Sustainability is not just about the environment. It is about culture, the economy, globalization, knowledge, and more.It is a way of life that starts when individuals think of how to utilize resources to meet the needs of the present generation. At the same time, it is making sure that scarce resources will still be available to meet the needs of future generations.
“It is a way of life that requires sacrifices from today’s generation for the benefit of future generations.”
It is a way of life one may encounter while visiting a family farm in North or South America, Europe, Africa, or Asia… I grew up on a family farm, and I know sustainability was our way of life. We loved farming; we shared the crops with all family members, sold the residual crops for profit, and took care of the land and other scarce resources because our family knew the survival of the next generation would depend on what we did.
Times have changed. We do not have the family farm, and our economies have transformed from agricultural to manufacturing, service, or knowledge-based economies. Moreover, emerging countries have parallel economies. Changing economies and rapid growth have led to a higher utilization of resources to meet the needs of today.
“The concern is whether the next generation will have enough resources to live comfortable lives or even survive.”
That’s why business schools are trying to educate future managers in how to incorporate sustainability into business decisions and strategy. Global organizations and governments are encouraging businesses to participate in sustainability programs to reduce consumption and improve performance. It is good to educate future managers and introduce businesses to the concept of sustainability because this is one of the solutions that ensure the well-being of future generations.
“We also need to understand the problems that led us to adopt sustainability as the solution.”
The problem is growth, and we need to learn how to manage growth to reduce the consumption of scarce resources. Managing growth requires the combined effort of people, businesses, organizations, and governments. The following “5 Gs” (Ahmed, 2014) will help in understanding the variables involved in growth, in terms population, consumption, innovation, obsolescence, and knowledge—and how they are related to each other.
- Growth in Population: This is the result of social, economic, religious, and political forces.
- Growth in Consumption: This is the result of population growth, customer behavior, market strategy, knowledge, and production strategy.
- Growth in Innovation: This is the result of competition, knowledge, and economic and corporate culture.
- Growth in Obsolescence: This is the result of innovation, competition, and quality of output, knowledge, and corporate strategy.
- Growth in Knowledge: This is the result of education, technology, open access, desire, and cost.
Let’s look at market strategy and consumer behavior (variables of growth in consumption) to investigate how these variables increase the consumption of resources. We used to have water fountains for drinking water. The water used came straight from the local utility company (treatment facility) to the water fountains. The only resources consumed were water from the local utility company and a small amount of energy for maintaining the fountains. There was no cost for the individuals who were drinking the water.
However, the quality of water from local utilities became an issue, and businesses seized the market opportunity with a strategy to market bottled water to consumers. Consumers changed their behavior and stopped drinking water from water fountains. Now, we use plastic and paper to package millions of bottles a day and energy to process, store, and dispense the water from the machine and transport it to distribution centers and retail stores. The water is also used to clean the production facilities.
This was a brilliant strategy from the businesses’ point of view because they turned a low market value (from business point of view) resource into a high profit margin product for the business. It also increased the consumption of scarce resources and raised the question of sustainability.
“That’s why we need to make sustainability as part of the corporate strategy, and the way of life.”
Lastly, the concept of sustainable growth was introduced in business schools and to businesses as early as the 1970s, as far as I can remember. This concept suggests that the growth rate a firm can sustain is the function of the retention rate and return on equity. The focus of a sustainable growth rate was on growth, long-term profitability, and the financial sustainability of the company. Today, our focus is on corporate sustainability, which includes growth, long-term profitability, concern for the environment, and social issues.
How do we promote sustainability to businesses in a capitalistic society?
© 2015 Mohammed R. Ahmed.
Ahmed, M.R. (2015). Sustainability is a way of life!
Published in Linkedin