Hello Reader,
We've had some good feedback on the white paper we prepared (download it in one click below π). What started as a way to see what we could translate from the big end of town to inspire SMEs ended up as a critique of where some of these organisations are - despite what may be good intentions - just aren't taking enough action when approaching sustainability.
Conversations we've been having with business leaders of late have been naturally around the mandatory disclosures, which will officially come into effect in January 2025. This will firmly cement climate disclosures as a statutory requirement, so impacts will be treated just as seriously as financial reporting for ASX-listed and large entities.
The 'stick' is here and the compliance effects will quickly flow down to SMEs.
The 'carrot' will be in the eye of the beholder though (ouch - that's a weird visual, isn't it?! ποΈπ₯).
Just like OH&S before it, those organisations - of any size - that look beyond the compliance aspect alone and see the opportunities:
- to become a supplier of choice
- to thread their purpose throughout their organisation
- to engage their people
- to win tenders
- to collaborate more widely for shared value
- to build greater resilience
These are the carrots worth strategising for.
What do you make of the mandatory climate disclosures?
All hands on deck,
Melissa
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The Sustainability Gap: Why Australia's Leading Companies Aren't Leading At All
We've prepared a white paper after analysing the sustainability reports of some leading Australian companies - and highlighted where the opportunities are for SMEs
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Inspiring Purpose
It's never too late to reimagine your organisation's purpose in connection to what the world needs, as proven by the Natural History Museum in New York. Reflecting more deeply on their raison d'Γͺtre showed them the opportunity to play a more active, rather than passive role, in educating the public. They now see the role they can play in helping grow appreciation for the natural world, acting as 'advocates for the planet'.
This of course came with some hard calls to make, namely, relinquishing some of their sponsors and putting clear boundaries in place for future funding sources. Those with poor climate records are a clear 'no', which helps Natural History Museum maintain integrity and true alignment with their revitalised purpose.
Business As Unusual Innovation
If you can find an emotional benefit to your innovation, you're onto a winner. You'd think this would be hard to achieve for a purely functional product like batteries. Energiser has tapped into the parental safety concerns linked to children swallowing small batteries. They've gone beyond the current child-proof packaging. They've made batteries taste bad, deterring kids from putting them in their mouths. A dye that shows when in contact with saliva overcomes the 'did they eat it??' moment. So how is this an emotional benefit?
Well, for a parent, the fear of your child swallowing a battery and the damage it can do is huge. If a product can quiet that fear (amongst all the others that go with parenthood), it's worth paying more for. This innovation has taken the time to really understand the consumer and what makes them tick. We think this is a great example of how innovation can take many forms.
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The Real Costs of Greenwashing: A Systems Thinking Approach for SMEs
Learn how greenwashing and eroding goals undermine sustainability and long-term business success.
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Roundup
This is a must-read exposΓ© of Microsoft and its AI play, and how it erodes their climate commitments. It's a great piece of investigative journalism that shines light on the struggle our biggest corporations are having to balance climate commitments with business-as-usual competitive advantage.
Tupperware has recently filed for bankruptcy in the US, joining the many 'entrenched' brands who have failed to innovate to keep up with a market that has evolved around them. The outdated business model Tupperware became famous for relied on a family structure that largely doesn't exist anymore, archaic gender roles and a way of life that has since very much moved on.
We spoke at length about resilience in our last edition and that isn't limited to climate impacts. Australia looks set to see increased shipping costs. Smart players might want to look at diversifying their supply chain where possible and looking to local supply.
The whole world is enamoured with AI and the innovation that it can drive. This article is a great reminder that amongst the shiny object syndrome of new tech it's imperative to remember the core of your business and stay aligned with that.
βHome Depot in the US have removed certain plastics from their private label supply chain. While this is described as an initiative that Home Depot took on, it's likely that most of the responsibility fell to their suppliers. A big reminder that business is at the mercy of its customers. As consumers look for sustainable options, retailers look to their suppliers to meet that brief or they'll go elsewhere. The opportunity lies in meeting their needs before they enforce them, painting yourself as the supplier of choice.
Renowned economist and Nobel laureate Joseph Stiglitz has recently toured Australia sharing his perspective on the need to focus on fixing democracy first in order to 'stop the climate crisis'. It's a fascinating reminder of the interrelatedness of issues - the system effect - economy, society, environment and governance.
What We're Reading
The Great Greenwashing: How Brands, Governments and Influencers Are Lying To You, by John Pabon. This is an informative, witty, example-rich read for anyone interested in seeing how the 'powers that be' have been pulling the green wool over our eyes.