Committing to the SDGs: Ensuring responsible consumption and production – SDG 12

Businesses are the primary drivers of economic growth. Not only do they create employment opportunities that lead to economic progress and decent standards of living for the people who benefit from it, but they also substantially affect the livability of a country being the primary stakeholders of its environment. In addition to being responsible for providing value to consumers through their goods and services, businesses have an obligation to the environment on which they exert growing demands for their resources. Yet, despite achieving competitive markets through their value chains many of them have failed to exploit the other part of this equation – environmental responsibility. The production and consumption patterns of businesses globally are diminishing natural resources and degrading the environment, securing growth, but at the cost of our ecosystems.

The ramifications of such a ‘business as usual’ model are manifold. Resources are depleting rapidly putting future generations at the brink of survival; rising material waste is resulting in deaths and loss to biodiversity; and extreme weather events caused by climatic change are endangering lives and livelihoods of millions. The Sustainable Development Goal (SDG) 12 ‘Ensuring Responsible Consumption and Production Patterns’ aims to avert this ‘negative’ growth and its debt on future generations by calling to action all stakeholders including the private sector to decouple economic growth from environmental degradation by achieving the following targets. These include but are not limited to:

• 12.3 Halve per capita global food waste at the retail and consumer levels and reducing food losses along production and supply chain

• 12.5 Reduce waste generation through prevention, reduction, recycling, and reuse

• 12.6 Encourage companies, especially large and transnational companies, to adopt sustainable practices and to integrate sustainability information into their reporting cycle

• 12.7 Promote procurement practices that are sustainable, in accordance with national policies and priorities

To situate the business-environment scenario in the context of Pakistan, it is important to highlight that we are ranked as the 7th most affected country in world by climate change. We are losing Rs.1 billion per day due to environmental degradation which is 6 percent of the GDP. Our energy and agriculture sectors combined emit about 87% of the total national GHG emissions and in terms of low water use inefficiency, we consume 1,070 litres per dollar which is four times the use of 128 litres per dollar in the Asia Pacific.[1] Moreover, the Global Air Quality Index recently ranked Lahore as having the worst air quality in the world. The costs of this environmental damage translate into (i) illness and premature mortality caused by air pollution (indoor and outdoor), (almost 50 per cent of the total damage cost); (ii) diarrheal diseases and typhoid due to inadequate water supply, sanitation and hygiene (about 30 per cent of the total), and (iii) reduced agricultural productivity due to soil degradation (about 20 per cent of the total).[2]

On the current environmental trajectory and with the upcoming establishment of industrial zones as part of CPEC, not to mention the rise in consumer demand, it is highly likely that energy strains, resource depletion, and ecosystem degradation will only worsen in the near future. Under current circumstances, the need for existing and emerging businesses, particularly in the industrial sector, to adopt Sustainable Consumption and Production practices is acute.

The Sustainable Consumption and Production Wheel illustrated in the above diagram[3] has been prepared by the Cambridge Programme for Industry (CPI) and Business Taskforce on Sustainable Consumption and Production. Encompassing a range of drivers, enablers, and techniques being adopted globally by companies practicing environmental stewardship, the matrix provides a holistic starting point for businesses seeking to embrace a more Sustainable Consumption and Production agenda in their value chains.

Drivers

Businesses should start by sourcing all their electricity needs from renewable energy and switching to smart energy efficient equipment like movement sensitive office lights. However, savings and efficiencies should be considered not just in terms of energy, but also resources such as waste, land, or water. Globally, an estimated 41.8m tonnes of e-waste was discarded in 2014, a figure predicted to rise to 50m tonnes by 2018.^[4]

Case Study

Ericsson offers free product take-back services in efforts to reduce waste from electrical and electronic equipment (WEEE). Materials from this e-waste are recycled and reused in their new products.

Imposing costs and penalties on departments and employees for carrying out environmentally irresponsible and inefficient business practices can be a driving force for businesses to think critically about their environment. This driver can be enabled on a collaborative scale between private sector and government regulatory boards wherein the latter could legally fine/penalize companies for engaging in negligent production and consumption activities.

A global research by PwC found that 78 percent of customers are more likely to buy the goods and services of companies that had signed up to the SDGs.^[5] With consumers increasingly demonstrating a shift towards sustainable and eco-friendly products, it is in the personal interest of businesses to leverage this customer demand to bring value to their chains, as a result, making their brand more competitive, resilient, and profit maximizing in the long run.

