Singapore corporations increasingly finding green is profitable: PwC

Amit Roy Choudhary, Business Times 28 Feb 08;

WHILE today's business managers have become more environmentally conscious, easily measurable economic benefit is still the key driving force behind corporate green initiatives, both in Singapore and the rest of the world, according to a new study by PricewaterhouseCoopers (PwC).

The joint study by PwC and the Economist Intelligence Unit (EIU) looked at the green technology movement by exploring the key drivers for change; the effect green initiatives have on collaboration and innovation across the technology value-chain; green-oriented regulations; and opportunities for growth.

The study shows that 40 per cent of technology executives claim the green movement creates significant market opportunities for their companies, as evidenced by a noticeable increase in customer demand for green products and services.

Additionally, 60 per cent cite energy savings as one of the most important factors in their company's environmental decision-making process.

'The growing demand for environmental products and services could translate into one of the biggest new markets in recent memory,' says Greg Unsworth, PwC Singapore partner and Asia Pacific technology industry leader, told BizIT. 'Technology companies can exploit this opportunity to drive growth, but they must ensure their green initiatives are in line with their business strategy.'

He noted that given Singapore's status as a leading financial centre, companies based here cannot afford to ignore the issues arising around climate change and the international momentum towards environmental awareness.

Mr Unsworth said that apart from the broader social objective to reduce the impact of business on the environment, companies here need to be aware of potential consumer and investor backlash due to a perceived lack of green initiatives.

'The survey shows that nearly one-in-five companies in the technology sector already assess environmental policies and track records of their suppliers in making purchasing decisions, and this figure is expected to increase,' the PwC official noted.

He added that in future sound environmental policies may become a prerequisite to generate business in some instances. In a number of countries, for instance, government customers are increasingly mandated to purchase green where available.

Mr Unsworth also noted that while there has been a relatively light touch to date in Singapore regarding regulation, there will be an increasing interest in the experience of those countries that are introducing carbon taxes and other regulatory measures - 'many companies are moving now to be prepared for risk of potential future regulation'.

The survey showed that technology organisations are taking steps to safeguard themselves from stringent government legislation and regulations in the future by proactively imposing their own green-oriented controls.

'Twenty per cent of the survey respondents say their companies maintain a formal and widely distributed environmental policy,' Mr Unsworth noted.

He added that this figure will increase significantly over the next two years, jumping to 48 per cent. 'To further reduce the risk of government regulations, technology companies are implementing a range of other environmental processes such as auditing internal green practices, appointing senior executives to oversee green programmes, and creating a clearer linkage between green initiatives and performance,' he said.

Mr Unsworth noted that the measures that should be taken by individual companies in Singapore will vary, based on the nature of their business operations, scale and current initiatives in place. 'The current carbon footprint could be assessed and an understanding of the opportunities to either generate revenues or save costs should be explored.'

Specifically, Mr Unsworth suggests measures like IT infrastructure and server consolidation, exploring alternative energy sources and automated technologies that regulate energy consumption and increased use of video or Web conferencing to cut down on travel requirements.

The PwC official noted that as a small city state with little natural energy resources, Singapore is vulnerable to the impact of a volatile energy market. So the republic would do well to think of introducing innovative fiscal incentives to tackle climate change issues, he added.