The Next Boom - A Surprise Hope for Australia's Economy

The Next Boom A surprise new hope for Australia’s economy? | Page 1

The Next BoomA surprise new hope for

Australia’s economy?

Future Business Council - 2015


About this publication: The Future Business Council (FBC) represents the next generation of business in Australia and is setting the vision for the next 50 years. We advocate reforms that will make Australia a more innovative, sustainable and resilient economy, and a global hub for future business. This publication was written by Tom Quinn, Executive Director, Future Business Council with the support from our Founding supporters:

Please contact the Future Business Council at [email protected] for further information.


Executive Summary

What the Data Shows

The Drivers:1. Consumer preference: changing

values, changing demand

The Drivers:3. Environmental necessity:

a force of nature

Catching the next boom - Recommendations for Australia

Acknowledgements

Data Sources

The Drivers:2. Government regulation: the great enabler and destroyer

Reform recommendations

Future projection

Table of Contents


Executive SummaryAcross Australia and around the world, demand for sustainable goods and services is booming. The Future Business Council has tracked the performance of leading sustainable goods and services since the turn of the century. We found compelling evidence that sustainability should not be seen as a cost, but a business opportunity. From solar panels to green buildings and sustainable agriculture, the results are striking and represent a significant new economic growth story.

The next boom represents a major opportunity for businesses to become sector leaders in Australian and international markets. At the national level, there is a once in a lifetime chance for Australia to position itself among the world’s leading suppliers of sustainable goods and services, capturing a share of the trillions of dollars that will be invested to meet the explosion in demand.

The rest of the world is not sitting idly by. Australia must do much more to develop new industries and support companies making the transition to more sustainable business models if it is to compete for a share of these fast-growing markets.

The three main factors accelerating the global green business boom - changing consumer preferences, government regulation and environmental necessity - are likely to keep growing in the sectors we analysed. This presents a crucial opportunity for Australia to diversify its exports and decrease its reliance on the mining sector, particularly in light of receding mining investment and volatile commodity prices.

What the data shows• Boom times for green business: FBC found annual demand growth rates of 100 per cent or more across several

sustainable products and services.

• Sustainable options outperform the competition: For example, organic food sales have been growing at over 80 per cent a year, compared to just 6 per cent for food retail as a whole, and the Dow Jones Sustainability Australia Index has increased by 8.4 per cent a year on average, compared to 3.2 per cent in the All Ordinaries index.

• Green labelling means go: Price sensitive and values driven consumers want trustworthy sustainable products - in several of the sectors we analysed trusted certification schemes were the key that unlocked massive consumer demand.


Governments have a key role to play in enabling sustainable business growth. Provided we get our policy settings right, Australia is in a good position to take advantage of the next boom. Local businesses can benefit from several elements that work in Australia’s favour, including:

• a highly educated and innovative workforce• advanced education and research facilities • good levels of capital availability• latent manufacturing potential• access to abundant renewable resources• proximity to Asia • the increasing viability of long distance service provision due to advances in technology

Australian participation in global booms has a mixed history. A strategic and confident approach is needed to ensure that Australia makes the most of the next one. The trends outlined in this report show that the sustainable business boom is not just on the way, but underway. Australia still has a chance to capture the benefits if it takes rapid action.

The DriversThree primary drivers underpin the growth in demand for sustainable goods and services. Each sector is also influenced by a multitude of sub-drivers, but these three factors stand out as major influencers in the majority of data sets.

The primary drivers are:1. Changing consumer preference2. Government regulation 3. Environmental necessity

Our research has analysed the role of each in accelerating the growth in demand for sustainable goods and services. The influence of all three drivers is forecast to increase in strength over the coming decades, further expanding the market for sustainable goods and services and underpinning the sustainable demand boom.

