October 21, 2022
Tokyo has some seriously ambitious extension plans.
Japan’s capital is set to become bigger, better and incorporate a mini city, the Tokyo Metropolitan government (TMG) says in a new report.
Tokyo eSG, as its name suggests, will be built around the principles of environmental and social governance and incorporate the latest green technologies.
“The world’s first ESG city” is due for completion by 2050 and billed to become a municipal model for the global community.
Back to the future
Today’s urban planners need to adopt a forward-thinking approach in the face of urgent global challenges such as climate change and the threat of future pandemics, the project report says.
But the TMG’s vision of creating a sustainable and future-proof city that leads by example is nothing new in Tokyo’s history, it adds.
In the 18th century, Japan’s capital, then known as “Edo”, was the world’s biggest city, with a thriving circular economy. And in 1923 it had to be completely rebuilt after being devastated by the Great Kanto earthquake.
“Tokyo expanded through creating reclaimed land into the sea and that is a strong advantage for us… No one lives on the land we plan to use, so we can start from zero,” the city’s deputy governor Manabu Misaka told Bloomberg.
The Tokyo eSG project will see an unused stretch of land in Tokyo Bay extended to around 1,000 hectares (2,470 acres).
This unpopulated area was used during the 2020 Olympics to host canoeing and rowing events and, recently, for waste disposal.
A sustainable vision
Cities currently support half the world’s population and they account for more than 70% of global greenhouse gas emissions, according to the UN.
So, what’s being done to make Tokyo a clean and sustainable city of the future?
To establish what it calls a “sharing economy”, the TMG says it is rethinking ideas around ownership and consumption, as well the use of materials and waste-management.
It is hoped the project will attract ESG-focused venture capital and start-ups from around the world looking to test new technologies that can help build a circular economy. To this end, the TMG has set up a green finance scheme that provides subsidies to foreign asset managers and fintech companies with a sustainability focus.
All of the city’s energy needs will eventually be met by renewable energy, including hydrogen, wind power and floating solar farms, managed by smart grids, according to the report.
The Tokyo eSG plans also envisage zero-emission buildings and public transport systems.
“The challenge is to build a city that will be strong against the crises we face, whether it’s infectious diseases, climate change or energy supply,” Miyasaka told Bloomberg.
Providing an economic boost
While the project aims to tackle the most pressing challenges facing the world’s major cities, it is also about increasing the country’s global competitiveness.
Japan ranked 28th among the Organization for Economic Cooperation and Development countries for digital competitiveness in the 2021 IMD World Digital Competitiveness Ranking.
The report acknowledges that the country has much work to do: “Japan lags far behind in the digital shift occurring in the rest of the world. It has also fallen behind in the area of economic growth. Based on these circumstances, there is a pressing need to fundamentally reform existing systems and approaches”, it says.
The TMG is focusing on building up its 5G network in the city, in line with government plans to triple coverage across the country in the next two years. This will be essential to the swift development of a future-proof municipal infrastructure, as well as garner the interest of businesses and talent.
Building the cities of tomorrow
As well as “creating ripple effects throughout Japan”, the city’s governor believes Tokyo eSG could achieve significant international impact: “Technology is moving away from being used in the purely digital world, to physical spaces. Cities will battle to become places to develop such new technologies, and the project could become a template for other urban centres,” he told Bloomberg.
The future of cities is a major focus of the World Economic Forum’s network of Global Future Councils. The 1,000-strong membership of thought leaders - from academia, government, international organizations, business and civil society - seeks to identify how urban areas can be re-designed to work better for residents and the planet.
WEForum, 21 September 2022,By: Stefan Ellerbeck.
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category : Topics
October 14, 2022
Everywhere we look, we see companies making commitments to climate and sustainability goals. But while the bold net-zero pledges that CEOs, investors, and boards are making have received a positive response, it’s clear that companies still have a long way to go to inspire the consumer action needed to help reach our global climate ambitions.
What will it take to make consumers choose environmental sustainability, whether through their behaviors or their purchases? What are C-suite executives (CXOs) missing?
We believe the answers lie with consumers themselves. Our research has confirmed that consumers do care about climate and sustainability and want to do their part. (See the sidebar “About Our Research.”)
