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Posts Tagged ‘Population’

21st Century Tragedy Pending
Sustainability is recognizing the need to better manage resources for survivability, while rethinking actual needs, and reducing waste of emissions, energy and water.  In the European Union, sustainability is implemented through government regulations and policies.  In other countries it is not national policy, but corporate leadership that understands needs for change. Sustainability is an American governmental policy, but is only mandated through environmental laws and regulations. Here, sustainability initiatives are voluntary and a choice for the individual and business concerns.  Not surprising, a recent MIT study suggests that  American leaders are motivated by significant tangible results that affect profitability for their enterprises.

Why are so many governments and so many corporations engaged in sustainability? Why are so many studies focused on sustainability? Simple, survival. Here is an example of a recent survey that shows world population growth has grown dramatically and will continue to do so:

  • 1800 less than 3 percent of the world population lived in large urban areas
  • 1900 about 150 million people lived in the largest urban areas
  • 2011 currently about half of the world’s population live in large urban areas, 3 billion (7 billion total)
  • 2050 it is estimated that over 65 percent of the world population will live in urban mega cities, the world’s estimated population will be 9 −10 billion

Additionally, according to KPMG, the 10 global sustainability megaforces that may impact business over the next two decades are:

  • Climate Change: This may be the one global megaforce that directly impacts all others. Predictions of annual output losses from climate change range between 1 percent per year, if strong and early action is taken, to as much as 5 percent a year–if policymakers fail to act.
  • Energy & Fuel: Fossil fuel markets are likely to become more volatile and unpredictable because of higher global energy demand; changes in the geographical pattern of consumption; supply and production uncertainties and increasing regulatory interventions related to climate change.
  • Material Resource Scarcity: As developing countries industrialize rapidly, global demand for material resources is predicted to increase dramatically. Business is likely to face increasing trade restrictions and intense global competition for a wide range of material resources that become less easily available.
  • Water Scarcity: It is predicted that by 2030, the global demand for freshwater will exceed supply by 40 percent.
  • Population Growth: This will place intense pressures on ecosystems and the supply of natural resources such as food, water, energy and materials. While this is a threat for business, there are also opportunities to grow commerce and create jobs, and to innovate to address the needs of growing populations for agriculture, sanitation, education, technology, finance, and healthcare.
  • Wealth: The challenge for businesses is to serve this new middle class market at a time when resources are likely to be scarcer and more price volatile. The advantages many companies experienced in the last two decades from “cheap labor” in developing nations are likely to be eroded by the growth and power of the global middle class.
  • Urbanization: By 2030 all developing regions including Asia and Africa are expected to have the majority of their inhabitants living in urban areas; virtually all Population Growth over the next 30 years will be in cities.
  • Food Security: Global food prices are predicted to rise 70 to 90 percent by 2030. In water-scarce regions, agricultural producers are likely to have to compete for supplies with other water-intensive industries such as electric utilities and mining, and with consumers.
  • Ecosystem Decline: The decline in ecosystems is making natural resources scarcer, more expensive and less diverse; increasing the costs of water and escalating the damage caused by invasive species to sectors including agriculture, fishing, food and beverages, pharmaceuticals and tourism.
  • Deforestation: Wood products contributed $100 billion per year to the global economy … Yet the OECD projects that forest areas will decline globally by 13 percent from 2005 to 2030, mostly in South Asia and Africa. 1

But why do we need to act now?
Political and Business leadership, mostly in Europe, and many multi-national organizations with revenues exceeding $1 Billion annually have recognized the global need for Sustainability and, in many cases, implemented initiatives to transform to 21st century realities.  Major players clearly understand the consequences of their actions, possible scenarios, and the need to manage potential threats or conflicts. The future of current societies will be based on keen understandings of what is required to be efficient, sustainable and promote policies of “zero waste” with long-term commitments from business, governments and citizens.
Many organizations are preparing for limitation of resources in the next three to five years. China has already demonstrated restraints on the export of rare earths or other commodities to the West. For this century, we need Sustainability Leadership that effectively orchestrates resources to preserve our planet for this generation and succeeding generation to meet their needs, whether East or West. Protracted trade wars would have little or no advantage to the global economy and could be a catalyst for a second recession.
To summarize, this man-made global situation, based on poor economic, environmental and social decisions were based on these criteria:

  • Scope: total Global impact (threat to entire biosphere)
  • Business: Involvement and engagement from a global perspective
  • Government: Multi-lateral, multi-country driven legislation and voluntary participation
  • Stakeholders: Consensus varied from Tier 1 – developed and Tier 2 – developing countries. There is no one leader or country that is  inspirational, promotes change and accepts long-term commitment. Responsibilities are unilateral and often centered on individual country priorities.
  • Mitigation: Diplomacy, treaties, government trade and economic policies
  • Result: On-going global discussions for the last thirty years has elevated awareness. Currently, there is no consensus regarding timeline, international sustainability,  or universal strategies to reach a sustainable economy in each country.

