Economy

Altruism Vs Profitability: Latin America's Green Debate

It's not easy being verde
It's not easy being verde
David Cornejo

SANTIAGO - In 2009, the European Union agreed to gradually prohibit classic incandescent light bulbs, finishing the process in September 2012. The idea is to replace them with energy efficient light bulbs and kick start sales of green products. At the same time, Argentina was much more radical - at the beginning of 2011 the government completely prohibited imports and sales of incandescent light bulbs. While summits like the Rio+20 haven’t succeeded in getting global agreements on sustainability, the market for green products, companies and consumers is moving right ahead.

According to the Meaningful Brands study done by Havas Media with 50,000 consumers in 14 countries of Europe, America and Asia, 53 percent of consumers questioned are prepared to pay 10 percent more for a product if it is produced sustainably. And in Latin America, that number rises to 63 percent. “Green products will always be good business. Consumers and markets have demonstrated that buying ecological products creates added-value,” said Pascoal Koutras, CEO of Phillips in Latin America.

The advances in this market are based on the increase in the scale of production, which reduces costs at the same time as the consumers’ perception of green products has matured. For companies, the increase in green products is based on their commercial viability, since the market doesn’t change due to altruism. “You are not going to ask a company to be responsible for the environment just because of ethics. It works when you can show numbers that make sense from a financial point of view, because you save money,” said Juan Verde, advisor to Barack Obama on sustainability and co-director of his reelection campaign.

An eco-citizenship that is conscious of the importance of conserving natural resources can tip the balance so that companies are more sustainable in their products and processes.

Green-washing

Green products available in Latin America move forward through word of mouth, at least as much as through the nearly inexistent marketing in the green economy. The green consumer can become a missionary in his or her eagerness for a sustainable continent. A sustainable evangelizer.

Companies in the region are incorporating more and more sustainability criteria into their operations. And they are including sustainability in corporate visions and missions. On the other hand, as consumers have become more and more interested in the subject, it has also stirred up some disillusion. According to the Meaningful Brands survey, 63 percent of consumers in Latin America think that companies have started sustainability initiatives as a way to green-wash their public image. “There are many different green products on the market, but we need more information to make good choices, with more complicated labeling,” says Alex Godoy-Faúdez, director of the master’s in Environmental Management at the Universidad de Desarrollo (Development University) in Chile.

Juan Verde thinks the region is on solid ground for growth in the green market. “Latin America is much better situated to implement these ideas in light of the economic turbulence,” he says. “Being green means having a sustainable economic model that allows you to earn money in the long run. If the people want these changes, then it is logical for the companies to follow them,” he added.

Marcelo Bisordi, vice-president for international relations for Brazilian conglomerate Camargo Corrêa, says that Latin America should incorporate the development of sustainable products into its DNA, despite some limitations due to geography and economics. “Some countries are already running up against environmental obstacles, like in Peru, where there is a shortage of water in some regions.” People in Latin America are also worried after having seen the direct effects of damage to the ecosystem. We are ecologists by necessity.

Altruism versus Profitability

Now we just need the consumers’ green proselytizing to catch on with the companies. “The most common error that companies make is to think of sustainability as an element that makes products more expensive and less competitive. On the contrary, they should think of them as an investment and an opportunity,” says Marcelo Bisordi from Camargo Corrêa. He adds that taking planned actions towards sustainability can actually protect companies from risks that effect cost increases.

And we’re not just talking about promises of future returns. Around 39 percent of the products sold by Phillips in 2011 were green. “We know that they are more expensive then other technologies, however, we can recoup the investment in the medium-term,” says Pascoal Koutras. Those energy-efficient light bulbs are one example: they last longer and have lower maintenance costs.

But a green economy that is based on profitability has an inconvenient key point. There is a risk that companies will not enter markets that are not attractive. “Most companies concentrate on the most profitable investments and not on the investments that the society really needs,” says Norwegian sustainability specialist Jorgen Randers. It’s altruism versus profitability. The economy’s eternal karma.

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Coronavirus

COVID Chaos In Bulgaria: One Reporter Is Tired Of Asking “Why”

With much attention now focused on rising COVID-19 cases in the UK and Moscow's new lockdown, a hidden story is in Bulgaria, which claims both Europe's highest death rate and lowest vaccination rate. By now, this reporter knows the drill…

Walking in Sofia, Bulgaria, on Oct. 9

Carl-Johan Karlsson

SOFIA — I suspected, while Google translating the Bulgarian news Wednesday morning, that I might be the last person in Sofia with an internet connection to have found out about the new COVID rules.Following reports of 4,979 new COVID-19 cases and 214 coronavirus-related deaths on Tuesday, the Bulgarian government had announced that proof of vaccine or negative PCR tests will be required for access to restaurants, theaters, cinemas, gyms, clubs and shopping malls. Starting tomorrow.


I'd heard some chatter at the co-working place the night before, but after 18 months of coronavirus reporting, and pandemic living, both in my native Sweden and my former home in Paris, I wasn't up for another round on the topic.


The world's highest mortality rate

Perhaps, that same plague fatigue was what caused me — when deciding to set up shop in Bulgaria a month ago — to miss the detail that this is both Europe's least vaccinated country and the one with the highest COVID-19 mortality rate.

I had chosen Sofia (Europe's oldest city!) on the latest stop of my now 12-year hunt for a place to sort of settle down for its cheap rent, cobblestoned city center … and its excellent nationwide WiFi. What more could you ask?

Well, vaccinations, it turned out. So here I was facing the COVID story again, after months exploring France's extra strict lockdown measures, Sweden's famous flirt with herd immunity, the mask morality police and anti-vaxx ideologues everywhere.

Photo of people wearing COVID protective masks in Sofia, Bulgaria

Inside a tram in Sofia, Bulgaria

Artur Widak/NurPhoto/ZUMA

Pandemic fatigue

The world's pandemic press this week is focused on the UK, where again cases are skyrocketing, and Moscow's new lockdown. But here in a country of barely 7 million, where I didn't speak the language or know the history, what might I find? After just six weeks, I considered the social dispositions I had discerned, what political leanings I'd nosed out that might explain why 80% of the population still isn't vaccinated.

Where does a hungry reporter go?

I had, for example, observed with great interest that Sofians never jaywalk. Maybe that was the angle? The striking incongruence between social conformity and vaccine refusal? Or maybe the upcoming parliamentary elections held a clue to the bad COVID management.

To answer these questions, I went where any hungry reporter would go: the burger joint on the corner.

- "So new restrictions huh? You think they might lockdown?"

- "Dunno. The usual? No chili?"

- "Right, no chili … So you think more people will get vaccinated now?"

- "We'll see. That'll be four leva."

Having spent the past 18 months among the army of finger-wagging, number-crunching armchair social scientists (both in and out of print) I had suddenly lost my hunger to "explain" why Bulgarians were the world's bad boy of the moment on the COVID front. Consider this just one roving reporter's version of pandemic fatigue.

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