Does action on climate change make a company sustainable?

Less than three years ago climate change was still a relatively small issue for Australian businesses and the Federal Government. At that stage only a small group of public servants were starting to develop a public discussion paper on how the State Labor governments – independent of the Federal Coalition Government – could develop a National Emissions Trading Scheme.

I remember going to one of the very first public forums on the issue. Although the general Australian business community wasn’t really awake or alert to the issue of climate change, it was obvious that a number of small businesses and consultants could see the emerging issue and wanted to be part of the solution.

Most of the consultants I met that afternoon had a background in sustainability and had personal passion to help increase the sustainability of the business sector. With all respect to those people I met, I don’t think they actually realised how action on climate change and action on sustainability were actually different things.

Action on climate change and action on sustainability are different. Fundamentally, action on climate change is a sub-set of the sustainability agenda that attempts to improve the energy efficiency of processes and reduce the negative by-products of energy consumption. Sustainability, on the other hand, attempts to increase the longevity of business and decrease the negative by-products business can have on itself, society and the environment through short-term thinking and self-interest.

Despite what many people believe, action on sustainability is not about donating to charities, volunteering, or community service. Rather, it is an attempt to create a local environment where business can continue to grow. For example, a community which does not have enough skilled people leads to a business that cannot make or sell its product. Likewise, a community without businesses does not have enough income to create a quality of life that keeps people happy, healthy and living locally.

As such, while action on climate change might reduce our carbon footprints, it does nothing to ensure we have the skilled people to make and lay our bricks, or create a situation where people want to improve their living circumstances by building new homes.

As such, despite the looming threat of higher manufacturing costs and a massive effort to reduce this, it is imperative that businesses don’t forget that they still need to engage and nurture their local communities to ensure prosperity beyond the climate change threat.

Furthermore, action on climate change will become the norm and all businesses will learn how to reduce their costs through manufacturing efficiency improvements. Conversely, action on sustainability will continue to provide a competitive edge that increase real value within the company, not just efficiency dividends.