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The Economics of Green

17 June, 2013 - 07:54 -- tbrunner

Ideals are all well and good but at the end of the day businesses exist to make the money that keeps economies afloat. Carbon calculating and offsetting exist in order to enhance the business. As someone at Mondi’s Green Event said earlier this spring, “green is about being better” and that extends to all interpretations about what better means, including more profitable.

It makes sense. Businesses can only do well if the organisation is run efficiently. For huge companies such as Mondi this means reaching out to all areas of the business to make sure that things are working as they should. This is the underlying thinking in the concept of Natural Capital that was also discussed at the Mondi meeting. Natural Capital is a concept dreamt up by a group of bankers who wanted to “embed specific aspects of environmental, social, and governance factors in their risk management, due diligence, loans, investments, and insurance activities”. A bit of a gobful but basically the Natural Capital Declaration (NCD) is about recognising all aspects of a business, and somehow assigning a numeric value to what might otherwise be considered intangible assets.

The NCD is managed by the United Nations so this is not mere marketing bark. For the graphic arts industry and probably most other sectors it seems miles away from the realities of daily life and business. But for companies such as Mondi, which has huge amounts of capital tied up in trees Natural Capital is a valuable asset descriptor. More importantly Natural Capital assets can generate other assets that might fall within the purview of the NCD. For instance, Mondi’s efforts in South Africa to apply “landscape level thinking” to local ecosystems. The result is massive improvement to wetlands that has also helped improve the quality of harvested forests through holistic landscape management.

Mondi has set aside 25% of its Russian and South African forests and is looking at other ways to use its Natural Capital to enhance its business. This is of course about money, because without money a business is little more than a house of cards. But the alignment of commercial interests to social and environmental interests is what business is increasingly about. For a handful of companies in the graphic arts industry this is the reality. They are paving the way for new approaches to business and for new ways of thinking about environmental impact improvements.

– Laurel Brunner

Digital Dots Client

Digital Dots Client

Digital Dots Client