So, what is Sustainable Development?

 Meeting the needs of the present without compromising the ability of the future
generations to meet their own needs- Brundtland Commission
 Two key notions include:
➢ the needs of particularly the world’s poor to which overriding priority must
be given; and
➢ limits to capacity of the environment to meet current and future needs
 It entails the concept of environmentally sustainable development- sustainable
levels of both production and consumption rather than just sustained economic
growth
 What should be sustained?
 Both source (to provide raw material inputs) and sink capacities (to
assimilate waste) must be maintained infinitely
 Holding the scale of the human economic subsystem to within the
biophysical limits of the overall ecosystem on which it depends.
Weak and strong sustainability
Weak sustainability: human centered view that natural capital can be replaced by
manufactured capital.
➢ It believes that it is possible to increase the efficiency of economic growth so
that it uses fewer natural resources (“ecological modernization”); and that
economic growth can continue but there is need to redistribute costs and
benefits in a more equitable manner (“just sustainability”)
Strong sustainability: nature centered view that natural capital has an
irreplaceable role in production and consumption.
➢ Manufactured capital cannot be duplicated without the input of natural capital.
Thus, it is important not to cross the ecological thresholds (“Ecocentrists”)
Some sustainability instruments
➢ Precautionary principle: When human activities lead to morally unacceptable
harm that is scientifically plausible but uncertain, actions shall be taken to
avoid and diminish that harm. (Refer Principle 15 of Rio Declaration).
➢ Polluter pays principle: Used to ensure that the third parties do not bear the
external costs of other people’s activities, such as air pollution, where these
are by-product of certain business activities. (Refer Principle 16 of Rio
Declaration).
The impending threats and safe operating space- Planetary boundaries
Johan Rockstrom et al. , Stockholm Resilience Centre, 2009

 Safe living space for humans and

wildlife.
 Crossing one or more of these
boundaries create a tipping point where
global earth system may shift into a
permanently less hospitable state
 Boundaries are interrelated processes
within the complex biophysical earth
system.
 This means that a global focus on
climate change is not enough for
increased sustainability. Instead, there
is a need to understand interplay of
boundaries, especially climate and loss
of biodiversity.
https://www.planetaryhealthcheck.org
Doughnut Economics
 The doughnut framework brings social and
planetary boundaries together to talk to just
and safe space between the two for humanity
to thrive.
 This space demands greater equity between
and within countries- in the use of natural
resources and greater efficiency in
transforming these resources to meet human
needs
 https://www.youtube.com/watch?v=XxlHbZzlj
JM (5:50 to 22:36)
(Kate Raworth, A Safe and Just Space for Humanity,
Oxfam Discussion Paper, February 2012)
https://doughnuteconomics.org/about-doughnut-economics
 Key aspects to draw
from Doughnut
economics

Purpose driven Innovation for

Long-term focus Systems Thinking
leadership Sustainability
How can companies do it?
Is Degrowth an option?

 The idea of Degrowth (décroissance- French)-1972

 Social philosopher, André Gorz asked: “Is the earth’s balance, for which no-growth – or even degrowth – of
material production is a necessary condition, compatible with the survival of the capitalist system?”
 It resurfaced in 2002 and in 2008 the first international degrowth conference for ecological sustainability and
social equity took place in Paris
 The core of the degrowth argument is the historical fact that economic growth and emissions are inexorably
connected.
 Proponents argue that human economic activity could be lessened, and societies transformed to prioritize
improved wellbeing, reducing the threat of climate change
 It focuses on an “equitable downscaling of production and consumption that increases human well-being and
enhances ecological conditions at the local and global level, in the short and long term”
 What does it mean for business?
 Some industries shrink while others grow
 Some businesses within shrinking ones can transform
 Stage of post-growth: economy with less overall production and consumption

https://www.weforum.org/agenda/2022/06/what-is-
degrowth-economics-climate-change/
https://www.youtube.com/watch?v=Ia8u5P0KbPQ&t=395s
 Climate Change,
Adaptation, Mitigation
and Key Policies
Climate Change-evidence

