The impact of globalization and climate change on vulnerable communities in developing countries is an increasing focus, with more companies investing in the health, wellness and education of local staff and suppliers. Failing to practice corporate social responsibility in India literally presents an existential threat as it was made compulsory in 2014.
The trend isn’t entirely altruistic as businesses see the value of unlocking new markets and increasing productivity through boosting engagement.
INDUSTRY TO WATCH: CONSTRUCTION
Smart cities with affordable housing, energy efficient infrastructure and greater online access for rural areas are being built across Asia and Africa. Unlike past urbanization, it won’t just be the rich who benefit.
In Guadalajara, Mexico, IoT technologies are being used to improve drinking water in poor areas and install affordable electricity infrastructure. The same is true in Santiago, Chile and La Paz, Bolivia.
Fifteen years ago, most multinationals delegated the newly coined term ESG to the CFO, who then quietly passed it to the finance team to ‘sort out’. It then showed up as a minor agenda item at board meetings, of interest only as an easy way to write off tax and boast about green credentials.
One of the world’s first chief sustainability officers was appointed by Nike in 2004, which started a trend that is still accelerating today. That dismissive CFO has seen their power base collapse and the inevitable route to CEO challenged as CSOs extend their reach into every crevasse of organizations, driving innovation, culture, brand identity and growth strategies.
However, they too might need to watch their back as ‘chief trust officers’ are now emerging, and could make CSO positions a bit less sustainable.
INDUSTRY TO WATCH: FINANCIAL SERVICES
Deloitte warned in 2021 that sustainability was ‘the crisis of our generation’ and explained that sustainability and financial services are intricately connected. Crucially, its research found that corporations are more successful when the CSO has the ear of the CEO.
The seismic shift in C-suite dynamics has ruffled feathers, but, if anything, the appetite for change across banks and private equity is growing. In 2019, more than US$80 trillion in managed assets were held by companies who’d signed up to the United Nation’s strict principles for responsible investment.
The global supply chain chaos of the past two years was caused by the COVID-19 pandemic, complicated by the war in Ukraine, made much worse by rampant inflation and then, the cherry on the cake, devastated by further pandemic infections sweeping through China.
In January this year, three-quarters of exhausted logistics professionals surveyed by Container xChange said they thought the crisis was set to worsen.
But, despite the gloom, the sector has embraced sustainability as never before. While AI is minimizing waste, anticipating logjams and reducing freight mileage, cleaner fuels and more efficient engines are lowering energy costs.
INDUSTRY TO WATCH: SHIPPING
More than 90 percent of everything we consume is carried on ships that pump out 2.5 percent of annual CO2 emissions, but the International Maritime Organization projects a 50 percent reduction by 2050, meaning transportation will be a powerful weapon for companies aiming for net zero.
Using technology from the European Space Agency, United Kingdom startup Smart Green Shipping is pioneering wind-assisted, vertical hydrofoils that anticipate weather patterns to guide ships in the most energy efficient way, slashing fuel consumption.
“In a few years, almost every company in the world will have adopted mandatory sustainability reporting standards – either by law or because they can no longer resist stakeholder pressure,” says Florian Hoos, Professor of Sustainability at the International Institute for Management Development in Switzerland.
Maybe so, but the most futureproofed ones will be those who didn’t begrudgingly comply when they had to, but saw the opportunities early and genuinely took responsibility for their impact on the planet and its people.
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