Comparing the 20th century to the 21st century, is a contrast in scenarios and outcomes. In the last century, lines were drawn across ideologies and almost produced a cataclysmic event that would have changed the world permanently, in just a few minutes.
Since the 1960s, we watched radical environmentalists confront business and government, to promote environmental and social issues. From the scientific community, environmental and social issues have been studies and shown that indeed our world is changing. Public skepticism has been a byproduct of radical self promotion and scientific bias. Public opinion is concerned about improved economic conditions, while it also has a growing concern over the environment.
Also, we are seeing the expansion of sustainable infrastructure into new areas, destined to build and restore our environment. Successes are often cited in articles about Sustainability initiatives improving business, education, government and the military. Measuring tangible results are posted by the Business Roundtable,  company Sustainability Reports and financial market indices. Sustainability is embraced as a smart choice for future, but it is not quick fix, and will be a long-term commitment.

Footnote:

1 KPMG, Sustainability “Megaforces” Impact on Business Will Accelerate, Finds KPMG, 14 Feb 2012; Retrieved: 14 Feb 2012

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Take a moment and think about this: 70,000 years ago, erect humanoids were almost  eliminated by an Ice Age. Scientists estimate that roughly 5,000 female individuals existed during that time. They survived by adaptation to change, ability to understand consequences of doing nothing,  a willingness to prudently experiment, and discovered two truths of life: hope and perseverance.


Now, let’s fast forward to the 21st century. We’re living on a planet, a very special planet that we call Earth. It is estimated that we have a population of about 7 billion people. So why is this important? Well, for starters, mankind is truly in jeopardy of extinction within the next 100 to 200 years. It is projected that by the year 2050, our population will grow to 12 billion people. That’s roughly 5 billion people in 40 years.

Now, let’s throw a monkey wrench into this US scenario. What is Sustainability? It is a pattern of resource use that aims to meet human needs while preserving the environment so that these needs can be met not only in the present, but in the indefinite future. The term was originated by the Brundtland Commission which has become the most often-quoted definition of sustainable development as development that “meets the needs of the present without compromising the ability of future generations to meet their own needs.”

In 1987, the Brundtland Commission, was chartered to review and recommend long-term strategies that recognized population growth, limited resources, economic considerations and environmental impact to existing business practices. Why was this conducted? Here is an example: A recent survey shows world population growth has grown dramatically and will continue to do so:

  • 1800 less than 3 percent of the world population lived in large urban areas
  • 1900 about 150 million people lived in the largest urban areas
  • 2011 currently about half of the world’s population live in large urban areas, 3 billion
  • 2050 it is estimated that over 65 percent of the world population will live in urban mega cities

So, Sustainability addresses the importance of economic, environmental and social influences on all corporations. Sustainability also recognizes constraints that are probably not on your dashboards and will have strategic impacts [i.e.,  energy supplies, population growth, global competition, emerging markets, trade barriers, limits on resources, etc.]. Sustainability, in a general sense, is the capacity to maintain a certain process or state indefinitely. The concept of sustainability applies to all aspects of life on Earth and is commonly defined within ecological, social and economic contexts. To be sustainable, regardless of context, the Earth’s resources must be used at a rate at which they can be replenished.

So what? We live in the land of opportunity. We live in the United States. We have had the good fortune of being blessed with resources, diversified skills, an educated population, the largest world economy, and a democratic republic constrained by constitutional rights. Yes we have been given many blessings, but so what? (I’ll come back to this.)

In the today’s business world, executives make decisions regarding expenditures by the millions and billions of dollars. No think of this: how is that decision process determined?

Well, in terms of the environment, reusing resources without recognizing consequences. Why? Because that’s the only way it’s been done?! Well, this is 17th century mindset where resources were collected locally, hewn or molded into buildings or products, and then sold in an open market. Little has really changed in the 21st century.

We are still using 18th-century accounting practices that only recognizes sales, costs and assets. Before we get into an argument, it is true that please business accounting principles have been updated and standardized for the last 200 years. However, I would argue that most of those adjustments, amendments, and standardized approaches are based on government regulations, tax policy and international trade conformity. Nonetheless, profitability was inherently calculated on the cost of resources, cost of production, and fulfilling market needs without regard to the consequences of resource depletion.

Many companies are still reliant on Frederick Taylor’s principles that workers are incapable of understanding what to do and need to be enforced to ensure work completion. It is amazing that many businesses in today’s world still use these philosophies that were originated in the 19th century.

However, in today’s world where competing globally, due to a 60-year-old ‘free trade‘ policy  that reduced or eliminated trade barriers in order to promote international trade among nations. This shift in policy was suppose to open up trade opportunities  for the United States with other countries. But it was a two edge sword, for example, it produced outsourcing of millions of call center, financial and technical positions to improve corporate‘performance. In today’s marketplace, in the United States, we are tethered and constrained to a 20th-century policy of ‘free trade’ at any cost.

We can infer that this policy issue has been a critical element in our recent ‘great recession’. That is, millions of US jobs have been lost permanently, US businesses must compete in a noncompetitive world, and outsourcing in many instances has undermined corporate strengths.

Source: Jarvis Business Solutions, LLC, © 2011, For services: www.JarvisBusinessSolutions.com

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