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Business Transformation in the Context of Climate Crisis
Supporting An Environmentally Sustainable World
In modern society, in conditions of urbanization of the population and concentration of industries, environmental problems are becoming increasingly important. Both enterprises and individuals show a responsible attitude to environmental well-being. The main catalysts of environmental behavior in developing countries are administrative requirements for the organization of production, and the role of personal environmental responsibility is minimal. In developed countries, along with fines, internal motivation, expressed in corporate environmental responsibility to consumers and society, has a great influence ( Covid restrictions, 2021). Environmental friendliness, sustainable development, and care for the environment are sustainable trends in 2021 (Clark et al., 2018). Giant enterprises and fast-growing start-ups around the world are spending hundreds of millions of dollars to save our planet. For ecological businesses, monetization is not the only goal: behind the loud numbers of venture investments, there are no less loud ideas caring for the environment in which humanity lives.
In the new realities of the growing attention to environmental problems on the part of the state and society, the business should focus not only on making a profit but also on protecting the environment. Therefore, businesses everywhere set a course for the greening of the modern economy, which obliges them to introduce environmental standards and engage in environmental management (Nakate, 2021). The issues of environmental responsibility are nowadays considered more widely in search of a balance between the needs of society and the balance of the natural environment. With the development of economic and social systems, they are more and more often based on the principles of environmental sustainability.
Challenges of Sustainability in Investments
Despite the presence of many interesting private initiatives and investment projects in the field of environmental entrepreneurship, entrepreneurs face some difficulties. Thus, the implementation of environmental projects at the initial stage of their implementation requires considerable investments, and in conditions of economic uncertainty, participation in such projects creates serious risks for potential investors. In addition to financial and legal difficulties, the activities of enterprises organized with concern for the quality of the environment may be hampered by the lack of infrastructure that ensures the availability of necessary services and resources for environmental business entities. At the moment very few regional or private investment or venture funds have been created to support environmental entrepreneurship (March, 2021). They could provide co-financing of environmental investment projects, in particular, through environmental payments and fines, voluntary contributions from enterprises and public organizations.
The lack of private investment in this segment of entrepreneurship is also associated with low results of environmental projects and insufficient economic incentives for this kind of business from the state. This is especially true for enterprises producing environmentally oriented products from recycled raw materials and waste (Reynolds, 2021). Despite a fairly wide range of types of environmental entrepreneurship, it is not necessary to talk about its effectiveness yet. There are several reasons for this: first of all, it is an underestimated price of natural resources. Thus, the main challenges of sustainability in investments are related to the fact that, for this reason, projects on the use of secondary raw materials for the production of products or energy are unattractive for investors.
Opportunities of Sustainability in Investments
In the post-Covid world, there are many opportunities that can help build a future career. It seems to me that a career related to investments in maximizing the spread of electric vehicles and reducing the carbon footprint would suit me. After analyzing several scientific and news sources, I came to the conclusion that, although this direction is only at the very beginning of its development, it is very promising. The rapidly growing start-up Charge from the studio Colab.la it was created in 2019 and has not stopped growing for a month since then (Long & Rice, 2018). Charge has grown from a small start-up in just two years into a giant enterprise providing electricity in 20 countries, and by July 2020 their net profit reached $20 million (Long & Rice, 2018). Starting with charging stations for electric vehicles, they moved on to electric scooters, energy solutions for cellular companies and even power banks.
The next example that shows the feasibility of investing in a project related to reducing the carbon footprint is Recurrent. The founder of Recurrent, Scott Case, noted that together with the active filling of the world market with electric transport, there was an opportunity to radically change the model of buying behavior of motorists. For years, the choice of a used vehicle was based on unchanging principles mileage, condition and history of the car. He developed criteria for determining the internal condition of an electric car, or rather, its real power reserve after several years of operation. The start-up, which received $ 3.5 million in investments, provides verification of electric vehicles before reselling them: at the moment, the project has the opportunity to evaluate the performance of VW Golf-e, Nissan LEAF and BMW (Kumar & Majid, 2020). The global eco-objective of the project is to accelerate the spread of electric cars and, as a result, reduce carbon dioxide emissions by 20%.
I think, as part of my career, I will invest in companies that are related to this segment, because they are not very overheated yet and have great growth potential. According to a study by George et al., automakers are betting on electric vehicles, and investments in the production of cars with internal combustion engines have been declining since 2019 (George et al., 2021). The segment of electric cars is waiting for rapid growth. Among the leaders will be China, where gas pollution in large cities is already forcing the government to take active steps to replace gasoline transport with electric. Europe is also active in this regard, where electric transport subsidy programs have been operating for several years. On the growth of this segment, good money can be made on the time period of 5-10 years.
Conclusion
Global transport is both the main consumer of global oil production and the main source of greenhouse gas emissions, in particular from carbon dioxide. Thus, reducing energy consumption can solve such global problems as the depletion of fossil reserves and climate change that the world is facing. Over the past decade, the global environmental business market has made a huge leap forward. However, even though there is already an incredible increase in the number of electric vehicles worldwide, industry forecasts suggest that companies are only at the beginning of the whole journey. In practice, this means that the plans of other auto giants for the development of the electric car industry are backed up by serious opportunities. Therefore, the career of sustainable investments electric vehicles can become a profitable contribution to both the future of business and the future of the planet.
References
Clark, R., Reed, J., & Sunderland, T. (2018). Bridging funding gaps for climate and sustainable development: Pitfalls, progress and potential of private finance. Land Use Policy, 71(6), 335-346. Web.
Covid restrictions could hinder Cop26 delegates and observers. (2021). Web.
George, G., Merrill, R. K., & Schillebeeckx, S. J. (2021). Digital sustainability and entrepreneurship: How digital innovations are helping tackle climate change and sustainable development. Entrepreneurship Theory and Practice, 45(5), 999-1027. Web.
Kumar, C. R., & Majid, M. A. (2020). Renewable energy for sustainable development in India: Current status, future prospects, challenges, employment, and investment opportunities. Energy, Sustainability and Society, 2(10), 515-534. Web.
Long, J., & Rice, J. L. (2018). From sustainable urbanism to climate urbanism. Urban Studies, 1(2), 1-19. Web.
March, C. D. (2021). Outdoor gear companies do more for the environment by offering customers less. Web.
Nakate, V. (2021). We know who caused the climate crisis but they dont want to pay for it. Web.
Reynolds, C. (2021). Ottawa unveils $1.5-billion plan to boost green construction. Web.
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