Pollution has the effect of decreasing labor productivity and reducing customer footfall. According to a study by consulting firm Dalberg Advisors in collaboration with Clean Air Fund and the CII, it causes premature death, decreases asset productivity, and raises health costs and welfare losses.
According to a study by consulting firm Dalberg Advisors in collaboration with Clean Air Fund and the Confederation of Indian Industry, air pollution costs Indian companies 7 lakh crore ($95 billion) annually or 3 percent of India’s GDP (CII). The costs express themselves in six different forms. As a result of the emissions, labor efficiency and customer footfall are reduced. According to the study, it causes premature death, decreases asset quality, raises healthcare costs, and reduces welfare benefits. Employee efficiency, customer footfall, and premature mortality are only a few of the factors that affect companies.
According to Dalberg, employees miss 1.3 billion days of work per year due to the impact of air pollution on their wellbeing, costing the economy $6 billion. Air pollution has also been shown to have a direct impact on workers’ cognitive and physical health, resulting in lower job efficiency and, as a result, a $24 billion loss in company revenue.
Lower air quality decreases consumers’ ability to leave their homes, resulting in lower footfall and $22 billion in lost revenue, according to the study. All calculations are based on 2019 results. The study is focused on a comprehensive examination of four ways in which pollution reduces the benefit. Premature mortality, presenteeism, absenteeism, and market footfall are all examples of these factors.
It makes use of data on air pollution, historical traffic, pharmacy sales, and premature mortality statistics. According to Seema Arora, deputy director-general of the CII, “it is clear that individual companies and their employees have a direct interest in improving air quality,” according to survey insights, interviews, and data analysis that went into the preparation of this study.
“While more research is required, the business solutions to this problem, according to our findings, include ‘greening’ business processes and supply chains, embracing renewable energy technologies, reducing emissions through CSR activities, and lobbying for more ambitious pollution policies,” said Arora. Moreover, he added, “We believe that India will soon achieve bluer skies and a healthier economy through an active and sustained partnership between the public and private sectors.”
A safe and free workforce and customer base, according to Sunil Dahiya, analyst, Centre for Research on Energy and Clean Air, is the key to growing businesses and the economy. If their happiness, well-being, and ability to contribute are jeopardized, the business and economy as a whole will suffer.
As mentioned in the study, air pollution is the most significant factor that jeopardizes people’s ability to function effectively and even to be free consumers because their activities are limited by hazardous pollution levels. To develop efficiently and contribute to India’s economic growth, Dahiya believes companies must prioritize air pollution and emission mitigation strategies in their operations and supply chains.
The research, according to Anumita Roychowdhury, executive director of the Centre for Science and Environment, provides an important insight into how lower on-the-job productivity caused by air pollution-related health risks goes unaccounted for in business balance sheets, resulting in massive revenue and GDP losses. “Such persuasive evidence strengthens the case for a green economic recovery and the inclusion of health considerations in our decision-making processes.”