Booming Demand for Sustainable Products and Services

118% growth in annual solar

installations

48.5% of all plantations

now FSC certified

26% increase in fridge,

freezer and dishwasher

efficiency

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issuance

82% of taps, showers,

toilets sold now 3 WELS or

higher

116% growth in annual

Green Star certifications

165% average hybrid sales

growth

73% average growth in

Fairtrade sales

Energy ResourcesEnergy

EfficiencyNew Markets

Water Efficiency

BuildingsTransport Food

*Growth figures cover a range of dates, refer to full report for specific details


1. Consumer preference: changing values, changing demand

Consumer demand is changing and a growing number of values-driven and quality-focused consumers are selecting more sustainable products and services. This trend is especially pronounced in product categories such as climate bonds, Green Star rated buildings, Fairtrade and other certified food products, FSC certified timber products, and star-rated whitegoods. In these product categories, consumer preference is the main driver of change, with little to no influence from the other drivers identified through our research.

The issuance of green and climate bonds is a global trend, which is now taking the Australian investment market by storm. The introduction of domestic climate bonds lagged the international market, but as is clear from Figure 2, so far demand in Australia looks set to follow the explosive growth path seen in the rest of the world. (Note that 2015 is not yet over, so by the end of the year this growth is likely to be even more impressive).

Figure 1:International issuance of green & climate bonds (US$m)

Source: Climate Bond Initiative

FBC analyse based on data sourced from: Climate Bond Initiative

Figure 2:Australian green & climate bonds issuance ($m)

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Source: GBCA

Source: Biological Farmers of Australia, Organic Market Report

Source: Fairtrade Australia New Zealand

Source: E3, Greening Whitegoods Report

Changing consumer preferences and values are also driving rapid growth in the demand for socially and environmentally sustainable food, as seen in Figures 4 and 5.

Mandatory performance labelling for whitegoods has improved market knowledge and facilitated consumer driven demand for better products. Consumers’ preference for higher-rated products has led to an increase in the average energy star rating of whitegoods on the market.

Figure 4:Certified organic food sales ($m)

Figure 6:Average energy star rating for whitegoods

Figure 5:Fairtrade certified product sales ($m)

Green Star rated buildings have become the building of choice in Australia’s CBD property markets. Environmental responsibility, combined with the productivity benefits of greener building designs and higher property investment returns, is driving rapid expansion of demand for Green Star buildings, tracked via the total number of certifications depicted in Figure 3.

Figure 3:Green Star total certifications

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Image Source: Grains by Lukas Schweizer from Unsplash

Image Source: Tap drip - photo by Dimbledar (flickr)


A trusted certification or labelling scheme is critical to enable consumer-driven market change. Certification schemes – like Fairtrade, Green Star, WELS, Energy Star, FSC and Climate Bond Standard – can reduce consumer confusion and give customers the confidence that they are getting what they pay for. The value that customers place on trusted brands creates a unique opportunity for Australia to differentiate locally produced goods and meet the demand for trusted and credible products (see Catching The Next Boom for recommendations).

Trusted labelling schemes provide the additional benefit of unlocking both latent demand for better, cleaner products from price sensitive consumers, such as for more energy efficient washing machines, and deliberate demand where consumers choose to purchase more sustainable products even if that comes at additional costs, such as with certified food products.

Certification schemes are a response to consumer demand for improved market knowledge, and in some instances, government mandates and industry self-regulation. This is a global trend, with the number and type of certification schemes growing strongly. In the United States the number of eco-labelled food products and forestry products has grown at 20-30 per cent per year since the late 1990s and early 2000s. Comparable figures have not been collected for Australia, but the strong growth recorded for indicator products, like Fairtrade certified, suggests a similarly robust local market.

Increased demand for FSC certified timber (see Figure 7) can be ascribed to consumer demand for better paper choices and incentives for its use in the building industry.

Figure 7:Percentage of Australian plantations FSC certified

Source: FSC Annual reports; ABARES, Annual Wood Production

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Image Source: FairtradeSverige - Wikipedia


Government regulation in Australia and internationally has a significant impact on the local market for sustainable goods and services, both positive and negative.

Our research demonstrates how government regulation and incentives can either be a force for rapid change and development of the clean economy, or – when deployed to impede these emerging trends – a destroyer of jobs, investment and opportunity. This is particularly notable in the carbon market and renewable energy sectors.

