Navigating through the sustainability megatrends

Dec 19, 2014

We are now living in a world where the consumer is undoubtedly king. At the push of a button or a click of a mouse big brands, individual companies and even whole industries can find their reputations in tatters if they make the wrong supplier choice. The pulp, paper and bioenergy industries are right at the forefront of this new world, and there are plenty of both challenges and
opportunities to embrace.

Tobias Webb runs the London based Innovation Forum which has sustainability and responsible business practice at the heart of its foundation. Webb is something of an expert on the subjects, as well as lecturing on Corporate Responsibility at the University of London he is also the mastermind behind Innovation Forum’s thought-leading conferences such as its latest: How Business Can Tackle Deforestation. The conference held in London recently attracted high level speakers including politicians, procurement officers from companies such as Unilever, McDonald’s and Marks & Spencer as well as NGOs including Greenpeace.

Forward asked Webb for some insight into some of the global megatrends that are affecting major corporations and their sustainability agendas, and for some ideas on how to manage goals going into the future.

“Well there are a lot of megatrends” he says. “But KPMG has identified ten sustainability-related issues that corporate reputations could hinge on and that must be addressed as a matter of urgency. These are: climate change, energy and fuel, material resource scarcity, water scarcity, population growth, wealth (middle class predicted to grow 172% up to 2030), urbanization, food security, ecosystem decline and deforestation. All of these should be of massive importance to all major companies”.

Consumer expectations are changing

The consumer, through the Internet and social media, is now much better educated and informed as to what is going on in the world and even a single voice can now go viral and make a huge difference, but Webb believes that this consumer behaviour change is a really difficult area to manage for B2B companies going forward.

He says: “There are more than 400 eco labels worldwide and they confuse customers and a lot of these have a negligible impact on the environment anyhow. But it is really consumer expectations that are changing how both B2C and B2B companies are thinking. Research from all over the world, particularly northern Europe and emerging markets shows that whilst consumers want sustainable products, they don’t want to be drowned in detail. They simply expect brands to get on with it.

“In the B2B space there’s lots of really interesting innovation going on,” continues Webb. “This has much less to do with consumers than with redesigning products and services for efficiency and environmental savings, for instance on carbon, water and chemicals. So companies such as Interface have redesigned how modular flooring works, DSM have reworked their business around recycling, and suppliers to companies like Coca-Cola have begun innovating with plant based PET type plastics to reduce environmental impacts. Siemens now has a whole business unit, a major one, focusing on the opportunities for sustainable and technologically enabled urbanization, and firms such as Skanska do ‘deep green’ retrofits in old buildings such as the Empire State in New York, which hugely reduce costs and impacts. We’re at the early stages of a slow revolution – or perhaps even a fast evolution is better way of putting it – and many B2B companies, and businesses which invest in sustainable R&D today, such as Nike or Adidas are doing, will reap the rewards in the medium term and long term”.

Serious issues to be tackled in biomass based industries

A lot of innovations and good development in sustainability issues have taken place in the pulp, paper and bioenergy industries during the recent years. However, active discussion on the topic continues. Whilst not professing to be an expert in the pulp and paper sector, Webb has had some experience, most recently with the industry in Asia especially. So what is his take on the industry’s position in relation to challenges of a corporate sustainability nature?

Webb comments, “It’s obvious to me that the pulp and paper sector has some very serious issues to manage with regard to sustainability. The big issue has been poor planning, with little consideration for biodiversity and natural forest. But this is changing fast, all over the world, and technology and transparency, alongside NGO and investor pressure, is driving progress faster than ever before towards greater sustainability. A major trend is information mapping, the Global Forest Watch as an example, led in part by the World Resources Institute. This is part of the bigger trend towards much greater, almost real time, information flow about how companies are managing natural assets.

“But I think paper has the potential to be seen as an extremely environmentally friendly product,” continues Webb.

“However, this potential is very dependent on how it is produced, used and disposed of and recycled at end of life. Any natural product can be managed sustainably, over time.”

And finally, what has been the impact of social media? Has its rapid take up really made the major corporations sit up and listen when it comes to issue of sustainability, deforestation, and social responsibility?

Webb concludes: “Yes, definitely. Rightly or wrongly, the Greenpeace/ Kitkat and Mattel/Barbie youtube campaigns were highly effective in driving change. Were they fair? Probably not, but campaigns like it, and more nuanced ones such as those by Canopy in North America, have made, and will continue to make a real difference”.