events. We would know what our issues are but we haven’t been measuring. So if there was one action that I would ask everyone to do it’s to measure. Because what you measure gets managed.”
In line with the new moral money buzz phrase, Pelham says that “businesses are changing their strategies to align with the SDGs. The US Business Roundtable recently said it best: Shareholder value must be more than just economics; it must be more than just profit. So as this trend is going to continue, sustainability is going to become the DNA of most businesses. Events are how businesses and products come to life. We as an industry have to realize that sustainability should now be a given—we should not be waiting for clients to ask for it.”
"If there was one action that I would ask everyone to do it’s to measure. Because what you measure gets managed.”
Forget One-Size-Fits-All
Moving away from the one-size-fits-all sustainability checklist is another ingredient of the emerging purpose-meets-profit economy. “Every single event is different,” Pelham says, “therefore, during the planning of an event, there should be a stage where the key stakeholders come together—supply chain to client to event organizers—to identify the sustainability challenges of the event. Then they can create objectives to address those challenges. Sustainability is not just the environmental piece, it’s also the social and economic piece. When planning an event, the event organizer should be thinking: ‘What location should I chose?’ Well, what location would make a difference to the local community for the budget that I have? Or, ‘What materials can I use if I’m giving a gift away?’ could segue into, 'Which local companies could support where the money would be going somewhere that would make a difference?'
Event organizers should be strategic in identifying their own sustainability objectives. Steer clear from ‘We must do x’ because that’s never the case with sustainability.”