When applied constructively, government regulations, such as those that mandate higher energy performance for lighting products and whitegoods, are demand creators that have delivered significant change in these markets. Demand changes have been observed from the imposition of water restrictions during drought years, and in the energy sector through carbon pricing and renewable energy targets.

2. Government regulation: the great enabler and destroyer


The sale of compact fluorescent lighting, LEDs, rooftop solar (see Figure 9) and WELS-labelled products (see Figure 8) have all expanded immensely since 2000 due, in large part, to government policy. In each of these cases government action has delivered broader economic benefits and has helped to fix market failures in ways that often become self-sustaining over time. This is particularly notable in areas where high up-front costs deter consumer purchases that deliver longer-term savings. Often a nudge from government was all that was needed to shift the norm.

Mandatory disclosure of product performance, from light bulbs to buildings to dishwashers, while not forcing product improvements directly, has improved market knowledge and enabled consumers to make informed choices and select more sustainable products.

Figure 8:Percentage of taps > 3 star Water Efficiency Labelling and Standards (WELS) rating

Figure 9:Cumulative capacity of solar energy installations (MW)

Figure 10:Total number of National Australian Built Environment Rating System (NABERS) certified buildings

Figure 11:VEEC lighting certificates

The inverse of this is that government regulation also has the potential to destroy jobs, businesses and industries delivering sustainable goods, whether through a lack of policy support or ongoing policy uncertainty or through actively regressive policies. The events of recent years have clearly demonstrated the power of government regulation to do harm as well as good to this century’s most promising growth industries.

The removal of the price on carbon led to the collapse of the Australian carbon-trading sector and deliberate regulatory uncertainty for renewable energy projects has stifled investment in large-scale renewable energy projects, as demonstrated by Bloomberg New Energy Finance statistics which reveal an 88 per cent drop in large-scale clean energy investment in 2014 compared to 2013.

Source: Department of Environment, Evaluation of WELS scheme

Source: Clean Energy Australia Report 2013

Source: NABERS annual reports

FBC analysis on data sourced from Victorian Essential Services Commission

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Image Source: Clotheswashers - Andreanna Moya (flickr)


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Freezer Energy 33%Dishwasher Energy 21%

Total improvement(from 2001 to 2009)

Other regulations are being adapted to boost the trade in more sustainable products, as observed in 2014 with Asia Pacific Economic Cooperation (APEC) commitment to free trade in environmental goods. Regardless of government decisions made in Australia, government regulation in other countries will continue to increase the breadth and size of the export market for more sustainable products and services. But there is a risk that the lack of proactive national regulation will undermine Australia’s brand strength on sustainability and limit local businesses’ ability to compete in this growing market.

Our research suggests that the lack of emissions efficiency standards in Australia compared to other producer and export markets should be counted among the factors that led to the closure of the car industry in Australia. Locally produced vehicles didn’t have a strong incentive to innovate and improve fuel efficiency, and lost the capacity to compete internationally or meet local expectations.

While car-makers suffered, among other factors, from Australia’s failure to introduce fuel efficiency regulations, other businesses have prospered from the introduction of smart regulations, such as water trading and efficiency policies. Spurred to innovate, Australian businesses are now competing internationally by exporting water-efficient products and know-how to major markets like California and Brazil.

Australia’s economy is highly exposed to global economic changes. Government regulation, whether local or overseas, will often have strong flow-on effects for the local economy.

The overall global trend is for governments to regulate markets when they fail to account for costly environmental side-effects (externalities). This has already been observed with the ongoing roll-out of national and regional carbon prices around the world.