But some consumers are confused about what they, as individuals, can do to make a difference; only 20% think that they can personally have an impact. More significantly, approximately 70% are disillusioned—wary of corporate claims about progress toward sustainability and suspicious that those corporate commitments are a ruse masking the true intent: merely to burnish reputations and attract customers. High-profile allegations of corporate greenwashing only bolster the disillusionment.
While up to 80% of consumers say they think about sustainability in their day-to-day purchases, only 1% to 7% report that they are paying a premium for sustainable products and services. Leaders often interpret this extremely broad “say-do” gap as a signal that consumers are not yet ready to follow through on their own convictions about sustainability. We believe, however, that measuring only those two extremes conveys an incomplete picture of the true range of actual consumer behaviors.
We examined every stage of consumer behavior in our research and identified two other important groups of consumers who are on the threshold of embracing sustainable products and services. The key question for CXOs is, How do we encourage more of those consumers to cross that threshold and make sustainable choices?
Breaking Down the “Say-Do” Gap
Between the consumers who are paying a premium for sustainable products and services and those who merely express concern about sustainability there are many other consumers: those who are taking action by buying sustainable products and services (albeit not at a premium) and those who are adopting sustainable behaviors (such as minimizing their water and electricity use, washing their clothes in cold water, restricting solo travel in automobiles, or using refillable packaging).
More good news: there are ways to reach and motivate these “in between” consumers by aligning sustainable offerings with their core needs. CEOs, chief marketing officers, and chief sustainability officers also need to understand the factors that currently deter consumers from more fully embracing sustainable choices and the factors that will motivate them toward sustainability. Then, CXOs need to learn to speak the language that will best resonate with consumers.
There’s marked variation across the product and service categories we examined. Some categories are more advanced on the consumer maturity curve, offering significant opportunity for companies to step up.
For instance, in home care products, nearly 60% of consumers say they are already following sustainable behaviors such as recycling products, bottles, and packaging (36%); using reusable cloths for cleaning (35%); and buying refillable cleaning and home care products (29%).
In the cars category, 39% of consumers report they are adopting sustainable behaviors such as avoiding driving or driving only when necessary (38%) or carpooling with others (14%).
The imperatives differ across categories, so the agendas for reaching consumers will differ as well.
Our survey also revealed trends by country, with some surprises. We’ve seen that the greatest concern about sustainability comes from consumers in China (92%) for categories such as home care, cars, grocery retail, apparel, and skin care products and those in Brazil (89%) for select categories including home care, cars, and PCs and tablets. Concern is relatively high among consumers in India (84%) for cars. Among higher-income markets, Italy shows the highest level of concern (87%), particularly in electricity providers, home care, luxury, and PCs and tablets.
Possibly, the trends in emerging markets reflect localized and firsthand exposure to the harmful effects of nonsustainable behaviors. In certain markets, consumers may feel these effects more acutely, resulting in a heightened awareness of the need to act. In China, for instance, consumers witness firsthand the smog and pollution that result from nonsustainable practices. (Another possible reason for China’s progress on this front: government leaders may be emphasizing sustainable development.) Consumers in Brazil may have a greater understanding of and commitment to sustainability because they have a front-row seat to the unfortunate destruction of the rainforests. In some other nations, the true impact on environmental degradation may simply not be so obvious. Yet.
And the heightened concern doesn’t translate into action across markets. Consumers in China and Italy are generally embracing sustainability. But while consumers in Brazil and India are concerned, they tend to fall behind on adopting sustainable behaviors or buying sustainable products and services across most categories.
Driving Green into the Mainstream
Companies and CXOs will not fully maximize the potential of sustainable products and services if they focus only on increasing the percentage of consumers who are willing to pay more for sustainability—a segment that currently comprises just 1% to 7% of consumers. That segment is merely the tip of the iceberg.
Companies can move more consumers toward sustainable products and services by thinking about the different imperatives of the other three consumer segments. Those consumers—the ones who are concerned about sustainability, adopting sustainable behaviors, and acting by purchasing sustainable products and services—are high-potential silent stakeholders in sustainability. For example, we see that sustainable products and services have higher net promoter scores (NPS) relative to nonsustainable alternatives. Having the right value proposition can not only encourage people to act and buy sustainably but also develop strong relationships and loyalty between consumers and brands.
