15 Trends for sustainability innovation for 2019 & beyond

Looking ahead of what’s going on, what might happen and where opportunities may lie for innovation and ventures in the sustainability space.

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Finance

1. The focus on impact investing grows and ESG metrics and disclosures become the norm. The term impact investing itself evolves in meaning and broadens in scope. Helping companies navigate this particular issue presents a continuing opportunity.

Circularity

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2. Large organisations, including cities, embrace the circular economy — or at least some version of it. An opportunity emerges around the underlying multi-stakeholder infrastructure to deliver this — beyond existing measurement tools and resale platforms.

3. Innovation continues to occur around cleaner inputs — commodities and materials.


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Carbon, energy, cleantech

4. With some difficulty, the carbon conversation evolves from reducing emissions to net positive, in this case, carbon capture/removal, and the market for offsets being optimised and made more transparent. The concept of net positive then translates more readily into other areas.

5. Innovation in the related areas of energy / cleantech / decarbonisation starts to get more and more specific in its applications as the larger innovations become more mature. Subsequent new opportunities are created on the back of this, similar to how Facebook, App Store spawned new ecosystems.

6. An increased focus on regenerative agriculture as the realisation kicks in that it holds a more simple key to carbon positivity. Sustainable agri-tech grows alongside this.

7. Meanwhile, decarbonisation and broader sustainability focus catches up in lagging and challenging industries such as construction and shipping.





Research, Technology & Innovation

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8. Beyond cleantech, the Tech for Good doesn’t quite crack it in terms of commercial and sustainability impact at scale, but continues to grow as a movement. A promising increase in applications of AI, big data, blockchain and more to sustainability challenges.

9. Universities focus more on entrepreneurship and technology transfer, particularly those with a technical / scientific focus. Concurrently they start looking specifically through a sustainability lens for this, and more courses focused around impact will exist — as usual there will only be a few really good ones.

10. An opportunity for clusters to develop around those universities doing it really well, and perhaps certain clusters emerge that are the “Silicon Valley for sustainability / impact”. My current bet is on Amsterdam, where I have recently started living.

11. Healthcare and education see disruption in the US through new business models and utilisation of technology, with a possible resulting ripple effect into emerging economies as the middle class rises and technology leapfrogs occur.

12. Cities and municipalities act unilaterally of nation states and federal governments on addressing these challenges. The focus on smart cities continues, although ensuring solutions deliver real impact rather than jump on the trend will be a challenge.





People

13. Purpose becomes increasingly vital, particularly for the new workforce coming through — social entrepreneurship (or other tags for this slightly nebulous term) continues to gather more pace and brands will increasingly get behind it in a number of ways (such as Red Bull Amaphiko, AB InBev 100+ Accelerator). How purpose is defined evolves (although comes down to individual interpretation), in the process risks losing its meaning through over, and mis-use. Critical thinking required to navigate.

14. A focus on providing access to under-represented populations continues — for entrepreneurs in emerging economies through mechanisms like micro-finance; and within large scale companies looking at driving more balanced representation and engagement at all levels. The business case gathers strength.

15. Citizen and media pressure for action on sustainability issues increases, maybe more policies such as Green New Deals emerge beyond Northern Europe. Polarisation on this topic persists however. [Noting that some nations and regions with high commitment to innovation in clean energy, cleantech and beyond are still equally as entrenched in high carbon activities].

Short essay - addressing sustainable production and consumption in fashion

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working on a case study of a workwear clothing company.

 

Produce a briefing for the CEO of the company in your case study that highlights how the company could become more competitive and resilient to external risks (those associated with the systems, pressures and trends in the industry of the case study you have picked) by systematically addressing unsustainable production and consumption practices relevant to the company and its sector.

 

To remain competitive, we need to react to our commercial and sustainability challenges, and associated shifting trends in demand [1], through new business models and markets, investing for long-term reduction to our rising production costs and risk.

Using our positioning in durable clothing over “fast fashion”, through circular solutions we can create new opportunities and avoid pressure from volatile and rising input prices [2), while tapping into an opportunity to re-capture $500bn of lost value each year and mitigate systemic risks of downstream environmental impacts around unsustainable consumption [3].

