Personal Finance

How green economy can build resilience

energy-clean

Summary

  • The appetite for sustainable action is accelerating across multiple fronts.
  • More and more Kenyans now prefer buying sustainable products.
  • They are more keen about the products’ ingredients and also the impact that organisations have on the environment.

The appetite for sustainable action is accelerating across multiple fronts. More and more Kenyans now prefer buying sustainable products. They are more keen about the products’ ingredients and also the impact that organisations have on the environment. It is, therefore, crucial for businesses to adapt to the Sustainable Development Goals in their operations to ensure the continuation and growth of their businesses.

To achieve this and meet the consumers' demand, organisations need to be more deliberate about their impact on environment. From greener trends in consumption to favorable or stricter government policies and better green opportunities, businesses need to become more eco-friendly.

Sustainability, which focuses on maintaining a balance between people, planet and profit is not a static undertaking rather an ever-changing concept. Consumers, who make or break businesses are tuning to this rhythm. It, therefore, helps for a business to be aligned with these principles to suffice.

Considering consumers’ shifting preferences, we are seeing a new generation of successful companies with sustainability at the core of their business – and they are being rewarded by the consumer. Consider Safaricom and KCB who continues to be more intentional about incorporating the Sustainable Development Goals within their strategies and sharing annual sustainability reports to track their progress.

Nike and Adidas, other famous brands from the fashion industry, have also started to promote sustainable fashion, pledging to use only recyclable plastic by 2024. In the tech sector, tech giants such as Apple, HP or Dell are all going green by committing to new recycling programmes and energy-conscious supply chains.

Not only giants from different industries are going green. There has never been a better time than now to start or incorporate sustainability in businesses as opportunities are numerous. Small businesses present a significant contribution towards achieving a green economy more so with the support of banks through sustainable finance. SMEs tend to respond positively and effectively when supported with their environmentally friendly strategies through programmes such as capacity building, financing and an enabling environment to make them thrive.

Another sustainability culprit is fossil fuels. Fossil fuels operators and dependents need to start taking responsibility and steer towards eco-friendly energy sources. There is a need for fossil fuel operators to reduce their production by about six percent between 2021 and 2030 for countries to achieve the set climate goals. Additionally, these dirty fuels are proving to be more expensive compared to renewable energy. As a result, organisations and investors are now focusing on clean sources of energy. However, we still have a long way to go. The best way for established brands to stay ahead of this insurgent sustainability and seize this burgeoning market is to get involved – and breathe life into sustainability initiatives. Both KBA and KCIC Group are committed to preach the sustainability gospel through two programmes: Sustainable Finance Initiative (SFI) and Inuka SMEs programme.

So far, KBA through the SFI e-learning training has reached over 30,000 bank employees. Under the Inuka SME Programme, where SMEs are offered sustainable business training and mentorship, over 4,000 MSMEs have interacted with the training.

KCIC Group on the other hand, offers business incubation, training, financial and technical support as well as consultancy and reporting services on organisation sustainability initiatives. This has provided a hybrid targeted approach to advance the green/sustainable finance agenda in Kenya.

According to the Landscape of Climate Finance in Kenya, which is the first attempt to track the climate finance flows in the country since the Paris Agreement, Kenya requires multiple investments annually to meet its climate goals according to best estimates. KCIC group is committed to ensuring that Kenyan organisations are on track to achieving this goal.

Yet, unfortunately, as with every other trend becoming popular, they are also those who are faking it to seem like they are part of it, when in fact, they are causing just as much damage to our planet as they did until now. These are companies that are guilty of “greenwashing” by promoting themselves as eco-friendly brands while merely going through any change.

Greenwashing does not necessarily mean that companies lie about being green. It can also mean that they are distorting the truth. For instance, some brands promote their products as being organic but, however, fail to mention how much pollution is caused by the factories that produce them.

To conclude, sustainability in the business world is not going anywhere. Infact, it is not only expected to stay but to even trigger greener trends among consumers. This acts a clear indication that companies need to pledge for a sustainable way of doing business.