|Author Name:||Katrin Scholz-Barth|
|Date:||Mar 17 2021|
Think: Awake a different mindset for new business models and operation.
Act: Innovate inspired by nature.
Lead: Dare to create the future.
Whether in mythology, literature, or in a good movie we like the thrilling story of a hero who overcomes Resistance, or the Refusal of the Call, sets out to change the world without fear of challenging the status quo. Business trends in 2021 are just like a hero’s journey, filled with adventure to tackle and solve the world’s most wicket problems to leapfrog into a healthy, clean and resilient future.
The economic chaos of 2020 uniquely challenged every business executive, entrepreneur, and innovator. Some businesses emerged stronger, others bruised, and some businesses disappeared. 2020 also accelerated new business trends, not surprisingly driven by a new normal, social alertness and behavior, in response to fear of the unknown.
Necessity is the mother of innovations rang true and business activities quickly pivoted toward contact-less payments and deliveries, tele-commuting and tele-conferencing, e-learning, biopharma, tele-healthcare, and online entertainment via virtual and augmented realities.
2021 Year of Creative Economy for Sustainable Development
The UN General Assembly declared 2021 the International Year of Creative Economy for Sustainable Development in foresight to avert the effects of a climate crisis. Unexpected but lucky, the theme now also serves to enable economic recovery and survival.
In business, the stages of an innovators’ journey from idea to successful enterprise are similar to the “hero’s journey.” For instance, scaling Tesla’s business idea feels and sounds very much like a gripping and thrilling hero’s story. Tesla’s mission, with its vertically integrated business model, is to accelerate the world’s transition to sustainable transport and clean energy. In doing so, Tesla combines three major industries – transportation, energy, and mobility, traditionally excessive contributors to global warming – and helps to turn them carbon positive, eventually, IF all goes well. But not all ideas scale and not all entrepreneurs return as heroes. There are winners and losers, however environmental, social, governance (ESG) along with turn-around strategic sustainability and innovations have become the foundation for future-fit business success.
The global pandemic induced a monumental societal shift that removed barriers and lead to some incredible insights and breakthroughs. The common denominator of these trends was the recognition of the true and hidden costs of the current economic model and the benefits of true social, human, economic and environmental sustainability.
As a result, a greater focus on the ‘social’ dimension of ESG and more decisive efforts on carbon emission reductions have become indicators for recovery and economic progress toward a long-term sustainable economy.
Life in our present ordinary world seems comfortable but flawed. The call to action is loud and clear because, globally, over 80% of companies will face dire consequences from climate change. As carbon emissions continue to increase, causing the atmospheric temperature-rise likely to exceed 1.5 degrees Celsius, assets and supply chains are at risk, disrupting business operations, markets and therefore the global economy and consequently, our personal and planetary health and well-being.
With increasingly warmer temperatures, no rain and rising sea levels, the Arabian Gulf region’s biggest challenges are arguably along the water-energy-food nexus, all of which are inherently linked to resilience, health, economy and national security, as well as regional stability.
Business owners and executives have a choice to participate in a great adventure, to pivot from business-as-usual to future fit and reduce carbon emission in every industry. It’s exciting and demanding. We need to break through self-doubt and current inadequate preparedness, to lean in and learn, gain necessary knowledge and understanding to change business practices. We don’t really have another choice.
Key skills needed to respond to the current slow economy, pandemic and global warming include strategic sustainability – environmental, social and governance (ESG) as a driver for attracting and securing investors capital, satisfying customer’s needs and as indicators to accurately assess financial performance. “Today, around 92% of Millennials prefer buying from ethical brands.” (WordStream, 2020) Becoming comfortable and familiar with ESG is as crucial as understanding a balance sheet to become future fit, whether a company plans on reporting on ESG performance or not.
Interestingly, 2020 was proof that sustainability has become non-negotiable for overcoming a global pandemic, social unrest, economic inequality and global warming. Companies that doubled down on strategic sustainability commitments and ESG metrics for growth and success experienced greater stability against market vulnerability and volatility because of customer and stakeholder confidence and operational risk reduction.