Figure 12:Average energy use of whitegoods

Figure 13:New large-scale investment in clean energy (AUD m)

Figure 14:Average emissions intensity of new vehicles sold in Australia (g CO2/km)*

Figure 15:Number of climate policies introduced globally

Source: Bloomberg New Energy Finance

FBC analysis based on data sourced fromE3, Greening Whitegoods Report

Source: BITRE, Fuel Consumption Trends; NTC Australia, Emissions Intensity for New Australian Light Vehicles

*New passenger and light commercial vehicles

Source: HSBC Climate Change Centre of Excellence; IEA*Includes forestry (LULUCF and REDD+), waste and adaptation policies

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Image Source: CSIRO Solar Concentration - North Sullivan Photography


Drought, resource shortages, climate change. Environmental necessity is a direct driver of change in a number of economically significant sectors. Compared to changing consumer preference and government regulation, fewer sectors have environmental necessity as a major driver, but its influence is pronounced, and likely to become more so over time. The impacts are easier to identify in specific sectors like agriculture, industrial production such as steel processing, as well as in the form of increasing insurance premiums due to damage from extreme weather events.

3. Environmental necessity:a force of nature

Image Source: Drought in Australia -Tim J Keegan


The impact of environmental necessity is, to a certain degree, dependent on the duration of adverse environmental impacts. One example is the rapid increase in water use following the end of the Millennium Drought. The short-termism of resource efficiency improvements in these sectors suggests that further reforms are required to embed long-term structural change.

Demand for more sustainable goods and services due to environmental necessity is also likely to have an impact on the expanding market for higher-rated products under the Water Efficiency Labelling and Standards (WELS) scheme.

Resource scarcity, such as high or volatile oil prices and urban density growth, is another driver of increased demand for sustainable goods and services.

Figure 16:Steel production water use per kilotonne (ML/kT Raw Steel)

Figure 17:Agricultural water use per ha

Figure 18:Percentage of products sold rated 3 WELS or higher

FBC analysis based on data sourced from Bluescope Steel Annual Reports

FBC analysis based on data sourced from ABS - 4618.0 - Water Use on Australian Farms

FBC analysis based on data sourced fromDepartment of Environment, Evaluation of WELS scheme

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Image Source: Duststorm - MrCricket48 (wikipedia)


Spikes in the cost of iron have seen the recycled content of steel increase (the same trend is underway in China, opening up potential service export opportunities for Australian businesses with relevant expertise). In a world with a growing population and limited resources we should expect the prices of most commodities to rebound from their current slump at some point. We are probably entering a long-term era of high but volatile resource prices, which is likely to incentivise greater resource efficiency and sustainable innovation.

Environmental necessity will become a more important driver over the next few decades as the severity and frequency of natural disasters and extreme weather increases due to climate change, causing businesses and consumers to adapt by demanding products and services that address the problems. Already this can be seen in the viticulture sector where, due to continuing water shortages, most properties have now installed water efficient drip irrigation systems and other resilience-boosting systems.

Insurance claims related to extreme weather are also likely to continue increasing, which in turn will affect insurance premiums.

Figure 19:Oil price and hybrid and electric vehicle sales in USA

Figure 20:Recycled content of raw steel production, Bluescope Australia (%)

Figure 21:Annual disaster insurance claims, Australia ($m)

FBC analysis based on data sourced fromBluescope Steel Annual Reports

Source: Argonne National Laboratory, light vehicle sales

Source: Insurance Council of Australia

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Image Source: Drip Irrigation - Joby Elliot (flickr)

Image Source: Lake Hume at 4 percent - Tim J Keegan


Future ProjectionThe economy is on the cusp of a boom in demand for sustainable goods and services.

The past 15 years have seen strong increases in demand for cleaner products as innovative and affordable goods entered the market and trusted sustainability certification schemes gained traction. The rise in consumer demand has been assisted by the catalysing effect of government policy, setting standards and providing support to open up new markets like the renewable energy industry and carbon trading markets. Finally, environmental pressures are placing a strain on the economy and society and creating a need for cleaner, lower impact business models. This is spurring innovation and creating a larger market for more efficient, lower-impact products and services.

The boom in demand for sustainable products will be marked by rapid change in diverse sectors. We know that fundamental market shifts are on the way, but their arrival and speed can take even keen observers by surprise – as has been witnessed with the recent plummet in solar prices (see Figure 22) and subsequent boom in residential and commercial demand.

Figure 22:Cost of solar modules ($US/Wp)Supporting wholesale shifts towards sustainable business

models across the entire economy is the best way to enable local businesses to capture new opportunities.

