Positioning your business for the dawning of the green economy

Hugh Tyrell

Hugh Tyrell

The development of our modern economy produced specific challenges over time that South African businesses are increasingly responding to, reports HUGH TYRELL.

The economic system that runs our working lives – industrial capitalism – came into being over 250 years ago.

At that time there was a lot fewer of us (about seven billion fewer) and a lot more of nature.

Today it’s the opposite.

Through a combination of our inventiveness as a species, scientific and medical improvements, an abundance of oil and coal for fuel energy among others, our population has exploded.

And along with it, so has our impact on the environment.

Our “success” as a species has caused our forests to be cut down, our soils depleted, our seas over-fished, and our water and air polluted.

By the 1950s, signs of the damage to our planetary life-support system started to become inescapable and in response, the environmental movement took shape.

Around the world, people began to stand up against polluting industries, toxic agriculture, and other forms of degradation.

Governments took notice and enacted laws to limit this destruction set in motion by a highly efficient economic system that had until then not taken nature into account, except as a place from which to extract resources to which to dump waste.

A milestone in the recognition that business had to change its relationship with nature was the Rio Earth Summit in 1992. Here the idea of “sustainable development” was born.

This was an understanding that present generations have a responsibility to leave the planet in a condition that gives following generations the same resource options as they had.

Slowly things began to change and more governments enacted laws to protect our environment. Meanwhile the world’s human population continued expanding at an increasing rate and along with it, industrial production to meet the wants of the consumer society being promoted through mass media.

At the same time, this production and consumption was being fuelled by an energy source that emitted carbon dioxide (CO2). As more of it was released into the air through burning coal and oil to power our industrial civilisation, global warming was the result.

Increasing concentrations of CO2 began to trap heat in our atmosphere in sufficient quantities so as to change the climate, with harmful and very costly effects on nature and humanity.

The realisation that the usual way we were doing things and going about our business could have such wide-ranging impacts on our planetary system was a wake-up call to all.

Fierce debate broke out about whether the science behind the climate change findings were rigorous enough, and the oil and fossil fuel companies and their lobbyists threw their considerable weight into campaigns to cast doubt on the findings.

South Africa’s government also set commitments for the country to reduce greenhouse gas emissions of 34% by 2020 and 42% by 2025.

These are significant targets which are partially being met by the huge growth in our country’s renewable energy industry, which has seen private investment in it grow in recent years at a rate far faster than any country globally.

Though the vast majority of international scientists overwhelmingly support the findings, the fossil fuel industry continues to oppose them.

This is partly because if coal and oil were left unused in the ground, they and their investors would end up with worthless assets.

However, around the world, far-sighted governments and businesses are seeing the light and it is green.

In 2009 President Zuma and his advisers went to Copenhagen for the COP15 intergovernmental negotiations on climate change.

There the developed nations, whose growth had been based on unlimited supplies of fossil fuels, acknowledged that they had a responsibility to support the developing countries to grow, though on a low-carbon trajectory.

The developed nations were prepared to back that up with a billion dollar climate fund which would go to developing countries with a green economy development strategy in place.

Soon after President Zuma returned from Copenhagen, the government got to work to put together a green low-carbon economic strategy.

By the time COP17 was hosted in Durban in 2011, a “green accord” co-operation agreement had been reached by a range of government departments, private business, labour unions and civil society organisations.

Tough local-content requirements as part of the deals seek to stimulate growth and employment in a variety of sectors primarily construction, electrical engineering and manufacturing.

A green jobs research report by the Industrial Development Corporation (IDC) and the Development Bank (DBSA) has predicted that some 500 000 jobs could be created with the greening of the South African economy.

The IDC is investing R22 billion in green industries in coming years.

This will be going to industries with a focus on cleaner production, cleaner energy generation, greater energy efficiency, mitigation of pollution, waste reduction and bio fuels development.

Other areas that hold good green growth potential are agriculture and natural resource management.

According to researcher JM Borel-Saladin, the potential long-term benefit of greening the economy is innovation.

The development of new technologies, industries and processes could provide a whole new range of employment opportunities.

The ground is being prepared for a vast range of opportunities for innovation and entrepreneurship by both large and small companies.

Those enterprises who want to be in business profitably for the long term, who understand the need for environmental protection and can bring greening into day-to-day operations and strategy are best-placed to score.

The green economy is opening up quickly and the time to gain first-mover advantage is now.

  • Hugh Tyrrell has over 30 years’ experience in the environmental, communications and marketing fields. He has founded national environmental magazines, convened environmental media conferences and consulted to companies such as Woolworths and Distell as well as the City of Cape Town. To read Hugh Tyrell’s blog and find more information on how to green your business, visit www.greenedge.co.za

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