17 June, 2022
This week, record inflation levels have been front-page news. But what does this mean for sustainability?
Recent surveys suggest shoppers may be abandoning sustainable habits in response to price increases caused by inflation. This has led some to caution that inflation may damage sustainability goals. However, consumer habits are just part of the sustainability puzzle. Assuming customers alone bear the responsibility for improving sustainability underplays the importance of building sustainability into the fabric of business for lasting improvements. Additionally, while consumers are struggling with price increases, they still desire sustainable goods and services.
Concerns that inflation will stall progress towards net zero spring from an overly narrow understanding of sustainability as focused on products, rather than as an approach to business as a whole. Furthermore, this discussion is overshadowed by the persistent, yet misguided, notion that sustainable business is more expensive than business as usual (or indeed even a ‘luxury’). In fact, ensuring that sustainability is at the heart of company strategy can help businesses overcome a myriad of challenges.
More importantly, sustainable business solutions do not always lead to higher costs – often, they help businesses save money. For example, given that inflation is being partially driven by energy prices, business decisions like switching to renewable energy sources can help companies simultaneously reduce energy costs and reduce their carbon footprint. And sustainable business models – think about the rising trend towards “rent don’t buy” from IKEA and others – can help customers save money too.
Companies need to get creative, developing new business models to ensure they maintain momentum on carbon reduction and other sustainability targets without passing extra costs onto consumers.
By Miriam Shovel