The instability of our globalised supply chain is a risk. Poor working conditions are driven by prices being forced downwards by fast fashion [4] and exacerbated by our lack of transparency on operations. We risk operational shutdowns and regulatory issues and reputational issues [5]. Production intensity is high: water, chemicals, fossil fuel based energy [6], and virgin material use, raising a concern around long-term resource depletion, and thus viability.

We can mitigate this by evolving to a collaborative relationship with our suppliers, rolling out supplier standards, gaining transparency on their operations and helping them improve to build long-term resilience; as part of this initiative, collaborating to develop materials that produce garments that can be reused or recycled easily and have lower impact [7].

We immediately need to convince a number of stakeholders, and invest in our new standard, innovation for new materials, and an improved stable deal for our supply chain. We will realise payback in the long-term through higher resilience and a new product range aligning to sustainable trends (see Adidas [8]).

We risk losing a foothold with customers in existing markets and not evolving into new ones. We need to connect with younger generations who value sustainability more highly [9] and respond to negative impacts of our industry [10].

We mitigate by evolving our business models, putting the customer at the core [11].

We can offer customers repair, exchange and recycling (enabled by materials redesign [12]), refurbished garments, and physical collection points and online marketplaces as enablers. Alongside this we can move our B2B business to a subscription model.

This will take time and investment in the short-term, refocused marketing and optimised logistics [13], but we can fund through subscription cash-flow; whilst increasing utilisation and lifetime value per garment long-term, “locking-in” [14] our customers to our ecosystem [15] by providing these new forms of value.

 

To secure our future market position, we need to make short-term economic sacrifices and risks, embracing sustainable consumption as a long-term value creator. Stabilising our supply chain, developing new circular products and business models is a long-term strategic move, which will eventually lower our costs and risk, open new markets, and establish stable win-win stakeholder relationships and greater long-term value.

 

1 - Blowfield, M, 2013, “Business and Sustainability, Oxford: Oxford University Press.

2 - Ellen MacArthur Foundation, 2013, “Towards the Circular Economy”, Retreived from https://www.ellenmacarthurfoundation.org/assets/downloads/publications/TCE_Report-2013.pdf

3 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

4 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

5 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

6 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

7 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

8 - Edie, 2018, “Adidas sold one million pairs of ocean plastic trainers in 2017”, https://www.edie.net/news/5/Adidas-sold-one-million-pairs-of-ocean-plastic-trainers-in-2017/

9 - McKinsey & Company (2016), “Style that’s sustainable: A new fast fashion formula”,https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula

10 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

11 – Barry, Mike, 2017, CSM BSM Module 4, Unit 3 Video, Cambridge / Get Smarter, All Rights Reserved

12 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

13 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

14 – Volans, 2016, “Breakthrough Business Models: Exponentially More Social, Lean, Integrated, Circular”, Business & Sustainable Development Commission

15 - Borromeo, Leah, 2014 “A Swedish denim label wants to change the way we wear our jeans”, https://www.theguardian.com/sustainable-business/nudie-swedish-denim-label-jeans, Guardian

Short essay - communications and marketing around sustainability in fashion

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working on a case study of a workwear clothing company.

 

Your case study company’s marketing department has enlisted your help to write a blog post to defend the industry and the company against the accusation that it simply “applies its dark arts of marketing to cover up the company’s misdemeanours and applies a liberal coat of greenwashing to coat sustainability credentials in its marketing campaign”.

In your blog post, use the information provided about the company in the case study, as well as your own research about the industry and other relevant references, to highlight the following:

·          An acknowledgement of areas where improvement is necessary within the industry’s approach to sustainability marketing (what the industry could be doing better, based on the accusation quoted above).

·          How the company plans to create benefits by increased transparency in its internal and external communication and marketing.

·          How the company is planning to revise or refine its approach to sustainability marketing, in line with its overall business strategy. Use your creative license to recommend one or two ideas.

 

We know we need to improve

2017’s Fashion Transparency Index showed an average score of 49 out of 250 [1]: clearly the industry must improve.

While 63% of fashion brands publicly communicate tackling sustainability challenges, most fail to produce tangible information about action taken [2].

Campaigns have used sustainability as a driver for more (unsustainable) consumption rather than delivering impact [3], due to poorly conceived campaigns and fighting against inherently unsustainable business models and broader materialism [4].

