Innovation, sustainability and our social licence to operate
She of the Sea founder Jenny Matthews explains how yachting can avoid the stick and enjoy the carrot…
Even before the global pandemic, the wider world has been exploring, studying and actioning how these factors are intrinsically connected. Together, all three are both cause and effect. Significant budgets and brainpower are being assigned to creating the perfect environment in which all three flourish. Industries across the board such as oil and gas, aviation, tech and even investment are turning their attention to reap the many benefits. Their focus? Adding stakeholder value through sustainability and innovation, while avoiding public ignominy by validating their social licence to operate.
The dance between innovation and sustainability, and its impact on the bottom line.
It could feel redundant to use this column to make the case for why innovation and sustainability not only matter, but are critical to the future of the industry. However, to ensure we are all singing off the same hymn sheet, let’s do a quick run-down. For additional clarification, ‘sustainability' refers to three central factors in measuring the sustainability and ethical impact of an organisation or industry: environmental, social and corporate governance, or ESG. As industry initiatives such as the Water Revolution Foundation and She of the Sea are highlighting, here’s what we need to know:
a) There are incredible and critical benefits for all major stakeholders that come from weaving sustainability into our collective DNA;
b) Over the next few years, there will be two sides. Those that lead and those that get left behind. The only choice we each currently have right now is in which camp we will sit, based on the action or inaction of today.
So, what is the link between sustainability and innovation? We all want to innovate, and we cannot ignore the demand to be sustainable. More so, a true sustainability commitment leads to innovation. Finally, this innovation will determine your bottom line and the future trajectory of our industry.
Disrupt the status quo and engage new markets, attract premium talent, all while creating strong, authentic brands that reflect the values of our audience. What’s not to love?
All result in solid revenue growth and bolster the bottom line. Perhaps more importantly this also means increasingly engaged owners wanting to invest their hard-earned millions.
We can attract the next generation of human capital required to innovate our way into the future by understanding their values. We can engage a whole new market of young, sustainably focused yacht owners by reflecting theirs. We can continue to exceed the expectations of the current owners and ensure their interests come first. We have all this to gain and more when we as an industry decide that sustainable practices are the way of our future.
The cost of inaction is on the horizon. Not only in the form of penalties for ESG non-compliance, or loss of market share, but whether or not we can validate our social licence to operate. Until recently, yachting enjoyed somewhat of a cloak of invisibility to anyone outside its direct circle of major stakeholders. Now, however, the public eye turns with eager anticipation to see what really happens behind the closed doors of the ‘one per cent’. As much as we might like to think we are, we are not an island, and the doors are no longer as closed as they once were. We are not immune to unpopular public opinion and neither are the owners of the vessels. A single viral post or tone-deaf Instagram pic can have catastrophic results. We live in a global climate where cancel culture is crippling companies and individuals who fail to understand the risks associated with inaction or indifference.
It is up to us now whether we, and the owners of tomorrow, think that being viewed as the bond villain, ocean-polluting epitome of the wealth divide is an acceptable risk they are willing to take. Whether or not this is accurate, we must accept that in our attempts to remain private, we have neglected to invest in the lens through which the wider world (and potential owners) will see us.
It is time for yachting to invest in its narrative, get our house collectively in order and make investing in a superyacht a risk-free, sustainable option for the owners .
Will we avoid upcoming penalties from inaction, move beyond compliance and embrace this challenge with passion and purpose? This is a call to action that all must answer. The future of our industry depends on it.
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The first in a series of innovation essays from The Superyacht Innovation Report