KEY POINTS:
Sustainability is the new black in Wellington. And it's a short conversation with a Government minister or official these days if you're not on the topics that fall under its banner. Carbon emissions, waste, product stewardship and food miles are some examples.
As many of these issues require a corporate response, and with sustainability a sure platform in this year's election, businesses will be hoping for a holistic debate because sustainability is about more than just our physical environment.
Of course, issues such as air and water quality are extremely important and are taken seriously by enterprise, as demonstrated by business involvement in many initiatives to preserve our natural resources and improve our environment.
But it's a mistake to think that's the limit to sustainability. New Zealand's challenge of a sustainable future is an extremely broad one.
Importantly, the debate must extend to the sustainability of business, for our livelihoods are sustained by enterprise. Governments do not create resources and wealth, nor do regulations or legislation - only enterprise can do that.
Without sustainable business, people will not have the incomes and resources to prosper. It's simply not possible to manage the physical environment of our country if our prosperity is in question.
So the economic sense of sustainability and the need to preserve the competitiveness of our businesses is essential to understand.
But I think this aspect has too often been overlooked in the debate this year, particularly on the topic of climate change.
The voice of business is often belittled in our national conversations by a tendency to separate out the success of enterprise from the success of the country as a whole.
There's a view that, somehow, business success comes at a cost to other groups in the community.
But this couldn't be further from the truth.
The challenge for the year ahead is to turn this view around and to demonstrate the real connection between successful business and successful communities.
Businesses play an integral role in our communities, with their profits and wages providing the resources essential for infrastructure such as schools, hospitals and roads essential to community prosperity.
The money we earn from exports when our businesses succeed offshore provides crucial opportunities for our firms to expand, innovate and employ more people - central to helping Kiwis afford the standards of living we all aspire to.
So it is alarming that when several well-respected business organisations last year raised concerns with how the Government was moving to establish an emissions trading scheme, they were sidelined for their views and - in the worst cases - labelled vitriolic and unbalanced.
Sadly, this attack only serves to make people scared to join the debate. And on an issue as important as our response to climate change, which has the potential to be as critical to New Zealand as the economic reforms of the 1980s, this is also deeply concerning.
Open public debate around the consequences of the Government's climate change policy is essential to ensure that, as a nation, we make the right decisions on policy that will be so transformative to our economy.
Pigeon-holing the view of business as extremist or anti-green is not helpful. Far from trying to duck responsibility for any polluting activity, many businesses are taking positive steps to reduce emissions and to support the climate change initiatives of NZ Inc.
We are world leaders in the generation of electricity from renewable sources, with more than 65 per cent of our electricity generated by hydro, wind and geothermal. By comparison, Australia generates almost all its energy from low-grade, coal-fired thermal power stations. This is a global trend in developed and developing nations, with China building the equivalent of New Zealand's sole coal-fired power station in Huntly each week.
Further, it has been demonstrated that most large industrial emitters are maintaining their 1990 levels of emissions output or are operating within a few percentage points of world best practice for energy efficiency.
What is more, our businesses will face significant cost increases when carbon is priced into the economy via emissions trading.
Rushing the process and moving ahead of our major trading partners poses economic risks, including a threat to our competitiveness in international markets.
We need to preserve this competitiveness because our livelihoods to a large extent depend on competitive enterprise.
That's why in our quest for sustainability we must ensure our environmental solutions are also economically responsible.
Unfortunately, last year, valuable opportunities were missed to harness the conversation around climate change to build consensus on one of the most complex and, undoubtedly, the most politicised challenges this country has faced in decades.
I hope we do not repeat that mistake this year.
Business is up for the debate. Sustainability is a challenging notion, but it also holds many opportunities if we get the policies right. And it's our businesses - on the back of a strong and sustainable economy - that are best placed to take advantage of these.
Ingenuity and innovation is something Kiwis are naturally good at. Applying this to developing the technology the world needs to combat climate change could see it transformed from an environmental threat to a market opportunity for New Zealand.
Prime opportunities exist in the agricultural sector where we are already market leaders. New Zealand's clean, green image will also work to our advantage in the international market place as sustainability becomes an important selling point for goods. Further opportunities will be found in making these products the most carbon-efficient in the world.
On entering election year, it's my greatest wish all political parties will put New Zealand's success at the top of the agenda, including business success. If we can bring that balance to the conversation, our future will be as bright as we can make it.
* Phil O'Reilly is the chief executive of Business NZ. Fran O'Sullivan's column will return on January 27.