Mass disruptions will occur across the economy as the next boom gains momentum. Australia will need to move fast to ensure the local economy and business community are prepared to capture the benefits. The overall economy-wide trend strongly suggests continued and rapid increases in demand for sustainable goods and services. An economy-wide response is therefore the best approach to position Australia to prosper from the next boom.

FBC analysis based on data sourced fromRenewable Energy World

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The economics of the 21st century will be defined by the rapid growth in demand for sustainable products and services. The first 15 years have already been notable for the boom in more sustainable business models across the world. In the United States, the ‘green market’ is already outperforming the overall economy and grew by over 40 per cent from 2004 to 2009. A parallel surge has been observed in Australia, as shown in this report. It is not yet clear, however, whether Australia is ready to capture the supply side as well as the demand side of this global economic transformation.

Catching the next boom - Recommendations for Australia


Australia has a once in a lifetime opportunity to not just catch the boom but lead it, however we need to implement the right incentives for business now.

Catching the boom will require a step change in Australia. Sustainable innovation was once seen as primarily a Corporate Social Responsibility (CSR) compliance consideration. No longer. In light of the clear trends here and overseas, it must now be seen for what it is – a growth opportunity and a magnet for investment.

Government has a critical role to play in creating the right market conditions for the growth of innovative sustainable business in Australia. Regulatory inconsistency and policies that protect old business models hamper innovation and new investment and will cost Australia the ability to prosper from the next boom. Positive policy reform is needed to incentivise the growth of more sustainable business and to support business attitude shifts if Australia is to seize this opportunity.

It will be equally crucial to accelerate the transition of ideas from the lab to the production line, and to build an entrepreneurial start-up culture to ensure that good ideas are welcomed locally and are not lost to competing economies (see box 1: Australian Solar).

Other nations are already preparing their economies and are investing heavily to seize the lead. Germany’s infrastructure bank has a five-year €100 billion green investment plan, Singapore has positioned itself as a global resource efficiency and sustainability leader, California is using a combination of aggressive targets, supportive policy and incentives to spur sustainable business growth, while Abu Dhabi has invested between US$18-22 billion in the sustainability incubator, Masdar City.

Australia will be left behind without rapid investment in sustainable innovation and low impact business models of the future.

Global manufacturing of solar cells expanded 67% in 2004, and a further 45% in 2005, and 85% in 2008 - growth reminiscent of the electronics industry in the booming 1980s. What’s more, the industry further expanded by 55% in 2009 despite the Global Financial Crisis. - UNSW

Box 1: The Australian solar story

Australia has been one of the world’s leading developers of solar technology since the 1960s. Most recently, researchers at UNSW set a new record by achieving a solar conversion efficiency rate of 40 per cent. However Australia has not been able to convert technical innovation into a viable local production industry, with only one local solar panel manufacturer remaining, and has thus missed out on much of the economic benefit stemming from this enviable innovation record.

A lack of government support to establish the fledgling industry as well as a high Australian dollar during the solar boom crippled the industry before it could achieve manufacturing scale.

So despite training some of the world’s leading solar researchers, designers, and entrepreneurs, the vast majority have relocated overseas – including to other high-income countries like Germany and the USA – to commercialise businesses stemming from their solar innovations. Local support was lacking and Australia has lost a generation of our best and brightest in one of the star sectors of the new economy.

Image Source: Solar Installation - GW Solar Institute (flickr)


The Future Business Council has consulted with its members to unearth positive suggestions for policy reform. The ideas that follow indicate the many avenues through which governments at all levels could help Australian businesses to make the most of the growth in demand for sustainable products and services. Further consultation would be required at the policy design stage to avoid duplication and ensure regulatory simplicity.

The following recommendations are the start of the conversation between the next generation of business leaders, policy makers and the broader community to create a reform blueprint for the future economy.

Reform recommendations


Benefits:• Increased consumer confidence• Expanded international market share• Economic growth and job creation

Australia has a unique opportunity to make “Made in Australia” a global byword for sustainability excellence. This will position the national brand in preparation for booming demand for cleaner and better products and services, and could expand the market for Australian made and designed goods.