 Long term shift in temperature and

weather patterns
 But it always changed? What is new?
 While Earth’s climate has changed
throughout its history, the current
warming is happening at a rate not seen
in the past 10,000 years.
 Extra energy has warmed the
atmosphere, ocean, and land, and
widespread and rapid changes are
observed in the atmosphere, ocean,
cryosphere, and biosphere
 Most of the warming occurred in the
past 40 years, with the seven most
recent years being the warmest. The
years 2016, 2020 are tied for the
warmest year on record.
 Ocean is getting warmer
 The ocean has absorbed much of this increased heat, with the top 100 meters
(about 328 feet) of ocean showing warming of 0.67 degrees Fahrenheit (0.33
degrees Celsius) since 1969
 Ice sheets are shrinking
 Greenland lost an average of 279 billion tons of ice per year between 1993 and
2019, while Antarctica lost about 148 billion tons of ice per year.
 Retreating glaciers
 Glaciers are retreating almost everywhere around the world — including in the
Alps, Himalayas, Andes, Rockies, Alaska, and Africa
 Decreasing snow cover
 The amount of spring snow cover in the Northern Hemisphere has decreased over
the past 5 decades
 Sea Level rising
 Global sea level rose about 8 inches (20 cms) in the last
century. The rate in the last 2 decades, however, is nearly
double that of the last century and accelerating slightly
every year
 Arctic sea ice is declining
 The extent and thickness of Arctic sea ice has declined
rapidly over the last several decades
 Extreme events increasing in frequency
 The number of record high temperature events in the
United States has been increasing, while the number of
record low temperature events has been decreasing, since
1950
 Ocean acidification is increasing
 Since the beginning of the Industrial Revolution, the acidity
of surface ocean waters has increased by about 30%. The
ocean has absorbed between 20% and 30% of total
anthropogenic carbon dioxide emissions in recent decades
Reasons

 Increasing GHGs
 Major gases responsible: CO2 (burning fossil fuels and
deforestation), CH4 (landfills and rice farming,
Livestock animals, fossil fuel production, and
transportation), N2O (commercial and organic
fertilizer production and use, burning fossil fuels and
burning vegetation, CFCs refrigerants, solvents, and
sprays)
 Water vapour: not a direct cause of climate change
Responses to Climate change

 Mitigation: Reducing emissions of and  Mitigation

stabilizing the levels of heat-trapping  Reduce the sources of these gases
greenhouse gases in the atmosphere (for e.g., burning of fossil fuels for
electricity heat or transport)
 Enhancing the ‘sink’ that
accumulate and store these gases
(such as oceans, forests or soil)
 Key features
 stabilize greenhouse gas levels in a
timeframe sufficient to allow
ecosystems to adapt naturally to
climate change,
 ensure that food production is not
threatened,
 enable sustainable economic
development
Responses to Climate change
 Adaptation: Adapting to the climate change already in the pipeline
 Reduce the risks from harmful effects of climate change (like sea-level rise,
more intense extreme weather events, or food insecurity)
 Leverage on any potential beneficial opportunities associated with climate
change (for example, longer growing seasons or increased yields in some regions)
 Action by Cities and local communities worldwide to solve their own climate
problems. This includes building flood defences, planning for heat waves and
higher temperatures, installing better-draining pavements to deal with floods
and stormwater, and improving water storage and use.
 Governments working on better Development planning with focus on :
 managing the increasingly extreme disasters,
 protecting coastlines and dealing with sea-level rise,
 managing land and forests,
 dealing with and planning for drought,
 developing new crop varieties, and
 protecting energy and public infrastructure
https://assets.bbhub.io/company/sites/60/2021/10/FINAL-2017-TCFD-Report.pdf
Corporate Climate Adaptation Initiatives-Global

Unilever: integrated climate resilience into its entire value chain by investing in sustainable agriculture, enhancing water management
practices, and designing products that are adaptable to varying climate conditions.
E.g.: sourcing of tea from Rainforest Alliance certified farms; Working on climate smart and regenerative agriculture (Cocoa, Knorr soups…)

IKEA: The company has committed to sourcing 100% of its cotton and wood from sustainable sources and has invested in renewable energy
to power its stores and production facilities.

Levi Strauss & Co.: developed “Water<Less” technology, which reduces water consumption in the production of jeans by up to 96% in
certain stages. It also focused on recycling water within its production facilities and sourcing cotton from suppliers practicing water-
efficient farming.

