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The cost of living crisis needn’t delay climate progress


01 December 2022

You often hear the old expression ‘the time to fix the roof is when the sun is shining’ in relation to climate change. We nod along intuitively, until someone points out that the sun rarely shines – there’s always a reason today is a bad day to start. It’s only when the storm comes that we seem to realise what an opportunity we just missed.

As we head into a difficult winter, the big topic on most people’s minds is not the climate crisis, but the cost of living crisis. Sustainability can seem deceptively non-urgent when you’re worried about affording food, covering bills or staying in business as customers tighten belts. Indeed, a global study of 100,000 consumers by Kantar found that 45% reported finding it harder to make sustainable choices due to their economic conditions.

Yet tackling the cost of living crisis need not take away from tackling the climate crisis, or vice versa, in some zero-sum contest for our efforts and attention.

Green can be affordable

While some products and processes do carry a sustainability premium, and carbon offsetting certainly isn’t free, it isn’t necessarily the case that green options increase cost, either for consumers or businesses.

Technological and business model innovation is rapidly reshaping what’s affordable. The most obvious example is electric vehicles (EVs), which now comprise nearly 20% of new vehicle registrations in the UK, 26% in Germany and 86% in Norway. As the technology improves further and usage scales, EVs are predicted to become cheaper to buy than equivalent petrol or diesel vehicles between 2025 and 2027, and are already cheaper to run.

There are also affordable smartphones like Fairphone that don’t use conflict minerals, or the solar-powered desalination system developed by Desolenator, which will become more and more cost effective as the efficiency of solar thermal rises.

Such progress shouldn’t obscure the urgent need for further investment in green innovation, if it’s to become affordable for the masses, but it does show that the situation is more nuanced and hopeful than many may assume.

Working with the supply chain

Many businesses would counter that innovations like these aren’t apparent in their sector, or that they’re hampered by an inability to engage their supply chain in reducing emissions or environmental impact. Yet this doesn’t mean there's nothing they can do.

I was recently involved in a project to reduce the carbon footprint of biscuits, without impacting flavour or appearance. By introducing new, less carbon-intensive farming technologies, reducing use of carbon- and water-intensive ingredients and cutting transport distances across the supply chain, we were able to get close to net zero while actually reducing costs.

It showed how with a systematic, collaborative approach - and a well-thought-out roadmap - it was possible to take steps in the right direction without sacrificing either price or impact.

When approached this way, suppliers are often keener to engage than they might appear. Sometimes all it takes is buyers with clout to give direct suppliers the security of knowing they can make changes that temporarily increase costs, in the interests of longer-term, affordable sustainability. Once this happens, it can have a snowball effect across the often-complex supply networks that characterise modern business.

If anything this catalytic process will get easier in the coming years, as the intersecting imperatives of geopolitics and sustainability push firms to localise supply chains, giving them greater visibility and influence.

The circular economy

In the short term, consumers may struggle to pay a premium for sustainability, but that doesn’t mean that they have given up on conscious consumption altogether. A YouGov survey in the UK found that half of the 69% of consumers who previously prioritised sustainability in their purchasing choices would continue to do so, for example.

They may just do so in different ways. Another UK report by eBay found that a fifth of consumers were buying more second-hand goods, while 25% were looking to upscale or repair existing items.

For businesses, this behaviour change presents an opportunity to look at the circular economy and other ways of meeting demand for sustainable choices. Sometimes this can take you in unexpected directions.

For example The Warehouse Group (TNG), New Zealand’s largest general merchandise retailer, began exploring business models like repair, rental and resale as it sought to make sustainable living easy and affordable for customers who may not have realised that it was possible before. TNG now has a comprehensive roadmap for affordable sustainability, touching everything in the business from marketing strategy to performance reviews.

Sustainability as an investment

When times are tough, cost centres and the nice-to-have initiatives tend to get cut first and deepest. Certainly the recession will show up which companies see sustainability in these terms. The tragedy is that it won’t be apparent to them how wrong-headed this view is until it’s too late.

Think of it this way: in 20 years, do you expect that society will tolerate materials and processes that cook the planet, degrade environments, cause deforestation and water scarcity, or reduce biodiversity? How about in 10 years? How about in five? At some point you will have to make changes to retain your licence to operate - and there is a real financial risk to waiting until you’re forced to do so.

Now is precisely the time to lean into tackling the climate crisis and preserving the environment, even if economic conditions mean you can’t afford to do everything you’d like straight away.

Don’t wait for the sun to come out to fix that roof, because there will never be a perfect opportunity in future. The best opportunity is now, by definition, because the longer we wait the more painful and costly it will become to fix it later.

This article was first published in Forbes

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