In a market-based economy, the higher the production, the better the company's chances to squeeze more profits. However, in the pursuit of sustainability, the companies are trying to forge the business in a manner that will not harm the current rate of revenue. The companies can also put their effort into doing their business more eco-friendly.
Here come the governments with strategies to collaborate and find a solution that will help shape the economy in a direction that will foster sustainability. Here, we will discuss the collaborative efforts from government agencies and private sector companies to develop a new economic structure which will push the sustainability agenda.
Private Companies as Innovators and Change Enablers
Private companies are at the forefront where they can change the common standards of the industry as these companies have a proper team of R&D which helps them develop a new product. Based on that, they can bring innovation to the market, giving substantial financial gain.
It is the major motivator of private companies to take risks and enter into the realm of sustainability to start the process of Co2 reduction. Through innovation, only these companies can incorporate changes that will not hamper the profit-making ability of businesses and will ensure that they stay aligned with their sustainability goals.
The companies are keen to develop sustainable supply chains and waste reduction processes to ensure that we can maintain the ecological balance. Now the question is why these companies put so much effort into moving towards sustainability.
Here comes the government’s regulations and policies.
Government as Policy Architect and Guardian of Public Interest
The authorities create the regulations which will promote the change towards sustainability. It sets the guidelines that help businesses follow a standard per their area of origin. The government is the architect and works as the body to enact and maintain laws.
The government establishes clear environmental standards and creates regulatory bodies which check these private companies and help them follow the guidelines accordingly. The most exciting part is that it encourages businesses to follow these regulations by providing incentives through reducing excise duty to corporate taxes, thus enabling them to ensure that their business output doesn’t get hampered in the short term.
It acts as a way where the corporates can do business cost savings from these incentives and promote the R&D towards sustainability. Hence, it answers why private companies prefer to work closely with the government and follow its lead when they find substantial gains in that market.
Public-Private Partnerships
It is a new tool which creates a synergy between the public and the private sector and increases the quality of the output of any particular project. Governments invest large funds for critical projects to develop the country's infrastructure, but they don’t have the proper expertise. Hence, comes the private companies which have the expertise and trained staff who can complete that particular project.
Here forms the collaborative partnership between the government and the private sector companies. Through these efforts, countries worldwide are seeing progress, and the rate of developing sustainable products and technologies increases accordingly.
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