By understanding the core needs of consumers, companies can significantly increase sustainable outcomes. Sometimes this will mean innovating to remove real barriers, and sometimes it will mean using communication to address perceived barriers.
The three imperatives for expanding the uptake of sustainable lifestyles are:
-Make claims locally relevant.
-Broaden the dialogue.
-Break the tradeoffs.
Make claims locally relevant. Among consumers who are paying more for sustainability or acting by making sustainable purchases, participation can be expanded if companies emphasize the legitimate, fact-based sustainability claims that resonate best given consumer perceptions—and thus spur consumers to greater action. (Remember, consumers are wary of claims that might be perceived as greenwashing.) CXOs need to speak the language of consumers rather than the language of their internal business team, regulators, or investors.
This language can differ in each country, so CXOs should use nuanced claims and language across markets. For instance, product claims that relate to protecting forests and biodiversity will resonate greatly for consumers in Brazil. Packaging is an issue of particular concern to Japanese consumers; they are likely to favor products that are recyclable, reusable, and made of compostable packaging or packaging that is free of plastics.
Broaden the dialogue. We found that, at most, 16% of consumers value sustainability for its own sake as a top driver of choice; this relatively small share of consumers said that sustainability was one of the top-three needs in their last purchase.
However, a significantly larger share of consumers (20% to 43% in the categories we tested) could be persuaded to make sustainable choices if the products or services also deliver other related and highly relevant needs.
In the beverages category, for instance, only 7% of consumers cite sustainability as one of the top three attributes they consider when making a purchase. But a larger share of consumers—as much as 43%—have top-three needs that don’t include sustainability specifically but are related to sustainability. These consumers seek beverages that are healthy, high quality, guilt free, and socially responsible—and all these associations are positively correlated with sustainable products. By broadening the dialogue to emphasize these related attributes in product design and marketing initiatives, companies can attract consumers to sustainable products even when consumers are not deliberately seeking them.
Break the tradeoffs. Consumers who express concern about climate and sustainability and those who are adopting sustainable behaviors can be reached through strategies designed to break the tradeoffs—the reasons why consumers hesitate to more fully embrace sustainability.
Sometimes these tradeoffs reflect real shortcomings. Companies’ sustainable offerings might not include appealing or acceptable products and services. Companies may offer less variety in the category of sustainable snacks, for instance, or a paper straw may be of poor quality relative to a plastic straw and therefore less convenient to use.
Alternatively, the tradeoffs may be misperceptions on the part of consumers. Many consumers think sustainable alternatives to products and services simply don’t exist, even when they are plentiful on the market. And consumers who are aware that sustainable products and services exist may assume that they are a lot more expensive than they actually are.
These may not be the only misperceptions posing barriers. Consumers may not understand the various ways to be sustainable—they might not know, for instance, that washing dishes by hand uses more water than a dishwasher.
Revisiting our example of beverages, we see that consumers believe sustainable beverages aren’t appropriate for celebrations, aren’t extraordinary, and aren’t a good value for the money. Companies will need to first understand the specific tradeoff that consumers are making and then plan solutions accordingly. For instance, advertising sustainable beverages as “fun” and “extraordinary” could enhance the image of the products as appropriate for celebrations. However, improving the actual innovation pipeline may be what it takes to make “good value” sustainable-beverage options available to consumers.
For many consumers who are concerned about climate and sustainability but are reluctant to act, cost is a primary issue. In fact, this is a key tradeoff. It’s also a great example of a negative perception that may not be justified. Our research proves that consumers who do not actually buy sustainable products tend to perceive a much higher “green premium” than the actual premium paid by consumers who do buy green products.
Therefore, consumers who are on the fence about making sustainable purchases for reasons of price need to see clearer price communication.
BCG, 13 September 2022, By: Kanika Sanghi, Aparna Bharadwaj, Lauren Taylor, Léa Turquier, and Indira Zaveri.
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