03:57 (GMT +7) - Saturday 19/09/2020

Business

Circular economy a viable alternative

Released at: 09:44, 17/12/2019

Circular economy a viable alternative

Photo: VET Magazine

Local businesses have seen significant progress in conducting sustainable development programs and moving towards a circular economy.

by Ngoc Lan

The landing on November 3 at Hanoi’s Noi Bai International Airport of the first modern Airbus A320neo acquired by Bamboo Airways impressed many with its “Fly Green” livery and marked the beginning of the new carrier’s campaign to conduct 100 per cent green flights. 

Inheriting the advanced features of the A320 family, the Airbus A320neo improves fuel consumption by 15 per cent compared to previous versions. Bamboo Airways’ new Airbus A320neo will operate green flights by replacing single-use plastics with environmentally-friendly equivalents that are recyclable or biodegradable. Plastic utensils have been replaced with wooden utensils, while blankets are made from craft paper and all nylon gloves and garbage bags are made from biodegradable materials. 

The carrier accelerated its Fly Green campaign on all flights from November. A representative said that receiving this initial aircraft is an important milestone in its sustainable development, improving operational capacity, upgrading service quality, and providing passengers with high-quality aviation services. “Using environmentally-friendly products is one of the first activities conducted by Bamboo Airways to stay abreast with the ‘green’ development trend in aviation, which is being welcomed by many airlines worldwide,” he said. 

Specific practices

Business growth in line with the goal of protecting the environment and sharing the benefits with the community is considered by experts as a major development trend among businesses around the world and many other Vietnamese businesses have joined Bamboo Airways in executing sustainable development activities in business and production.

After more than 40 years in business, Vinamilk remains constantly aware that all manufacturing activities have an impact on the surrounding environment and so always strives to identify solutions to minimize any impacts and most effectively use resources and energy. Green energy and renewable energy are the main sources in its production activities. 

It has invested in a bottle blowing production line that uses any excess created during the process and complies with supplier technology, quality assurance, and food safety standards. All farms have waste treatment technology using biogas anaerobic technology. Grasping the global trend towards organic products, Vinamilk has researched organic materials and encouraged suppliers to follow the organic trend. It has introduced a range of organic products from fresh milk and yogurt to infant formula and cereal powder. Ingredients are selected and balanced, with lower use of sugar and fat. Vinamilk has also determined that quality human resources are the foundation of sustainable development, so attaches importance to quality and transparency in recruitment.

With a long history, the Bank for Investment and Development of Vietnam (BIDV) has continually bolstered the factors behind sustainable development, according to the BIDV Annual Report 2018 released in April. Deputy General Director Le Ngoc Lam told VET that it has implemented a host of solutions that bring sustainable values to the community and businesses.

In particular, it focuses on and professionalizes risk management in the credit granting process, carefully evaluating environmental risks when appraising projects and requiring customers strictly comply with laws on environmental protection. During project implementation, the bank regularly monitors and manages social environmental risks in parallel with disbursement, ensuring that projects financed by BIDV minimize any negative impact on the environment. It has long determined that building, maintaining, and developing a quality workforce is the core task of its business strategy. Most of its 24,000 employees are women.

Other Vietnamese businesses have been active in implementing sustainable development activities in business and production, such as Masan, FPT, Viettel, and Bao Viet Insurance. Prime Minister Nguyen Xuan Phuc affirmed at September’s National Conference on Sustainable Development 2019, themed “For a More Sustainable Development Decade” that sustainable development is both an urgent need and an inevitable trend in the process of social development.

Significant benefits 

According to Bamboo Airways, it has operated “Fly Green” flights since June and the campaign received positive feedback from local and foreign passengers. Through its Fly Green flights, Bamboo Airways hopes to become a pioneering carrier in Vietnam by cutting plastic waste and air pollution and inspiring others to protect the environment by changing even the smallest of habits. 

2018 was the third year in a row Vinamilk was voted among the Top 10 Sustainable Manufacturing Enterprises by the Vietnam Business Council for Sustainable Development (VBCSD) at the Vietnam Chamber of Commerce and Industry (VCCI). The dairy producer not only maintains but increases its market share yearly, even when the local dairy industry suffered something of a downtown last year, with 208 distributors reached, 249,991 selling points available, and 426 “Vietnam Dairy Dream” stores with open doors. Vinamilk’s products are also exported to 49 countries and territories and increasingly trusted by foreign consumers. Thanks to its working environment and physical and mental care, in 2018 Vinamilk rose to the No. 1 position in the “Top 100 Best Workplaces in Vietnam” for the first time. Staff turnover is a low 5-7.5 per cent; ideal for its “human resources health”.

Meanwhile, Mr. Lam said sustainable development is inevitable for all and brings economic benefits and an outstanding reputation to BIDV. Sustainable development not only helps the bank limit credit risks but also enhances its reputation in the international banking community. It was honored among the Top 10 Sustainable Enterprises in the field of commercial services out of 500 businesses at VBCSD’s awards. 

In the long term, analysts believe that sustainable development plays an important role in the development of a circular economy. According to research from Accenture Strategy, the circular economy model could open up global market opportunities worth some $4.5 trillion around the world by 2030 and create millions of jobs. Mr. Nguyen Quang Vinh, General Secretary of VCCI and Vice Chairman of VBCSD, told VET that Vietnamese businesses have recently placed greater emphasis on sustainable development and are moving towards a circular economy. As an enterprise that sets business goals in parallel with environmental protection and benefits for all related parties, Vinamilk views the circular economy as a guideline in sustainable development. 

More challenges

Executing sustainable development programs also poses challenges to Vietnamese businesses. In terms of capital effectiveness, Mr. Lam pointed out that sustainable development brings results in the medium and long term but requires large investment in the short term. He took the example of credit institutions, with funding of training, cutting interest rates to support businesses, increasing operation times, and reducing overall credit by not lending to projects that have a negative impact on the environment all having an effect on the bottom line. Businesses also incur greater costs when investing in energy-saving technologies for environmental protection and waste treatment.

Skills and knowledge also pose a challenge. Candidate evaluations during the recruitment process allow Vinamilk to stay abreast of developments in the personnel market and match this with its own requirements. Mr. Lam said while credit institutions have large networks of personnel, knowledge about social and environmental risk assessment is a specialized skillset. “BIDV and other credit institutions will spend a lot of time on developing processes, adjusting behavior, and training employees with knowledge of social and environmental protection,” he added.

At the National Conference on Sustainable Development 2019, speakers agreed that the application of the circular economy at some Vietnamese businesses has only gone as far as reusing and recycling waste to bring financial benefits. Similarly, Mr. Lam said that businesses have not been fully aware of the consequences of their production and business for the environment. “Problems regarding environmental risks will have a negative effect on production and business,” he believes.

Though the challenges are many when executing sustainable development programs, it can’t be denied that they bring a host of benefits to businesses and the community. “We always say that difficulties are temporary, but sustainable long-term values are important,” Mr. Lam said.

In particular, it focuses on and professionalizes risk management in the credit granting process, carefully evaluating environmental risks when appraising projects and requiring customers strictly comply with laws on environmental protection.

User comment (0)

Send comment