The trends driving sustainability, and insights into how businesses are pushing environmental, social, and governance (ESG) standards, were key themes discussed at BBC’s Sustainability in Business Summit 2023 held recently in Singapore.
The half-day event, attended by thought leaders from the worlds of finance and sustainability, saw business leaders and BBC journalists speaking on various topics, including how the global economy is impacting progress, what it’ll take to reach net zero, and how the latest in tech and innovation can help businesses achieve their targets.
Kicking off the event, Karishma Vaswani, chief Asia presenter, BBC News, gave a sobering update on the progress of sustainability development and warned the effects of climate change are now playing in real time with cities sinking and becoming vulnerable to droughts, heat waves and flooding.
Across the different sessions, a fireside chat with professor Koh Lian Pin, director of the National University of Singapore’s Centre for Nature-based Climate Solutions, also moderated by Vaswani, saw Koh expounding on the benefits investing in nature can bring to combating greenhouse gas emissions and species loss, as well as why carbon credits are important and how they can work.
Standalone sessions by BBC Click presenter, Spencer Kelly, showcased the latest tech and innovation being used by businesses around the world, such as smart offices, robotics technology and e-vehicles, while Dr Christina Dean, founder of The R Collective and Redress, a social impact business, and a charity working to reduce waste through recycling, shared her journey to creating sustainable alternatives and solutions in the slow-moving fashion industry.
How do marketers feel about the sustainability conversation?
Today, consumers often turn to brands to take the lead in sustainability issues. Slightly more than a third of APAC shoppers (32%) said it is up to businesses to behave sustainably, Kantar's latest Sustainability Sector Index 2022 in APAC found.
However, brand marketers find it difficult to predict how fast green consumers will demand sustainable brands, and they often use this reason not to act. Many companies are still treading cautiously in the space given the fear of backlash with 59% of consumers are concerned that the brands involved in ESG are doing so for commercial reasons.
This has resulted in many CMOs treading rather cautiously. Forrester found that while many B2C CMOs (76%) want to showcase more green initiatives, they are also afraid of greenwashing. Many of the CMOs believe their role to be limited as they do not own the departments that have the greatest impact on sustainability. These include product, supply chain, manufacturing, operations, and finance. Around 64% of B2C CMOs said that while their companies have started on their sustainability transformation journey, it is not yet impacting the marketing department.
As more consumers look towards sustainable products and services, and as investors consider an organisation’s ESG efforts before making their financial decision, net zero can no longer be an aspiration but is a necessary. The imperative for marketers is clear – understand sustainable marketing by aligning with corporate net-zero goals.
What it really takes to get to net zero
A key highlight of the event was the panel session on getting to net zero and discussing the challenges and feasibility of meeting targets.
With more and more companies pledging net zero targets, an often asked question is how achievable they are for organisations in Asia?
Making the pledge is simple, but turning it into action and getting an impact is more difficult, said Esther An, chief sustainability officer of property developer City Developments, whose emission targets are science-based and set to standards from the World Green Building Council’s framework.
“You have to be prudent and pragmatic. It won’t be done by tomorrow. We can only move in phases – firstly decarbonisation, then digitisation, and thirdly, sharing data that can be tracked so that we can see where the gaps are and decide on what to do.”
Expressing his concerns, Abhas Jha, practice manager, climate change and disaster risk management, the World Bank, shared that the Paris target for net zero, for example, may be too distant in the future and hopes it won’t “become an excuse for not doing things immediately”.
Jha said the focus should instead be on talking about “actual reductions in emissions”, and addressing the uneven access to energy between developed and developing countries, where an average person in Nigeria consumes less energy in a year than a refrigerator in the US.
Business drivers of net zero
Tech, costs, and government roles were highlighted to be the key business drivers of net zero. Panellists agreed that technology can help as the sustainability and digital revolutions converge not just in reducing energy use, but also in improving efficiency.
City Development’s An said: “We look at the combination of technology with design, to how we build, and what sort of materials are we procuring.”
Another advantage towards sustainable development is the potential lower costs, said Jha. He added that today, the implied cost of capital for a fossil fuel project is very high. Nonetheless, advancements need to also be made with governments playing a key role – and in many parts of the world, this is yet to be the case.
Jim Bullock, director, energy and sustainability, Asia, Microsoft, shared that governments play a key role, with renewable solar and wind benefitting from government initiatives in states such as California or countries such as Germany. This has helped cities and countries bring the cost curve down for businesses, and enable renewable technologies to come more quickly to market.
However, Asia has a very carbon-intense energy network. “If we don’t solve some of these problems, such as mitigating the impacts of coal and other thermal generation (energies), there’s no way we’re going to meet our global climate goals,” Bullock said.
Plan your strategy right
In planning your company’s net zero strategy, make sure the emission reduction can actually take place, advised Ted Chen, co-founder, CEO and chief product architect of IT consulting company Evercomm Singapore. To do this, Chen said that first, the data must be verifiable, and second, the emission strategy that is put in place is feasible to achieve.
Companies are quantifying their emissions “not because they want to do so, but because they need to disclose these numbers to their customers”, he said, adding it is also important the upstream – the financial institutions, the government, and the big companies – asks the same types of questions to their suppliers.
“If you plan your emission reduction strategy correctly, and if you executed it correctly, it is actually a savings for you,” Chen said.
In spite of the short-term challenges, the business imperative for net zero is becoming stronger and stronger, said Microsoft’s Bullock.
“Convince your stakeholders that the risks of not doing net zero actually outweigh the risks. There’s real and tangible operational benefits, new revenue opportunities and new business models by moving to net zero.”
Visit https://bbcnews.bbcstudios.com/events-pages/sustainability-in-business-summit-2023/ to relive these moments.
This article was done in collaboration with MARKETING-INTERACTIVE.