Inaccurate claims have been made – one campaign claimed 95% of clothes involved were recyclable when 1% actually were [5] - not backed with data, or data isn’t accessible, leading to a loss in trust [6]. The failure to gather necessary information is partly due to complexity of value chains; otherwise brands simply fail to admit shortcomings [7].

Persisting outdated marketing concepts mean sustainability is not properly woven into the value proposition [8], so clothing’s sartorial appeal gets overlooked, meaning missed opportunities to connect with consumers [9].

 

How our increased transparency will benefit our stakeholders

We are only as strong as our stakeholder relationships.

To our customers: you want to know more about how we operate, 94% of you may become loyal if we commit to full transparency [10]. We can prove this through how we market our products, our new business model and how communicate our wider performance and create the same loyalty that Patagonia enjoys [11].

To our employees: through more transparent communications around our sustainability performance you know you are contributing to a wider purpose. We hope this develops long-term relationships with you, while positioning us to attract the finest new talent.

To our shareholders: through our transparent reporting and supply chain improvement programme, you can be confident in us as a long-term low-risk proposition, particularly in reducing climate risk.

To our supply chain: lack of transparency costs lives, as seen at Rana Plaza [12]: our collaborative programmes together show that we are focused on increasing stability, reducing risk and building long-term relationships with you.

 

Our new approach to sustainability marketing

First, what are we communicating?

Our value proposition: creativity, longevity and fairness at the core of our business model evolution: sustainability is naturally part of this [13].

Our core issues: carbon, water, waste, and fair conditions and prices for growers.

Our focus activities: our materials, circular ecosystem and supply chain improvement programme.

How will we engage our stakeholders on these? A new digital platform, spread through a digital media campaign, designed to connect with our target millennial market.

Embedding sustainability within the proposition, placing the customer at the centre [14], we will make it easy to find both product-specific and company-level sustainability information - particularly focused on our core issues [15].

We will host a digital map of our supply chain [16], embracing behind-the-scenes video content to humanise our value chain through storytelling [17]; aligning with Fashion Revolution’s #whomademyclothes campaign [18] and showcasing the improvements we are driving.

 

 

1 – Fashion Revolution, 2017, “Why Transparency Matters”, https://www.fashionrevolution.org/about/transparency/

2 - Sustainable Brands, 2014 - Study Reveals Few Fashion Brands Are Walking Their Sustainability Talk, http://www.sustainablebrands.com/news_and_views/marketing_comms/aarthi_rayapura/study_reveals_few_fashion_brands_are_walking_their_su

3 – Siegle, Lucy, 2016, “Am I a fool to expect more than corporate greenwashing?”,   https://www.theguardian.com/commentisfree/2016/apr/03/rana-plaza-campaign-handm-recycling, Guardian

4 – Chuahiock, Jenica, 2016 – “Sustainable Fashion Needs A Consumer Revolution”, https://www.huffingtonpost.ca/jenica-chuahiock-/sustainable-fashion_b_9835848.html, Huffington Post

5 – Chuahiock, Jenica, 2016 – “Sustainable Fashion Needs A Consumer Revolution”, https://www.huffingtonpost.ca/jenica-chuahiock-/sustainable-fashion_b_9835848.html, Huffington Post

6 – Siegle, Lucy, 2016, “Am I a fool to expect more than corporate greenwashing?”,   https://www.theguardian.com/commentisfree/2016/apr/03/rana-plaza-campaign-handm-recycling, Guardian

7 – Rayapura, Aarthi, 2014, “Study Reveals Few Fashion Brands Are Walking Their Sustainability Talk”, http://www.sustainablebrands.com/news_and_views/marketing_comms/aarthi_rayapura/study_reveals_few_fashion_brands_are_walking_their_su, Sustainable Brands

8 – Cipriani, Simone, 2015, “Fashion Needs a Sustainable Handprint”, https://www.huffingtonpost.com/simone-cipriani/fashion-needs-a-sustainable-handprint_b_7128020.html, Huffington Post

9 – Siegle, Lucy, 2016, “Am I a fool to expect more than corporate greenwashing?”,   https://www.theguardian.com/commentisfree/2016/apr/03/rana-plaza-campaign-handm-recycling, Guardian

10 - Peattie, Ken, 2010, “Sustainability Marketing - An Innovative Conception of Marketing”

11 - MacCarthy, Libby, 2017, “Trending: Making Sustainable Fashion More Accessible to Consumers”, http://www.sustainablebrands.com/news_and_views/organizational_change/libby_maccarthy/trending_making_sustainable_fashion_more_access, Sustainable Brands

12 - Kline, Kenny, 2016, “Here's How Important Brand Transparency Is for Your Business”,  https://www.inc.com/kenny-kline/new-study-reveals-just-how-important-brand-transparency-really-is.html, Inc.

