Australia Fallout: The Environment is a Priority

The extent and ferocity of the wildfires raging in Australia have caught the world’s attention. They also have brought into focus the dangers of climate change and environmental damage it can cause. 

At least 24 people across the country have died from the fires, and the disaster so far has killed an estimated half billion animals. Thousands of Australians have left their homes and many have fled to the shoreline to escape the burning inland. Temperatures are soaring throughout Australia; outside Sydney, the thermometer recently reached 120 degrees. 

The economic effects of this tragedy are also starting to be felt which will have ramifications for business everywhere. 

David Bassanese, chief economist at BetaShares Capital in Australia, told CNBC that beyond the devastating loss of lives and property, which so far have put insurance companies on the hook for almost half a billion U.S. dollars in claims, the fires have been a big drag on the country’s economic growth and could lead to a slowdown. 

“This is a wake-up call that climate change is starting to affect us,” he said. “It’s the first tangible sign that’s hitting us right in the face.”

The rising level of carbon in the atmosphere, of course, is seen as the reason for higher global temperatures, and U.S. industrial companies are doing their part to reduce carbon emissions by becoming more fuel efficient. They also are using cleaner manufacturing processes, producing less waste and focusing on sustainability. 

Ironically, many companies that are working hard and successfully on being “green” don’t want to talk about their efforts, according to an article in The Guardian, and not because they fear revealing any business secrets. According to Professor Steve Evans, director of research in industrial sustainability at Cambridge University’s Institute for Manufacturing, the reason is likely the common public perception that there must be some kind of downside to the introduction of sustainable practices in terms of either a reduction in product quality or an increase in the price of manufacturing, or both. In fact, companies find that sustainability efforts typically improve or don’t change product quality and often lower manufacturing costs.

Libby Peake, senior policy adviser at Green Alliance, an independent think tank and charity, notes that the best manufacturers are improving their energy efficiency about five times faster than the average company. She says that the leaders “have vital lessons to share with the laggards, so it’s a sad state of affairs if they feel they cannot boast about their achievements.” She hopes that sustainable goods and services move to the mainstream instead of being “hidden in the shadows.”

IndEx 2020 is part of that mainstreaming effort.