Green futures

Green and sustainability: The answer to South Africa's problems?

Writer Ian Armitage

The International Monetary Fund (IMF) has warned that South Africa is trailing other emerging markets and must quickly implement reforms if it wants to avoid a crisis.

In its annual country report on Africa's largest economy, the IMF predicts growth this year to slow to two percent and to recover only slightly to three to 3.5 percent in the next few years.

"South Africa's growth has underperformed and vulnerabilities have increased considerably," it explained, adding, "Absent structural reforms, growth will be insufficient to reduce unacceptably high unemployment," pointing an economy "increasingly vulnerable to shocks."

It is a sorry state of affairs. But could this represent an opportunity so far as sustainability and green are concerned? South Africa's Minister of Water and Environmental Affairs Edna Molewa certainly thinks so.

"South Africa is committed to pursuing and exploring opportunities in its transition to an inclusive, low-carbon, resource-efficient green economy," she says.

Molewa has thrown her weight behind a new study, South African Green Economy Modelling, which shows that investing in a low-carbon, resource efficient green economy is fundamental for South Africa's sustained economic growth and well-being.

"This study demonstrates that a green economy approach, which takes into account the country's economic, social and environmental aspirations, can deliver as much growth as a business-as-usual model but in a more sustainable manner," she says.

Earlier this year, Molewa launched the Nissan LEAF green car, a ground-breaking pilot initiative, and a first of its kind in South Africa. Through this initiative, which is an exciting development for the motor industry, SA is setting an example. It will also create jobs.

The auto industry isn't the only one embracing green. Indeed, nowhere is it taken more seriously than in the building industry and activity in the green building sector has surged as the government, businesses and developers in the country increasingly embrace sustainable building practices. More and more property developers, it seems, are opting for sustainability, not only as an alternative building initiative but as a unique selling point.

"We will increasingly see green building practices becoming the norm," Brain Wilkinson, CEO of the Green Building Council of South Africa, said in a recent press release. "There are clear environmental benefits for building green as well as compelling business case."

Going green is not just about the environment. The bottom-line benefits of building and operating green buildings are important too, considering things like South Africa's rising energy costs and water crisis.

Developers are obviously aware and the country is now home to a number of Green Star-rated buildings, including the Environmental Affairs Department's head office in Pretoria, Hyundai's new head office in Bedfordview and Nedbank's Menlyn Maine Falcon Building in Pretoria.

"The industry is embracing this absolutely necessary shift towards sustainable practices and it is exciting to be part of this change," Wilkinson said.

This is a great point at which to introduce Dr Sujit Ghosh, the CEO of Holcim Singapore, a man I had the recent pleasure of meeting. Holcim's vision is to provide "foundations for society's future and commitment to sustainable development", continuously seeking "ways to promote sustainable construction through innovation". It's a hell of a vision. And for Dr Ghosh it is much more than mere window-dressing.

He believes that by adopting sustainable practices, companies "can gain competitive edge, increase their market share, and boost shareholder value".

What's more, the "growing demand for 'green' products has created major new markets," he says. "Our sustainability efforts are central to our core strategy. Apart from focusing on business growth, we also put a strong commitment to sustainability development. Typically, companies have lofty visions and Holcim also has its own lofty vision – to be not only a profitable company but also take the interests of stakeholders at large into account. We've been talking the talk and walking the walk, being named the leader in the Dow Jones sustainability Index because of our commitments on sustainability and with CO2 emissions control."

Last year Dr Ghosh attended an event run by Harvard Business School called "Innovating for Sustainability" in Hampshire, England.

Something like 40 executives from 24 countries and many industries attended and discussed items like how to avoid trade-offs between short term financial and nonfinancial performance improvements.

One of the many outcomes was the conclusion that investors of today are highly sophisticated, well informed, and highly demanding.

Not only do they care about immediate financial performance, but they are looking for business sustainability.

This of course was not news for Holcim. "We've long been aware of the need to create value for shareholders in a way that creates value for other stakeholders as well," Dr Ghosh explains. "But we are about more than simply saying sustainability is good business because it reduces waste or something like that or creating products that are green. It is much far-reaching and takes a long time for companies to develop and implement, and requires creativity.

"We look for win-win solutions that offer immediate value and provide a commercial advantage."

The Building and Construction Authority (BCA), which regulates Singapore's construction industry, has embraced Holcim's approach and has even gone as far as far to amend building codes, while encouraging the use of materials that reduce the carbon footprint of buildings.

South African government, policy makers, decision-makers and businesses can learn much from green pioneers like Holcim.

Image: © Thinkstock

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