While some countries still debate whether climate change is real, most Australians now accept it as a settled fact, especially after the devastating bush fires at the end of 2019. Even newspapers that have previously resisted the theory, have publicly stated they recognise the problem. So now that we acknowledge the problem, how do we go about solving it? With political and scientific arguments still raging over questions such as whether renewable energy sources can be enough on their own, a solution is in the making. . Recently making the news was that retail giant ALDI has committed to powering its Australian operations with 100% renewable electricity by 2021 even more striking, a laying down of the gauntlet.
Even if, as the small print reveals, ALDI’s delivery vehicles aren’t included in this commitment, it’s still a huge undertaking. ALDI is the 64th biggest user of electricity in Australia, with its 555 stores and eight distribution centres. It has already managed to reduce its emissions by 40% since 2012, but this new pledge – to be delivered through a combination of solar and wind power – will send it straight to the top of the league when it comes to environmentally friendly retailing. Which is, of course, a large part of the point. While ALDI is doubtless truly committed to the fight against climate change, it also knows that proving its eco-credentials to customers will deliver a competitive advantage in the years ahead.
Consumers are increasingly motivated by environmental concerns
Consumers are increasingly motivated by environmental concerns backed up by a plethora of research conducted, so much that you could stack it one metre high, though – given the topic – we don’t recommend you print it to find out. According to Ipsos, by January of this year concern for the environment had risen from a fringe concern to the number one worry of Australians, cited by 41% of the population overall. What’s more, Millennials – key tastemakers, and the demographic who will be the largest consumer group in the future– are even more environmentally conscious, with 48% calling it their top priority.
Whilst COVID-19 has overtaken climate change in media coverage this year, there is an abundance of evidence that the pandemic is actually deepening many young people’s commitment to “build back better” and ensure that the world’s recovery from COVID-19 sets the planet on a better and more sustainable path. These consumers are likely to increasingly embrace brands which can demonstrate they are trying to combat climate change, and reject those that do not.
This has huge implications for all retailers and producers, not just giants like ALDI. If you run a smaller business and still think of environmental awareness as a luxury or passing trend, wake up now or risk being left behind. You should be looking at every aspect of your business, from the vehicles you use to deliver your product to the packaging that ends up in consumer’s hands, and working out how you can make changes towards sustainability.
What this means for you as a business.
If you aren’t a retailer or producer yourself but part of the supply or service chain that supports them, then you need to honestly assess whether you are likely to be seen as part of the problem. Many retailers will come under increasing pressure to cut ties to partners which are seen as environmentally harmful, such as delivery chains which use inefficient vehicles. Last year, there was controversy over climate activists engaging in “secondary boycotting”, and this is likely to intensify as concerns over ecological damage grow. Wise businesses will anticipate and adapt now.
If, on the other hand, you are a business who can be seen as part of the solution, then the coming years will be full of opportunity. If you are a small food or drink producer, for example, who can solve a packaging problem like New Zealand-founded coffee brand Allpress Espresso did with their compostable coffee bags, doors will open much more quickly for big new partnerships. If you are a supplier who can help a large retailer or producer meet their climate change targets through an innovative business model or new technology, you may be able to elbow your way past much larger rivals for new contracts.
The coming months and years are likely to be turbulent all over the world, and you need to be ready to seize opportunities while dodging disasters. As always, that’s going to mean assembling a first-class team to have on your side. In the past, that has usually meant appointing first class financial advisers, legal experts and marketers, but in the future, it will also mean environmental consultants able to keep you informed on the latest climate change developments and guide you towards solutions. Just as in the dot com boom, late adopters will probably never be able to catch up.
Mark Lazarus
Mark Lazarus, the visionary behind the business and the fresh blood of the Lazarus Legal team, Mark (or Laz as he is often known) owes much of his success to his past experiences. And he’s made it his personal goal to bring that wisdom and formula to the firm.