The pandemic induced economic crisis has raised awareness that economies remain fragile since the GFC and that we must urgently shift to more sustainable and environmentally sound forms of economic development if we are to survive as a species. As a nation in the spotlight right now, New Zealand has an opportunity to lead with change. But we need a vehicle to drive this process and we must shift the mindset of the nation towards environmental entrepreneurship.
Institutional leaders such as the World Economic Forum (WEF) and the European Investment Bank predict that the next two decades will see a vast migration of capital from traditional industrial verticals to green investments, “responsible” deep tech and “bio-impact” investment, as the “just transition” to a cleaner, low carbon economy takes hold. Some sources claim that this “green shift” could be worth as much as $6 Trillion per annum as infrastructure replacement and the migration to cleaner industries proceeds. The global effects of the COVID 19 pandemic has only served to accentuate the very urgent need for deep structural reform. In fact the WEF argues further that the fiscal response to the resultant economic crisis absolutely must be tied to a greener economy.
Along with this shift comes increasing recognition from global corporations that profit and social purpose are inextricably linked. Socially responsible companies and those that develop engaged, happy and productive learner employees, will capture a greater share of value within the transition economy. Consequently this will invoke greater delivery on environmental, social and governance objectives (ESG) as part of reporting to boards, shareholders and other stakeholders such as local communities. Indeed, the New Zealand government is a signatory to the UNDP Sustainable Development Goals (SDG) of which SDG 9 has a particular focus on “building resilient infrastructure, promoting inclusive and sustainable industrialization and fostering innovation”. At the same time, governments remain interested in endogenous approaches to economic development that value development of human capital, since innovation through creating new knowledge is essential to sustainable growth and wealth creation.
With rapidly shifting technologies, the reconfiguration of the global economy and consequent disruption of traditional industries, in what has been described as the “fourth industrial revolution”, there is an ongoing need for discovery, evolution and enrichment of entrepreneurial skills, from an early age and throughout life, supported by better connectivity, greater insight and structured exchange of knowledge. Many of the capability building mechanisms required for this journey already exist in their own silos within New Zealand. But there is no unifying framework or plan in place to fully capitalise on this energy.
As part of the response to our Entrepreneurship Manifesto 2020 document I am calling for the establishment of a New Zealand Centre for Environmental Entrepreneurship (CEE). This would provide a coordinating role in aligning innovation and entrepreneurship programmes nationwide towards delivering a pipeline of talent fit and ready to address the biggest and most important economic opportunity of our lifetimes – our living environment. Partnership with the CEE would be through an application process with successful programmes receiving additional government funding support. A lean and future focused advisory board would administer the CEE. The board would comprise an equal weighting of experienced founders, business academics and government representatives supported by an executive officer. The CEE could be a virtual organisation as well as rotating hosting among academic institutions with strengths in business and environment.
Success would be measured thus:
- By a more coordinated national approach to entrepreneurship and innovation education in general, through supporting high performing enablers.
- By implementing micro-accreditation and NCEA credits for entrepreneurship and innovation courses.
- By delivering a talent pipeline with an environmental and social innovation mindset (including migrant entrepreneurs).
- By raising the status of entrepreneurs as champions of change and opportunity in the global transition economy.
- By a growing pipeline of new ventures that address both the SDGs and position New Zealand as a global leader in green transitional technologies.
Possible Focus Areas
- Technological responses to climate change.
- Alternative energy technologies.
- Social housing solutions.
- Management and improvement of flora and fauna ecosystems.
- Agritech and food security.
- Infotech and data security.
- Health Tech solutions for pandemic response.
- AI and Education.
Government would need to lead the funding but partnerships with venture funds and global corporations would be sought in return for early access to opportunities generated. A full time XO/Administrator with a part-time board of six and virtual workplace would require a commitment of around $300,000 per annum, plus additional supporting grants to member programme providers of say $500,000 in total. Less than $1 million per annum to focus our innovative talent on huge and challenging environmental problems worth trillions of dollars to the global economy.
- Isaac Ehrlich, Dunli Li, & Zhiqiang Liu (2017),The Role of Entrepreneurial Human Capital as a Driver of Endogenous Economic Growth, J Human Capital 11,3.
- Maradana, R.P., Pradhan, R.P., Dash, S. et al. Does innovation promote economic growth? Evidence from European countries. J Innov Entrep 6, 1 (2017).
Paul Spence is a commentator and serial entrepreneur, a recently exited co-founder of a New Zealand based technology venture, a co-founder and director of Creative Forest and principal at GeniusNet Research. You can follow Paul on Twitter @GeniusNet or sign up for a free weekly digest of startup, tech and innovation related events curated by him through New Zealand Startup Digest. Paul is a co-author of the Entrepreneurship Manifesto 2020.