13 – Birkner, Christine, 2017, “How Clothing Brands Are Embracing Transparency to Meet the Growing Demand for Sustainable Apparel”, http://www.adweek.com/brand-marketing/consumers-care-about-sustainable-ethically-made-apparel-and-these-brands-are-providing-it/, Adweek

14 - Peattie, Ken, 2010, “Sustainability Marketing - An Innovative Conception of Marketing”

15 – MacCarthy, Libby, 2017, “Trending: Making Sustainable Fashion More Accessible to Consumers”, http://www.sustainablebrands.com/news_and_views/organizational_change/libby_maccarthy/trending_making_sustainable_fashion_more_access, Sustainable Brands

16 – Sustainable Brands, 2018, “Trending: New Sustainable Fashion Collections, Connections, CEO Agenda”, http://www.sustainablebrands.com/news_and_views/product_service_design_innovation/sustainable_brands/trending_new_sustainable_fashion

17 – Sustainable Brands, 2018, “Icebreaker Aims to Prove Its Apparel Is ‘Made Different’ with New Transparency Report”, http://www.sustainablebrands.com/news_and_views/marketing_comms/sustainable_brands/icebreaker_aims_prove_its_apparel_made_different

18 – Fashion Revolution, 2018, https://www.fashionrevolution.org/

 

Short essay - investment and innovation for design

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working on a case study of a workwear clothing company.

Identify two aspects of your selected case study company’s operations or supply chains that would benefit from investments and innovation to improve sustainability design (i.e. the application of new technology, better planning, or re-imagining the business model).

 

To tap into the $100bn annual opportunity around wasted fibre input [1], and address 80% of the product’s environmental impact [2] we need a new product design process. We should focus on solving our problem areas: we could reduce GHG emissions by 44% by doubling product life [3], water usage through lower use of virgin materials and less water-intensive materials [4] - Levi’s saved 1bn litres through their “Water<Less” initiative [5]; and up and down-stream waste, by driving a circular product lifecycle, optimising for product longevity [6].

We must incorporate multiple stakeholders and a sustainability focus from the start of the design process [7] leveraging inclusive/participatory design, including sustainability experts, entrepreneurs/intrapreneurs from our target market (also forming our marketing campaign) and suppliers - typically 80-90% of impact sits in supply chain [8]. This will deepen stakeholder relationships, however, we may first need to build their capacity to contribute in the transformative ways required for big change.

As well as incremental innovations reducing impacts around existing materials, we should work to discover substitute materials with exponentially lower environmental impact, and circular sources of materials, i.e. through reclamation - Adidas met increasing consumer demand for this, selling 1m pairs of trainers made from reclaimed plastics in 2017 [9]. This will make us more robust against rising resource prices globally [10], however we will need to ruggedly test these materials across a number of criteria for circularity suitability [11].

Subsequently designing a new circular business model and a technology-driven ecosystem - both physical and digital – to deliver and track it, opens a $500bn global market opportunity enabling us to offer repair, subscription, exchange, resale, recycling and redesign services, as well as driving significant reductions in our environmental footprint [12].

To enable these new forms of consumption we will need to develop a robust physical infrastructure (e.g. collection points, logistics) and a digital ecosystem with internal dashboards to manage usage [13].

To understand where the biggest risks and opportunities lie, we need to undertake Material Flow and Lifecycle Assessments [14]: blockchain company Provenance could enable this, simultaneously tracking the impact of our new model and resilience of our supply chain [15]. However, given our supply chain is located in developing economies, is this Appropriate Technology [16] that will be readily adopted? We may need to start more basic and build up, although aWEARness have utilised digital tracking to record material flows to great effect [17].

We can create new value through these new business models, developing new markets, potentially locally and reducing carbon footprint [18]: Nudie Jeans have employed a repair shop, recycling [19], 100% organic materials [20], achieving significant growth and winning Ethical Awards in the process [21].

