Sustainable Innovation and Impact

Cary Krosinsky, Todd Cort

• Publisher: Routledge
• Year: 2018
• Print ISBN: 9780815386742
• eBook ISBN: 9781351174800
• Topic: Business
• Subtopic: Sustainability in Business
• Index: Business

Following the Brexit and Trump election cycles, consistent, long-term policy solutions to environmental and other societal challenges are becoming increasingly difficult to achieve. Stepping into this breach is a clear opportunity for innovation by public and privately held companies, as well as the increasingly significant role of investment and consumption.

Sustainable Innovation and Impact provides a roadmap of the many critical pathways of positive change emerging to achieve modern day societal success, including rapidly evolving corporate and investment innovation and impact strategy considerations. Exploring innovation around the future of energy, electricity and related technologies, as well as transportation and buildings efficiency, Krosinsky and Cort consider ideas framed around the circular economy, operational and supply chain strategies and the global economy.

Drawing together a diverse range of contributors and case studies, this book will be of great relevance to students, scholars and professionals with an interest in innovation, economics and sustainability more broadly.

1

Introduction

Cary Krosinsky, Todd Cort

These are unprecedented times.

Global economic growth and average lifestyles are at all-time highs, yet this has come with costs such as degraded environmental systems which otherwise support economies, societies and cultures. Other costs appear to include rising inequality, and the effects of automation are only expected to accelerate these.

Scientists predict that the next 20 to 30 years will be filled with severe challenges to our way of life. We need look no further than the turmoil in Syria or Venezuela to see examples of the direct consequences of degraded environmental and social systems, and these may well grow exponentially if we don’t find a way to resolve present day challenges.

Environmental challenges we currently face, or will face in the near future, include:

•    a lack of adequate arable land to grow the food we need as a global society

•    freshwater shortages resulting from climate change shifts, infrastructure challenges and economic disparity

•    deforestation in both the tropics and temperate regions

•    ocean acidification and pollution destroying large swaths of marine ecosystems, such as coral reefs

•    mounting toxic and other waste problems

•    air quality challenges, particularly smog in urban areas

•    increased frequency and severity of weather events such as hurricanes and droughts

•    increasing challenges to terrestrial biodiversity

•    greater numbers of climate and environment refugees.

The social dimension, while at times overlapping with expected outcomes as above, also sees continuing challenges emerge across a lack of adequate education, housing and financial services, as well as unequal access to energy.

Progress remains fragmented and uneven, although there is much to be encouraged by.

China has made great strides in eliminating energy poverty, but these challenges remain in India. Conditions are improving for a rising middle class in other developing nations, while in countries such as the United States and the United Kingdom, large swaths of society feel increasingly left behind, leading to unexpected election results which have environmental and social ramifications.

The interconnected nature of the global economy and such environmental and social challenges is becoming clearer, and fortunately, so are solutions to these challenges. However, what is needed to fix these problems is not simple. Many categories of solution in fact appear to be necessary. The common thread for these myriad solutions is innovation for impact.

Sustainability has become an issue of global competitiveness, requiring innovative thinking in areas such as:

•    corporate strategy

•    economics, currency and the future of money

•    energy

•    food and forests

•    investment prioritization and strategy

•    logistics and the future of transportation

•    policy

•    regional solutions

•    technology.

The countries and regions which can best address these areas of innovation will almost certainly be those which will be the most economically vibrant in the coming decades.

However, as with social and environmental challenges, solutions will always have side effects and unintended consequences that must be managed. A full solution set must be multi-layered and complex by definition. A systems approach to innovation will be necessary, and therefore we see the need to run solutions within these diverse areas in parallel for best effect.

Unintended consequences have already been witnessed in regions such as Silicon Valley in the US. This region succeeds through a lens of innovation, leading to almost out of control financial success for the area as a whole, yet many have been economically left behind. An ideal systemic solution appears to require more consideration of the social dimension, creating opportunities for all categories of resident, thereby reducing inequality in order to achieve full economic health and vitality which all of its citizens might therefore benefit from – but how best to achieve this outcome?

Key questions and imperatives, as a result, continue to emerge, such as:

•    how can innovation be a driver of better social and environmental outcomes?

•    what do we mean by innovation in all of its manifestations?

•    how can we create a symphony of solutions running in parallel for best effect, so that we can take full advantage of new technologies?

•    how can we both maximize globalization while revitalizing local communities?

•    what should corporations, investors and policymakers do to create positive dynamics among all such categories of innovative thinking?

This is exactly what this book intends to achieve – a review of solutions that, if run successfully in parallel, might keep us from driving over the environmental and societal cliff-edge that we will otherwise continue to race towards. Turning challenges into opportunities through innovation is the only way to drive future success. We all want a world that thrives.

What are these solutions and what do they start to look like?

