A ranking of the world's 30 largest economies shows the Asia Pacific region as being far in front of the rest of the world when it comes to reducing reliance on non-renewable natural resources.
The concept of sustainability seems to have become this all-encompassing whitewash that sometimes feels like it can stand for almost anything.
The noun has started to crop up as a catchword denoting anything and everything from sensible agricultural practices to the increased use of fossil fuel alternatives and renewable energy – to more rational means of production.
Original Meaning
In the financial industry, it has been pigeonholed into the operations-compliant and client-friendly terms of net zero and ESG investment criteria.
Given that, it might be good to remind ourselves of the original meaning from the 1987 UN Brundtland Commission, which defined it as «meeting the needs of the present without compromising the ability of future generations to meet their own needs.»
Use of Resources
By extrapolation, mentioning «meeting the needs» and «meet their own needs» in one sentence places the onus of sustainability, in most respects at least, squarely on the use of resources.
To some, it may come as a surprise, but the Asia Pacific region seems to potentially lead the rest of the world when it comes to reducing its reliance on non-renewable natural resources, according to a recent Visual Capital ranking that cited data from the hinrich foundation and the IMD World Competitiveness Center.
Less is More
The region took the first eleven places of countries least dependent on natural resources across 30 major economies, led by Bangladesh, and followed by New Zealand, Sri Lanka, Vietnam, Cambodia, Hong Kong, China, Philippines, Taiwan, and Thailand.
But it didn’t end there. Mexico, at 12th, represented a small extra-regional blip before the list continued with Japan, South Korea, Singapore, and Malaysia. Although, by the same token, any ranking at or around the 15thplace is mid-field at best given the total population size.
Laggards as Well
By contrast, industrialized countries in the G-7 that were outside the region didn’t fare quite as well, with the US making 17th, the UK 20th., and Canada 23rd.
But there is a catch. The region also had the countries that were most reliant on natural resources, led by Brunei and followed by Australia, Papua New Guinea (4th), Indonesia (9th), and India (10th). A caveat here is that both the Visual Capitalist and hinrich appear to have left out Continental Europe for their exercise.
Unsustainable Rate
Still, the regional laggards better match current conventional wisdom, as succinctly encapsulated by the UN, that the region’s «increasing population, industrialization, and rapid urbanization have led to the accelerated use of natural resources at an unsustainable rate».
Australia itself seemingly represents the prevailing biases related to regional sustainability efforts, as four of its top five exports in 2020/21, or well over three-quarters, came from natural resources. Iron ore and concentrates ranked first, comprising 33.3 percent of all the country’s exports, followed by coal (8.5 percent), natural gas (6.6 percent), and gold (5.7 percent).
Right Direction
Another source of information, however, confirms that something is happening here in the region, and it looks like it is more good than bad. In December, Eco-Business, the largest regional media and business organization for sustainable development and ESG, also hinted that trends are pointing in the right direction.
In late December, they maintained that Asia’s representation on the Dow Jones Sustainability Index was on the up. According to them, 134 companies from the region made the index, up from 128 in 2022. Importantly, they indicated that these made up 42 percent of all entries on the list, which included companies from the US, Europe, and Africa.
Par for the Course
This confusion related to the overarching theme of sustainability is par for the course. As finews.asia previously reported in its discussion of green bonds and the ostensible lack of so-called greeniums in the middle of last year, the financial markets, and the finance industry, are not going to be singlehandedly saving the planet anytime soon – claims of greenwashing or adherence to ESG criteria regardless.
That leads to another truth related to sustainability. Some of the data always hints at progress at the same time that others do not. The term doesn't only suffer from definition creep but it frequently seems to be that the more you start digging, the more you are apt to get yourself very confused.