Our barrier will be capital capabilities to develop this new ecosystem, particularly as our revenue is stagnating. However, we can explore utilising “leveraged assets” [22] for delivery through a partner, looking at sharing both risks and returns [23].

 

1 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

2 - European Commission. (n.d.). “Ecodesign your future: How ecodesign can help the environment by making products smarter” European Commission. Retrieved from: http://www.buildup.eu/en/practices/publications/ecodesign-your-future-how-ecodesign-can-help-environment-making-products

3 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

4 - The Conversation, 2017 – “Sustainable shopping: for eco-friendly jeans, stop washing them so often”. Retrieved from: https://theconversation.com/sustainable-shopping-for-eco-friendly-jeans-stop-washing-them-so-often-75781

5 – Levi Strauss & Co, 2018, “Water<Less”, Retrieved from: http://www.levistrauss.com/sustainability/products/waterless

6 – RSA, 2013, “The Great Recovery: Investigating the role of design in the circular economy”, RSA, Retreived from: http://www.greatrecovery.org.uk/resources/the-great-recovery-report/

7 - The Natural Step, 2013 “Interface: The Journey of a Lifetime” Retrieved from: http://www.thenaturalstep.org/sites/all/files/case_study_interface.pdf

8 - The Natural Step, 2013 “Interface: The Journey of a Lifetime” Retrieved from: http://www.thenaturalstep.org/sites/all/files/case_study_interface.pdf

9 - Edie, 2018, “Adidas sold one million pairs of ocean plastic trainers in 2017”, Retrieved from: https://www.edie.net/news/5/Adidas-sold-one-million-pairs-of-ocean-plastic-trainers-in-2017/

10 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

11 - CISL, 2016 “Collaboration for a closed-loop value chain” Retrieved from: https://www.cisl.cam.ac.uk/publications/publication-pdfs/cisl-closed-loop-case-study-web.pdf

12 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

13 - Ismail, Salim et al, 2014, “Exponential Organisations”, Diversion Books

14 – CISL, 2017, “Notes: How design and technology lead to sustainability”, Cambridge University

15 – TechHQ, 2018, “How blockchain is changing the face of the fashion supply chain”, Retrieved from: http://techhq.com/2018/03/how-blockchain-is-changing-the-face-of-the-fashion-supply-chain/

16 – CISL, 2017, “Notes: How design and technology lead to sustainability”, Cambridge University

17 – Visser, Wayne, 2017, “Innovation Pathways Towards Creating Integrated Value: A Conceptual Framework”

18 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

19 – Fisher, Alice, 2015, “Observer Ethical Awards 2015 winners: Nudie Jeans” Retrieved from: https://www.theguardian.com/environment/2015/jul/02/observer-ethical-awards-2015-winners-nudie-jeans, The Observer

20 – Borromeo, Leah, 2014, “A Swedish denim label wants to change the way we wear our jeans”, Retrieved from:  https://www.theguardian.com/sustainable-business/nudie-swedish-denim-label-jeans, Guardian         

21 – Fisher, Alice, 2015, “Observer Ethical Awards 2015 winners: Nudie Jeans” Retrieved from: https://www.theguardian.com/environment/2015/jul/02/observer-ethical-awards-2015-winners-nudie-jeans, The Observer

22 - Ismail, Salim et al, 2014, “Exponential Organisations”, Diversion Books

23 - The Natural Step, 2013 “Interface: The Journey of a Lifetime” Retrieved from: http://www.thenaturalstep.org/sites/all/files/case_study_interface.pdf

 

Short essay - sustainability partnership proposal for workwear clothing company

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working on a case study of a workwear clothing company.

 

Propose a specific partnership or collaboration that would help your organisation to solve the systemic challenge you have identified, and seize new business opportunities in the process.

Developing a circular textiles/fashion economy driving more sustainable production and consumption represents a $500bn annual opportunity. This can tackle Industry-level impacts of 1.2bn tonnes of annual GHG emissions (23kg generated from 1kg of fabric produced), 93bn tonnes of water annually, and health issues arising from hazardous substances and microfibers, and generally how factories operate [1] [2]. Such issues align with our internal environmental challenges and opportunities.

We cannot solve such a multi-faceted, multi-actor and globally complex issue alone [3].

