Into the Unknown, Part 2: Sustainably Returning to Operations

Into the Unknown, Part 2: Sustainably Returning to Operations

By | October 26, 2020

Finding a pair of plastic gloves, a mask or a disposable wipe lying in the middle of the street is symbolic of how Safety, Sustainability and Productivity are intertwined. People have been using personal protective equipment (PPE) and disinfecting products in record numbers as the global pandemic continues, but those tools to keep people safe are also hurting the planet. Similarly, everything organizations do is interconnected. That’s why a focus on Safety, Sustainability and Productivity should always be top of mind, regardless of whether there’s a pandemic, a precipitous drop in oil prices or something else. As COVID-19 cases spike, especially in the United States, Europe and elsewhere, companies have a responsibility to do everything they can to make sure that any worker that walks through the front door can do so as safely, but that doesn’t mean companies should lose focus on sustainability initiatives. With the ever-mounting problem that is climate change, there’s just too much at stake. In this series, Spark explores these three key areas that companies must address to create a safer, more sustainable and productive world. This article will focus on Sustainability. To be clear, Spark is not in any way advising companies to stop any remote work situations they are currently using, but if or when the time comes for workers to return, we simply want companies to do so safely.

Learn how COVID-19 has affected Safety and Productivity.

The human tragedy of the COVID-19 pandemic leaves in its lasting wake many questions about what’s in store for all of us going forward. Despite the uncertainty, it doesn’t take much effort to read up on what is happening with both the virus and the global economy as a result of our response to the pandemic. We know that the outbreak itself is far from over.

Our direct response through lockdowns, border control measures, testing, physical distancing and the banning of public events are likely to last in one form or another into at least the third quarter of 2021, depending on your geographical region. Everything we know from previous global epidemics, such as the 1918 influenza pandemic (the “Spanish flu” is a misnomer) that killed my great grandmother, tells us that COVID-19, even if infection rates slow, won’t disappear and is already leading into a second wave as flu season picks up in the northern hemisphere. The next wave seems to be moving in the direction of curfews, additional lockdowns and an even larger numbers of people infected—the 1918 flu’s second wave killed more people than the first.

Every conservative estimate for the length of time it would take to develop a working vaccine set the minimum at 18 months. That means we have no assurance of a permanent end to the spread and immediate impacts of COVID-19 until the end of 2021, but even then we have the challenges of producing enough vaccines and  distributing them to enough people to see the numbers drop enough for the general population to be safe. Realistically, that means we are going to be dealing with COVID-19 in 2022 and probably into 2023.

We know that the downslope after the pandemic has peaked in a particular country can be just as deadly as the upslope and that reopening too early is going to make things far worse.

Some countries, such as South Korea, Greece, Taiwan, Norway, Iceland, New Zealand and Germany, seem to have handled the situation better than others, not always through lockdowns, but through a combination of measures, such as widespread testing, controlled isolation of those infected, protection of more at-risk groups and rapid response rates. In the Asian countries, a lot of this success seems to have been the result of having learned the hard way from the severe acute respiratory syndrome (SARS) and Middle East respiratory syndrome (MERS) epidemics.

In Greece, success was due to its immediate transition into lockdown. Germany has had the lowest fatality rate because it was already well-positioned with an abundance of supplies and a high ratio of beds/rooms to patients, because Germans trusted the advice of their national and regional governments and because of early and widespread testing. Other countries, such as Sweden, approached it differently and have let the virus run its course, albeit in a controlled way, triggering a high infection and death rate compared to the rest of Scandinavia.

Of course, comparisons between countries are complicated, because, as with environmental science, there are many factors to consider. For example, there are major differences between how countries have monitored the outbreak, between cultural norms connected with physical distancing, between urban densities, etc. So the verdict is not yet in as to which approach will have worked best for which contexts, taking into account all the relevant factors—we’ll only know after this is all over. The good news is that, for many countries, we’ll have solid data to learn what worked and what didn’t.

9 sustainability insighs from covid-19
E-book9 Sustainability Insights From COVID-19
The COVID-19 pandemic could be an opportunity for humanity to overcome the even more disastrous environmental crisis on the horizon.

Not Enough Testing

In too many geographical regions, reliable testing has not been happening at the scale it needs to, especially in places like Brazil and the United States. A recent Harvard University study suggests that the United States will have to increase testing to 20 million people a day by midsummer to bring the viral outbreak under control, an approach initially recommended by the World Health Organization.

