Corporate climate commitments have taken off worldwide in recent years, catapulting from 52 commitments to science-based targets in 2015 to more than 1,000 in 2021. The commitments are becoming more ambitious, too. In 2020, for the first time, the number of companies committing to limiting the global temperature rise to 1.5°C surpassed the number committed to a limit of 2°C. In addition, we’re seeing commitments across other issues of sustainability, ranging from deforestation, biodiversity, and land conversion to green steel usage and elimination of internal combustion engine vehicles.
As commitments multiply and the targets become more aggressive, however, the green economy is developing a resource scarcity problem. With thousands of companies simultaneously shifting to more sustainable practices and innovating new products and services to enable sustainability, the need for sustainable resources is becoming urgent. But inputs such as organic cotton, sustainable aviation fuel, recycled plastics, and seedlings, as well as the infrastructure necessary to ensure their widespread availability, are in limited supply.
There is also a shortage of people with green skills. Companies and governments are struggling to hire qualified talent, such as retrofitters to create energy-efficient buildings and power grids, ecologists to design and plan sustainable development, and seed collectors to scale up reforestation efforts.
In an earlier article, we explained how companies can identify where, when, and how significant scarcities will emerge in their ecosystem. In this article, we focus on strategies that companies can adopt to overcome resource scarcities. (See the exhibit.)