Happy New Year: What’s in store for green business?

A shift in climate change policy, more industry collaboration and a remanufacturing revolution are among the hopes and expectations of sustainability professionals who believe 2015 will be a year to remember for the right reasons...

As we saw in our annual review, 2014 was the year that the ‘circular economy’ marched into the mainstream; big business began to embrace the renewable revolution, and the IPCC published the most important assessment of global warming to date. 

So, what’s next for green business? Is 2015 the year that fully ‘circular’ resource use is implemented? Will ‘collaboration’ become the sustainability buzzword? And how will those all-important climate talks in Paris shape the future of our planet? We’ve looked into our crystal ball (and spoken to a few industry experts) to find out…

Going green: A business imperative

Paul Crewe, Head of Sustainability at Sainsbury’s, said: “We’re looking forward to yet another great year of sustainability being at the heart of our operations. Crucially, we’ll be focusing on the commercial element of being green as well as doing the right thing for the environmental too.

“I predict that businesses across the UK will very much turn its attention to this way of thinking this year. Green behaviours are no longer a ‘nice to have’ and are imperative for businesses to become sustainable for their own futures. These are also what our customers and investors will be looking for us to focus on too, with a great example being waste and recycling.

“I have asked my team to focus even further on their overall approach to waste and recycling this year in line with our financial strategy, and I can see many others across the industry doing the same too. “

General Election: Opportunity knocks

Nick Molho, executive director of the Aldersgate Group, said: “With both a General Election in the UK and a major international climate change summit taking place in Paris, 2015 is a big year for the environment. This has to be the year where world leaders agree a fair and sufficiently ambitious climate change deal that will prevent the worse impacts of climate change, with clear mechanisms to support developing countries to move towards lower carbon ways of developing their economies and adapt to climate change.

“In the UK, it is high time for the political debate on climate change to become far more solutions-focused, with more emphasis on how we can meet our emission reduction targets in a way that is affordable and maximises benefits to our economy rather than getting stuck in an unhelpful debate as to whether we should reduce our emissions at all.

“The General Election also provides us with a unique opportunity to make far more political progress on other environmental issues such as accelerating the move to a circular economy with more support for remanufacturing and protecting the UK’s natural capital, both of which could deliver significant economic gains.”

Circular economy: Remanufacturing gains traction

Aleyn Smith-Gillespie, head of business model innovation At the Carbon Trust, said: “In 2015, we are likely to see a significant push in the direction of more resource efficient business models, enabled by industry and supply chain collaboration and innovation. These efforts will begin to yield breakthroughs in the application of new materials, designs, technologies and processes that will go beyond incremental efficiency. 

“While the systemic change needed for fully ‘circular’ resource use is still some way off, we believe that certain areas where the business case is obvious and achievable, such as remanufacturing, will start to gain traction. More fundamental business model innovation for resource efficiency will still only be for a brave few; however exciting developments will come from new entrants with innovative solutions.” 

Sustainability skills: Minding the gap

Martin Baxter, executive director of policy & engagement at IEMA, said: “2015 will present significant opportunities for the environment and sustainability profession, and no doubt some challenges too.  The UK general election and the international climate change summit in Paris will both have major implications for green policies – whether politicians can deliver policy certainty that’s consistent with the environmental constrains we face is a major question.

“The signs are that more and more businesses will take action to address the shortfall in skills to deal with environment and sustainability challenges.  This is encouraging, as the skills gap is a major competitiveness issue and one which has been neglected for too long.

“The revised ISO14001 standard will be published in the second half of 2015.  With over 300,000 organisations certified to the standard and significant changes proposed, its impact will be felt across all sectors of the economy, and in most countries around the world.”

Scottish renewables: Surge continues

WWF Scotland’s director Lang Banks said: “During 2014 renewables grew to become the largest source of electricity generation in Scotland, overtaking both nuclear and fossil fuels. In the year ahead we should hopefully see renewables become responsible for meeting half of Scotland’s entire electricity needs. However, if we’re to keep on track toward our 100% target by 2020, we really need to see some of the already consented offshore wind projects start being built.

“On climate change, most eyes are on a positive outcome at the UN climate talks in Paris. However, as with current the targets, delivery has to actually happen back at home. So, we’d like to see the Scottish Government put just as much effort into getting back on track to achieve their annual climate targets as they have on achieving their targets on renewables.”

Waste and resources: Getting serious

Jacob Hayler, executive director of the Environmental Services Association (ESA), said: “Our biggest hope is to see a breakthrough in household recycling performance in England. We know from the Welsh that it can be done, but can it be done under a more constrained public spending environment?

“With the General Election happening in May, it would be also nice to see a new government recognise the role the industry could play as a key provider of materials and energy to the rest of the economy, and integrate the waste and resources sector fully into the Government’s economic thinking.

“2015 will also bring in a new round of discussions in Brussels which could have a huge long-term impact on our sector. We want to see the European Commission make substantial progress this year with fresh circular economy proposals which could deliver green jobs and growth for the future, and we want to see the UK Government constructively engaged in this process.”

Business innovation: Systemic shift

Sally Uren, chief executive of Forum for the Future, said: “We believe it is critical to transform the key systems we rely on to shape a brighter future and innovate for long-term success, and part of that is working collaboratively with business, government and other organisations to identify barriers to change and deliver solutions.

“In 2015, Forum for the Future is looking forward to working with our business partners to help them become system innovators, where they not only innovate to create new, sustainable products and services, but also influence their external context to create system level change.” 

UN climate talks: Road to Paris… 

Writing in a recent blog, M&S’s Plan A team Carmel McQuaid, Adam Elman and Mike Barry said: “This time next year we will have an agreement it just is very unlikely to be the one we need. Bi-lateral agreements will be sought to replicate the momentum that the China-US agreement recently created. India is becoming the dominant ‘swing voter’ on success and needs to see how low carbon will enable development. 

“Despite the COP gloom there is some momentum in the low carbon world with renewable deployment costs falling; the phasing out of some of the worse carbon practices (deforestation); the development of smart (and efficient) cities and mobility systems; and (the next big thing) green products and services become cost neutral AND desirable. 

“The OPEC vs US Shale price war is a further complication, creating short term uncertainty for renewable investment but potentially creating long term opportunity as oil investment is choked off in the face of plummeting prices.”

Carbon budget: Target-setting

Gareth Stace, head of climate & environment policy at EEF, the manufacturers’ organisation, said: “2015 marks an important year for the Committee on Climate Change (CCC) which has to make recommendations to Government on the Fifth Carbon Budget (2028-2032) and a 2030 electricity grid decarbonisation target.

“Whilst final decisions on these will not be made by the Government until 2016, they are likely to be heavily based on the CCC’s advice. It is therefore vital for industry that we see considerations of industrial competitiveness feature prominently in this.

“Of key importance here is the fact that the UK will essentially receive an economy wide carbon target from Europe through a combination of the EU ETS and the burden-sharing agreement (covering those sectors not included in the EU ETS). Our hope is that the CCC’s advice will set targets in line with our EU commitments.” 

2015’s buzzword: ‘Collaboration’

So what does this mean for business? As the M&S blog concludes: “It’ll have to be agile as technologies, business models and new issues emerge fast. It’ll have to collaborate even harder, not just on single issues like deforestation but also on defining the goal we’re aiming for – a sustainable society supported by a sustainable economy that works for everyone.

“Above all, business needs to work out how hard it will push policy makers to tackle issues like climate change or whether it’s willing to wait until the inevitable economic impacts of inaction occur.”

Luke Nicholls

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