Wednesday, February 10, 2010

In Vision 2050, sustainability is the key driver for innovation

By Connie Harryman, Applied Concepts Creativity
Guest Blogger IIR USA

LIVE Front End of Innovation Europe 2010

Topic:
Part 1: Using WBCSD’s Vision2050 of a Sustainable World to Drive Corporate Innovation

Speaker:
Per Sandberg: Managing Director, WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT

Per Sandberg posed this question, “What innovation does the world need?” Vision 2025 was just launched in India.

Agenda:
• Argue that sustainability is the key driver for innovation.
• Describe what sustainable innovation needed to deliver.
• Dialogue how best to do sustainable innovation.

Based on the vision 2050 platform, gaps are identified to develop a pathway and identify areas of action. The idea is to clarify the business perspective, quantify market potential, and then agree on action points and next steps. Vision 2050 was run by 29 companies within 20 months.

They evaluated the sustainability status to see how are we doing? We plotted the quality of life and the ecological footprint. This identifies a sustainable quadrant for different nations. Countries such as Africa and the South American countries are using fewer resources than available but with a lower quality of life.

We only know one way of developing. How can we keep the quality of life with fewer resources, without overusing the resources? The status is that we are not doing well.

We are borrowing from the future. Over the next 40 years, we will see fantastic growth, more people, and more wealth. Growth means wealth and spending power. The global middle class is expanding. There is growth in the emerging markets. Global economic power is shifting. The top ten economies will change.

We are experiencing inertia with an accompanying inadequate policy response. There is degradation of water and degradation of resources such as oil.

To summarize, we will consume 2.3 Earths in 2050!

In Vision 2050, nine billion people will live well, and within the limits of the planet. Vision 2050 proposes using one planet.

This means that business as usual is not an option. Neither is policy as usual, financing as usual, nor consuming as usual. Innovation as usual is not an option either! We must build an attractive path.

Please read HBR: Why Sustainability Is Now the Key Driver of Innovation

“…sustainability is now the key driver for innovation. In the future only companies that make sustainability a goal will achieve competitive advantage”

How do we close the gap?

1.) Resources and carbon: halving CO2 emissions while doubling agricultural output.
2.) Costs: internalize cost of carbon, water and other ecosystem services.
3.) Consumption: change consumption patterns in favor of more sustainable lifestyles.
4.) Areas of activity: people’s values, human development, economy, agriculture, forests, energy and power, building, mobility, materials, etc.

What does it mean? It is all about resource efficiency around labor, productivity, and financial. We have a rising cost of capital with fluctuating prices. There is availability of raw materials, increasing complexity of risk, changing consumer behaviors, and evolving framework conditions. This creates significant business opportunities.

Key insights are:

1.) Global challenges will become key strategic drivers for business and innovation.
2.) There will be tremendous change.
3.) Opportunities abound for those who turn sustainability into strategy.
4.) Business must work closer with government and society worldwide to transform markets, prices and competition.

The needed radical resource efficiency improvement will require sustainable innovation by all means. Sustainable innovation is waiting to happen. We can begin by harvesting the low-hanging carbon fruit.

It takes 30 years for new energy technology to have market penetration. It is very possible to triple Africa’s agricultural yield. We can make IT work for sustainability. Systemic, integrated innovation is needed and attractive. We can form complex coalitions, do co-innovation with customers and competitive, suppliers. We can forge public-private partnerships.

How do we make it happen? How can we make systemic, integrated “sustainable innovation by all means” happen at a radical scale, with speed and performance?

Per Sandberg then invited the Front End of Innovation attendees to form an Innovation Think Tank to generate additional ideas for Vision 2050. Please go to blog post, Part 2: Innovation Think Tank to see the results.

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