Today's consumption and production patterns have a severe impact on the environment, and inefficient use of resources is a drag on the UK's economy and business. This is the message from the UK Government, which has launched a package of measures targeted at producers, retailers and consumers, with the aim of promoting the development, production, purchase and use of 'better' products. The Government also claims that its strategy presents huge opportunities for businesses to grasp new markets
The sustainable development strategy aims to support and encourage businesses to undertake a major effort to deliver products and services which will have a lower environmental and social impact across their life cycle, and to develop new business models to meet this challenge, while at the same time boosting competitiveness. The Government itself intends to use its substantial purchasing power (£13bn of goods and services each year and £125bn in the wider public sector) to encourage business by increasingly embedding sustainable development considerations into spending and investment decisions. Its goal is to be recognised as among the leading EU member states for sustainable procurement.
It has already committed itself to buying the lowest emission cars, raising standards of energy efficiency in government departments, and only building to the highest sustainable building codes. By 2006, a business-led task force will draw up a national action plan for sustainable procurement across the UK public sector.
Environmental industries in the UK are increasingly important. Two years ago they employed around 170,000 people and were worth about £16bn. Today they are estimated to be worth £25bn and employ approximately 400,000
Supporting the strategy
The support available to help producers and manufacturers bring sustainable products, materials and services to market will include:
- A £284m business resource efficiency and waste minimisation programme, that will aim to drastically reduce waste and harmful emissions across the business sector
- The expansion of the Government's market transformation programme
- The use of public procurement to drive markets for innovative environmental goods and services
- A new push to influence consumption patterns, by product labelling, working with communities to change behaviours, and developing a new service for consumers called 'Environment Direct'
- Sustainability integrated across the DTI Technology fund (£150m, 2005 - 2008)
- A new sustainable design forum to promote cutting edge 'eco-design'
- The launch of the materials innovation and growth team
- Support for the national symbiosis programme - the use of waste from one business as a resource for another
- Stronger partnerships with key business sectors
- Building stakeholder confidence by open and transparent company reporting against meaningful performance indicators and targets.
Ed Mayo, chief executive at the National Consumer Council and co-chair of the Sustainable Consumption Round Table comments, "Our research shows that 90% of all consumers say they are happy to do their bit for the environment, but in reality, habit, confusion, convenience and cost override their concerns. If consumers are to play their part in a more sustainable economy, green choices need to be easier choices. If this strategy is matched by a strong commitment from industry, it should make all the difference."
The Government will lead by example. It will integrate sustainable development principles across all its departments, and it will use its 2005 presidency of the G8 and the EU to influence the international agenda on climate change. The Department for the Environment, Food and Rural Affairs (Defra), the Foreign and Commonwealth Office (FCO) and the Department for International Development (Dfid) will 'carbon off-set' their air, train and car travel from April 2005.
Further initiatives featured in Securing the Future include a £12m communications initiative on climate change, a forum on sustainable lifestyles, an extensive package of support and training for local authorities and environmental practitioners to help build sustainability into their work, and a major initiative to create sustainable communities across the country, called 'Community Action 2020'.
The strategy focuses on four priorities:
- sustainable consumption and production
- climate change and energy
- natural resource protection and environmental enhancement
- sustainable communities and a fairer world.
A government watchdog (a newly-strengthened Sustainable Development Commission), a comprehensive set of outcome-focused indicators, and a package of training and educational measures will secure delivery.
sustainable consumption and production - the Government says that the cost of wasted resources to UK manufacturing industry is equivalent to around 7% of profit. Basic energy efficiency improvements alone could save £12bn annually.
- More than 80% of all product-related environmental impacts are determined by product design
- New fridge freezers sold today consume on average 50% less energy than those sold eight years ago
- Developed country patterns of consumption and production could not be replicated worldwide. Some estimates suggest that it would require three planets' worth of resources to achieve this.
- UK households use £800m worth of electricity every year using washing machines, tumble-dryers and dishwashers
- A PC monitor left on overnight wastes enough energy to laser print 800 A4 pages.
Climate change and energy
- Temperatures and sea levels are rising, ice and snow cover are declining, and the consequences of a changing climate could be catastrophic. The scientific consensus is that most of the warming observed over the last 50 years is attributable to human activity, through emission of greenhouse gases into the atmosphere. We need to make a profound change in our use of energy and other activities that release these gases.
- By the 2080s the annual number of people at risk from coastal flooding could increase from about 10m to as many as 80m worldwide, with around half of the increase in the poorest parts of Asia
- Projections of future climate change indicate that global average temperatures could rise by up to 5.8 deg C during this century
- Recent research suggests that between 16% and 37% of land species could be on the road to extinction by 2050 (Nature 2004)
- By 2050, about 75% of the glaciers in the Swiss Alps are likely to have disappeared.
