There is more and more talk about environmental sustainability, the proper use of resources and the reduction of pollutant emissions.

Contents

What is sustainability The Intelligent Investor
Sustainability is a condition of development that ensures that the needs of the present generation are met without compromising the ability of future generations to meet their own needs

Responsible interaction with the environment is essential in order to continue producing goods and services and at the same time safeguard the Planet, making it available for future generations. Everything revolves around the concept of sustainability and its various declinations.

What sustainability is and what it means

The term 'sustainability' is derived from the Latin 'sustinere' (tenere, to hold; sub, under). In environmental and economic sciences, the term sustainability refers to the condition of development that ensures that the needs of the present generation are met without compromising the ability of future generations to meet their own needs. The concept of sustainability was introduced at the first UN conference on the environment in 1972, although it was not until 1987, with the publication of the Brundtland Report, that the goal of sustainable development was clearly defined and became the new development paradigm after the 1992 UN Conference on Environment and Development.

What is sustainability in the ESG context

Meeting the needs of the present generation without compromising those of the future generation' is the diktat of our times: this is in fact the definition of sustainable development, now a global goal thanks to the United Nations 2030 Agenda. But why is it so important to pursue this goal? The 17 Sustainable Development Goals define a new model of society, according to criteria of greater responsibility in social, environmental and economic terms, aimed at preventing the collapse of the earth's ecosystem. And everyone can play their part in this design, from companies to end consumers.

The need for sustainable and environmentally friendly economic growth took shape in the early 1970s, when society became aware that the traditional development model would lead to the long-term collapse of the Earth's ecosystem. Over the years, environmental efforts by the international community, including the Paris Climate Agreement, have demonstrated concretely that the planet's limits are real. And so, the new development model has based its foundations on respect for the future.

In a word, on the concept of 'sustainability'.

What is sustainability: formal definition

In environmental and economic sciences, sustainability is a condition of development that ensures that the needs of the present generation are met without compromising the ability of future generations to meet their own needs. The concept of s. was introduced at the first UN conference on the environment in 1972, although it was not until 1987, with the publication of the so-called Brundtland report, that the objective of sustainable development was clearly defined and, after the 1992 UN conference on environment and development, became the new paradigm for development. The s., in terms of its environmental content, is derived from the study of ecological systems, among whose characteristics properties such as carrying capacity, self-regulating possibilities, resilience and resistance, which together influence the stability of the ecosystem, assume importance. An ecosystem in equilibrium is implicitly sustainable; furthermore, the greater its stability, the greater its capacity for self-regulation with respect to internal, and above all external, factors that tend to alter its state of equilibrium. The factors that disturb the equilibrium of ecosystems even more are the relationships they establish with another type of complex system such as the anthropic one. The interaction between the two complex systems increases the likelihood of disturbances and raises the risk of irreversible alterations. In particular, research focuses on the possibility of so-called non-linear reactions, irreversible alterations in the equilibrium of the environmental system in the vicinity of threshold values of the system's carrying capacity, or recovery capacity if you like. The greater the structural and functional variety of the system, the greater the capacity for response and regulation of the systems affected by perturbations.

Compared to its first versions, the concept of s. has undergone a profound evolution that, starting from a vision centred preeminently on ecological aspects, has moved towards a more global meaning that takes into account not only the environmental dimension, but also the economic and social dimensions. The three aspects were, however, considered in a synergetic and systemic relationship and, combined to varying degrees, were used to arrive at a definition of progress and well-being that went somewhat beyond the traditional GDP-based measures of wealth and economic growth. Ultimately, s. implies constant and preferably increasing well-being (environmental, social, economic) and the prospect of leaving future generations with a quality of life that is not inferior to the present one. This approach can be formalised through social welfare functions, i.e. relations between the well-being of society and the variables that contribute to the economic state and quality of life. In this sense, the distinction between weak and strong s. appears particularly important. The former admits the substitution, within the capital to be passed on to future generations, of natural capital by manufactured capital (that created by man), while the strong s. introduces the rule of constant natural capital. Arguments in favour of the latter are based on the fact that a less complex environmental system would be less endowed with those properties (resilience, stability, capacity for self-regulation) that dampen the risk of non-linear reactions.

The s. is a dynamic concept, in that the relationships between the ecological system and the anthropic system can be influenced by the technological scenario, which, as it changes, could loosen certain constraints on, e.g., the use of energy sources. From an operational point of view, the assumption of the sustainable development paradigm implies the adoption of an assessment system that determines the s. of interventions, projects, systems and economic sectors.

Since the end of the 1990s, there has been a tendency to assess the s. of territorial areas and development programmes. Thus we speak of urban s., of s. of agriculture, of sustainable tourism. In all cases, the evaluation system tends to consider the environmental, economic and social health of a development intervention or a sector of society or the economy in a single framework.