August 18, 2022

Can the private sector champion green economy transitions in the Caribbean?

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green_economy-580x337From First Look

A new study just published in Sustainable Development, the journal of the International Sustainable Development Research Society, finds that the a big part of building a green economy really boils down to private sector players’ core business philosophies. The UNEP defines a ‘green economy’ as one that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities. Kalim Shah, the study’s lead author says that “ building a green economy won’t happen overnight and won’t happen without private sector commitment. We’ll need the business sector to commit now and stay the course over a long term horizon.” He adds, “our research shows that the strongest indicator of such commitment is a well entrenched, internally driven core ‘green’ business philosophy…and this does not spring forth overnight either!”

Shah’s project surveyed more than three hundred firms across five Caribbean countries pursuing green economy initiatives – Barbados, Guyana, Jamaica, St. Lucia and Trinidad & Tobago, and covered relevant manufacturing, tourism, financial services, energy, transportation and commercial sectors. Its the first study that empirically links regional firms based on ownership structure, size, age, target markets, assets and other identifiable features, to the likelihood that they will support governments in green economy strategies over the long term. A clear message emerges regardless of country or economic sector – Firms, regardless of sector, that embrace a core business philosophy that is inherently ‘green’ are dependable partners. This sets them apart from firms that merely (1) ‘check the box’ of having an environmental policy on paper and (2) those firms that are compliant with prevailing environmental regulations but are driven mostly by external pressures of regulators rather than a truly intrinsic interest in ‘being green’. Bringing sunshine to this nuance is immensely important in the Caribbean where many firms from hotels to manufacturing interests and especially some multinationals are being accused of ‘greenwashing’.

Upon reading the study, Anton Edmunds, Chair of The Edmunds Group International and an expert on US-Caribbean business investment said, “it makes good sense for Caribbean leaders to incentivize their investment promotion strategies in ways to attract environmentally proactive investors because these are the more innovative entities that you want to infuse into your domestic business network …Shah’s study gives credence to the argument that government policy has to allow for both the new and entrenched investor to embrace environmentally sound practices, including the possible incentivizing of such practices and the lowering of tariff and non-tariff barriers related to the implementation of green economy best practices”. Ariana Marshall, Managing Director of the Caribbean Sustainability Collective in Barbados says, “ we’re seeing clear environmental and economic business success working with small and medium businesses and Shah’s study confirms that this works across many countries and sectors. What we need now is for governments to heed studies like this to scale up green public-private partnerships.”

The full study: Shah, K.U., Arjoon, S., Rambocas, M. (2016) “Aligning Corporate Social Responsibility with Green Economy Development Pathways in Developing Countries”, can be accessed at . Shah is a professor of environmental affairs at Indiana University and principal consultant of Valinor Research & Consulting. Co-authors Arjoon and Rambocas are with Management Studies, University of the West Indies, Trinidad & Tobago.

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