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The greening of B2B

Think all farmers are potent polluters and B2B enterprises more ‘business as usual’ than keen to ride the green tech wave? Think again.

Think all farmers are potent polluters and B2B enterprises more ‘business as usual’ than keen to ride the green tech wave? Think again.

The New River Green 50, a list ranking the best in Kiwi green business that was released last month, revealed much more than the profits to be made while actively improving the environment.

Roger Parker of New River Strategic Research, who compiled the list from over 150 entrants, says some of the findings were unexpected.

“There was a surprisingly large number of business-to-business products and services that were delivering both profitable and sustainable results,” says Parker.

Nearly half of companies in the top 50 specialised in business-to-business products and services, ranging from transport tech firm EROAD to commercial cleaning company Crest Clean.

Despite the wealth of targeted ‘green’ and ‘eco-friendly’ branding to the consumer market, B2C-focused companies only made up 18 percent of the top 50.

Consumer brands that made the Green 50 include Earthwise, Eco Store and Cartridge World.

Most surprising was the finding that central government was the client of only 2 percent of the entrants, despite our government spending being over 40 percent of GDP.

“If we’re talking about political leadership and stewardship toward a green economy, you’d think central government would be above that number, considering the proportion of the economy they control,” says Parker.

Local government was the end client for 7 percent of ranked companies – think recycling and waste services.

To be considered companies needed a product, service or technology actively improving the environment where this was over 50 percent of their business. Their financials and growth data were then analysed by an expert panel to create the ranking.

Agriculture is the sector with the most companies in the top 50, which may be surprising to many who believe the industry shies away from environmentalism – apparently eco-friendly farmers are not an endangered species.

Parker believes the findings (although many companies chose to omit their financial data) promote the idea that economic and ecological ideals can be in sync.

“Most of the talk about the environment is to do with conflict, like environmental damage or protests against developments. But taking our view, where commercial and environmental work together there are plenty of opportunities.”

The New Zealand-focused report comes within months of a study from the American Council of Economic Advisors that found renewable and environmental goods and services as the fastest growing sector following the global financial crisis.

“It grew by almost 50 percent between 2007 and 2011. That’s striking, and something potential green investors here should be encouraged by," says Parker.