MovingTimes

A possible answer to this dilemma is recognising the need to take action on both sides. Trying to choose one could be a false choice.

At the Australia 2020 Summit in April, Federal Minister for Climate Change, Penny Wong, concluded her presentation with the statement “Act quickly; act wisely.” Acting with knowledge and wisdom can make the difference in preparing your company for the ‘carbon constrained economy’.

The value of environmental initiatives in a business can manifest itself in many ways. The companies which have deeply explored the implications of sustainability for them across all of their business units tend to unlock the greatest value.
For example, in office-based businesses, the benefits of an internal ‘green’ programme in a tighter economy include the obvious operational cost efficiencies achieved through reduction in the use of energy, office supplies, car and air travel. But, of even greater value in these times, are possible cultural benefits derived through a positive focus on doing the morally right thing and sense of collective achievement; at a time when employees are potentially anxious about the future. The return from productivity could be greater than from the operational cost savings.

The depth to which such a programme is embedded in the culture will usually determine its value to the business. In the latter situation, businesses can enjoy the benefits of motivated employees innovating in other areas of their work, cross disciple collaboration and new knowledge networks forming.

The Toyota Motor Corporation is famous for having one of the most effective automotive production processes in the world. At the heart of this process is a deep-seated commitment to eliminating waste in production.

This fundamental principal of sustainability has been instrumental in Toyota's rise to become one of the world's largest auto manufacturers with much greater profit margins than it American counterparts.

Beyond the benefits of acting immediately on environmental sustainability, we must also be cognisant of the costs of postponing action until more financially prosperous times. As the rate of climate change progress in Australia accelerates, will we be left behind? Will we see a more polarised market when the sub-prime smoke clears; with the leaders having made significant advances and their competitors lagging?

‘Green’ is now more than the opportunity for a company to differentiate itself as a ‘ leader’ in the market. With the growth in uptake, in many sectors it is now a standard expectation. Customers, clients and employees place a range of values on being green. It can be a hallmark of quality, social awareness or forward sightedness; all important values for companies today, especially those trying to attract younger talent.

We must also consider the current tight employment market. Given the rapid growth in sustainability and importance of experience-based knowledge over academic study alone, will a late-moving business be able to find the talent they need to bring their business up to speed, possibly in the face of regulatory pressures? This situation has already occurred in the property industry. For several years, only a handful of companies employed sustainability managers. In the last year, this position has become standard amongst major companies and has been difficult to fill.

Many opportunities and threats are emerging for businesses as the impact of environmental sustainability continues to unfold. As a bare minimum in less-certain economic times, companies must not act blindly. They should quickly understand their regulatory, client/customer demand, and reputational risks and the economic, employee performance and brand opportunities available to them. We must act quickly on sustainability, but also act wisely.