The international branding of Australia is currently under-realised. Compared to nations such as Germany and Japan whose exports carry strong associations with quality and excellence, Australia’s exports – with some exceptions – lack a close association with a specific and universal attribute.

We could build a stronger international reputation for the sustainability of Australian exports. Immediate benefits would be gained by sectors (and high performers within these sectors) that already exemplify sustainability excellence, such as in agriculture, commercial building, water efficiency and climate resilience.

To secure a lasting competitive advantage the integrity of the branding must reflect reality. It must therefore be secured by a suite of interconnected reforms that assist business innovation, set standards and enhance consumer knowledge.

Positioning “Made in Australia” as a trusted – and trustworthy – mark of sustainability excellence, will enable Australian business to better access and command premiums in the global market.

Supporting actions

Trusted certification schemes accelerate demand growth and are a critical mechanism for improving consumer knowledge and building new markets for sustainable products. Government should:

- Promote trusted certification schemes to raise consumer knowledge and protect the integrity of established and verifiable marks;

- Introduce a weighting for certified products in government procurement processes; - Provide incentives to support companies applying for certification relevant to their sector; - Initiate the establishment of certification schemes in sectors that lack them such as in agriculture (sustainable

farm certification), clothing and apparel, and housing rental markets.

1. Make “Made in Australia” the global mark of sustainability excellence


2. Remove market barriers to new business models and lift product standards

Benefits:• Less red tape for more sustainable business• Improved efficiency and better products for consumers• Boost to business confidence and clarity on future expectations

The market for new sustainable products is being hampered by outdated regulations, high barriers to entry and distorting subsidies to established ‘old economy’ businesses. The Future Business Council recommendations include the following options:

- Remove artificial barriers to entry for new products and business models (such as arbitrary limitations on sharing economy businesses and grid connection barriers for renewable energy);

- Streamline the approval process for sustainable products and services (buildings, renewable energy, electrical products);

- Phase out subsidies for unsustainable business models, such as new coal mines; - Remove tax exemptions for fossil fuel consumption and extraction.

The introduction of clear standards is required to give business the confidence to invest in the development of innovative sustainable products that meet customer expectations, for example:

- Introduce particulate emissions standards for power stations and vehicles; - Lift standards for water and energy efficiency products; - Index existing standards to the level of the current best performing product on the market; - Expand the list of mandated products covered by the Product Stewardship Act (coverage should extend to all

electronic products and goods containing hazardous materials); - Increase minimum standards in the building code.

Standards provide a minimum performance floor which, when combined with clearly signalled future improvement curves, incentivise innovation and new product development.


3. Introduce market mechanisms and boost investment in innovation, science and research

Benefits:• Effective and efficient mechanism to drive economic development• Boost Australian innovation and entrepreneurship • Create new industries and jobs

When properly designed, market mechanisms can foster rapid, cost-effective business innovation and incentivise positive business practices. Placing a price on negative externalities enables business to factor the cost into their budgets and spurs enhanced product development. Options include:

- Placing a price on greenhouse gas emissions, whether in the form of an emissions trading scheme (such as by substantially lifting the Direct Action baselines), carbon price, or equivalent. Market design should be simple, fair, efficient and subject to independent oversight to give business confidence and remove regulatory uncertainty.

- Placing a price on recyclable waste materials to incentivise reuse and investment in better collection and sorting facilities;

- Expanding state based energy efficiency white certificate schemes; - Extending tradeable water rights to urban water retailers (accompanied by a mandate to lower fixed costs while

raising excess usage charges, ensuring ordinary consumers are no worse off);

Introducing new market mechanisms will support local firms to innovate, generating expertise and products that can then be exported.

Image Source: Science CSIRO - Morgan Brown


AcknowledgementsThis report was written by Tom Quinn, Executive Director of the Future Business Council with substantial contributions from Anton Griffith, Miriam Lyons and William Sandover.

