The urgency of a green pandemic recovery

If the world learned anything from the pandemic, it is that nature should be protected and sustainability is critical. It is time for businesses to lead the way.

Since COVID-19 attacked communities across the globe, entire populations paused to take stock of their lives. Closed borders, restricted lives, changed consumption patterns, and above all, a deadly, contagious virus, scared many to adopt healthier habits, even if temporarily. These included eating healthier, spending more time outdoors, exercising more and sleeping better. International borders were closed and travel was severely restricted, resulting in deep cuts to global energy demands. As the pandemic accelerated, people began to pay attention to the sustainability of the environment which they had previously often neglected in the crazed rush to consume. John Replogle, the former CEO of Seventh Generation, a major consumer product company, once said, “You can’t live a heathy life on a sick planet.”

You can’t live a heathy life on a sick planet.

John Replogle, former CEO of Seventh Generation

And changes did happen, even temporarily. For example, the pandemic-induced closure of international (as well as domestic) borders and widespread lockdowns significantly reduced energy demands across the world. This led to a 17% reduction in daily global carbon emissions in early April 2020. Yet, two months later, in June 2020, with the situation far from normal, global carbon emissions were only 5% lower than the same period in 2019. Thus, the reduced carbon emissions were just a delaying of a relentless rise in greenhouse gases.

Even as individuals gradually resumed pre-pandemic lifestyles, the corporate world is giving even less consideration to sustainability and the environment. Confronted with an aggressively spreading pandemic, many struggling businesses are pushing environmental protection to the back-burner, encouraged by some governments lowering the bar for going green.

However, businesses need not sacrifice their environmental protection goals for the sake of pandemic recovery. In fact, a green recovery through building sustainability into pandemic exit strategies, will result in a win-win situation for the economy, the climate and public health.

The macro plan for pandemic recovery contains two phases – a “rescue” phase and a “recovery” phase. The rescue phase, which happened as the pandemic escalated, focused on the survival of people, keeping them employed and helping businesses to stay afloat.

As the world moves into the “recovery” phase, businesses need to understand that going green will help the process of optimising operational efficiency. Thus, the recovery phase is where businesses can choose to go “green.” Green businesses essentially use renewable energy resources, enhance material recyclability and reduce spreading toxicity to the environment.

However, as a recent study for the Finance for Biodiversity initiative found, only the UK, Germany, France, and the EU as an entity, out of the world’s 20 largest economies, are focusing on a green pandemic recovery that will benefit the climate and the environment.

The UK in particular, having hosted the 2021 United Nations Climate Change Conference COP26 in Glasgow, is anxious to adhere to the Glasgow Climate Pact that nations adopted, to transform the 2020s into a decade of climate action and support. The British government laid out an ambitious Ten Point Plan for a Green Industrial Revolution, with the aim of becoming a global leader in green technologies. Prime Minister Boris Johnson said, the plan “will mobilise £12 billion of government investment, and potentially 3 times as much from the private sector, to create and support up to 250,000 green jobs.” The plan will focus on the electric vehicle industry, agroforestry, and the annual planting of 30,000 hectares of trees by 2025.

Meanwhile, in the EU political agenda, hydrogen is seen as a critical element in achieving climate neutrality. The European Commission targets a six-fold increase in hydrogen production from renewable sources by 2024. In line with this, Poland, by utilising the EU economic rescue fund, plans to invest $960 million to produce and distribute hydrogen, thereby accelerating the shift to clean energy.

Moreover, with advancements in renewable energy technology, renewable electricity costs have plummeted in the past two years. A recent report by the International Renewable Energy Agency (IRENA) states that in 2020, the cost of concentrating solar power (CSP) fell by 16%, onshore wind by 9% and solar PV by 7%. At operational levels, renewable energy is increasingly cheaper than coal. This situation makes strong business sense for companies across both the developed and developing world to turn to clean energy. IRENA’s Director-General Francesco La Camera, said, “Renewables present countries tied to coal with an economically attractive phase-out agenda that ensures they meet growing energy demand, while saving costs, adding jobs, boosting growth and meeting climate ambition.”

Renewables present countries tied to coal with an economically attractive phase-out agenda that ensures they meet growing energy demand, while saving costs, adding jobs, boosting growth and meeting climate ambition.

Francesco La Camera, Director-General of the International Renewable Energy Agency (IRENA)

Employing green technologies in business can lead to a competitive advantage, because Millennials and Gen Z are increasingly seeking out sustainable products, and often expect social responsibility from suppliers and retailers to use green practices and sustainability.

According to a recent Nielsen global online survey, 66% of respondents said they will always buy eco-friendly products and services and champion such businesses, and will willingly pay more for green products. The respondents also said that the factors influencing their buying decision included: knowing that products are produced from natural, fresh, organic ingredients; being a recognised or certified eco-friendly brand; using environmentally friendly packaging, and; advertising that promotes the environmental and social benefits of the brand.

Tax is another important consideration. There are the tax breaks, rebates and other financial incentives that the federal and state governments offer businesses that go green. Some of these incentives include business deductions for installing energy-saving HVAC, lighting and hot water systems, tax credits and grants for using alternative energy, tax credits for clean energy vehicles that meet fuel-efficient standards, and bonus depreciation for qualified recycling and reusing of certain machinery and equipment.

As businesses are recovering from the pandemic, and leaning toward going green, it is appropriate to remember the aboriginal proverb, “Look after the land, and the land will look after you. Destroy the land, and it will destroy you.”