The Nature of Business; in the First of a Regular Series of Articles on Sustainable Development as a Business, Economic and Job-Creating Issues, David Middleton, CEO of MEBC, and Stratford-upon-Avon Based Richard Heathcote of Heineken UK Argue That If Chief Executives and Directors Are Not Interested in This Now, They Never Will Be
The sustainability of companies depends on many things, not the least being the raw materials from which some businesses make products that other businesses then sell.
If the source of those raw materials dries up, the consequences to the business community can be devastating. The ecosystem in which we live provides a vast array of resources upon which we are reliant.
The easiest example is water. It is too often taken for granted when we have enough of it, yet can quickly cause chaos when it dries up. But the range is huge and also includes, for example, timber, seafood, plants, fossil fuels and mineral deposits. In 2003, some 123 countries recognised the dangerous decline of species in the ecosystem. They vowed to take action. Yet today, species are bec1oming extinct at about 1,000 times their natural pace - with 35 to 40 species terminating their existence on the planet every day.
The rapid decline in the world's natural assets is causing some alarm bells to ring and new initiatives to safeguard them are emerging. While this may seem to be a distant matter to many CEOs and FDs, some are already responding in order to be well prepared when issues emerge but also to capitalise on significant new business opportunities and new dimensions of competitiveness. Puma, Unilever and M&S are visibly very active.
New initiatives spring up every week, such as the project involving the Association of Chartered Certified Accountants with the Natural Value Initiative and KPMG, which seeks to evaluate the impact on the business community.
The United Nations is central to concerns about how the world's natural assets are impacted by the growing global population, the emergence of millions of new consumers, changing eating habits, climate change and other pressures. The fast-growth economies of the BRICS nations, and how China in particular is devouring resources, is causing major impact on resource use worldwide. MEBC has been concerned about such things for years and some time ago looked at how globally depleting crucial natural resources might impact on businesses essential to the region. The Midlands Environmental Business Company vision was simple - if raw material availability was becoming compromised, was it time to either look for alternative materials or design new solutions into product design.
A Business Council for Sustainable Development workshop three years ago on the subject of water as a critical resource was possibly the first time in the UK that business delegates realised that water would become more important to them than carbon. And for those businesses with no direct contact with water, the issue of "embedded water" - water inherently within a product or component as a result of manufacturing processes in other parts of the world - was nothing short of a revelation.
A more recent MEBC workshop held in January included people from Heineken; PepsiCo; Hanson; Tarmac; Jacobs; Skanska; National Grid; E.ON and others.
They considered that while the link is less obvious to businesses such as engineering and manufacturers, it is a subject that will, one way or another, impact on all sectors and SMEs.
In 2007 the G8 countries and the five major newly industrialising countries agreed a study on the economic significance of the global loss of biological diversity.
The outcome was TEEB - The Economics of Ecosystems and Biodiversity - funded by sources including the UN and the UK government.
In response, the UK government published the National Ecosystem Assessment (NEA) in June 2011, a massive tome that has become the baseline bible on the subject in the UK. …