Swiss Re: developed advanced climate risk models to predict the impact of rising sea levels on coastal properties. The company adjusted
its pricing strategies for policies in high-risk areas and worked with governments and businesses to promote better climate resilience.
They also introduced parametric insurance products, where payouts are based on predefined climate events (e.g., rainfall thresholds or
wind speeds)
 Key takeaways Positive business outcomes

• Risk Management: Each company  Enhanced resilience to climate risk

identifies climate risks specific to its
 Regulatory compliance & access to
industry, such as water scarcity,
initiatives
extreme weather, and supply chain
vulnerabilities.  Cost savings and efficiency gains
• Adaptation Strategies: Solutions range  Improved reputation and brand loyalty
from technological innovations (e.g.,
 Access to new markets and customer
water-efficient production) to physical
segments
infrastructure upgrades (e.g., flood
defences) and sustainable sourcing.  Lower risk of financial loss
 Innovation and Competitive advantage
 Adaptation initiatives
by Indian corporations

 Mahindra Group: Climate-Resilient Agriculture

 Project Hariyali: working with farmers to
promote sustainable and climate-resilient
farming practices.
 The project focuses on improving soil health,
promoting water-efficient irrigation methods, and
reducing dependency on synthetic inputs like
fertilizers and pesticides.
 Sustainable Sugarcane Farming: farmers are
trained in climate-resilient sugarcane
farming that focuses on water conservation and
soil health improvement helping farmers adapt
to erratic rainfall and droughts.
 Impact: Mahindra’s climate-resilient agriculture
programs have improved productivity for over
250,000 farmers and helped reduce crop failure
risks associated with unpredictable climate
patterns.
 ITC Limited: Climate-Resilient Agriculture and Water Management
 Climate-Smart Agriculture: promotes climate-smart agricultural
practices through its e-Choupal initiative, providing farmers with
real-time information on weather forecasts and best practices
for sustainable agriculture.
 Integrated Watershed Development: ITC’s large-scale watershed
programs aim to improve water availability in arid regions.
Over 1.3 million acres of land have been covered under this
initiative.
 Impact: ITC’s initiatives have significantly improved agricultural
productivity and water security in drought-prone regions of India,
helping farming communities adapt to the impact of climate
change.
 Tata Group: Renewable Energy and Climate Adaptation
Technologies

 Tata Power: Tata Power is investing heavily in renewable energy,

including solar and wind power, to mitigate climate risks.
 Tata Power is working with communities in regions vulnerable to
climate change to promote energy-efficient technologies like solar
pumps and microgrids.
 Tata Steel: Tata Steel is adapting to climate change by reducing its
carbon footprint and developing sustainable steel production
methods.
 The company is also investing in climate adaptation technologies,
such as enhanced water management systems and low-carbon
technologies, to reduce the impact of extreme weather on its
operations.
 Impact: Tata Power’s initiatives have led to the installation of over
2.6 GW of renewable energy capacity, contributing to climate
adaptation by reducing the dependency on fossil fuels and lowering
the risk of operational disruptions from energy shortages.
Impact of climate change- physical
impacts
 For a company impacted by climate change, assessing the physical effects on suppliers,
operations, and customers, and implementing a climate adaptation strategy is
essential to ensure long-term sustainability and resilience.
 Can you identify the impact of heat wave on food ingredient supply chain operations
and logistics?
Three step approach to climate
adaptation
 Assessing climate risk
 What risks will you assess and at what levels?
 What kinds of data will be required?
 Adaptation Planning
 What can be the adaptation strategies for the nature of risks identified?
 Implementation and monitoring
 What kind of preparedness will be required for execution of the strategies
identified?
 What other aspects are important for ensuring timely and efficient execution and
impact?
Best practices in Corporate Climate Adaptation

Investment in green
Risk Assessment and Sustainable Supply
infrastructure and
Scenario Planning Chain Management
technologies
- Identify Vulnerabilities - Resilient sourcing
- Energy Efficiency
- Scenario Planning (ref: TCFD) - Decentralization
TCFD

- Green Infrastructure

Engagement with Climate Risk Insurance

stakeholders Climate-resilient and Financial
product innovation Instruments
- Collaboration with local
communities - Adapted products and - Parametric Insurance
services
- Industry partnerships - Sustainability linked bonds
Challenges in Proposing Adaptation
Practices
 Short-Term Focus and Cost Concerns
 Lack of Awareness and Understanding
 Difficulty in Changing Established Practices
 Uncertain Regulatory Landscape

Long term measures are more difficult to plan and execute

 Uncertainty in climate predictions
 High cost of long-term adaptation
 Long term planning vs. Short business cycles
 Impact on global supply chains
 Socio-economic and regulatory uncertainty