In December 2015, the Paris Agreement made history. The agreement brought much of the world together against a common foe: climate change. While efforts to combat environmental issues weren’t new, the agreement brought the fight against climate change to center stage and forced many businesses that were looking the other way to change their tunes. It was the start of something that will have ramifications in tech and related industries for many years to come.
In January, based on trends, Connected World declared that 2020 will kick off a whole decade focused on enterprise sustainability. The need to better manage natural resources, reduce carbon footprints, meet governmental regulations, compete with international standards, fulfill internal sustainability goals, please customers, and future-proof businesses will all contribute to companies’ drive to create, meet, and even exceed sustainability goals throughout the next 10 years and beyond. In fact, businesses might not have a choice. Many scientists predict irreversible damage will be done to Earth’s environment if nothing changes relatively soon.
One way some businesses are starting to frame their sustainability discussion and efforts is by taking steps toward a more circular business model, ultimately contributing to a more circular economy. In a circular economy, resources are recaptured and reused over and over again, allowing them to continue to contribute to the economy. (For examples, listen to the latest episode of The Peggy Smedley Show.)
Pursuing sustainability, which could be defined as avoiding the depletion of natural resources and finding ways to meet present needs without sacrificing future generations’ ability to meet their needs, can also be a profitable endeavor for enterprises and entire industries. For instance, according to a report from BSR on the Paris Agreement’s impact on business, national climate plans under the agreement represent a $13.5 trillion market for the energy sector through 2030.
A recently released report from Lux Research delves into this particular space and how much change the energy sector will undergo as the world pursues sustainability. Lux’s data suggests the future global renewable energy trade will be electric, requiring new electricity infrastructure in some places that will import solar energy from other regions. It also points out that the global push for decarbonization will create challenges. For instance, the firm says countries representing $9 trillion of global GDP (gross domestic product) would face difficulties in meeting energy demand with domestic renewable production alone, requiring the import of future energy carriers.
In other industries, too, the focus on sustainability goals like decarbonization will create both opportunity and challenges. However, the threats of climate change also loom. Agriculture faces many direct challenges in the face of climate change, according to BSR’s report, including declining crop and livestock productivity due to extreme weather events and increased risk due to changing water availability. In manufacturing, too, climate change poses direct and indirect risks such as resource scarcity, higher input costs, and disruptions due to energy supply.
While many businesses have more direction on sustainability thanks to international guidance like the Paris Agreement and the United Nations’ SDGs (Sustainable Development Goals), that doesn’t mean it will be an easy road. However, it’s an essential road to take, and, even amidst a global pandemic and an uncertain economy, the decade of sustainability will continue on, led by enterprises that know it’s no longer an option to turn a blind eye on meeting sustainability goals.
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