Future business models must consider use of natural resources: report
By Brian Collett — The world’s manufacturers are likely to triple their use of natural resources and quadruple their gross domestic product by 2050.
This scary explosion of industrial production is being demanded to satisfy the appetite of a world population expected to swell from seven billion to nine billion in three decades.
The figures are stated starkly in a report from the World Resources Institute, a global sustainability research NGO headquartered in Washington DC, which warns, while predicting the growth: “The problem is that the planet’s natural systems and finite resources cannot keep up.”
To soften the stress on the environment, says the institute, businesses must change the nature of their activities.
Kevin Moss, global director of the institute’s business centre, said: “Business models that rely on unchecked consumption and unlimited resources cannot last. They will be replaced by better models that deliver more value with the resources available.”
The institute’s first suggestions are that companies should assess their dependency on natural resources and the limits this would impose on business growth, and should then take the lead in seeking solutions with vital stakeholders.
The goal should be a transformation of their business to one that can “thrive in a resource-constrained environment”.
The recommendations are necessarily somewhat general but the institute report adds an illustration from the fashion sector, beginning by restating the problem.
In the US, households on average spend six times as much on clothes as those in emerging economies such as Brazil. US consumers’ purchases increased by 60 per cent between 2000 and 2014 and the clothes are now kept half as long.
Some fashion houses observe up to 100 micro seasons in a year, and the garment changes create “an enormous amount of waste”.
The global apparel industry, worth up to $3tn (£2.4tn, €2.8tn) a year, accounts for 10 per cent of the world’s greenhouse gas emissions. Every year it uses 1.33 trillion gallons of water for dyeing and sends up to 144 billion square yards of fabric scraps to landfill.
The fashion trade shows how business growth driven by unchecked consumption is unsustainable, says the institute.
Among its solutions it points out that clothes manufactured to last longer would reduce environmental impacts and stimulate jobs.
At Patagonia, a modest programme called Worn Wear employs 45 people to carry out about 40,000 repairs annually, minimising use of natural resources.
In New York City, the e-commerce company Zady offers T-shirts made by environmentally acceptable suppliers with US-grown organic cotton spun by a family co-operative.
All businesses, says the institute, should be considering the ecological limits of consumer-driven growth.
However, most companies are just not talking about it. The subject remains “the elephant in the boardroom”.
A little hope is then offered by the institute. The elephant 15 years ago was climate change, and today, more than 200 multinational companies have set greenhouse gas reduction targets.