How “Green in your Personal EBIDTA”

Preamble

World Environment Day was celebrated recently on 5^th June amidst much fanfare with the usual pledges by governments and corporate firms on climate change. Recent heatwaves across the world underscores the magnitude of the climate change problem. Apart from corporates and governments, its time for mass public and consumers like you and me to alter our consumptions patterns and lifestyles in this endeavor.

My blog touches upon this topic and poses the question “How green is your personal EBIDTA?” 

Invite critical views

#Climatechange, #sustainability, #Worldeconomicforum, #PersonalEBIDTA, #Housing, #Publictransport, #Recycling, #Recharkha

Article

World Environment Day was celebrated recently on 5^th June amidst much fanfare with the usual pledges by governments and corporate firms. Usual buzz words in the business and economic space, like climate change, global warming, and greenhouse emissions, net zero carbon, etc. were extensively discussed. 

However, at the ground level, magnitude of the climate change problem has reached huge proportions as exemplified by the heatwave across many countries, including in my own country India. Heatwaves have led to various destructive patterns like destruction of crops, scarcity of water, etc. The intense heatwave across India has led to such a huge surge in power demand, that the government has been forced to import additional coal to meet the demand! 

Food scarcity already exacerbated by the Ukraine war has been further intensified with the heatwaves severely affecting food crop yields across the world. India, one of the world’s largest wheat producers, has been forced to ban wheat exports as crop yields have been affected due to the recent heat wave.

Green activists are having a field day now with their targets being mainly governments and corporates. Business firms globally, are under scrutiny and pressure from critical stakeholders like government agencies, financiers and public to focus on reducing their “Carbon Footprint” or in other words focus on their “GREEN EBIDTA”. Undoubtedly, corporates and governments have a large role to play in this endeavor. Top global firms like BP, Shell, etc. have taken a pledge to move to zero carbon emissions by 2040. 

However, in this fight against climate change its time to target the segment which is most affected and whose consumption and behavioral patterns play a key role in the actions of corporates and governments – people like you and me – consumers, mass public- who pay the taxes finally !!Afterall, if we all demand carbon free goods, corporates will take heed. If we vote for public leaders who are serious about climate change, then we can get the right policies being implemented. If we buy shares, despite paying a premium, of firms which are serious about sustainability then publicly traded firms will be forced to pay attention. Fossil fuel companies like BP, Shell, Exxon, etc. were forced to modify their business strategies as they feared a backlash from the investors’ community as well as damage to their brand image. 

Consumers, however, can also play a major role, in this fight by paying heed to their personal lifestyles also and the carbon footprint left by their consumption patterns. It’s time that public also start measuring their “Carbon Footprint” and make their lifestyles more “Greener”!!!

An interesting article was published, in Economic Times, on the same topic by Arijit Burman titled “Is your Is your EBITDA black, grey, blue or green?”. In this article, the author emphasizes the need for public to pay heed to their consumption patterns and throws perspectives at carbon footprints left behind by our day-to-day consumption patterns. 

(https://economictimes.indiatimes.com/opinion/et-commentary/view-is-your-ebitda-black-grey-blue-or-green/articleshow/90785853.cms?frm=mailtofriend&intenttarget=no).

The recent World Economic Forum at Davos had climate change as one of the major topics of discussion. An article on the World Economic Forum platform published by Maciej Kolaczkowski  titled “What can consumers do to help solve the climate change crisis”  (https://www.weforum.org/agenda/2021/02/consumers-help-solve-climate-change/) states some interesting facts-

• Consumers are responsible for 60-70% of the global emissions. Afterall, consumption by consumers will lead to corporates making products leaving a carbon footprint!
• Majority of household carbon footprint comes from transportation, housing, and food choices. 
• High income households naturally consume more and hence higher carbon footprint. More money you have, more is your luxury consumption as compared to your basic needs’ consumption.
• Luxury consumption, as reflected by increased demand for goods and services, lead to a higher carbon footprint. 
• Education plays a vital role in optimizing the carbon footprint of households. Probably many people are still unaware of the trails of their consumption patterns and need to be shown a mirror of their actions.

What can consumers and mass public do to control the increased carbon footprint?

Like corporates, consumers too will have to take carbon footprint reduction targets and modify their lifestyles. Some major areas can be:

• Use public transport systems: Globally most of the major cities have very efficient public transport systems like London, Singapore, New Delhi, etc. Local authorities want people to travel more by public transport systems and lesser by private vehicles as it achieves the double purpose of lesser carbon footprint as well as reduce pressure on the roads. In Singapore, due to high local taxes, its very expensive to own a private vehicle and hence people prefer to use public transport system. Infact, I ‘am personally looking forward to the full-fledged rollout of the metro system in my city of Mumbai!

• Reduce luxury spending and consumption: This recommendation may sound odd given that it looks to be against the capitalist theories especially as the world is facing recessionary trends. Today if people spend as per their needs its sustainable however an excess of spending above basic needs leads to additional consumption which in turn leads to additional usage of natural resources. 

Clothing usage patterns are an interesting example. Fashion trends keep on changing and consumers are inclined to buy more in keeping up with the trends. The additional spends however lies unutilized after some time but has left behind a carbon footprint which is irreversible. 

 An interesting graphic I saw recently on Times of India, indicates that having a well-defined wardrobe means reducing new clothes purchase by 75%! Having a sustainable wardrobe means ditching fast fashion, embrace slow fashion and importantly be a part of clothes exchange ecosystem!

• Embrace recycled products: Footprint of products already produced and lying in a heap across the world, like plastic waste, needs to be addressed. Products made from plastic waste are great examples. Segregation of household waste and proper disposal for efficient recycling is the order of the day. An India based start-up – Recharkha (https://www.recharkha.org/), dealing with plastic waste products, has shown the way in this endeavour by upgrading plastic waste to various consumer products like bags, purses, etc.

The global problem of climate change which we are facing needs to be addressed on a war footing, as the world did with the Covid pandemic. Today corporates have started reporting the share of their earnings which is from sustainable resources- “Green EBIDTA”.

Consumers like you and me also need to shoulder responsibility and play our part and not leave the fight only to governments and corporates. Hence its time that everyone like you and me measure our “Personal Green EBIDTA”!