Sustainability is the new imperative of innovation

An interview with GFCC President Deborah L. Wince-Smith.

Interview first published in Portuguese on InforMEI, Brazil.

As one of the most renowned experts in the fields of innovation and competitiveness, Deborah L. Wince-Smith, President and CEO of the Council on Competitiveness, highlights that sustainability is vital to the prosperity of developing economies.

Few people in the United States have as much experience and recognition in connection with the innovation and competitiveness agenda as the President and CEO of the Council on Competitiveness, Deborah L. Wince-Smith. She has professionally served in policy and technology departments under the administrations of different American presidents, such as those of Ronald Reagan and George H. W. Bush — during which she was the nation’s first Assistant Secretary for Technology Policy. In recent years, Wince-Smith has also co-founded the Global Federation of Competitiveness Councils (GFCC), a network of leaders and organizations from around the world committed to developing and implementing concepts, initiatives, and tools to navigate the complex competitiveness landscape and to take action to drive long-term innovation, productivity and economic development. “The adoption of sustainability strategies in line with economic and innovation agendas and guidelines is increasingly a vital factor for economic growth and inclusive and social prosperity, becoming an imperative among public policies on the agenda at this moment”, she highlights. The interview is the result of a speech given by Wince-Smith at Amazon + 21, an international forum for dialogue on the Amazonian society held on November 4–6, 2020 in partnership with the Brazilian Industry System.

Innovation and competitiveness: the Brazil-United States relationship

I have lost count of how many times I have visited Brazil in my capacity as President and CEO of the Council on Competitiveness. As an archaeologist, I have a deep appreciation for the history of people and their cultures, of indigenous peoples, who in Brazil represent one of the richest and most diverse peoples in the world, with a history and culture going back more than ten millennia. For a long time, it was thought that the forest was empty. Today, we are seeing just how much of that notion was a myth. New archaeological discoveries, enabled by new technologies, are revealing Brazil’s incredible biodiversity. This biological and cultural diversity is a treasure for the world, with hundreds of Amazonian indigenous groups speaking hundreds of languages or variants of the same language, some spoken by just a handful of people. Much more will be discovered in the years ahead.

The relationship between the Council [on Competitiveness] and Brazil dates back a decade and a half, beginning with our partnership with the Movimento Brasil Competitivo (MBC), which led to four U.S.-Brazil Innovation Summits — in Brasilia, Washington DC, Rio de Janeiro and San Diego — in partnership with the Brazilian Agency for Industrial Development (ABDI). In 2010, we had a delegation from the Amazon Region organized by the leadership of the “Manaus Free Trade Zone Superintendence” (SUFRAMA) joining us in Washington DC for the 2nd US-Brazil Innovation Summit at Georgetown University. Bridging these four Summits, the Council on Competitiveness and our Brazilian partners were pioneers in promoting a new, bilateral cooperation model through a series of more than fifteen U.S.-Brazil Innovation Learning Laboratories on topics such as investment in research, manufacturing, renewable energy and entrepreneurship. The progress we made through this partnership led us to believe that in addition to bilateral engagement, a truly multilateral effort could give momentum to a global competitiveness and innovation movement.

That is why the United States and Brazil, together with other countries such as Japan, Canada, Egypt, Saudi Arabia, South Korea and the United Arab Emirates launched, in 2010, the Global Federation of Competitiveness Councils (GFCC) as the first global network dedicated exclusively to exchanging knowledge and practices related to competitiveness policies and strategies. In this environment, sustainability has become an increasingly prominent topic alongside the innovation agenda.

Sustainability as a stimulus for competitiveness

The COVID-19 pandemic is a truly transformative milestone in human history. We are living and working through a moment of tremendous challenge, change and reinvention. The types of creative destruction that normally take years or decades to unfold are happening rapidly before our eyes. These are transformations that, despite the incredible tolls on our society, can bring positive results for the workforce and the world. At this critical crossroads, we see opportunities to develop more sustainable, energy-efficient, and resilient production and consumption systems. And we both the need and the opportunities to drive more inclusive economic development, addressing marked economic and social inequalities, persistent poverty, and lack of development in certain parts of the world. For example, many believe that the COVID-19 pandemic will serve as a brake on rapid urbanization or will ignite a trend towards de-urbanization. In the United States, the real estate industry is reporting a huge increase in inquiries and home purchases for those living in metropolitan areas who seek to relocate to suburban and rural communities. If teleworking sticks and highly skilled workers disperse to non-urban areas, there is the potential to bring new economic and entrepreneurial stimulus to underdeveloped regions, rural communities, and declining industrial areas. This could be a golden opportunity to advance sustainable development while closing the urban-rural economic divide prevailing around the world. As these places develop, there is a chance to promote a greener and cleaner energy development. For example, some rural areas are excellent candidates for wind, solar, hydro, and bioenergy development and use. Increasing the sustainability of how we use and consume our natural resources is vital for the future of humanity, and there are few places on the planet where there is a more urgent need for doing this than in Brazil, in the Amazon region, with its unique biome — in terms of scale and mega-diversity — under constant threat.