Techniques

Innovation is the key approach to solving many of today’s wicked sustainable development challenges. Given their financial capital, resource capacity, and capability, businesses have a strong potential to invest in R&D to ideate technologies/strategies that may help minimize the environmental cost of their operations. These breakthrough innovations can occur across the products and services portfolio at any stage of its life cycle from design and procurement through to manufacturing and user consumption.

A Life Cycle Assessment (LCA) helps to identify ‘hotspots’ within the value chain where sustainable interventions will lead to an effective reduction in the environmental impacts of specific goods and services. It is used to present an overall analysis of the environmental footprint of a business. Ensuring that the procurement for various business functions along the value chains is sustainable whether its procuring raw materials and natural resources or product-systems such as transport logistics and labor standards, can lead to significant reductions in environmental risk.

Case Study

Unilever developed an innovative new technology called CreaSolv™ which produces quality polymers, which can be used to make plastic that can be used again and again. This breakthrough is a step towards achieving their goal of halving the waste associated with the disposal of their products by 2020, and increasing the recycled plastic content in their packaging to 25% by 2025.

Enablers

According to a recent report from KPMG, 93 per cent of the world’s 250 largest companies (in terms of revenue) are now reporting on sustainability, as are three quarters of the top 100 companies in 49 countries.^[6] There are various voluntary standards that businesses can adopt in order to operate more efficiently, without being necessarily binded to a third-party regulatory body such as government. LEED certification, ICC’s Business Charter for Sustainable Development, UN Global Compact, UN Guiding Principles on Business and Human Rights, ISO certifications, Forest Stewardship Council, and GRI Integrated Reporting Framework are few of such international standards.

Case Study

•           Sapphire Textiles is the only company in Pakistan that conducts Environmental Product Declaration (EPD) for its products, quantifying the environmental impact of their product in its lifecycle including impact of acquiring raw material, energy consumption, GHG emissions, and waste production.

•           The new HBL Tower in Karachi is the first LEED certified building in Pakistan and Artistic Milliners is Pakistan’s first LEED certified garments factory.

Businesses have the responsibility, credibility, and level of influence to maximize stakeholder engagement in order to maximize their value for sustainable consumption and production. Engaging consumers in efficient consumption behaviors is challenging but with the change in current trend whereby consumers are demanding sustainable retail products, provides a strong leverage to businesses to initiate change from production end. Targeting financial institutions to redesign their investments portfolio to ensure minimum to no investing in nonrenewable energy products and services will induce an eventual change in a business’s value chains, and lastly collaborating with the government through joint task forces or councils to institute legislations and standards for sustainable production and consumption practices will put the private sector on the path to environmental stewardship.

Pakistan has made a promising progress towards achieving this SDG by recently meeting one of its primary targets 12.1 that asks countries to “Implement the 10-year framework of programs on sustainable consumption and production . . .” In 2016, a National Action Plan (NAP) on Sustainable Consumption and Production was adopted in collaboration with UN Environment, the EU SWITCH-Asia Programme and the support of the 10YFP Secretariat. In line with ‘Vision 2025’ the Pakistan NAP functions as a roadmap for various stakeholders to practice SCP by mainstreaming and reflecting these targets and actions in their sector operations and lines of business. It is high time that more holistic and collaborative efforts were made by the private sector to ensure that the needs of the present are met without compromising the options available to future generations to meet theirs!

About the Author:

Neha Panjwani completed her bachelors in Social Development and Policy with an academic concentration in Urban and Community Studies from Habib University, Karachi. Her research work cuts across disciplines of gender studies, urban design and public policy. She has been actively involved in studies about urban mobility and the marginalized Khwājā Sīrā (transgender) community in Pakistan. She is currently working with Shehri CBE on the ‘Climate Efficient Urban Mobility and Smart City Growth’ project funded by Friedrich Naumann Foundation and is also co-authoring a publication on a Sustainable Urban Mobility Framework for Karachi.

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[1] https://tribune.com.pk/story/1433020/making-pakistans-consumption-production-sustainable
[2] http://www.oneplanetnetwork.org/sites/default/files/final_nap_report_aug_2017.pdf
[3] https://www.cisl.cam.ac.uk/resources/publication-pdfs/sustainable-consumption.pdf
^[4] https://www.pwc.com/gx/en/sustainability/publications/PwC-sdg-guide.pdf
^[5] https://sdgresources.relx.com/news-features/sdgs-opportunity-business
^[6] https://sustainabledevelopment.un.org/sdg12