Luc van Liederkerke – introduction session
“Change or perish”
Some macro trend behind the transition towards sustainable business models.
When it comes to sustainability some competences are very important to the future and this holds
for all business.
• Competence to look long term
• To think in a systemic way
• To think in a normative way
Normative means diversity. Diversity is a normative choice: to look at who works for you, how do you
deal with woman? How do you deal with common people?
Normative ideas about people in the world. Basic contention is that there are some long term trends
that makes the transition to sustainability almost unavoidable. Go a long with this or you would be
wiped out.
What happens when you have this rapid changes?
1. Economic growth
Why do we have this change process? Long term growth process and the impact becomes clearer
and clearer.
World GDP and population
If you look at it long term, we actually have seen economic growth only pick up in the second part of
20th century. After the second world war we have an increase in wealth (for the rich countries), now
for all the countries. Sustainable growth for all the population in the world is relatively new
because it never ever!!! happened in the history of mankind.
Usually in a situation where you don’t have enough food for sustainable population growth.
Situation/population that goes up and down like any other species. In the second part of 20th century
we have an explosion of the population.
Socio economic trends
The great acceleration (antropoceen)
Population expands so rapidly so we have these types of explosions.
,GDP growth in OECD and non-OECD countries
Economic growth process is not slowing down. Now we have one because of the corona virus. In
between 2-3%. Long term prediction by the OECD, until 2060 we will have long term sustainable
growth between 2-3% long term. Especially in de emerging countries.
Our world population will flatten out: as the population growth slows down, already happening in a
number of countries, the basic engine of growth (more people to feed) also slows down, growth will
not stop because we have a change in the way we live.
2. Impact on environment
Human development index: not only income.
Poor countries (developing), emerging countries (most people) and developed countries.
The poor countries, economic dynamic growth pushes you in the right direction. You have to look
at broader indicators not only to income.
Economical footprint: what do you have available? Dotted line: what you have available in terms of
ecological capital. Dotted line was higher, but it went down because we are with more and more
people. We want to be within the limits of what is available (quadrant), but there is not a single
country there. We have to end up in the sustainable development quadrant, but we have an
exponential growth. We go up. We are above the quadrant. There is a pressure going on in order to
get in the direction of the quadrant, do we move fast enough?
Emerging countries will need to go immediately to the quadrant and not first up and then down
because this will be a real problem. Challenge increases over time.
3. Institutional Change Growth of State and Legislation
Pages in federal register
,States make legislation. We have more legislation in all the countries. As the economy expands, the
state inside the economy expands even more. Do not underestimate this.
Power of the state also increases in poor countries. Institutional setting is changed!
4. Impact on value and norms -> critical stakeholders
If you look at how values and norms work within people, we can make a difference between
traditional and more modern societies. We come from traditional societies. We all used to sit left
under. Economic growth pushes us away from traditional societies and we can measure this.
Group and individual societies.
We measure there is generation shift: we all move in the
direction up right. The only part of the world that is still
traditional is Africa (escaped). This are data of 2006, now they
are also moving. Detraditionalization.
Why does it matter? Person on the left is different from
person on the right.
5. New risks and new opportunities
Brief history of cheating EPA
EPA fined VW. Twisted the software in their cars to
escape regulation. Escaping regulation is global, nothing
new. EPA: in 1973 fine of 120.000 dollars for the same
thing as the other firms in 1973, that were fined with 0.
1998: all the producers of trucks were fined with 83,4
million. To fix the trucks it costed 1 billion.
2014: overstating fuel economy in their advertising.
2015: 35 milliard. How many companies do we have in
Belgium that are worth 35 million?
, New situation to be in. Btw this is why ethic and business start to matter: you have to be aware of
your border line because the risk is far higher than it used to be. This in the auto industry sector, but
we see the shift in all the sectors. Same type of mistakes that companies make. The world around the
companies have changed and does not accept these things anymore.
When VW was fined, at the same time musk launched the tesla. The car wasn’t yet produced, you
could reserve the car, but the car didn’t yet exist. People were crazy to buy the car, on paper. VW has
a fine of 3 billion and on the other hand you have someone that raises 3 billion with nothing.
Transition:
• Increased risk for certain group
• Huge opportunities
Sustainable businesses = risk and opportunities. New problems show up that become tangible, but it
creates opportunities to start up new businesses.
Sell Tesla: 2015 the Netherlands: 95 BMW7; versus 1891 Tesla S
Boete van 16 miljard $ voor VW versus voorverkoop tesla model 3 16 miljard in een paar weken tijd
6. Intermediate Conclusion on Macro-trends
Three ways in which soft values become hard: civil society, law and market
• Civil society: growth of NGO’s (value shift and expressive individual). Impact on business e.g.
Peta and angora rabbits
• Law: as a citizen we support stronger consumer protection laws, stricter food safety rules,
environmental regulation, quota for equal representation of women, etc. (value shift +
stronger government and extended legal structures)
• Market: as a consumer we buy products that or more energy efficient, that promise fair
trade, claim to respect the environment, etc. (value shift + environmental and social
challenges)
Civil society: big differences between countries but the trend is always the same. De-traditionalise,
increase.
Market gives you opportunities to develop the car and change the entire industry. Don’t
underestimate the power of the market.
7. Example of fast, systemic change. Risk and opportunity?
What does it imply? Problem of obesity. Expansion of obesity in the US.
By 2010 already 1/3 of the population is obese.
Will states react to the situation? Yes, it is unavoidable because this is extreme expensive for your
health budget, and as private company that gives health insurance to your workers. Diet industry, all
kind of opportunities around this. When this change takes place, as a business you have to play on
this.
