Triple Bottom Line

Business must focus on people and the planet, not only profit, because we cannot be successful in a world that fails
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Royal DSM and POET’s new bioethanol processing plant will process 770 tonnes of maize residue daily to produce 20 million gallons of ethanol per year.
Governments need to create a globally effective carbon market as a primary driver for sustainable innovation, efficiency improvement and CO2 reduction all over the world.

In just a few months’ time, the UN General Assembly will outline a new set of global priorities for action. These will guide how we should best marshal the world’s resources not only to sustain a growing population who harbour expectations for an ever-increasing quality of life, but also to balance that requirement with the need to preserve the unique ecosystem of planet Earth. We still do not know their final form, but the post-2015 development agenda’s Sustainable Development Goals are designed to be achievable within 15 years. They will build on the successes of the original Millennium Development Goals—and on the issues that remain open—and will be increasingly interdependent. For instance, our positive potential to mitigate climate change will, in turn, impact the affordability and availability of food—and access to clean drinking water—for billions of people.

With December’s COP21 summit in Paris, 2015 offers a unique opportunity to align these SDGs with a comprehensive and ambitious climate deal. Such ambition is crucial if we are serious about mitigating the effects of climate change while addressing inequality and food/nutrition security. Delaying action is not an option: it will be very costly in the long run if we do not take steps now to preserve and protect the world we inhabit from man-made environmental degradation.
One way we can do this is to create and implement a comprehensive and workable framework for a carbon pricing system.

Governments need to create a globally effective carbon market as a primary driver for sustainable innovation, efficiency improvement and CO2 reduction all over the world. We need an international market that results in a global, effective and meaningful carbon price, and an agreement which facilitates and supports global market mechanisms. This carbon price should have a floor and must be prevented from becoming a new tradable “toy”, vulnerable to financial speculation. Part of the proceeds from such a system could be used for innovation in, for instance, developing new technologies to reduce CO2 emissions significantly. This will create a new playing field for business to compete on, and, subsequently, new opportunities for economic growth.

If we change the paradigm from one that solely focuses on quarterly or annual profitability, and take a broader view of success which reasons from societal and environmental needs, we can see more clearly what could and will be achieved. At Royal DSM, we have adopted a “triple bottom line” approach where we equally and simultaneously value our achievements in three dimensions: people, planet and profit.

For example, our company seeks—in collaboration with strategic partners in the value chain—to demonstrate the commercial viability of sustainable renewable technologies for the conversion of biomass, especially crop waste/residues. Our strategy is to license our technology and expertise to bio-based entrepreneurs in a commercially viable and sustainable way, thus enabling them to convert corn crop residue into green biofuels, which will ultimately be competitive with gasoline.

In Iowa, USA, our new joint-venture plant with POET, one of the world’s largest bioethanol producers, will purchase the waste corn stover not used in food production from farmers on commercial terms.

The plant will process 770 tonnes of waste corn cobs, leaves, husk and some stalk, daily, to produce 20 million gallons of cellulosic ethanol per year, later ramping up to 25 million gallons per year. The biomass will be harvested sustainably in ways that remove only about a quarter of the residue above the ground, thus maintaining—or even improving—nutrient and soil organic matter levels.

This is just one example of an innovative approach to our need for cleaner fuel sources. It demonstrates the possibilities inherent in the new “circular”—rather than in the old linear—economy. We have an opportunity, particularly in the current low oil price environment, to redeploy oil fuel subsidies towards renewable energy technologies.

In our view, and many others, climate change should be perceived not as a threat but as the greatest economic opportunity since the industrial revolution. New jobs can be created in the renewable energy sectors and new, more sustainable products and processes will be developed as old methods are phased out. The New Climate Economy Report clearly indicates that addressing climate change can go hand in hand with economic growth.

Over the next 15 years, the UN SDGs will only succeed if they receive the priority attention and focus of governments, businesses, science and civil society.

Later this year in Paris, governments worldwide must align over a series of new measures to create a more sustainable operating environment for businesses through consistent policy initiatives—including financial policy instruments to incentivize and reward innovation and the delivery of low-carbon technologies.

If we, as global political and business leaders, do not grasp this opportunity to act, people today—and future generations—will not understand why we did not. We cannot be, nor call ourselves, successful in a world that fails. ▲