An Interview
with
Professor
Steve Evans

THE ECONOMICS OF SUSTAINABILITY

Jack RiisfeldtOctober 26, 2021

As Director of the Centre for Industrial Sustainability at the University of Cambridge, Professor Steve Evans plays a central role informing and influencing the UK’s transformation towards a sustainable industrial system. We spoke with Professor Steve Evans to get a better understanding of his work and the industrial transition afoot towards more sustainable operating models.

INTERVIEW

The shift to ‘product-service systems’, or ‘servitisation’, will fundamentally disrupt the business model of many manufacturing firms. Will this shift lead to greater quality and lifespan of products, or merely exacerbate waste?

The shift is potentially neutral. It can be done poorly, but the forces at work mean that a shift to selling services is more likely to be profitable and environmentally sound. For example, servitisation means that a company gets their product back when you finish with it and that should improve recyclability.

 

We have seen in recent years an intensifying consumer pull for eco-products. How is sustainable manufacturing responding to this challenge while maintaining economic sensibilities?

There are many sustainability actions and the outcomes visible to consumers, such as using benign materials, using fewer materials, and bringing our materials back. However, there is so much that can be done that will remain invisible to consumers. Most pollution happens well before consumers ever receive a product, with the exception being energy-consuming products like cars. Manufacturers are responsible for reducing their own energy use, buying cleaner energy, and wasting less materials and water themselves to make a greater impact. The evidence is very clear that using less energy, materials and water can increase profitability, but it needs companies to use their brains rather than their wallets to solve problems.

 

Where once sustainable manufacturing was seen as an expensive endeavour for manufacturers, something that was “nice to have”, it’s increasingly recognised as a business imperative. How do you ensure that sustainability is effectively embedded at the core of businesses with often unsustainable foundations?

The answer to this question has two main dimensions – management systems, and a set of actions. There are various management systems to embed sustainability practices, from deploying KPIs in standard performance management, through to creating a senior board role of ‘ Chief Sustainability Officer’ to foster accountability and establish a constant sustainability presence. The second dimension, action, can be more overwhelming, particularly for businesses and leaders that are relatively new to sustainability. It’s easy to be overwhelmed by the information out there; turn to businesses and trusted partners with experience to guide your process. Start with problems that worry you, that pay back – how to use less energy or water in your business for example, before moving on to more complicated things like ‘how to find a benign substitute material for one of my components?

 

Resource scarcity and higher costs for energy and waste disposal will shift manufacturing value creation to new models. What role will the circular economy in particular have in ensuring both sustainability and economic longevity?

The Circular Economy is one path that can take many organisations towards sustainability. It can shift cost structures and effectively lower long term material costs while increasing profits. It does, however, reduce total cost by significantly reducing material costs while increasing labour costs, so it is not a trivial change in the short term and should not be undertaken without due consideration. In the long-term, the Circular Economy can significantly build business resilience. Having access to your own source of raw materials – in the form of your old products coming back to you – might seem like an operational and logistical nightmare at the outset, but it greatly reduces your exposure to global material flows, the importance of which has been exemplified by the ongoing pandemic.