In 2020, around 1,400 companies and 100 banks and investors committed to reaching net zero emissions, including Microsoft, Morgan Stanley and AT&T. The disclosure of ESG and sustainability information increased significantly, and many more companies support the Taskforce on Climate- related Financial Disclosures (TCFD).
Attention Arabian Gulf region: exciting new business trends emerge along the water-energy-food nexus.
Opportunities in regenerative agriculture and ocean farming are of particular interest. Aside the primary benefit of improving food security, carbon sequestration in soil and oceans, meaning removing and drawing down carbon from the atmosphere, is virtually untapped and offer a lucrative secondary revenue stream. Green and blue-carbon opportunities via regenerative agriculture and ocean farming have the potential to power stock markets, similar to digital-economy companies did in the past.
In addition to supporting the food system, this trend of using soil and ocean-based decarbonization, generates renewable energy and protects the coastlines.
Incubating new business ideas that combine water security with healthcare could be another hero’s journey. Redefining waste as raw material, Brine, the byproduct of desalination, could become a feedstock for health and wellness to naturally treat respiratory illness, preventing its discharge into the Arabian Sea and reducing the risk of biodiversity loss from increased salinity.
A third and often underappreciated trend for business opportunities include infrastructure design and public spaces that have a great impact on public health and well-being. Human-centered design greatly contributes to physical and mental health and productivity, influences how we feel and how resiliently we navigate uncertainties. Access to parks and communal spaces are proven to be therapeutic, especially during challenging times. Designed as functional landscapes, these parks, gardens and walkways around schools, offices, and hospitals add immediate tangible and intangible value.
Fast and deliberate actions are required in C-suites and boardrooms to commit to and execute greenhouse gas emissions (GHG) reductions by a given date to reap the benefits and create a ripple effect of change throughout a company that involves and engages all employees as well.
A first, we may not (want) to accept the challenge and refuse the call to action because of fear of failure. However, as soon as others succeed, we want to be part of the movement.
Digital transformation is rapidly adapted as a first step toward sustainability, to shift from typically paper-dependent to paper-less operations, and thus reduce the carbon footprint. Yet, the true impact of digitalization is often underestimated. Data centers use 200 terawatt-hours of energy a year, which is roughly 1% of the global electricity use and internet companies emit as much GHG emissions as the airline industry (pre-COVID).
Getting into the Ring
The hero’s journey starts NOW. Anyone clever enough to accept the call and realize the 2021 Business Trends can steer systemic change and true transformation. Tackling the design-challenge will solve the waste-problem in a circular economy and help reverse global warming.
It is not the critic who counts; not the man who points out how the doer of deeds could have done things better, while he falls and stumbles. The credit belongs to the man in the arena, whose face is marred by dust and sweat and blood; … who spends himself in a worthy cause. But when he is in the arena, at best he wins, and at worst, if he fails, at least he fails while daring greatly.
Adapted from "Man in the Arena" by Theodore Roosevelt, US President (1910)
Everyone can be a hero, if we get it right; if we accept the call and recognize the value of the opportunity at hand for transformational change! Those who take actions, who dare to get into the ring and chose to make this world a better place, are the real heroes and will be winners.
The next blog will dissect ‘Sustainability’ to turn an abstract term into practical, hands-on and tangible terms, explaining what strategic sustainability means in different industries, and how best to build a sustainability literacy to be part of the ‘in-crowd’ and become future-fit.
May 07 2021
How many times have you gone to a strategy meeting and had people listlessly sit there, unfocused or distracted?
Karen Jaw-Madson- Columbia Business School
Aug 13 2020
Entrepreneurial companies can prepare and rise to the challenge by following these 5 To Do's. In the midst of a crisis, a business believes all it can do is triage and manage what’s necessary to survive. Not true.