Promoting ecological sustainability
through the business cycle
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Philip Sutton
Director, Policy and Strategy
Green Innovations Inc.
Tel & fax: +61 3 9486 4799
Philip.Sutton@green-innovations.asn.au

Revised 28th July 1998 - Version 1.a.w:iii

.GIF graphic by Martin Powell
Paper marked up in HTML format
by Philip Sutton.

There is a common perception that environmental issues rise to near the top of the public and commercial agendas when the economy is booming and drop well down when the economy goes into recession. Given the Asian economic crisis it is just possible that a global recession will occur in the near future. If that were to occur, it might seem to be quite the wrong time to be trying to raise the issue of Australia committing itself to a transition to an ecologically sustainable economy. Careful consideration of the dynamics of the business cycle, however, suggests counter- intuitively that now is in fact a very good time to start such a profound discussion.

The time to do dramatic new things is in the upswing of the business cycle. People are optimistic, there's money to do things and people are prepared to take risks. However the time to prepare for dramatic new things is before hand!

[Graphic: Action through the business cycle]

Promoting ecological sustainability through the business cycle
(This figure is not a prediction - it is for illustrative purposes only)

If we want Australia to embark on the transition to an ecologically sustainable economy as soon as possible and if we want to make a major leap in that direction then we need to be ready to capitalise fully on the next boom period. The boom times are windows of opportunity for dramatic change and they only come around every 7-11 years. They are opportunities that should not to be squandered.

During the next boom we need to encourage new consumption patterns and support them with appropriate products, we need to put in place new supportive infrastructure, encourage the spread of sustainability-promoting transformative technologies and we need to make sure that a strong ecotax package is put in place. All of these things have long lead times so we need to start preparing the ground now.

While the Australian population is very green by world standards, there is little awareness of what needs to be done to create an ecologically sustainable economy. This awareness needs to be generated. There is no consensus in business that there should be a transformation to an ecologically sustainable economy. That consensus needs to be built. Plans need to be prepared for the new consumption patterns, products, infrastructure, and transformative technologies and for the ecotax package. Early mover companies need to be engaged in the process. And the less visionary firms need to be involved through environmentally-related cost saving programs.

The business cycle gives (approximately) one chance per decade to set the economy off in a new direction. Given the urgent need for an ecological transformation of the economy and the unavoidable slowness of such change, we can't afford to miss the next chance to move boldly in a new direction.

A key strategy is to prepare firms to take on a sustainability-promoting approach. This involves the firms (a) making a public commitment to such an orientation, (b) reorienting their business strategies around products that assist society to achieve sustainability, (c) using influence to encourage other firms and the community to become sustainability-promoting, and (d) granting governments a 'licence to govern' by urging them to be proactive in efforts to foster a sustainable society.

"The business cycle gives (approximately) one chance per decade to set the economy off in a new direction."


Last modified: 1 August 1998

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