Over the last decade and a half, the pace at which terms such as ‘sustainability’, ‘sustainable growth’ and ‘sustainable practices’ have been increasingly used necessitates the need to analyse this new trend. Why did we not have all these hoopla of sustainable development during the 80s or 90s? The growing S-trend is clearly reflected from the fact that there has been a magical upsurge in the number of green consultancy firms, energy service companies (ESCOs), compliance norms (both regional and global), standards, certifications and so on in the recent times which in turn reflect the growing demand and need for sustainability.
It is not too difficult to understand the meaning of the word ‘sustainability’; however the challenge is to understand it in the correct context along with its scope and implications. Let us build up the understanding of the S-word starting from the dictionary meaning. According to the Oxford English Dictionary, to ‘sustain’ is to keep something going over time or bear the weight of an object. Sustainability is derived from the Latin word sustinēre, meaning the capacity to endure. In the context of environment, the system would be said to be sustainable if an optimum stock of natural resource (such as fossil fuel) for future is maintained or the pollution caused by factories, vehicles etc. can be contained forever in the ecosystem without any adverse impact. The U.N. appointed World Commission on Environment and Development, known as the Brundtland Commission after chair and Norwegian Prime Minister Gro Harlem Brundtland, published a report called ‘Our Common Future in 1987’. In this report, the Commission offered one of the first formal definitions of sustainable development and referred to it as “…development that meets the needs of the present without compromising the ability of future generations to meet their own needs”. This is the most widely used definition of sustainability.
Note that sustainability can be considered as a means as well as a desired goal. A report on ‘Education for Sustainable Development’ proposed the following explanation for sustainability. It is an unending quest to improve the quality of lives and surroundings, and to prosper without destroying the life-supporting systems on which current and future generations of humans depend. Like other important concepts, such as equity and justice, sustainability can be thought of as both a destination and a journey.
Founded in 1978, the American Planning Association is an independent organization working in the field of city, regional and national planning to meet the challenges of growth and change. In their policy guide on planning for sustainability, four objectives have been laid down, achieving which will imply sustainable growth:
- Reduce dependence upon fossil fuels, extracted underground metals and minerals.
- Reduce dependence on chemicals and other manufactured substances that can accumulate in Nature.
- Reduce dependence on activities that harm life-sustaining ecosystems. The health and prosperity of humans, communities, and the Earth depend upon the capacity of Nature and its ecosystems to re-concentrate and restructure wastes into new resources.
- Meet the hierarchy of present and future human needs fairly and efficiently. Fair and efficient use of resources in meeting human needs is necessary to achieve social stability and achieve cooperation for achieving the goals of the first three guiding policies.
Accomplishing these four comprehensive objectives will get the world closer to its sustainability pursuits. Talking about sustainability in general, people mean or refer to the environmental sustainability. While environmental un-sustainability or the sub-optimal consumption rate of natural resources and anthropogenic activities polluting the environment is the foremost concern, these are closely interlinked with sustainability consideration in the societal and economic contexts. For large corporations like Vattenfall, the scope of sustainability has broadened from climate change and environmental implications to a “triple bottom line” definition that includes economic, social, and environmental impacts that can be traced to a 2002 research paper published by University of Michigan which identify these as three spheres of sustainability.
Three spheres of Sustainability
Environment, social, and economic systems are interdependent complex systems, and can be considered as heterogeneous, dynamic, non-linear, and adaptive groupings of agents whose actions have impacts within each of the three realms. Although the venn-representation above does not chalk out what the current focus of sustainability should be, or rather which aspects impact the corporations and communities the most, it is a great starting point as it describes the system in its entirety. The focus area must include Environmental-Economic and Social-Environmental overlaps (area shown in the figure below).
Focus Area in the Current Context
Before going any further, it is important to note one underlying principal behind the growing need for sustainable practices, and that is the scarcity of resources. Resources (minerals, fossil fuel, clean air and water) are getting scarcer – and this continues to be a looming threat on the quality of life of each one us. It is this constraint that makes it inevitable to plan, strategize and optimize.
The Social-Environmental analysis is very straight forward. Dilapidated air quality, depleting fossil fuels, food scarcity, drought and floods owing to climate change and so on are directly affecting the living creatures of the planet. It is estimated that by 2050, climate change will lead to a very acute food shortage and that the decline in calorie availability will increase child malnutrition by 20% relative to a world with no climate change. Climate change will eliminate much of the improvement in child malnourishment levels that would occur with no climate change.
The analysis on the Environmental-Economic front can be categorized into direct and indirect impacts. Economic activities that depend on natural resources, whose stock is either limited or rate of replenishment is far slower than the rate of depletion, will suffer. This constitutes the direct impact of un-sustainability. Agricultural sector, especially in the developing countries like India will suffer the most where yield will suffer because of extreme conditions (like drought and flood). Aside from output loss, there will be significant cost borne to adapt to the adversities caused by climate change. According to a past research work of mine that was submitted to the Ministry of Environment and Forest (Government of India), at least 1.5% of the India’s GDP could be could counted as fiscal burden of adaptation in the primary sector alone.
Because of the ecological damage caused due to unsustainable practices, various authorities are increasingly issuing compliance norms that companies have to ratify with. Complying with these norms add to the cost burden of companies as they are forced to share the burden of social cost to an extent. Non-compliance will lead to penalties that will also affect the profit margins. This is how un-sustainable practices lead to indirect consequences to businesses.
We now have an idea that sustainability (or the lack of it) has significant impacts. Therefore it is inevitable to strategize and chalk out a sustainable roadmap to maintain the prosperity of stake holders of social-environmental and environmental-economic domains.
The overlapping area between social-environmental and environmental-economic domains can be considered as the core of sustainability that by far impacts every living creature of this planet and an example would be the phenomena of climate change caused due to anthropogenic unsustainable practices over a sustained period of time. Once agencies such as Intergovernmental Panel on Climate Change (IPCC) scientifically prove the menace caused by climate change and the laid down the possible future catastrophes if timely corrective measures are not taken. Keeping the vista of the range and intensity of impacts, it caught sudden attention of governments and corporations. It will make sense if we map the growth of the S-trend to the rising awareness of climate change and its impacts, where much of the credit goes to the findings of IPCC and subsequent hype created by environmentalists, economists and policy makers. Sustainability is a very broad concept and has a wide scope and should not and increasingly is not limited merely to the climate change issue, however the scare of the impacts of climate change can be regarded as the single most important reason that from where the concept of sustainability started germinating. After the climate change scare was created, it was but obvious that corporations, governments and world organizations would switch to a corrective stance.
Now, there is a growing trend of integrating sustainability with any system – public policy framework or corporate strategy, because there are sure shot gains. There are long terms gains for sure as sustainability also implies inter-temporal optimization of resources, short and medium run gains are also reaped. Corporations have started integrating sustainability in their supply chain management strategies to reduce production cost. Looking ahead, sustainability needs to become core value at all levels and functions unequivocally– corporations, governments and communities.
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