The 5 Ways Innovation and Sustainability Are Transforming Industries

6 minute read

Sustainability is becoming inevitable for companies. With climate change getting too obvious to ignore, regulators are becoming stricter, but so are customers, employees, and investors. As a result, how an organization manages its carbon footprint and overall environmental impact is maturing into a top-tier operational issue. 

In an attempt to stay ahead of the game and reinvent traditional approaches that don’t seem to cut it anymore, a wave of companies are transforming industries and starting to treat sustainability as innovation’s new frontier.

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Luckily, this new reality, we believe, brings not only challenges but also numerous business opportunities to those who embrace it on time. A concerted effort to address climate change will demand investment across various sectors. For instance, according to the Business Insider, more than $30 trillion in global investments are driving companies to innovate alternative forms of plastic and the biodegradable plastics industry is expected to reach $6.73 billion by 2025.


Regulations are becoming stricter

The European Green Deal is very ambitious. Aiming to transform the EU from a high- to a low-carbon economy without compensating on quality of life, it demands reinvention in almost all directions, from energy and transport to construction and food consumption. 

Aligned with the United Nations' Sustainable Development Goals, The Green Deal works through a framework of regulation and legislation with the overarching target to make Europe climate neutral by 2050. 

With action plans and goals for key sectors and supported with incentives to encourage private sector investment, the initiative aims to achieve bloc-wide net-zero carbon emissions by 2050 and a 50-55% reduction in emissions by 2030 compared with 1990 levels. As a result, companies from all industries that do business in Europe can expect new policies, laws, and a revision of existing EU regulations that aligns them to the climate goals.

Businesses will play a key role on the road to a sustainable future for the EU. Through partnerships with industry and member states, the Green Deal will support research and innovation on transport technologies, including batteries, clean hydrogen, low-carbon steel making, circular bio-based sectors, and the built environment. The EU plans to finance the policies set out in the Green Deal through an investment plan called InvestEU, which forecasts at least 1 trillion euros in investment.


Technological innovation: critical to addressing complex global issues

Technological Innovation

Technological breakthroughs and creativity are critical for reducing the time and cost necessary for achieving results. Disruptive innovation is not a silver bullet but holds the highest potential in addressing complex global issues. Fortunately, transformative change is something humans have done many times throughout history.

Additionally, the adoption of novel sustainability solutions goes beyond society’s call for greater accountability. Blending purpose with profit promises companies a competitive advantage that meets the expectations of modern customers, employees, and investors. For instance, a PwC study found that 78% of consumers are more likely to buy from businesses aligned to the SDGs.

Moreover, companies that invest in sustainability initiatives can also expect increased financial performance. In a 2019 Deloitte survey, 86% of business owners said that taking a more sustainable energy use approach gives them a competitive financial advantage.

We’re already witnessing a wave of progressive, profit-oriented companies and entrepreneurs who are using innovative models to experiment with sustainable business opportunities and ensure long-term growth. A good example is BMW, which is staying “ahead of the curve” by expanding operations and positioning the brand as a shared-mobility service provider.


Energy: decentralization, digitization, decarbonization

Energy innovation

Globally, the primary source of greenhouse gas emissions is electricity and heat production. Additionally, the world’s energy demand is constantly on the rise and grew by 4% in 2018, according to IEA. As a result, energy efficiency, more sustainable power production, and smart energy management are becoming a pressing matter. 

Aside from renewable energy becoming more efficient and cheaper, a growing number of renewable energy startups are now developing novel storage and energy-efficiency solutions, even giving rise to the Energy Efficiency as a Service (EEaaS) trend. 

Some technology trends that are promising to make the sector more sustainable: 

  • Distributed Energy Resources (DER): Small-scale energy sources located close to where the electricity is used (like homes or businesses) that direct the excess to the common network.

  • Peer-to-Peer energy trading: Exchange systems where individuals that generate renewable energy can share the excesses at a given price with their local community.

  • Power-to-X technologies: Converting surplus renewable energy into new products and materials for other sectors. For example, power-to-chemicals, power-to-gas, power-to-heat, and power-to-methane.

  • Smart building energy management systems: IoT solutions that analyze consumption, find inefficiencies, and apply techniques to reduce energy use in buildings. For example, a room turns lights off when it's not used, and the A/C switches off when windows are open


[Related Article - Aligning Business with SDG 7 By Collaborating with Startups]

Mobility: fewer emissions, traffic and congestion

Mobility innovation

According to EEA, in 2017, 27% of the total EU-28 greenhouse gas emissions came from the transport sector. And given the estimations that by 2030, one in three people will live in a city with at least half a million inhabitants, everyday transport is in dire need of reinvention. Powered by technological innovation in multiple directions, we’re already seeing the industry shifting from a traditional ownership model toward a Mobility-as-a-Service (MaaS) access model.

Electric vehicles and shared mobility can significantly contribute to reducing GHG emissions. Research shows that the average private car is used for 50 minutes a day, carrying 1.4 passengers and that ride-sharing can provide the same flexibility with just 10% or fewer vehicles.

Some technology trends that are promising to make the sector more sustainable: 

  • Shared mobility: On-demand vehicles and transport modes accessed via ride-hailing apps.

