Companies Are Pledging Resource-Positive Futures. But How?
In the past few weeks, the CEOs of some of the world’s leading corporations have come out with a pledge to becomeresource-positive. In January, Microsoftannounced their planto be carbon-negative in tenyears time. Not long after, Starbucks’ CEO, Kevin Johnsonpublicly announcedthe company’s strategies to achieve resource-positivity by 2030, the same year the Sustainable Development Goals are planned to be accomplished. There are a few other stand-out companies that weave together core sustainable change, core business strategy, and positive sustainable change;IKEA has a goal to eliminate greenhouse gas emissions across their entire value chain and the fast-food chain, MAX, won aUNFCCC’s Global Climate Action Award for creating theworld’s first climate-positive menu.
What does it mean for businesses to be resource-positive?
Being asustainable business is often equated withbeing carbon-neutral –that is, achieving azero-carbonfootprint by removingequal amounts of carbon dioxide from the atmosphereas isproduced. In 2020, thisgoalhasbeen taken a stepfurther – companies are now aiming to beresource-positive.Beingresource-positiveis similar to being climate-positiveas both concepts adopt business processes that remove more greenhouse gases from the atmosphere than emitted.
However, being resource positive takes a more comprehensive approach in that it doesn’t only promise removing carbon from theatmosphere, butaims to protect a variety of limited resources such as clean water, and eliminate waste and pollution by using clean energy. Resource-positive companies contribute with a net positive impact, rather than net neutral or negative impact on the world and its inhabitants.
As multinational corporations continue to grow, their power does too. This makes companies the biggest influencer – along with governments – in how the future of the world is shaped, especially from a sustainability perspective. In the past, and to a large extent still today, the overarching business mindset is to maximize short-term economic gains and bases behavior around legal requirements. However, with the threat of irreversible planet damage and increased income inequality in some of the most populated countries, corporations are starting to be held accountable as a key change-maker in the fight for a resilient and sustainable future. If businesses are to have a world to stay relevant in and customers to stay relevant for, they need to take their own societal and environmental impact into higher consideration.
Additionally, a growing population of informed consumers are refusing to buy from or engage with companies that refuse to shift their mindset to that of greater global concern. Thanks to technology, these voices spread globally and start movements, and companies are brought under critique. The power of the people’s voice is holding companies accountable, and as always, if businesses don’t adapt to the demands of consumers, they are doomed to fail.
How can large corporations promise resource-positivity?
The way in which companies work towards this ambitious goal is largely dependent on the industry a company is most active in and where they have the greatest impact. For example, as a food and beverage multinational corporation, the most effective way Starbucks creates impact is through offering a more environmentally friendly menu with plant-based options, shift from single-use to reusable packaging, and investing in regenerative agricultural practices through its supply chain. Microsoft is working towards resource-positivity through making carbon-reducing procurement processes through their supply chain and are launching a $1 billion climate innovation fund that will catapult global carbon reduction and removal technologies. What do both company strategies have in common? They make an impact through more sustainable supply chains and where they have huge influence.
Many consumers are skeptical of the idea that corporations are able to reach such a lofty goal and deliver on these promises to stakeholders. However, two things make corporations the ideal entity to take on the challenge. Firstly, as such a large purchaser for so many suppliers worldwide, they have the power to impact how companies through all tiers of their supply chains produce their products and services. Corporations can demand sustainable practices from suppliers. If suppliers fail to adhere to these new requirements, they risk losing huge value order. Secondly, when huge corporations make drastic changes in favor of the world, they create new, innovative practices that outshine competition. At risk of becoming irrelevant to a changing market, many other corporations must follow suit, which will propel entire industries into transformation.
What is the business value of resource-positivity?
It isn’t news that being sustainable is more than just doing good and many companies already understand sustainability to be an untapped business opportunity in the form of strategic differentiation and increased financial performance. But what about going that extra mile? Why are corporations implementing strategies that create a net positive impact rather than a net neutral impact?
First of all, giving back more than they take will help businesses not only stay ahead of competition within their field but find innovative ways to tackle greater social and environmental challenges that reach beyond their current area of impact. This helps them discover opportunities that otherwise go unnoticed and give them a head-start in untapped market potential, preparing for a future in which they are still relevant.
As Sheila Bonini, SVP of Private Sector Engagement at WWF,says about Starbucks’ plan for becoming resource-positive,“this is exactly the kind of leadership we need to see from businesses — an opportunity to invest in their own future while making their global customer base a partner in this sustainability journey.”
Another large factor in success is having sustainable business practices be set and communicated by the most senior leadership of multinational enterprises. This shows a strong sign of commitment – executive leaders carry utmost responsibility for the financial success of a company, the primary objective for for-profit entities. The fact that these business leaders have decided to integrate sustainable practices as such an integral part of their business strategy for the next 10 years shows the extent to which approaching sustainability as part of core business strategy is critical to a company’s financial success.
All in all, resource-positivity is the future of business. Leaders all around the world need to follow suit and not necessarily only think abouthow to diminishbusiness' negative impact, but understand the advantage ofadopting a net-positive impact mindset and implementing a resource-positive strategy. The sooner the better.
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