That is precisely what we have worked on in some of our recent classes at Yale, Brown, Maryland and Concordia, and some of the best proposed solutions are featured here, among other views of what is soon to be required. As we wrote in our previous book on sustainable investing, the future of investing now requires sustainability to be fully “baked in,” and for the environmental and societal outcomes we seek, there also needs to be a business case.

Millennials recognize this, and so do leading businesses such as Amazon, Alphabet and Apple. New business models have also emerged in the sharing economy, and global cities are rising up as booming and thriving metropolises where all sorts of solutions are emerging among the positive energy of their citizens. This dynamic now needs to be experienced and implemented in all countries and in all regions to take full effect. Solving these problems is our biggest challenge, and hence our biggest opportunity.

The chapters to follow propose solutions to integrated environmental and social challenges. We hope you enjoy this expedition and that it helps you find your own pathway forward. We all now need to play our part to help create the sustainable and economically vibrant future we all desire. It appears to be the only way.

2

What is Innovation?

Arthur Matuszewski

Innovation is the proverbial buzzword of our hyper-growth era. In 2017 alone, there were over 16 million articles and blogs featuring the word ‘innovation’ in the headline. At root, our fascination with innovation in theory and practice comes from the hope that things will get better, and that there will be ever-newer solutions to deliver value in our day-to-day lives.

There are numerous frameworks and methodological interpretations of innovation, assessing everything from its commercial impact, durability and technological sophistication to, more prosaically, the degree to which it offers something to someone that was not delivered before.

Rather than outlining ad nauseam these minutiae, the goal of this introduction is to share some guiding questions, examples and leading thoughts to assess and define innovation broadly and to determine the degree to which the provocations and ideas you’ll be reading of might constitute that proverbial new.

Known need?

• Is there a clear and pressing problem, heretofore unaddressed?

• Is this a problem that has been clearly defined, distinct from broader thematic concerns?

• Are there clear stakeholders to this problem, or is responsibility for its impact unclear?

For example, trash is a clear problem of consumption, though there are many possible and attempted solutions to its resolution. The rapid environmental degradation of landfills and surrounding lands leads to clear and present danger to human and natural life therein, vs. the vaguer concern that this may contribute to global warming. Communities near landfills bear the responsibility of dealing with these localized negative externalities, and any solutions to waste management must consider their immediate concerns.

Unknown need?

• Are there problems that your solutions answer, but which are not yet understood to be the primary problems?

• Are there ways this notion will allow for further discovery, potentially solving multiple problems?

• Will this transform a system, or link disparate groups together, in a way that changes the dynamics of why different parties may care?

For example, before the advent of digital streaming, the solution entertainment companies sought to provide was how to get you physical media quicker, vs. the content of that physical media. Streaming content allowed for removing limitations, late fees, and the problem of physical convenience. By understanding better how people engage with content, the real-time data from streaming allows for more personalized recommendations, which in turn decreases the selection problem, and allows providers of content to produce yet better, more personalized, and more engaging content.

Known solution?

• Do you have a likely concept of the solution, or an understanding of which domain, discipline or technology may solve this problem?

• Does this solution exist elsewhere, where you may combine insights, or share best practices with others?

• Do you know who is responsible for addressing this problem, or who may be best positioned through unique resources, specialized context, or given capabilities to best solve it?

For example, it’s broadly understood that a central limitation to mass adoption of electric vehicles today is the limitations of battery technology, requiring increases in the productive capacity of individual batteries via engineering. Other industries, such as portable device manufacturers, have struggled with how to compress battery technology and how to best limit power usage within their devices. Companies with the most battery production infrastructure, unique materials understanding, and technical acumen to iterate quickest through complex production challenges have a stronger chance of succeeding given the human and financial capital required.

Unknown solution?

• Does your solution require solving other, harder, technical problems along the way, or do you not know from what fields insights impacting your solution may come from?

• Does your solution lack any existing conceptual or real-world analogs, from which refinements/improvements can build off?

• Will your solution beget answers to other solutions, probably though not always before solving your target problem?

For example, producing highly personalized medicine based on individual genomes required a fundamental understanding of how human cellular biology was structured, which required both a working conceptual model and a means of testing and verifying these hypotheses at scale. While treating patients for illness relies on observational and diagnostic studies, proactively medicating and targeting long-term growth specifically follows a fundamental reworking of nutrition vs. x genome drug delivery. On the path to solving and transforming human genetics, there are multiple advances in large data-synthetic ‘clinical’ trials, drug formulation and genetic sequencing that pr...

Table of contents

• Cover Page
• Half Title page
• Title Page
• Copyright Page
• Contents
• List of contributors
• Acknowledgments
• 1 Introduction
• 2 What is innovation?
• Part I Corporate perspectives
• Part II Investment perspectives
• Part III Regional innovations
• Part IV Technological innovation and the future
• Index