From food to carbon, big risks bring bigger opportunity

tight rope and global risks
ShutterstockRoman Tarasevych
Daunting risks like food insecurity and pollution of the oceans are adding pressure for more action from businesses and civil society.

Environmental risks aren't as easy to define — or respond to — as they used to be.

While still a huge problem in many places, a well-established environmental ail like the pollution stemming from dumping hazardous materials into waterways is relatively easy to solve: cut it off at the source.

Now, however, a new generation of interconnected risks are emerging that span easily-definable environmental, social, political and economic categories.

What can happen as a result of poor preparation and poor response to these risks is evident in scenarios like the Syrian civil war and refugee crisis, where researchers believe severe drought served as a catalyst to unleash simmering social and political conflict. The situation has now spilled over into mass loss of life and intense geopolitical instability that undermines both the regional and global economy.

While Syria was a powder keg for many reasons, a new report targeted at businesses and civil society groups isolates five key risks impacting the entire planet — ocean destruction, food scarcity, disease, youth unemployment and unmitigated transportation emissions — and then outlines specific ways businesses and society could benefit from taking action on these risks.

"We are in the midst of a seismic change in the way we organize our societies, run our businesses and live our lives," the report's introduction explains. "Whether we all stand to benefit from this change is up to you."

An overview of three of the top five global risks, and related opportunities, identified in the new Global Opportunity Report (right click to enlarge).

The "Global Opportunity Report" (PDF) was produced by a consortium called the Global Opportunity Network, which is comprised of the United Nations Global Compact, Scandinavian think tank the Monday Morning Global Institute and Norwegian consultancy DNV GL.

From cutting off sales of antibiotic-laden food to ramping up plastic recycling as part of the "circular economy" craze, many of the recommendations dovetail with trends already gaining traction in the realm of sustainable business.

The recommendations also bely another macro-trend in sustainability: the merging of social and environmental imperatives also evident in efforts like the U.N. Sustainable Development Goals. With the so-called "SDGs," systemic issues like poverty and rising inequality are factored in alongside wonky issues like green infrastructure.

This sort of environmental justice 2.0 approach to risk is evident in several parts of the new report, urging action on issues like transportation emissions that contribute to higher asthma rates in poor areas or problems with food scarcity and quality that again disporportionately impact the health of the poor.

The remaining two of the top five risks identified in the new Global Opportunity Report (right click to enlarge).

"The interconnected and complex nature of the five risks in this year's report call for systemic solutions," the authors state. "Youth unemployment is an urgent example of the threatening ripple effects of a generation without prospects."

The report also runs with the theme that "businesses are the new activists" — a refrain echoed at the U.N. climate talks in Paris last month, owing largely to corporations stepping up renewable energy investment in the absence of stricter government climate regulations. The authors go so far as to float "a new kind of social capitalism" rooted in "large scale societal change from the bottom up."

Actual activists, on the other hand, contend that corporations are ill-equipped to address issues impacting the poorest members of society, since publicly-traded companies are still beholden to pressure to deliver short-term financial returns. Rather than bottom-up, they see new corporate entries into industries like water and food as top-down threats to human rights.

Risk and reward

When it comes to much-discussed issues like food scarcity and global youth unemployment, the report contends that there is a real chance for corporate sustainability to intersect with basic human necessities.

Breakthroughs in fields like urban farming or precision agriculture, for instance, hold promise to increase food supply while decreasing agricultural impacts on the environment — but it is getting from this promise to reality that will be the trick.

The top business openings identified in the new Global Opportunity Report.

The new report identifies 15 top opportunities for addressing the social and environmental risks in play. Those with obvious potential benefits for private sector players, like the transition to jobs with more of a tech focus and the expansion of transportaion-as-a-service offerings, rank at the top.

While emphasizing the opportunity to respond to social issues like workforce development, the report points to technology as an enabler to shift the status quo.

"This year's opportunities also show how much can be achieved despite hamstrung governmental leadership," the report notes. "Technology is perceived as a powerful tool in this regard."

Techno-optimism aside, there is also the isse of fields where revenue may be harder to realize in the short term. On top of employment issues, opportunities like smart agriculture and the reduction of food waste rank near the top of the social impact list but lower on the business opportunity list.