This prolonged COVID-19 health crisis has had, and will continue to have, devastating consequences on the global economy. Whether countries conduct widespread testing and controls, enforce lockdowns and physical distancing or engage in other measures, the result is, without a doubt, the worst global economic crisis since the Great Depression. The IMF predicts that in 2020 the advanced economies will shrink by 6.5% and the developing economies 1% in real gross domestic product (GDP).

If we just take the Unites States as an example, the total loss in real GDP is estimated to be as high as 10% for the first two months of the pandemic and will continue to lose 5% per month as long as the physical restrictions continue. The unemployment rates paint a similarly dismal picture. During the peak of the Great Depression, U.S. unemployment was at 24.9%. At the time this article, official unemployment rate was 13.3% in the United States, but with almost 30 million people collecting unemployment benefits, the Brookings Institute, for one, says the unemployment rate could be as high as 19%. Why the discrepancy? The Institute wrote: “Part of it involves how the BLS [the U.S. Bureau of Labor Statistics] treats the many millions of people now on furlough and not being paid. They are considered ‘unemployed on temporary layoff.’ But if BLS expects them to return to their old jobs, based on the survey, they do not count among the unemployed.”

The level of U.S. unemployment was about 4% prior to COVID-19. If the unemployment numbers continue to increase, we can expect another 10 million people to apply for unemployment before things flatten out, approaching Great Depression-era levels, as Goldman Sachs recently predicted.

Economic Issues

Grants, tax incentives and business loans are not going to be able to bring the global economy out of this recession anytime soon. Stock prices will rise and fall, but it seems that nothing that governments or central banks can do will reverse the economic damage that has been done.

If you are lucky enough to still have a job and are still working from home, it has probably not yet registered how bad the economic crisis is going to be. We can’t wrap our heads around it quite yet—it’s all too theoretical at this point. It’s catastrophic, yet we still have Netflix. So until we start to experience the real signs of it, the reality of what is happening might not sink in.

In most countries in the northern hemisphere the peak of the virus is already over. Global epidemiological modeling around COVID-19 for when the peak hits depends on many factors, but is ultimately tied to when the cases stop doubling as well as the accuracy of the data collected. That is, is the data collected representative of the actual infection rate in every country and are countries testing enough to make sure that the data is representative? We like to point out the importance of this attention to accuracy in data collection because environmental sustainability at Sphera requires the same kind of exactness—in both cases science gives us realistic values that inform decision-making.

Without a doubt—unlike the 2008 recession—we are on the precipice of a long-term economic slump the likes of which we can’t entirely fathom. In fact, leading economist Dr. Ha-Joon Chang, a university reader at the University of Cambridge, has argued that we hadn’t even recovered from the 2008 economic crisis. He also says that the governmental money released into the global economy at that time didn’t flow to the people who needed it most.

Central banks have responded by printing more money. Many people have the view that it will result in larger national debt, which tax-paying residents will have to pay off eventually and that future generations will be burdened with. But Chang’s response is that “There are people who have this view, but it is not my view.

Watch or read the full interview with Cambridge University economist Dr. Ha-joon Chang.

Printing money may or may not lead to rising government debt. Also, it is misleading to describe national debt as a burden to future generations. Depending how it is used, increased national debt may actually make things better for future generations. In the short or midterm during an economic downturn, government borrowing and propping up demand actually makes recessions less severe and may actually benefit future generations compared to the government not doing that. In the long run, if the government runs debt to invest in infrastructure, R&D, education or health, it can make the economy productive and as a result make future generations better off. Also, increased public debt does not need to be repaid. Even if it has to be, not all future generations are going to become worse off from it.”

This economic downturn, like the Great Recession, is likely to create greater disparities between the wealthy and the poor. But this time, it seems governments won’t be able to ignore such disparities. Social changes, such as police reform in the United States and a universal basic income in hard-hit countries like Spain are already on the table. And policymakers in many countries are looking to environmental sustainability as a means for a potential way out of the recession. In the United Kingdom, the energy secretary has stated the need for a green recovery out of the crisis.

The COVID-19 pandemic is set to cause a generational transformation in our perceptions. It could be an opportunity for humanity to overcome the even more disastrous environmental crisis on the horizon.


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Sphera is the leading provider of Environmental, Social and Governance (ESG) performance and risk management software, data and consulting services with a focus on Environment, Health, Safety & Sustainability (EHS&S), Operational Risk Management and Product Stewardship.
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