In this lesson, I summarise a number of additional global issues that may impact your business' future survival and should be planned for.
And we start, of course, with a global pandemic.
I am writing this course six months into the impact of the COVID19 coronavirus on the UK. For that time, I have been working at home, as have many others. The impacts on the business of the pandemic have been severe. Industries that were formerly highly profitable are now on their knees, travel, tourism, and hospitality are suffering tremendously, and this is creating severe stress for the aerospace and automotive industries as well as many others.
No one expects the Spanish Inquisition, as Monty Python memorably told us. No one expected the COVID19 pandemic either. And yet, we are now told that the frequency and impact of global pandemics seem set to increase.
Human encroachment on wild habitats, intensified factory farming of animals, and increased global travel seem to be a large part of the cause, and the current Covid19 crisis has put many economies into recession.
In late April, global stock markets were down 35%. They have recovered a little since then. At the time of writing – in September 2020 – the FTSE 100 in London is down 24% since January, and fears of a second wave are beginning to depress prices again.
The impacts of the Coronavirus vary widely between sectors. Supermarkets and online retailers are doing well and having to employ more staff. Other industries are doing terribly badly, notable shops in city centres, aviation, bars and hotels, and travel and tourism. In every sector, the need for social distancing and protective measures will have driven costs up while income is likely to be down.
As well as planning, as best you can, for recovery from this pandemic, you need to start preparing plans for the next one because it seems very likely that there will be another at some point.
Severe Water Stress
Businesses, as well as populations, need water. Demand for freshwater has more than doubled since the 1960s, and domestic water demand grew 600% from 1960-2014.
One-quarter of the world now faces extreme water stress, where more than 80% of the available supply is withdrawn every year. The World Bank estimates that the number of people living in countries with water scarcity will rise from 1.6bn in 2016 to 4bn by 2050.
Without a change in approach, the world will face a serious water deficit by 2030, with knock-on effects for sanitation and health, energy generation, and agricultural production. How will it affect your organisation?
Pressures on Food Production
Water stress also affects food production, but it is not the only issue.
The food supply chain accounts for 26% of global greenhouse gas emissions, and half of the world's habitable land is used for agriculture, and it accounts for 70% of global freshwater withdrawals.
Food production creates water stress, pollution, loss of habitat, and loss of biodiversity.
Producers who are able to adopt the best farm and land management practices will be well placed to benefit from likely changes in legislation and from emerging market opportunities.
The Sixth Mass Extinction
The Earth may be at the beginning of its sixth mass extinction event: the most rapid loss of species since dinosaurs were wiped out 65 million years ago.
More than 40% of amphibian species, a third of marine mammals; a third of sharks; and a third of corals are threatened.
The disappearance of plant and animal species, caused almost entirely by human activity, will have serious ecological, economic, and social consequences.
Food supplies, tourism incomes, drug availability, and many other activities will be affected. How will your organisation and your life be affected?
Travel and tourism markets, products, and services are changing as individuals make their travel and tourism choices more critically and expect companies to change their approach.
There are 1.4 billion tourists in the world each year, and the social, political, economic, and environmental impacts of "over-tourism" are becoming more visible.
Pressures from communities to correct the imbalances of excess tourism are increasing.
Travel and tourism companies, already severely impacted by the coronavirus, are also under pressure to make their product offerings more sustainable.
Thank you for listening to this lesson. In our next lesson, we'll look at what you can do to develop your career and support your organisation in the face of the challenges we have covered.