  • Electric vehicles: Vehicles propelled by one or more electric motors, using energy stored in rechargeable batteries. The global share of EVs is expected to increase as regulations ramp up incentives to encourage adoption, and the cost to produce lithium-ion batteries is declining.

  • Autonomous vehicles: Self-driving vehicles are expected to progressively integrate six levels of driver assistance technology advancements over the coming years. For the time being, it’s expected for Level 4 autonomy to become available between 2020 and 2023.

  • Last-mile transport: Convenient alternatives for short-distance urban transport, such as electric scooters.


Agriculture: improved yields with fewer emissions and resources

Agriculture innovation

As the world population grows, so will the global demand for food. At the same time, agriculture accounts for around 20% of the global greenhouse gas emissions (GHG). The emissions are generally linked to enteric fermentation by animals, manure decomposition, deforestation and land-use management, fertilizers, and biomass burning. 

Introducing agritech solutions promises to lower the sector’s GHG emissions, and according to McKinsey, startup investments in agriculture grew 43% in 2018. For instance, using smart agriculture technology with IoT, AI, GIS, robots, and drones can help improve yields in a sustainable manner. As a result, these technology-induced productivity enhancements are boosting the growth of the global precision agriculture market.

Some technology trends that are promising to make the sector more sustainable: 

  • Precision agriculture: Using satellite imagery to optimize returns, predict crop conditions based on geolocated weather data, and preserve resources like water.

  • IoT: Using IoT sensors on the ground to measure temperature, humidity, and soil moisture to optimize returns, predict crop conditions, and preserve resources.

  • Smart irrigation systems: Combining sensors and AI to automate watering systems based on current crop conditions and water needs.

  • Vertical farming: Growing crops in vertically stacked layers, often incorporating Controlled Environment Agriculture (CEA) technology and farming techniques without soil (such as hydroponics, aquaponics, and aeroponics.)

  • Edible coating: Preservatives made from leftover organic produce applied to the surface of fruits and vegetables to enhance and significantly extend their shelf-life.

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Construction: better energy efficiency and less waste 

Construction innovation

As cities are growing, the construction industry is starting to adopt more reliable sustainability standards and resource-efficient practices to ensure safe and affordable housing for all. Some of the most significant aspects of traditional construction that are in dire need of reinvention are the management of the massive amounts of waste generated during construction and more efficient methods of cooling, heating, and lighting buildings.

For instance, the market for more sustainable construction materials is growing, driven by its potential for emission reduction, lower energy consumption, and more suitable materials for recycling and reuse. We also see the rise in popularity of modular construction as an offsite and resource-efficient answer to affordable housing challenges. 

Some technology trends that are promising to make the sector more sustainable: 

  • Building-integrated photovoltaics: Photovoltaic materials that are used to replace conventional building materials in parts of the building such as the roof, skylights, or facades.

  • 3D printing: Creating the exact amount of needed materials while minimizing waste and unnecessary labor costs.

  • Smart building energy management systems: IoT solutions that analyze consumption, find inefficiencies, and apply techniques to reduce energy use in buildings. For example, a room turns lights off when it’s not used, and the A/C switches off when windows are open.

  • Off-site construction: With prefabricated, also-known-as “modular construction,” contractors are assembling building sections in a factory or a similarly controlled environment to reduce time and excess materials.

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Waste management: reduce, reuse, recycle

Waste Management

The World Bank estimates that global waste will increase by 70% on current levels by 2050. When decomposing, organic material in landfills releases gas composed of roughly 50% methane, 50% carbon dioxide, and a small amount of other compounds. According to the EPA, landfills are the third-largest source of human-related methane emissions in the US, a gas that’s about 28 times more powerful than CO2 at warming the Earth on a 100-year timescale.

Consequently, sustainable waste management is imperative for reducing the growing amounts of waste and promoting recycled and upcycled materials in production. The topic has recently gained popularity, and an increasing number of innovative solutions are entering the market. 

Some technology trends that are promising to make the sector more sustainable: 

  • Novel waste-to-energy methods: Generating energy from waste through processes like anaerobic digestion, pyrolysis, and gasification.

  • Extending the shelf-life of produce: Innovative technologies that increase the shelf life of produce by slowing down the ripening and rotting process.

  • Compostable plastic alternatives: Compostable materials made mostly from renewable natural resources with similar functionality to oil-based polymers.

  • Advanced technology in trash and recycling containers: High-tech containers that include features such as capacity sensors and odor reduction systems.


Valuer can help companies find sustainability-related technologies

There’s no one-size-fits-all approach to achieving more sustainable products and business operations. This is why it’s essential that each organization addresses the challenge from a perspective that makes the most sense to its strategies.

We have seen in recent years the number of new business models are becoming popular and disrupting various industries on a global scale. At the same time, we have witnessed many different technological advancements in such a short period of time that it is inevitable that new innovative ideas will soon dominate the marketplace. As a result, these changes further confirm the belief that it is now institutions and technological changes that are acting as the primary driving force towards economic growth. 


The Valuer AI platform uses a data-driven approach to help large corporations find startups with innovative sustainability technology that match their unique needs.

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