Columnists: Hans Nilsson, Fourfact

Published on: 1 Jun 2007

Business magazine heroes today – losers of the future?

If it was not serious it would be pathetic. What are business magazine headlines screaming at you? Quarterly results, board bonuses risky stock rises like rockets etc., all trying to make you envious of the smart people that earn short-term sky-high profits. And of course forgetting that for every winner there is more than one loser.

Business as usual is heavily myopic in its short-sightedness, close to being blind. But could it be that the winners of today are the losers of tomorrow!

The Economist Intelligence Unit has made a survey of several big global companies and found that their attitude to climate change is lax. To the extent they take any precaution it is because the feel a need to “greenwash”.

Customers may find it odd if they were not paying a small tribute to brush up their reputation. But the heart is not there. If they should move any further, they want the government to take the lead!

It seems rather clear that they have not read (or they do not believe in) the Stern Review on the Economics of Climate Change. This review clearly states and proves that business as usual leads to a world recession of a magnitude never seen before. But more importantly, the actions that prevent the disaster are not costly. Rather, the report says that the economies (countries and companies) that take the chance to make use of this new market for energy efficiency, renewable fuels, and environmentally friendly products and services will profit – heavily!

Al Gore and David Blood have further developed instruments for investing in a sustainable future. They have discovered a new generation of companies with an entirely different mind-set. These companies reach the ultimate conclusion that some of their products will eventually be phased out and replaced by others. And with this experience they start to reshape their companies for a transformation of markets. A remarkable example that they mention is the Danish Company, Novo Nordisk , that sells products related to diabetes but has taken the view to cure and prevent diabetes instead, saying that this is going to the root cause instead of just curing the symptoms.

Translated to our energy world, this should of course mean that there would be more interest in reducing wasteful demand than supplying more. Even in reducing demand for less purposeful uses. This angle would at least translate, for example, in “energy service” supply rather than traditional energy supply or finding ways to reduce stand-by power in leisure electronics.

But if this should happen companies have to put more effort in strategic/holistic thinking than in tactical survival of the day. More effort in development of top performing products and processes than in meeting the minimum standard.

When and where this happen we see the more likely winners in the future business. For the others we can only say: “sorry guys”! We hope that you have not invested all your bonuses in the companies you represent today.

Hans Nilsson is chairman of the IEA DSM-Programme and runs his own consultancy FourFact.
Visit Mr Nilsson's web site .


Other columns by Hans Nilsson