We need to map and consult stakeholders as early as possible [4]. As many impacts are felt primarily by our suppliers and their localities – particularly as they are in areas vulnerable to climate change and water-stress - engaging these affected stakeholders is vital [5]. NGOs will be key to research and innovation: Ellen MacArthur Foundation can provide expertise in circular textiles, while Fashion For Good can connect us with delivery partners (e.g. resale, repair); particularly through their Accelerator and Scaling Programs [6]. I:CO can provide expertise on circular ecosystem delivery services [7] while cities can support this through their control of after-use collection infrastructure, and policies [8]. We should start with C40 cities due to their climate engagement [9].

We will form a partnership of these stakeholders in the form of a collaboration, whose primary collective function is focused on project delivery [10] of developing sustainable materials and building a circular economy ecosystem. A secondary (and enabling) function is learning and innovation [11].

This collaborative collective form is vital as it provides enough focus and drive to tackle the grand issue at hand, however as the stakeholders are diverse as are their resourcing levels and motivations, a fully integrated partnership would be challenging to manage [12]. Functionally, as the focus is implementing new business models and research enabling this – rule-setting and resource-based partnerships are less applicable [13].

Our main opportunity is to exert great influence [14] and commercial, environmental and social impact as outlined above [15] through fibre innovations [16], enabled through a smaller, hands-on partnership.

Communicating and marketing this initiative effectively provides an opportunity to be seen as a leader and enhance our reputation with our target millennial audience, particularly as they are more engaged in these topics [17].

The main pitfall is resource-led – given our precarious market position and smaller and less stringent partnership form. Do we have the resources and risk-appetite required to deliver such a project? Can we guarantee all parties commit the necessary resources? As a small group, can we scale up for broader impact? [18]

Another pitfall is the diversity and complexity of both the issue at hand and the form, function and membership of the project delivery-based collaboration. How do we ensure we are all aligned and incentivised, and are setting effective targets? Will it be clear when we have reached our ultimate goal and the partnership therefore ends? [19]

 

1 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

2 - Remy, Nathalie et al, 2014, “Style that’s sustainable: A new fast-fashion formula”,  https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula, McKinsey

3 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

4 - International Finance Corporation, 2017, ‘Stakeholder Engagement, A Good Practice Handbook for Companies Doing Business In Emerging Markets’

5 - International Finance Corporation, 2017, ‘Stakeholder Engagement, A Good Practice Handbook for Companies Doing Business In Emerging Markets’

6 – Fashion for Good, 2018, ‘Fashion for Good – Accelerator’ - https://fashionforgood.com/innovation-platform/accelerator-programme/

7 - Remy, Nathalie et al, 2014, “Style that’s sustainable: A new fast-fashion formula”,  https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula, McKinsey

8 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

9 – C40, 2018, ‘C40 Cities’, http://www.c40.org

10 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

11 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

12 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

13 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

14 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

15 - Ellen MacArthur Foundation, 2017, “A New Textiles Economy”, Retrieved from: https://www.ellenmacarthurfoundation.org/assets/downloads/publications/A-New-Textiles-Economy_Full-Report_Updated_1-12-17.pdf

16 - Remy, Nathalie et al, 2014, “Style that’s sustainable: A new fast-fashion formula”,  https://www.mckinsey.com/business-functions/sustainability-and-resource-productivity/our-insights/style-thats-sustainable-a-new-fast-fashion-formula, McKinsey

17 - Blowfield, Michael, 2013, ‘Business and sustainability’ Oxford: Oxford University Press.

18 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

19 – CISL, 2017, ‘Notes: Collaboration and partnerships’, Cambridge University

Short Essay - the business case for sustainability for food companies

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working to a case study of a meat production company.

 

Argue the business case for incorporating sustainability into the organisation’s strategy. Your senior management team wants to know how the pursuit of sustainability could lead to operational and strategic benefits for the business.

 

We can become a market leader through sustainability as a reaction to a shifting world - improving our stakeholder relations, reducing risks, realising cost savings and tapping into significant market opportunities.

Sustainable companies have shown 46% better share price performance [1] and 112.5% better return on assets [2] than non-sustainable companies; Unilever’s Sustainable Living brands grew 50% faster than the rest of the business, delivering over 60% of growth in 2016 [3].

