An inclusive, net-zero future

By Wendy Cukier, Founder and Academic Director, Diversity Institute at Toronto Metropolitan University

The Government of Canada has manifest its commitment to fight climate change with the Net-Zero Emissions Accountability Act (external link) , which became law on June 29, 2021. At the same time, financial commitments to net zero included significant investments in cleantech innovation, such as the Canada Growth Fund (external link) , a $15-billion government investment fund to incentivize private capital investments into decarbonization and clean technology projects. This comes as Canada commits to a “just transition,” which means it will “ensure that the transition to a net-zero economy is done in a way that creates new opportunities for Canadian workers and their communities – providing sustainable jobs for Canadians in every region.” When strong commitments to equity, diversity and inclusion are prioritized across innovation, entrepreneurship and skills development, Canada has an unparalleled opportunity to rebuild better.

Green technology as an enabler of growth

While the pace of change will be affected by large social, economic, environmental and political trends, the direction is clear: the transformation to net zero will affect every dimension of life and every sector. For example, a recent report by the Smart Prosperity Institute with the Diversity Institute (DI) and Future Skills Centre, explores three possible scenarios in the transition to net zero with a focus on labour demand and skills. Titled Jobs and Skills in the Transition to a Net-Zero Economy (external link) , the report modelled the jobs and skills that would be required in a net-zero economy across three different future scenarios:

Lower-carbon-intensity pathway with end-use electrification;

Higher-carbon-intensity pathway that relies on carbon capture or direct air capture (DAC) technologies;

Middle-ground with elements of both and reliance on carbon offsets.

Under all three scenarios, there was job growth. And the growth was not just evident in the green tech sector but stretched across sectors as they introduce new processes to their value chains. Rather than thinking of green technology, products and services as a sector, it is helpful to think of them as enablers across sectors.

Lessons from ict

There are important lessons to be learned from the evolution of the information, communications and technology (ICT) sector. While initially the focus was on jobs in the software, hardware and network industries, and the skills needed to fill them, there are now more jobs outside of the ICT sector than within as digitization affects every sector, from agriculture to retail to education. Similarly, the new jobs and skills associated with the transformation to net zero will affect every sector in the economy.

The similarities don’t end there. Technology is necessary but insufficient to drive innovation. For example, we have created many digital technologies, from artificial intelligence, the internet of things and robotics to augmented reality/virtual reality, but businesses are slow to adopt them. And without adoption, there is no innovation. Innovation is “doing things differently.” For example, for more than a decade, Ontario has had over 400 water-tech companies at the same time as many Indigenous communities were under boil water advisories. Without focusing on the infrastructure, policies, processes and practices to promote and sustain adoption, there is no innovation.

Innovation requires understanding ecosystems and interconnectedness, the factors that can drive or impede change. It requires leveraging policies and regulation, creating infrastructure and incentives. Transforming organizations requires a deep understanding of how to re-engineer processes: from procurement to research and development through operations, sales and marketing, and how to drive change throughout the value chain. Change also requires shifting attitudes at the individual level.

Many of the jobs we need to drive to net zero are completely new or changed: net-zero strategists, analysts, auditors and managers. Some will be hybrid roles, requiring knowledge of green technology and sustainable processes but also ways in which to create change. Consequently, focusing only on the technical roles or skills associated with science, technology, engineering and math (STEM) will not enable us to meet our net-zero goals. A focus on STEM also excludes people not well represented in those disciplines, Indigenous peoples, women, Black people and others, potentially increasing a “green divide.”

While there is limited intersectional data, Statistics Canada shows men in the environmental and clean technology (ECT) sector hold 64 per cent of the jobs and have a higher average salary ($86,413) than women ($71,099). Osler’s (2021) analysis of TSX-listed clean technology companies shows that women are represented at 30 per cent in the board of directors and 17 per cent as executive officers, similar to what we have historically seen in ICT. Rebuilding better requires us to avoid the errors of the past.

Preparing the ground for net zero

While we have to continue to promote more women and diversity in STEM disciplines and support the commercialization of technologies to create high-tech, innovative, high-growth companies, we have to do this with a broader view. Labour and skills development policies are central to preparing for a net-zero economy as well as a powerful tool to broaden occupational choices and address long-lasting occupational segregation. As many of the green economy companies are new, this makes it easier to bake in commitments to equity, diversity and inclusion from the outset.

Indigenous-led companies are more likely to address sustainability goals and plan for the long term, often with an eye to impacts on future generations. Recent research shows that women-led startups are also more likely to prioritize sustainable development goals – an area where the innovation and entrepreneurship ecosystem is still playing catch-up. For example, the top green energy startups (external link)  have almost no women and are led overwhelmingly by white men. A 2020 MaRSDD report shows that only one in 10 cleantech founders is a woman, and only 19 per cent of cleantech companies in Canada have at least one woman founder.

But recent research from the Women Entrepreneurship Knowledge Hub and BMO (external link)  shows that when we think beyond clean tech, we see that women entrepreneurs are actively driving sustainable development and transformation in Canada and the U.S. Sustainability is embedded in their goals and practices. Many of the “green” ventures supported a focus on sustainability practices across sectors, in retail services, health services and in health and beauty as well as in traditional green technology. Other studies (external link)  suggest that women entrepreneurs are more likely to develop businesses that combine economic sustainability with social and environmental goals. Coralus (external link)  (formerly SheEO) demonstrated the potential to invest in women-led businesses that achieve, dollar for dollar, economic impacts that match or exceed other investments (in terms of revenue generation, exports and investments) while also committing to advance the UN Sustainable Development Goals.

Fuelling an inclusive transformation

Investors are getting more serious about holding corporations accountable for their environmental, sustainable and governance (ESG) commitments. If saving the planet is insufficient to motivate companies to change, there are other business imperatives to do so. Markets are changing, and consumer demand for authentic action rather than greenwashing is growing. As younger and more diverse people enter the workplace, create organizations and lead them, they are looking for opportunities that reflect their values, including sustainability and equity, diversity and inclusion. Canada has a massive opportunity to avoid the errors of the past in challenging conventional wisdom as it develops and implements its strategy for the transition to a net-zero economy. Some jobs will be lost, but others will be created and still others will be transformed. And we need to recognize the role that women, Indigenous and diverse entrepreneurs will play in fuelling the transformation.

Economic and sustainable development goals are complementary as we rebuild better and strengthen inclusion in our innovation ecosystem.

This article originally appeared in a Globe and Mail sponsor content feature produced by Randall Anthony Communications. Reprinted with permission. All rights reserved.