Natural resource protection and environmental enhancement
- The demands made on natural resources continue to grow as people's expectations of quality of life are coupled with a rise in population. The use of environmental wealth is vital for economic development and poverty reduction in this country and abroad. Our economy and key industrial sectors are directly and indirectly reliant on functioning ecosystems, which are vital for nutrient cycling, and the break down of waste:
- 72% of the world's marine stocks are being harvested faster than they can reproduce (Food and Agricultural Organisation's statistical service)
- Over 90% of the 1.2bn people living in extreme poverty depend on forests for some part of their livelihoods. Global forest cover decreased by 4% between 1990 and 2000
- Activities in sectors that are closely connected with the management of the environment support 299,000 full time equivalent jobs in England, and contribute £7.6 billion in gross value added.
Sustainable communities and a fairer world
- Creating sustainable communities requires long-term strategic thinking. Sustainable communities should give people more control over decisions, and should combine social inclusion, homes, jobs, services, infrastructure and respect for the environment.
The aim is to create places where people will want to live and work now and in the future:
- Average life expectancy at birth in the UK is currently 78 years, while the global average is 65 years
- More than 300m children go to bed hungry every day. Only 8% of them are victims of famine or other emergency situations.
- Over 800m adults are illiterate, 90% of whom live in developing countries
- One in every five children has no access to even the most basic education.
Success for businesses in the 21st century will depend on their ability to meet growing consumer expectations of higher environmental and ethical standards. Businesses that anticipate this trend and develop 'material-light' goods and services will be best placed to enhance their competitiveness.
'Securing the Future' - can be downloaded from: www.sustainable-development.gov.uk Sue Copeman is editor, Strategic Risk
CASE STUDY: BAYWIND ENERGY CO-OPERATIVE
The Baywind Energy Co-operative was formed in 1996 to offer community
ownership of the Harlock Hill wind farm project in Cumbria. It was based on renewable energy models successfully pioneered and widely practised throughout Scandinavia. The concept of community involvement rather than private finance is common in Europe, the largest example being the 40MW offshore wind farm, Middlegrunden, in Denmark.
Since 1996, Baywind has successfully carried out two share issues, has raised over £1.9m and has more than 1,300 members each receiving dividends from the profits earned from electricity generation during the year. The share prospectus offered a minimum investment of £300 and a maximum of £20,000.
Both share offers qualified for the Enterprise Investment Scheme (EIS) tax relief. Qualifying shareholders received 20% tax relief on their initial investment of £500 or more. In 2002 Baywind's rate of return on investment was equal to: 6.07% gross (EIS equivalent 7.59% gross).
Baywind Energy Co-op now owns six wind turbines in Cumbria and sells the energy generated through a Non-Fossil Fuel Obligation contract with a turnover, last year, of £475,000. The Baywind Energy Conservation Trust (BWECT) also works to cut energy use. A guaranteed 0.5% of the income from the Harlock Hill wind farm funds the Conservation Trust. The fund has distributed over £10,000 to the local community through the provision of energy efficiency advice and low energy appliances to homeowners.
To help achieve further community-owned wind power projects, Baywind established Energy4All, to recreate the success of Harlock Hill by forming new co-operatives throughout the UK. Three share issues will be launched this year for wind co-operatives in Oxfordshire, Linolnshire and the north of Scotland.
CASE STUDY: UNILEVER
Fish stocks worldwide are in serious decline: 48% are fully exploited, 16% overfished, and 9% depleted, according to the United Nations Food and Agriculture Organisation.
Unilever is one of the world's biggest buyers of fish. Their fish business relies on access to dependable supplies into the future, so over the past decade Unilever has been encouraging production of sustainable sources of fish for the UK market.
In 1996, Unilever began working with the WWF to help establish a certification programme for sustainable fisheries, known as the Marine Stewardship Council (MSC). This became an independent non-profit organisation in 1999. Under the MSC programme, fisheries can apply for independent assessment to see if they meet strict environmental standards for sustainable and well-managed fisheries. If they pass, their products can display the MSC eco-label.
A dedicated Unilever sustainability manager assesses each fishery against five indicators: fisheries research; quota system; regulatory tools; control systems; long-term management plan. The effect of fishing on marine ecosystems is also taken into account. The assessment is graded by a traffic light system. A fishery that gets all green is deemed sustainable and Unilever encourages it to seek certification to the MSC Standard. Those that show a mix of green and yellow are deemed managed and progressing, and those that get one or more red, poorly managed. Unilever categorise a fishery as unmanaged if it scores red against all five indicators. Although Unilever no longer sources from fisheries that are unmanaged, it continues to support those that are making good progress towards sustainability.