 

As a food producer, sustaining our position relies on preservation of natural ecosystems, stability of the interdependent global value chain and wellbeing of people from both a consumption and production perspective. We are operating in the highest value sector as part of a total $12tn opportunity around the SDGs, with clear opportunities that sit within our remit: food waste, low-income food markets, farming technology and dietary switch [4].

 

Reputation with our stakeholders is key. Of our customers, Marks & Spencer have led on sustainability with Plan A - which realised a £105m net benefit by its fifth year [5]; while supplier standards have been presented to us by Tesco, Sainsbury’s and Waitrose. Rising to their challenge is vital to maintaining this source of 74% of our revenue. More broadly, government, consumers, suppliers, colleagues and local community all secure our licence to operate [6], managing this can result in a potential impact of 70% on EBITDA [7].

 

Sustainability opens up significant efficiency gains across our operations and supply chain [8] - since 2008 Unilever have saved over €700m through eco-efficiency [9]. Smart farming technology will drive sustainability performance, productivity and yield [10] - 80% of agriculture companies foresee a competitive advantage from it [11]. Olam have leveraged this to great effect - Mitsubishi investing at a price of approximately 16 times’ forward earnings, citing sustainable practices as a key driver [12], [13].

 

Beyond general cost drivers around waste, packaging, fertilizer and feed are key areas for us. Food waste will be most significant; food currently wasted in Europe could feed 200m people, presenting a market opportunity of $685bn [14]; using smart sensors could reduce food waste by 25-40% [15].

 

Sustainability will define what the business models and opportunities of the future look like [16], driving changing consumer habits: a shift to plant-based products - which saw year-on-year market growth in Western Europe of around 15% [18] with an expected global revenue of $5.2bn by 2020 [19] - local and online purchasing, and increased demand for transparency on sustainability performance [17], all of which we will need to react to, to remain competitive.

 

References

1 - Bonini, Sheila and Swartz, Steven (2014) - “Profits with Purpose” Retrieved from (12 March 2018) :https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Sustainability%20and%20Resource%20Productivity/Our%20Insights/Profits%20with%20purpose/Profits%20with%20Purpose.ashx, McKinsey

2 – Whelan, Tensie and Fink, Carly “The Comprehensive Business Case for Sustainability” Retrieved from (12 March 2018): https://hbr.org/2016/10/the-comprehensive-business-case-for-sustainability, Harvard Business Review

3 - Unilever (2018) “Sustainable Living Strategy” – Retrieved from (13 March 2018) https://www.unilever.com/sustainable-living/our-strategy/about-our-strategy/

4 – Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

5 - Marks & Spencer (2012) “Key Lessons from a Plan A Business Case”, Retrieved from (13 March 2018): https://corporate.marksandspencer.com/documents/plan-a-our-approach/key-lessons-from-the-plana-business-case-september2012.pdf

6 – Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

7  - Bonini, Sheila and Swartz, Steven (2014) - “Profits with Purpose” Retrieved from (12 March 2018) :https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Sustainability%20and%20Resource%20Productivity/Our%20Insights/Profits%20with%20purpose/Profits%20with%20Purpose.ashx, McKinsey

8 – Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

9 - Unilever (2018) “Sustainable Living Strategy” – Retrieved from (13 March 2018) https://www.unilever.com/sustainable-living/our-strategy/about-our-strategy/

10 - Generation Investment Management (2017), “Sustainability Trends Report”, Generation Investment Management LLP

11 - United Nations Global Compact (2017) “Project Breakthrough – Disruptive Technologies Executive Briefs – Digital Agriculture”, PA Knowledge Ltd

12 - Terazono, E. (28 October 2015). Mitsubishi seeks Olam’s sustainable approach. Retrieved from (12 March 2018) https://www.ft.com/content/e9d0ea06-7ca5-11e5-a1fe-567b37f80b6, Financial Times

13 - Mistubushi (2015) – “Mitsubishi Corporation Acquires Stake in Olam International “ Retrieved from (13 March 2018): https://www.mitsubishicorp.com/jp/en/pr/archive/2015/html/0000028412.html

14 – FAO (2016) - “Key facts on food loss and waste you should know” Retrieved from (12 March 2018) http://www.fao.org/save-food/resources/keyfindings/en, Food and Agricultural Organisation of the United Nations

15 - Global Goals Technology Forum (2017), “2030 Vision - Uniting to deliver technology for the global goals”, Sustainability

