NP Group Blog

Global Change and Sustainability

Posted by Andy Green on Jun 25, 2018 9:12:50 AM
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On the 5th of June 2018, I hosted NP Group’s fifth Technology Leadership Breakfast. Over the years I’ve been running this series of events I’ve covered digital strategy, cyber security and artificial intelligence. This time I wanted to do something different. I’ve been engaged in the issue of global sustainability for a very long time. At the Breakfast I remade the case for a global focus on sustainability, assessed the drivers for companies to take action and then considered how much action organisations take currently and why. In this blog I’ll cover off the case for sustainability and set the scene for why we need to take action now.

Global Change and Sustainability

Why Should We Care About Sustainability?

We live in extraordinary times. I know everybody says this about their times and about the rate of change, but we really do.  There’s so much information in the media about the world experiencing a rapid rate of change. Whether you’re viewing this from a business or individual perspective it’s all encompassing and you can feel the effects. One thing I think we are blinded by is that all of this change is to do with technology. Yes, tech is evolving at a rapid place but it’s not the be all and end all of global change.

So, the rate of change isn’t just because of technology and the digital age…or Donald Trump…or global warming or all the other things we blather on about. I think there are two key things happening right now which should be the focus of discussions: population growth and an increase in the number of wealthy people.

I was born in 1955 and there were 3.3bn people on the planet. In my lifetime the world population has already more than doubled. If I’m lucky it will have more than trebled before I die. I often refer to this as a Plague of humans! It’s something David Attenborough has spoken about and there are serious consequences which I will come on to shortly. Every year, the world’s population is expanding by 83 million people. Right now, there are around 7.6 billion people in the world (for a live update on current world population check out worldometers – link). By 2050, there may be just short of 10 billion.

Half the world’s population growth will take place in 9 countries:  India, Nigeria, the Democratic Republic of the Congo, Pakistan, Ethiopia, the United Republic of Tanzania, the United States of America, Uganda and Indonesia, whilst Europe’s population will decrease. This directly impacts the rate of change the world sees. These changes in population are changing consumption patterns and increasing the average lifespan. Countries whose populations are declining have to think about different things to those whose populations are increasing. For Europe, there will be a huge focus on how to support older people when there are fewer young workers to pay into government funds whilst those with growing populations will need to think about how to feed them and provide education and healthcare.

What does this mean? I visited Ethiopia to look at famine relief operations last month and I was blown away. 100m people. A business opportunity, a reason for celebration, but the growth in population is the root cause of so many sustainability challenges.

The huge number of people living on Earth and consuming resources means climate change, there are pressures on space, places to grow food and of course the lack of natural resources. Unless we come up with something radical it’s going to get worse and worse.

The second major trend is that people are getting wealthier. Fewer and fewer people are living outside the money economy. And of course, this is happening quicker than we’ve seen before. According to the World Bank global wealth increased 66% from 1995 to 2014 (link). This is fantastic for billions of people across Asia, Africa and South America. But not so good for the planet.

As people move into the money economy, they begin to consume the world's resources at an unsustainable rate (as the rest of us have been doing for ages!). Because of TVs, movies etc., we all aspire to live like Texans. But if we did, we'd need to reduce the amount of the world's resources used by a Texan by 90%, to less than 10% of today's level to be in balance with the planet. Turning off the air conditioning just won't hack it!  Science writer Tim De Chant calculated that we would need four Earths to sustain us if everyone lived like a Texan. Tim did this by looking at the average American’s ecological footprint and multiplied this across the world’s population. Given the rate of growth of the world’s population you can probably make an educated guess that even four Earths wouldn’t cut it now as this research is a few years old. Scary.

It's clear that sustainability will be the abiding issue of our age. Whether it is fish, water, rare metals or oil, things will start to run out - potentially with catastrophic consequences for the billions who rely on them. By the way, as a trustee of WWF, if you think it’s bad for humans be grateful you’re not from some other species. We’ve wiped out more than 50% of the vertebrate populations in the world since I left university. Our demands on the planet will lead to a catastrophic loss of biodiversity in the next decades.

My parting thoughts on sustainability. Ignore Brexit, Trump, Facebook, Google and GDPR for a moment -  we’ve created a new geological Age - the Anthropocene Age in just my lifetime. That really is something to think about.

When it comes to business, all companies create externalities. Some companies like miners and oil companies very obviously and significantly. But even knowledge-based companies do at a lower level. But what is an externality? When companies provide their products or services to customers, employ people, pay taxes and reward shareholders they nearly always create some shared cost to society as a whole which they are not required to pay for. Things like pollution and greenhouse gases, health and safety impact the planet and people for sure but also other more nebulous costs like congestion, customer health effects, social costs and financial impacts.

In my next blog I’ll delve further into these points, discuss why businesses are doing something about sustainability, what they’re doing (and not doing), and what you can do.