© WWF International.
Is my current lifestyle sustainable? What would the world look like if 7 billion individuals were living the same way as I do? How does my daily commute to the office impact global greenhouse gas emissions? These are all valid questions. Not only for individuals, but also from a business point of view.
The study of our ecological footprint – measuring how much biologically productive land and water is required to produce all the resources we consume and to absorb the waste generated – provides some interesting insights. Especially when we compare this footprint to the Earth’s regenerative capacity, also called biocapacity.
According to WWF, the global population used in 2008 50% more resources compared to what the Earth can provide. In other words, it would take 1.5 years for the Earth to fully regenerate the renewable resources that we collectively use in one year. Even more concerning, under “business as usual”, humanity is set to require by 2050 an equivalent of 2.9 planet Earths to fulfill its appetite for resources (Moore et al., 2012; WBCSD, 2010).
© WWF International. Living Planet Report 2012
In a similar approach, The Global Footprint Network developed the concept of the Earth Overshoot Day, marking the date “when humanity exhausted nature’s budget for the year”. According to their calculations, Earth Overshoot Day was this year on August 20, meaning we will reduce our stock of renewable resources and accumulate CO2 concentration for the remaining four months of the year.
In case you are wondering how much your ecological footprint actually is, have a look at these simple tools: WWF ECOGURU and Ecological Footprint Calculator from the Global Footprint Network.
From these simple facts, we can safely conclude we are over consuming the Earth’s resources – depleting our natural capital over time. Our current lifestyles are undermining the health of our planet and its ability to continue providing basic services such as food, energy and water.
Where have we gone wrong? What can we do to tackle this deficit and reduce our environmental impact? Are businesses addressing this issue?
As individuals, it is clearly in our hands to understand where we have most impact and review our lifestyle choices – mobility, housing & energy, food and consumption – in the light of this information. Simple everyday actions can make a difference – for reference, read our previous Eco Stories from Louise Southerden and Giles Parkinson.
On the business side, leaders in sustainability are implementing new tools to measure the full costs of their operations. In 2011, the first ever Environmental Profit & Loss (“E P&L”) account was published by sportlifestyle company PUMA, measuring the costs of its activities for the key areas of greenhouse gas emissions, water use, land use, air pollution and waste. For the year 2010, the environmental impact of PUMA’s operations and supply chain was valued at € 145 million. Land use, air pollution and waste along the value chain accounted for € 51 million, while € 94 million resulted from greenhouse gas emissions and water consumption.
The methodology, developed in coordination with PwC and TruCost, was subsequently taken to the product level and concluded that the environmental cost of a biodegradable T-shirt comes to € 2.4, 31% less than a conventional T-shirt (€ 3.4).
In an effort to be transparent, Kering (PUMA’s holding company) convened a team of experts from organisations such as WWF, TEEB and the World Business Council for Sustainable Development to review the Environmental Profit & Loss methodology. The panel concluded it was “an excellent first step in the right direction to promote the sustainable use of natural capital”. However, the panel reminded us “that an E P&L is currently more a backward looking indicator of the current perception of welfare impact, and not necessarily of sustainability over the long term”.
Kering has now committed to implement an Environmental Profit & Loss account across all its Luxury (Gucci, Balenciaga, Stella McCartney…) and Sport & Lifestyle brands by 2016. There is no doubt that this type of initiatives will be promoted by the recently launched “B Team”, led by former PUMA CEO Jochen Zeitz.
Louis Hamon is an Investment Director at NEUW Ventures
