Rebuilding the SA economy more sustainably – and for greater impact

UCT GSB PRESS OFFICE - 20 April 2021

COVID-19 has devastated the economy, but it has also opened a window of opportunity for businesses to integrate smarter and more sustainable solutions into their day-to-day operations as they rebuild for the long-term, saving on costs and protecting natural and scarce resources like water and electricity.

It’s no secret that COVID-19 and the subsequent lockdown have delivered a harsh blow to South Africa’s already ailing economy. Despite these measures easing up, many sectors are battling to get going again and consumer spending is still not back to pre-lockdown levels. Millions of jobs were lost and many have not been recovered. According to recent reports, small and medium business bankruptcies have gone up to 6.5% from 4% in 2019 – and are expected to rise to over 10% in the year ahead. 

There is no doubt that this is a very difficult time to run a business in South Africa (and the world), but there are also some positives to take away – not least, an opportunity to reimagine how we can run our organisations more affordably and efficiently in terms of energy and water consumption and in ways that benefit more stakeholders.

To address the above, the National Cleaner Production Centre South Africa (NCPC-SA) – a  national programme of the DTIC that promotes the implementation of resource efficiency and cleaner production (RECP) methodologies —  has over the past few years assisted several factories industrial plants, and businesses both big and small across the country, to increase efficiencies in their day-to-day operations. And these lessons can be usefully applied in the wake of the COVID-19 crisis as companies seek to return to full operations.

In an article published last year, Kevin Cilliers (NCPC-SA Regional Manager) points out that the national lockdown presented manufacturing companies in particular with an opportunity to improve their resource and utilities management. Alternative systems, products or operational flows can result in huge savings that also help protect the environment by reducing unnecessary use (and waste) of water and electricity, both resources that are under pressure in South Africa.

There is a significant opportunity for example, for companies to get in place proper monitoring and metering of water and energy resources that will reduce costs and protect the environment. One of the largest computer and ICT manufacturer in South Africa, for example, managed to reduce carbon dioxide emissions (a drop of 287 tonnes over 12 months), by overhauling air-conditioning systems in one area and upgrading solar power units, resulting in savings of R243 000 and an electrical conservation of 243 MWh.

As things stand however, many South African organisations don’t know what their consumption of water and electricity is and are therefore taken aback to find out that they could be saving thousands to hundreds of thousands of Rands by optimising existing systems or changing to newer technologies. In other instances, business owners may be aware of a problem but either don’t have the know-how or the capacity to implement changes. These are essentially low-hanging fruits for organisations seeking to get back on their feet at this time.

The world is becoming more attuned to resource scarcity and better ways of doing business - for the benefit of both shareholders and the planet. An intensified focus on circular economy initiatives through adopting sustainable consumption and production (SCP) practices and policies, is driven by global entities like the UN Environmental Programme (UNEP) and the UN Industrial Development Organisation (UNIDO). In emerging economies, like South Africa, where significant unemployment, poverty and socio-economic challenges exist, better management of resources can also go hand in hand with social innovation and the improvement of lives and communities. 

With global efforts to achieve inclusive economic growth, amidst the crippling pandemic, South Africa, like other developing countries, also has the opportunity to be at the forefront of an accelerated shift towards broadly adopting circular economy principles, sustainable consumption and production practices, resource efficiency and cleaner production, as well as ecodesigning and developing of clean technologies in the key economic sectors. As the support to industry continues, the NCPC-SA also recognises the need to advocate for concentrated and inclusive industrial development in a post COVID-19 national economy. Thus in 2020 the NCPC partnered with UNIDO and the DTIC to participate in the Global Eco-Industrial Parks Project (GEIPP) in South Africa – which aims to drive the transition of all types of existing industrial parks to become Eco-Industrial Parks. The concept of eco-industrial parks promotes resource efficiency and circular economy practices, and has been proven globally to be an excellent example of industrial symbiosis in practice, aiming to build industries that are inclusive of surrounding communities by creating shared economic opportunities, better support ecosystems and innovative approaches to responsible business practices.

Professor Warren Nilsson, who directs the MPhil specialising in Inclusive Innovation at the UCT Graduate School of Business – a programme that explicitly encourages students to explore novel and sustainable solutions for social challenges – says that the simple introduction of solar power for local businesses or making use of recycled materials instead of raw source material in the production of goods, like plastic crafted shopping bags or rugs, can have a huge impact on business sustainability while creating jobs and building healthier communities.

COVID-19 has had many severe consequences across society, but it has also opened this unique window of opportunity to shape our recovery for the better. As the WEF’s Great Reset initiative argues, “leaders find themselves at a historic crossroads, managing short-term pressures against medium- and long-term uncertainties.” In this moment we can choose to take steps that will set us up for a sustainable and inclusive future, finding smart ways of running profitable businesses while also helping the environment and local communities.

Lee-Hendor Ruiters is a UCT GSB Bertha Scholar and a student on the MPhil in Inclusive Innovation programme. He is also the Western Cape Regional Manager at the NCPC-SA.

Energy security | Sustainability

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