Photo by Zbynek Burival on Unsplash

Sustainability and use of new technologies

Powerful technologies are emerging that can drive sustainability solutions. The opportunity is multidimensional, encompassing agriculture, energy, water supply, civil construction, and how we produce, move and consume products and services. “Energy poor” countries often also face other massive challenges like: health problems, lack of drinking water, food scarcity, and little or no industrial development. Energy is a high-priority issue. However, there is no energy “silver bullet”. We need to adopt a diversity of approaches in favor of cleaner and cheaper sources of energy. Opportunities are ubiquitous, embedded in nearly every use of energy. We are in the midst of a shift to more sustainable energy systems, and Brazil has been a world leader in adopting cleaner energy sources, including biofuels, solar, wind, and, of course, hydropower — which accounts for more than two-thirds of the country’s electricity generation.

More than 30 countries rely on shale gas resources. There have been significant advances in the fields of nuclear power, hydrogen use — affording unique economic and environmental benefits to the transportation and industrial sectors. We will have better production strategies based on hydrogen, small wind, and biomass systems, small hydroelectric plants, greater use of geothermal energy. We will be seeing, on a smaller scale, off-grid systems that will be needed in areas still not served by centralized energy systems, such as poor communities and rural areas. We will be seeing, on a larger scale, simple technologies such as solar water heaters, wind pumps and biogas, small wind turbines placed on bridges over rivers and ridges along valleys driven by the force of the wind. Given that hydrokinetic devices can be deployed in any water resource with sufficient speed to drive them, such as streams, tidal estuaries, sea waves, currents and human-built waterways, their potential for energy generation is significant and should be considered in the process of designing development strategies.

Sustainability, innovation, and change

Increasing the sustainability and productivity of agriculture in Brazil is an urgent need, given the link between food production and the deforestation taking place in the country. Biotechnology can provide solutions to the four key factors for life and for preserving essential resources in Brazil: food, feed, fibers, and fuel. Biotechnology will help us create pest and disease-resistant crops and higher-yield crops more tolerant to climate — thereby making agriculture possible where it has not been before. Precision agriculture can help to optimize land use and save water and energy. Biomanufacturing will also play a relevant role in this regard. A recent study by the McKinsey Global Institute suggests that as much as sixty percent of the physical inputs to the global economy could be produced biologically. That is: one-third of these inputs can be biological materials and two-thirds of them could be produced using biological processes. Much will change in the near future that will impact innovation, sustainability, and the competitiveness of economies.

Innovation, consumer relations and circular economy

On the consumption side, circular economy models seek to design products and components to keep them circulating in the economy, reducing replacements and increasing the value and longevity of the energy and materials we consume. Due to the consumption of materials and energy and to the generation of waste and pollution, some industries are a priority, such as those related to textiles and apparel, construction, agriculture, furniture, electronics, packaging, plastics, vehicles, food, steel, cement, and chemicals.

With production and consumption concentrated in cities, taking advantage of new technologies in systematic ways could make a significant difference in sustainability — which is a particularly important goal as new urban areas emerge around the world (despite the COVID-19 pandemic). For this to be possible, among other measures, new investments are required in sustainable energy and water supply systems, new projects and technologies for energy-efficient buildings, where we will see intelligent buildings and systems designed to achieve optimal efficiency that can ensure energy savings of as much as 60–80 percent; intelligent roads and vehicles that optimize traffic flows and reduce road congestion and idleness, and high levels of broadband and internet penetration to support teleworking. In short, if we look at the scenario of innovation and consumption, we will see a profound potential to move from scarcity to sustainable abundance of food, water, energy, and much more.

Future and innovation

In the future, we need a new global framework for economic development focused on abundance and growth, rather than on scarcity and constraints. In this scenario, companies have a major role to play and many of them are responding with sustainability initiatives. In the production of goods, for example, many companies are striving to reduce energy consumption and use cleaner energy sources to power their operations. Many companies are implementing efforts to use more sustainable materials and greener chemicals, reduce water use, adopt strategies to use alternative energy in their fleets, as implement measures to increase the energy efficiency of buildings and industrial equipment.

Other companies are working just as hard to incorporate sustainability into their products by, for example, developing more energy-efficient appliances, recyclable products, compostable goods or biodegradable packaging. Improving sustainability throughout the lifecycle of products — including in their supply chain, source, production, packaging, distribution and storage and final disposal — has become a major focus of attention. Some companies are setting ambitious sustainability goals across their supply chain for packaging, water use, climate, and agriculture to be achieved within five to ten years. In a recent survey of companies, 52 percent responded that climate change is a very significant issue, and 40 percent indicated that it is a matter of key interest for investors. However, only half of the companies said they were integrating sustainability into their core business extremely or fairly well.

In terms of innovating solutions, whether it is a new, highly efficient solar cell, a battery that can extend the range of an electric vehicle, or the development of drought or flood tolerate crops, only a competitive industry has the resources to develop new technologies and put them on the market efficiently and economically. Some universities are incorporating sustainability into their educational programs, contributing to improving the workforce in companies facing this challenge. For example, Arizona State University established the United States’ first school of sustainability, offering programs and degrees in sustainability, including specialized programs in sustainable food systems, global sustainability science, sustainability leadership, and sustainable energy.

We are experiencing a key moment in history. In the face of the global COVID-19 pandemic, we are rethinking how to produce goods, strengthen supply chains and use new technologies to make our operations more resilient. Some people are questioning whether we actually need physical offices. This is a time of change.

It is clear that our current economic model is unsustainable. To get around this situation, we need to know where we are and where we want to go in terms of innovation, sustainability, and consumption. We need new strategies to avoid waste and develop products designed to be reused or shared. Clean production must always be considered, in synergy with an inclusive and sustainable economy, so that we can rely on feasible and accessible solutions for all.