The Future Business Council would like to thank the following people for their expertise, assistance and time in developing this report.Astha Batra, Adam Beaumont, Tim Buckley, Sophie Ellis, Felicity Ford, Damien Griffante, Chris Hale, Rob Hyndman, Craig Irvine, Zac Jasper, Nathan Lim, Eleni Matheou, Ian McAuley, John O’Brien, Francis Pamminger, Matthew Rose, Neil Salisbury, Charlie Wood, Anna Young.

We would also like to thank the wide range of companies and organisations that have published the primary data over the years that has enabled this cross-sector analysis to be undertaken.

The Future Business Council would like to thank our supporters and the many external reviewers for their insights and assistance.

Data sourcesThe Future Business Council has sourced data from a wide variety of public sources, annual reports, research reports, company reports representative of specific industries and of leading products and sectors indicative of longer term trends. Please refer to the full version of the report for the bibliography and footnotes with more detailed information.

Increased investment in innovation, science and education is also critical to enable primary research and to progress early stage innovations through to commercial feasibility. There are several significant opportunities to boost innovation, science and research support in Australia. For example, governments could:

- Establish dedicated industrial research parks to foster stronger links between universities and industry, accelerate sustainability innovation, and capitalise on the benefits of clustering;

- Increase total investment in universities and research institutions; - Increase the Research and Development tax incentive for verifiable clean tech initiatives; - Invest in a future focus scholarship series to attract the best and brightest from around the world to study and

work in new industrial research facilities; - Invest in fee-for-access advanced manufacturing facilities to remove barriers to entry for new businesses and

product prototyping; - Invest in new infrastructure, including grid access to renewable energy hot spots, advanced waste recycling and

EV charging networks;

A series of sector specific recommendations are outlined in the full version of The Next Boom report. Please download the full report from the Future Business Council’s website or contact the team at [email protected] to obtain a copy. The Future Business Council will provide additional information and more detailed recommendations on each sector in future releases.


DisclaimerAll rights reserved. No part of this publication may be reproduced or used in any way without acknowledgement to the Future Business Council.

The Future Business Council has taken reasonable care in publishing the information contained in this publication but does not guarantee that the information is complete, accurate or current. In particular, the Future Business Council is not responsible for the accuracy of information that has been provided by other parties. The information in this publication is not intended to be used as the basis for making any investment decision and mus not be relied upon as investment advice. To the maximum extent permitted by law, the Future Business Council disclaims all liability (including liability in negligence)to any person arising out of use or reliance on the information contained in this publication including for loss or damage which you or anyone else might suffer as a result of that use or reliance.

Further notes: The Future Business Council has undertaken this research using a wide range of publicly available data from a variety of sources. We have found the collection of data on sustainable business trends to be inconsistent across sectors. As a result, some data sets are highly comprehensive (such as insurance), while others are either incomplete across time (such as organic food demand) or represent broad estimates. In some sectors, such as LED lighting, reliable data is virtually non-existent and, therefore a trend line has not been established. Where incomplete and estimated data exists, the average percentage change has been interpolated. A more consistent and timely collection of data on key sustainable products and services across the economy would enable better analysis in future reports.

The absence of indicator data sets across the whole of the economy, as determined by ABS industry categories, is a limiting factor for gaining as wide and accurate a perspective as possible. This is due to challenges in determining what constitutes a more sustainable approach in the services sector in particular (for example hospitals and education).

While there is anecdotal evidence that sustainable demand is increasing within this sector (for hospital products, or sustainability-focused degrees for example), there is no consistent indicator that could be used with confidence to determine a sector-wide trend.

The definition of environmentally sustainable goods and services has been purposefully been construed widely to capture the significant breadth in improvements across all product categories.Comparison analysis has been completed where possible on analogous data sets, or where this is not an option, on reasonably similar products.

This report has not attempted a unified forecast due to the widespread uncertainty of mass-disruption innovation that makes accurate prediction both impossible and foolhardy.

The Future Business Council welcomes the opportunity to work with other organisations for future research in this space, especially to either produce complementary data sets for sectors not currently covered or more detailed analysis of the sectors where there is incomplete data.


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