16 - Mike Barry (2016), “Episode 3: Mike Barry | The path to become the world’s most sustainable retailer”, Retrieved from https://itunes.apple.com/gb/podcast/the-sustainability-agenda/id1147166189?mt=2, The Sustainability Agenda podcast

17 - Generation Investment Management (2017), “Sustainability Trends Report”,  Generation Investment Management LLP

18 - Generation Investment Management (2017), “Sustainability Trends Report”,  Generation Investment Management LLP

19 - Upadhyay , Sheetanshu (2016), Meat Substitute Market” Retrieved from (12 March 2018) https://www.alliedmarketresearch.com/meat-substitute-market, Allied Market Research

 

 

Short essay - sustainability challenges for the food industry

A short essay from Cambridge Institute for Sustainability Leadership's course "Business Sustainability Management", working to a case study of a meat production company.

 

What are the top three global sustainability challenges for your industry at large (food)?

1) Global hunger

1 in 9 people or 815 million globally are undernourished [1]; with an additional 2bn expected by 2050 [2] and a 60% increase in food supply required to feed this predicted world population [3]. The challenge and opportunity for business moving forward will not only be how to match this demand, but also to deliver solutions to lessen risk of loss and improve productivity, improving food security and output [4].

The parallel issue of poverty limits the market opportunity, so both need to be solved in order for business to realise this.

2) Food Waste

Whilst people who need food are not getting it, food that is not getting consumed is heating up the planet [5].

20-30 percent of food is wasted [6], generating 4.4 gigatons of carbon dioxide equivalent each year - reducing food waste can reduce 70.53 Gigatons of equivalent carbon dioxide by 2050, the third-biggest lever [7].

Food waste ranks as the biggest market opportunity for food and agriculture relating to the Global Goals, valued at $685bn [8]; being present at all stages in the global value chain [9].

This is significant for GMF who can realise resource efficiencies; meeting of stakeholder needs and expectations; and innovations addressing the issue that can create new forms of value.

3) Animal Agriculture

Animal agriculture contributes up to 50% of global GHG emissions; significantly more than plants, as well as using more water, energy and land; and requiring feed to maintain [10].

A move to a plant rich diet is the fourth biggest lever to impact climate change (66.11 Gigatons of co2) [11], ranking as one of the largest market opportunities related to the Global Goals, as part of a $12tn total opportunity [12].

Substitutes for animal products are gaining market share in many markets [13], and business will look to develop such products to meet this growing consumer demand.

The challenge for companies such as GMF, could be to completely rethink their purpose, business models and products, moving from a ‘meat’ to ‘protein rich food’ company to remain competitive.

 

Value chain & plastics

Rising to standards set by their customers and driving improvements further down the supply chain will be another key challenge for GMF. There is an increased focus on packaging by stakeholders, in particular plastics, and GMF can collaborate with their entire value chain to reduce packaging and identify alternative materials to plastics for circularity.

 

 

1 – United Nations (2016), “Sustainable Development Goals – Hunger” Retrieved from http://www.un.org/sustainabledevelopment/hunger/ (Accessed 6 March 2018)

2 – United Nations (2016), “Zero Hunger, Why It Matters”

3 – United Nations Global Compact (2017) “Project Breakthrough – Disruptive Technologies Executive Briefs – Digital Agriculture”, PA Knowledge Ltd.

4 - United Nations Global Compact (2017) “Project Breakthrough – Disruptive Technologies Executive Briefs – Digital Agriculture”, PA Knowledge Ltd

5 – Hawken, Paul (2017), “Drawdown: The Most Comprehensive Plan Ever Proposed To Reverse Global Warming”, Penguin.

6 – Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

7 - Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

8 - Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

9 - Hawken, Paul (2017), “Drawdown: The Most Comprehensive Plan Ever Proposed To Reverse Global Warming”, Penguin.

10  - Hawken, Paul (2017), “Drawdown: The Most Comprehensive Plan Ever Proposed To Reverse Global Warming”, Penguin.

11 - Hawken, Paul (2017), “Drawdown: The Most Comprehensive Plan Ever Proposed To Reverse Global Warming”, Penguin.

12 - Business & Sustainable Development Commission (2017), “Better Business, Better World”, Creative Commons License

13 – Generation Investment Management (2017), “Sustainability Trends Report”,  Generation Investmnet Management LLP