Business leaders globally have strong confidence in their own ability to turn sustainability challenges such as water scarcity and fossil fuel dependency into new business opportunities, particularly in the manufacturing and finance sectors in emerging economies. This is one of the key findings of the first Global Opportunity Report, released today by the Global Opportunity Network — an initiative launched in August by DNV GL, UN Global Compact and Monday Morning Global Institute.
The Global Opportunity Network aims to identify opportunities for sustainable solutions to five pressing global risks:
- extreme weather
- continued rise in non-communicable diseases
- water scarcity
- urban breakdown
- fossil fuel dependency
The identification process began with a series of eight workshops that took place beginning last fall around the globe — the new report is the first set of findings, based on a survey and consultations with more than 6,000 public and private sector leaders in over 21 countries.
“The report is a reminder that risks are only half the story. It is important that businesses and organizations around the world not just focus on risk assessment, but continuously become better at spotting opportunities for markets, sectors and society overall,” Global Opportunity Report project director Morten Jastrup told Sustainable Brands. “For us, an opportunity mindset is not something we just talk about, it is a structured process, designed to create insights that allow us to take action on some of the greatest problems we face. This is also what we demonstrate with this first opportunity report.”
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“Businesses across the planet are not shying away from global risks such as climate change, and increasingly recognize the positive benefits of seizing the related opportunities. The report confirms that there has been a turning point, where private sectors are now a critical driver of sustainable development with emerging economies in the front seat,” says Georg Kell, executive director of UN Global Compact.
In addition to the 6,000 leaders surveyed, 200 experts from eight countries shared insights and contributed to creating the Global Opportunity Report, which identifies and ranks 15 sustainability opportunities according to public and private sector interest and potential impact on societies and business. With the new report, the partners aim to demonstrate how global sustainability challenges and risks can be seen as opportunities. The work provides an open innovation platform where stakeholders worldwide can explore and capture sustainability opportunities and solutions across risk domains and regions. Additionally, the report identifies more than 120 readily available solutions. Key themes include:
Water innovation a leading opportunity
In terms of future prospects, business leaders see untapped and profitable opportunities especially in handling and providing solutions to address water scarcity and to promote more responsible consumer choices. Overall, developing water-efficient agriculture is the opportunity that inspires most confidence among the leaders: 37 percent find this to have great benefits for society and consider their country to have great capacity to seize this opportunity.
Jastrup added: "Private and public sector leaders around the world show great confidence in the opportunities we have to address water scarcity. This is very good news. Water scarcity affects hundreds of million globally, and just a few days ago World Economic Forum’s annual Risk Report came out pointing to the water crisis as the most impactful risk for 2015. Our survey shows that while the risk is definitely huge, both businesses and public sectors leaders place great confidence in their ability to address and significantly alleviate a water crisis. 2015 can very well become a year for opportunities — not just risks.”
The importance of responsible consumer choices
Opportunities related to fossil fuel dependency were another favorite of the group, the most favored being more responsible consumer choices. This includes innovations to change consumer behavior to increased uptake of renewable energy in households or a growing selection of consumer products made with the use of renewables.
Private sector more optimistic than public sector
The public sector is expected to play an important role in realizing many of the opportunities described in the report, especially those that are regulation-oriented. Nevertheless, public sector respondents were consistently less optimistic than the private sector about how the opportunities can positively affect society and their capacity to pursue these opportunities.
“The report findings are encouraging and concerning at the same time,” says Erik Rasmussen, founder of Monday Morning Global Institute. “The strong interest in pursuing sustainable business opportunities in the private sector is very positive. Yet, the governmental sector seems to be more reluctant and not seeing the same opportunities. This is a pity. Governments can play an important role by issuing regulations that support both sustainability and business ventures. Business and governments must share visions and initiatives.”
However, the Global Opportunity Report indicates that this scenario is likely to change. For leaders below 30 years of age, female leaders and leaders in emerging economies in Asia, Sub-Saharan Africa and South America, regulated energy transition and smart water regulation are the top-ranking sustainability opportunities.
“I believe that one of the most interesting findings in the report is how young leaders under 30 years of age, people in emerging economies and also women embrace regulation as a strong tool for sustainable change,” says Henrik O. Madsen, Group CEO and president of DNV GL. “It is very likely that the decision makers of tomorrow will be found in these groups, and it gives us hope that we can see a stronger collaboration between the private and the public sector in the future.”
Manufacturing and finance sector most confident
Emerging economies are especially ready to pursue market opportunities associated with sustainability challenges. The report shows that the manufacturing sector — especially in China — is most confident in its ability to address sustainability barriers and deliver profits and prosperity in return.
China first, Europe last
Regionally, China is the most optimistic in the survey with 48 percent showing great confidence in sustainability opportunities, followed by India with 44 percent and South America 37 percent. Europe is the least optimistic with only 23 percent, making it the most cautious region when it comes to belief in development associated with sustainability.
The Global Opportunity Report and survey will be conducted annually. To follow today’s launch event in Zurich and to download the report, visit www.globalopportunitynetwork.org.