Sustainability set for take-off

Johannesburg - More businesses are positioning their operations to make money from sustainability initiatives.

This is the view of Peter Lacy, head of sustainability projects for Europe, Asia and Latin America at consulting firm Accenture. Lacy is in South Africa to meet with a number of leading businesses to discuss the development of sustainable companies.

His visit came shortly after a recent United Nations delegation discussed climate change issues with local players.

Lacy emphasised that sustainability - which deals with issues such as climate change, carbon footprints and business relationships with communities - is no longer viewed as a "charitable" aspect, but in fact a profitable operating unit.

Asked whether local companies are taking sustainability seriously, Lacy said he has been surprised at how the bigger companies, like Woolworths, are making a good attempt at building sustainable businesses.

Mindset switch

One of the issues at stake is whether firms will sacrifice profit for the sake of socially responsible initiatives.

"What we are seeing in places like North America is a dramatic transition," said Lacy, referring to the recognition that sustainability and profitability can go together. Many companies are making money from these projects.

For instance, General Electric's Ecoimagination business unit is targeting revenue of S$25bn this year. Also, the international Carbon Disclosure Project has valued opportunities in the carbon credit market at more than $60bn over the next 15 years.

"Sustainability affects four main areas of the business," said Lacy. This includes revenue growth from new or differentiated products and services, cost reductions, better risk management and brand and reputation enhancement.

"Water is going to be the next big sustainability issue," said Lacy about opportunities in this space.

According to Lacy, much emphasis has been placed on climate and the carbon market - an area where he still sees growth - but he points out that the pressure on global water supplies is becoming increasingly topical.

- Fin24.com