Bio-banking and other green economy innovations
By the end of 2012, Facebook had one billion users sharing a whopping 140 billion plus connections between them. It is safe to guess that Facebook is the most visible company in the world. This is, of course, a blessing, but it could easily turn into a curse if it’s not carefully handled when we step into the future. In this day and age of information and information technology, companies whose brands have become regular household words are so connected to peoples’ self image that what they do can, by extension, affect their users. This could lead to a reputational risk no company would like to face.
Apple and Samsung have recently experienced this bitter truth. When Friends of the Earth, an international non-governmental organization (NGO) released the report, Mining for Smartphones: the Real Cost of Tin, they reported that the world’s two biggest phone brands, Samsung and Apple, should ensure that rules to protect people and the environment are enforced across their whole supply chains. The FoE report claimed that tin exported from Bangka was tainted by illegally mined tin and was causing serious environmental and human health problems. They further claimed that they were almost certain both these companies sourced Bangka Tin. Thus a movement of smartphone owners was launched, aimed at companies involved, asking them to ensure the tins they used were untainted.
Facebook has shown a much more acute sense of awareness than the two companies mentioned above, concerning its image as a contemporary company that is expected by the public to go green. It annually shares with the public information of its carbon footprint. This year’s report was launched on June 13 to assure people that Facebook was focused on long term efficiency, smart design, and clean energy sources aiming for a low carbon footprint. People learned that each one of them as Facebook users were using .000294 MT of CO2e—or 294 grams—per month in 2012, slightly up from .000249 metric tons of CO2e— or 249 grams—usage per month in 2011. To make sure everyone understood, they explained that this amount had the same carbon impact as three bananas or one coffee latte.
This year Facebook also made the list of ‘Innovation 40’, a report that recognizes the most diverse and imaginative companies in the world according to The New Economy. As we inch into the second decade of the 21st century, the most successful companies understand that they must innovate in order to accumulate. In other words, innovation is becoming an important engine for economic growth. This is a difficult challenge for countries like Indonesia, which to this day still boasts an economic system that is predominantly dependent on natural resource extraction to fuel its economic growth. It is high time for us Indonesians to begin investing more into building the nation’s capacity to innovate.
The good thing about innovation is that the possibilities for its growth are boundless. Unlike natural resources, innovation is mined from people’s imagination, and imagination, as Einstein once famously said, is the only thing in this universe that is truly infinite. This leaves a lot of space for development. But to embark on the journey of prospecting this brave new world, this new frontier of development, governments must be prepared to take the risk to invest.
The ‘Innovation 40’ report shows that countries have unique ways in dealing with innovation. The traditional west focuses on launching new consumer goods and services, while Australasia and Scandinavian countries relate innovation much more closely to sustainability and green technologies. Asian countries like Japan, China and Korea are masters in improving existing processes. It is high time Indonesia musters the nations’ innovation genes to shift the boundaries of our existing economic paradigms. Indonesia must evolve to enter the era where growth is created through innovation.
To begin, we could take a new look at what we have. Indonesia is one of the most mineral-rich countries in Asia-Pacific. It has gold, tin, manganese, nickel, copper, diamonds, coal, oil and gas. You name it, we have it. Unfortunately, it is the extraction of this wealth that has recently put us under the critical light of Friends of the Earth in the clean smartphone campaign. Illegal mining has become a chronic problem in this country. Regency governments have been issuing mining licenses without the ability to regulate these activities in a responsible way. The Energy and Mineral Resources Ministry estimates that in total, more than 10,000 mining licenses have been issued in this country. This has resulted in a trail of decimated landscapes and impoverished people. To add pain to injury, the government even lacks the ability to track the revenues these mines pay, if they do at all. With sustainability high on the consumers’ agenda and with the transparency of supply chains open for all to see, the government has no option but to find innovative ways to improve its governance capacity, or lose the markets for its resources.
Conventionally, when people talk about greening the economy, they are talking about how to ensure that social and environmental risks are mitigated, ecosystems and people are protected. Just like in the tin campaign previously described. But the color green in economic terms is continuously making the news, in diff erent shades, and these shades are getting darker as time goes by. Today, throughout the world, more and more countries are seeing the birth of true green companies.
In terms of natural capital endowment upon which to base a true green economy, Indonesia is one of the most fortunate countries. Indonesia may only have one percent of the land area, yet we accommodate 10 percent of the world’s known plant species, 17 percent of all known species, and 12 percent of mammal species.
To complement this biological diversity, Indonesia is also home to a rich diversity of cultures. In the context of innovation and the nurturing of a green economy, cultural diversity is a valuable asset. Through research and innovation, ways can be found to develop this combination of natural and cultural wealth into effective drivers of economic growth and equitable prosperity.
But to do this, Indonesia will need to channel serious financing into the exploration of innovation. It is well worth taking a look at what our neighboring country, Australia, is doing with its mineral resources, in terms of saving biodiversity. For example, the state of New South Wales recently increased the transparency of its biodiversity off sets framework, to create a fund from the mining industry and other developers, designed to finance a ‘bio-banking’ system. If Indonesia ever allows its mining sector to spiral into chaos, it will forego its ability to transform its mineral wealth into a strengthened green development capital base, like the government of New South Wales is doing. In the process, we risk losing an important opportunity to secure a sustainable basis for developing the future. This would not only be a tragedy for the future of our children, it would also be a serious embarrassment, considering that Indonesia’s projected international image is that of a leader among international sustainability circles.
To turn the economy green, innovation and capital must play a key role, for without them, rhetoric alone will not deliver the goods.
Chandra Kirana is Director of Green Economy Initiatives at Daemeter Consulting. This article first appeared in Tempo Magazine on 8 September 2013