Sustainable development makes good business sense, especially in Singapore

The world is currently at several inflexion points. There are now more than seven billion human beings on the planet, and more than half of us live in cities. Indeed, the most essential elements of life – food, water – are now interlinked with energy, and with fossil fuels. And this portends therefore, either a potential crisis or enormous opportunities for businesses in the years ahead.

In the past, great fortunes were made by simply extracting resources, mining materials – iron ore and energy – from the ground. And manufacturing grew enormously, on the back of the availability of cheap resources and cheap energy. But this era of cheap natural resources is coming to a close.  And we can now no longer afford to ignore the externalities of industrialisation and of human activities.  Pollution and global warming are real phenomena,  which affect not just the quality of the environment, but also involves huge economic costs for all of us. In other words, the old ways of getting rich are not going to be viable in the future.

That is why we need to find new ways of making living, and living in harmony with nature. And this is not just ideology – this actually makes good business sense. The societies that can adapt successfully to this new reality, the fastest, will have an enormous competitive advantage by being ready for that future. And therefore, what I am saying, is it is not a trade-off between the environment on one hand and business viability on the other hand. In fact it is a virtuous cycle.

And we hold Singapore as a good working example of this concept. In Singapore, we have never had natural resources, we have never had large land mass and we could never afford to spoil our environment, precisely because we are so small. My backyard is your front yard.  I cannot afford to dump or to degrade your front yard.

Because of this, in a way, in the last 50 years, we have always been extremely conscious about pollution – we could not afford to have our air and our water poisoned. Therefore, we did not take the easy road to development by being prepared to sacrifice our environment. Instead, we made a deliberate choice to put sustainability at the forefront of our planning process, on the top of our development agenda, even before it became fashionable to be green 50 years ago.

So for example, we have built a Garden City even as we built a Global City. We pride ourselves on Singapore being a city in a garden. This is not just a tourist slogan, but indeed, this is a key reason why companies and families will choose to base themselves or their regional headquarters in Singapore.

Another example – water has always been an existential issue for Singapore. Through political will, the use of innovative technology, assiduous long-term planning and the ability to also charge full long-run marginal cost for water, we have been able to turn a strategic vulnerability into a business opportunity. And today we have Singaporean water companies growing and pursuing opportunities all over the world. Their calling card is their success in Singapore.

There is another paradox that is not appreciated. Mr. Peter Calthorpe wrote in 1985, some 28 years ago, that: “The city is the most environmentally benign form of human settlement.” It is a statement which is worth stopping for a moment to ponder, and I believe he is right. Because if you stop to think about it, the per capita cost of providing the essentials of life for human beings – the unit cost of providing shelter, food, water, electricity, education, healthcare, transportation and jobs – the cost of providing all these essentials are much lower in a dense city than in a suburban sprawl or even in the rural countryside.

And hence, I believe that living in a well-planned dense city is in fact a more sustainable way of life for human beings in the decades to come. Being green actually means living and thriving in a dense city. The key then, is how we plan and how we organise ourselves. And therefore, we are trying to use Singapore as a working, living, breathing model of the future, of the future in which the vast majority of human beings of this planet will live in.

We will be revising our Singapore Sustainability Blueprint as we prepare to harvest these opportunities, and as we prepare to confront the challenges in the decades to come. The point I am making is that governments have a crucial role to play. Governments have to devise policies that will lead businesses to make the right choices. Governments will also have to make investments in research and development because it is from such technological breakthroughs that we will also get new ways of life, and a more sustainable way of life for human beings.

But governments cannot do this alone. We need the non-government sector, and we also need empowered consumers who have access to information – in other words, a regime of complete transparency, so that people can understand the issues, make informed choices and can decide what causes to support, and what products or services to purchase. Businesses need to seek value in new business models and in sustainable responsible practices, in a world that demands greater sustainability, transparency and fairness.