A path to a sustainable future
As we get look ahead to 2023, sustainability takes center stage, yet again. Can we really achieve a sustainable future? Today, we posit that we can, if we are able to apply the equity and inclusion lens to the problem and bridge the Choice Chasm – the seemingly unbridgeable gap between the haves and the have-nots, between developed and developing nations, between incumbent practices and emerging norms.
Aftershocks from the Covid19 pandemic exacerbated by Russia’s invasion of Ukraine, combined with climate chaos made 2022 a chronicle of global challenges. These include the intermittent resurgence of Covid variants, the mental health epidemic, continued supply chain disruptions, internal displacement in Ukraine, worsening food crisis in the world’s most vulnerable regions, and a global energy crisis. By October 2022, weather disasters alone cost nearly 20,000 lives and 30 billion dollars, refocusing governments and organizations alike on sustainability.
Against the backdrop of these unique challenges, decision-makers in governments are shifting their strategic focus to three pillars – energy transition (including decarbonization), supply chain diversification, and energy and supply chain security. Companies are taking their cue from this, as they develop their own strategies.
Sustainability means meeting current needs without compromising the ability of future generations to meet theirs. Achieving sustainability requires the balancing of natural, social, and economic resources. This is not a new conversation. Yet, despite annual reports, conferences amongst national leaders, a plethora of new technologies, and commitments to sustainability goals, we have consistently missed our targets.
The fatal flaw has been the failure to integrate short- and long-term approaches to bridge the Choice Chasm by addressing 3 core factors – Awareness, Accessibility, Affordability. Here, we use decarbonization as an example to recommend how we can bridge the Choice Chasm and achieve sustainability goals.
Factor 1: Awareness: Decarbonization technologies and solutions are emerging and evolving faster than ever, subjecting decision-makers to Choice Overload. It is tempting to rely on financial models and business cases to identify the best solution(s) – one that promises the lowest investment, quickest implementation, or highest return on investment. And herein lies the first implementation pitfall – the Awareness Gap.
First, when making the choice, decision-makers select from solutions they are most aware of, rather than the full gamut of options. This can result in solutions that are suboptimal in the context of their organization or customers’ true needs. While it is impractical to expect individual leaders to assess all possible solutions, this gap can be addressed by creating a single source of truth that consolidates data and solutions from across the globe.
Secondly, achieving the full benefit of identified solutions, requires not just the purchase and implementation of that solution but also the adoption by the end-users. Socio-economic, educational, and cultural backgrounds affect how aware an individual end user is, of the impact and benefit of planned changes. Unless a concerted effort is made to identify and address these awareness gaps, low end-user adoption rates will result in the underperformance of the planned solution.
Factor 2: Accessibility: Significant decarbonization efforts are underway in the US both at government and private sector levels. However, cleaner forms of energy have not been available everywhere.
For example, regions where coal mining has been the primary industry have been major detractors of cleaner forms of energy. This is because, in these regions, coal mining is likely the primary source of income for individuals. Their objections to energy transition are motivated by a fear of job loss, the lack of awareness about the proposed solutions, and the lack of access to alternative livelihoods.
Looking ahead, successful transition will require a concerted effort to not only address the awareness gap but also provide the most impacted people – those living in these regions – with access to information, education, reskilling or upskilling, so their livelihoods are protected through the transition.
Including the people’s input in the design of the transition plan will reduce the trust deficit while overcoming the accessibility barriers.
Factor 3: Affordability: The final factor to address the Choice Chasm is affordability, which manifests itself in different ways for various stakeholders.
For large companies, energy transition is a global effort that must account for geographical differences in policies, regulations, and conditions. Implementation is a multi-year effort requiring the investment of time, manpower, and resources, that must be diverted from other projects. Given the opportunity cost, transition must be incentivized through tax and policy initiatives.
For many small and medium businesses (SMB), the transition from current solutions to cleaner options is cost prohibitive. In the wake of the pandemic, which saw thousands of small businesses shut their doors permanently, making clean energy solutions affordable is the only way to ensure that they are adopted by SMB. While some clean energy solutions are still inherently expensive, the undue regulatory compliance burden makes more affordable solutions unaffordable as well. SMB can be incentivized to adopt clean solutions by simplifying the compliance mechanisms and providing expert transition support and resources as a transition benefit.
For individuals, affordability is extremely variable depending on the geographical and socio-economic background. For those who can afford it, rooftop solar, geothermal heat pumps, electric vehicles are only some of the possible solutions they can choose to adopt. However, for many, energy transition is not yet affordable at the individual level. In such cases, we must expand community transition efforts with adequate support and incentives.
Community efforts are most susceptible to the Choice Chasm. Community-based energy transition initiatives must involve community members early and address all three factors – awareness, accessibility, and affordability – to achieve success.
Across the board, to ensure that the sustainability initiatives are a genuine effort instead of a public relations exercise, leaders must consider how they will address the Choice Chasm. Applying the equity lens to identify and address the barriers to awareness, accessibility, and affordability unique to each stakeholder affected by an initiative is the only way forward.
- Bridging the Choice Chasm – by Dr. Shalini Nag and Surya Guduru - January 2, 2023