“Profit and purpose are now inextricably linked”: Businesses have a key role to play in tackling climate change

Australian small businesses have a big role to play in addressing global warming, according to Who Gives a Crap co-founder and leading entrepreneur Simon Griffiths.

Griffiths was responding to the landmark climate change report released yesterday by the Intergovernmental Panel on Climate Change (IPCC), which painted a bleak picture for the future unless global warming can be turned around. 

The IPCC report suggested the planet could heat by more than 1.5 degrees celsius within the next 10 years, passing the threshold that would lead to more frequent, more devastating natural disasters and cause serious challenges for the global population.

United Nations secretary-general Antonio Guterres called the report “code red for humanity”.

“The alarm bells are deafening, and the evidence is irrefutable: greenhouse‑gas emissions from fossil-fuel burning and deforestation are choking our planet and putting billions of people at immediate risk,” he said in a statement.

“Global heating is affecting every region on Earth, with many of the changes becoming irreversible,” he added. And the only way to prevent crisis is to “act decisively” and step up global efforts to reduce emissions.

The report is damning, but according to Who Gives A Crap’s Simon Griffiths, it didn’t exactly come as a surprise.

“What the report laid out is something a lot of people have known for a while,” he tells SmartCompany.

“Governments have failed us at this point.

“If we continue to rely on governments to turn this around, then we’re not going to end up in a good place.”

That means the onus comes down to businesses, big and small, he says.

Almost every single thing that produces emissions is made by a business. So if every company that builds anything can reduce its emissions in the way they operate, “then we can get to a place where we can actually start to significantly reduce the impact of climate change”.

If governments are not taking ownership of it, Griffiths says, it falls on individuals and businesses alike to think about what they can change to reduce their carbon footprint.

For businesses in particular, that means thinking differently about their relationship with profit.

“It doesn’t matter how profitable your business is in the long run if we don’t have a world worth living in,” he says.

For Melbourne-based jewellery and clothing brand Elk, taking action on climate change is a key part of its values, even if the link between fashion and sustainability isn’t immediately clear.

The team recognises its business operations and products have an impact, ethics and sustainability manager Erika Martin tells SmartCompany.

“We don’t want to be part of the climate problem, we want to be part of the climate solution,” she explains.

“If we don’t take action to reduce emissions and operate with the smallest environmental footprint possible, then we won’t have a fashion industry or business in the future.”

For Martin, the IPCC report highlighted that every single fraction of a degree in warming we can avoid is significant.

“Although we don’t have the same footprint or influence as some of the bigger players in the fashion industry, we believe that it is still important for us to act as collectively every incremental action helps,” she says.

Elk’s ethics and sustainability manager Erika Martin. Source: supplied.

Purchasing power

That said, Martin concedes the inaction from governments and large organisations is “extremely frustrating”.

It’s understandable for some small business owners to feel there’s only so much they can do. It can feel futile to make changes when large corporations are looking the other way.

Griffiths says this is where consumers come in. If consumers use their purchasing power to support environmentally conscious businesses, the big end of town will have no choice but to follow suit.

“Profit and purpose are now inextricably linked,” he explains.

“If businesses want to remain competitive in the long term they have to start taking this seriously, because demand for their products will fall away if they’re not thinking about the role they’re playing in the climate crisis.”

There is also collective power in the small business community. Entrepreneurs can be strong advocates for change, educating their customers and their partners alike.

Overall, Martin says it’s better for small business owners to focus on what they can control, and what change they can make.

“It is easy to become overwhelmed by what appears to be a devastating future,” she says.

“So it is important to focus on the solutions and what we can act on and to share and celebrate the wins along the way.”

What can SMEs do?

As to what changes business owners can make to start having a positive impact on the climate, Griffiths says there’s no easy answer. For some businesses, it could be as simple as switching to a supplier of sustainable products but for others, it will be more complex.

Who Gives A Crap, for example, has multiple layers of a supply chain to examine.

Martin says it’s important to first understand and measure the business’ impact, in order to prioritise the higher-impact areas and start setting goals.

Elk goes one step further and makes its transparency report public, partly in a bid to get a conversation going.

Martin also lays out some easy wins: switching to energy-efficient LED light bulbs; choosing 100% ‘green energy’ providers; reducing corporate air travel; and using recycled paper products. There are also grants available to help businesses change their operations.

The key, Martin suggests, is to identify the issues and simply get started.

“It is important for every business to set their own goals and make efforts to achieve them,” she says.

“We can’t save the planet with only a few of us trying. It needs to be a collective and unified effort.”