Corporations are more likely to embrace sustainability when it benefits the bottom line. That isn’t surprising considering they are ultimately in business to make a profit. For many, purpose may very well come in second — if at all. Still, there’s more than one way to encourage businesses to do better by people and the planet.
TriplePundit spoke with Dr. Steven Cohen, a professor of public affairs at Columbia University and author of the new book “Environmentally Sustainable Growth,” about how the profit motive can catalyze the desired effect where shame and guilt have failed.
Incentivizing sustainability can be easier than it sounds
The best way to make corporations behave is by creating an environment in which doing so will help them make more money, Cohen argues. “In some cases, you don’t have to do anything other than educate people and say, you know, this will be a profitable item,” he told TriplePundit.
Cohen advocates for a carrot instead of a stick approach. He’s hopeful that making good behavior profitable will hasten more wide-sweeping changes at the business level than punishing or charging companies for the negative impacts they have. And he’s not alone in that opinion.
“Sustainability is on the cusp of an evolutionary leap,” Georgia Makridou of the ESCP (École Supérieure de Commerce de Paris) Business School wrote in an impact paper on the challenges confronting sustainable energy companies and their resulting tactics. “Sustainable companies are becoming the new norm as those that have a well-rounded approach to sustainability can see wide-ranging growth opportunities.”
Further, employees want to work for companies that align with their values. “If I’m in a business that requires talented engineers, talented designers and and so forth, to attract those people, I have to be a company they want to work for,” Cohen said. “That’s also incentivizing companies to start behaving this way: If you want to attract the best brains out there, then companies are under internal pressure to behave and to start focusing on their energy use and their waste and pollution.”
Dr. Steven Cohen unpacks practical steps to push sustainable business forward in his new book “Environmentally Sustainable Growth: A Pragmatic Approach,” out this month from Columbia University Press. Image provided.
Major companies reap cost savings through sustainability, while creating measurable impact that matters
Cohen gave examples of major multinational companies that moved toward sustainable practices because they foresaw a financial benefit. For example, “Walmart discovered they have a lot of flat roofs,” he said. All that space adds up vast solar energy potential — and Walmart and its big-box competitor, Target, are on the job.
Together, they’re the top two business installers of onsite solar. “In their case, you don’t have to do anything. They just had to internally figure out this was going to help them make money,” Cohen said. If fully harnessed, Walmart’s available roof space at stores across the country could produce enough solar energy to power more than 842,000 homes, according to the nonprofit Environment America.
This month Walmart also teased new plans to roll out electric vehicle charging stations at thousands of stores across the U.S. The move will help bring in shoppers, while making EV charging more accessible to millions of people in towns large and small.
One of the country’s top agricultural producers, Land O’Lakes, also cut its footprint through cost reduction measures. The company uses satellite telemetry, artificial intelligence, and robotics to ensure it doesn’t waste inputs like water, pesticides and fertilizer — using only what’s needed and none of what’s not. “They’ve now created a much more efficient form of agriculture, which also just so happens to cost less and pollute less,” Cohen said.
Apple’s engagement in sustainability came out of a need to satisfy its customer base. “[Young people] started to make the demand that Apple reduce the pollution [associated with] their products, and Apple has done that dramatically over the last 10 years,” Cohen said. He cited the company’s buyback program and the fact that it hired a former Environmental Protection Agency administrator to manage its environmental endeavors as examples. “It’s not required by the government, but in order to meet their market, they have to do that,” he said.
Incentives and regulations work. Shame and guilt doesn’t, this expert says.
That’s not to say there isn’t room for regulations — there still needs to be rules of the road. The key is a good balance between government regulations and the incentives provided by an improved profit margin, Cohen said.
“What doesn’t work is trying to shame people, to shame companies,” he argued. “People want to live their lives, and companies want to make money. I think that green principles are most effective when they line up with the self interest of people and of corporations. And when that happens, you see a lot of activity.”
As for how to shift from a scapegoating and punishment approach to one that focuses on financial rewards: “Instead of thinking about the company as an enemy, you think about the company as a partner,” Cohen said. “And the only way they’re going to be a partner is if they see they’re gonna make money out of it.”
Jean Pierre Azañedo, CEO and co-founder of CoreZero, share the importance of achieving a sustainable food value chain. By Jean Pierre Azañedo from Sustainability Magazine • Reposted: May 29, 2023
The journey from farm to table is characterised by loss and waste – from overproduction to accidental damage and unmet quality standards – these are just some of the “opportunities” for waste that are encountered amid the farm-to-table process. In fact,almost 40% of the food in the United States is wasted.
Not only does food waste cause greenhouse gas emissions and environmental damage, but it also exacerbates food insecurity in many communities. Like a vicious cycle, food waste accounts for 10% of total global emissions, yet, at the same time, the climate crisis is one of the main factors exacerbating food insecurity.
Since methane, a greenhouse gas that is 80 times more potent than carbon dioxide over twenty years, is released into the atmosphere when food ends up in landfills, it’s safe to say that minimising food loss across the supply chain should be treated as a priority, not as an option.
Food waste across the supply chain
Besides the release of greenhouse gasses, when food goes to waste, so do all the resources that were utilised for its production, processing, transportation, preparation, and storage. Food waste in the United States, for example, results in the loss of water and energy equivalent to building more than 50 million homes.
Consequently, it’s important to not only acknowledge the environmental effects of food waste but also to assess where food is specifically wasted and lost in the supply chain.
For starters, while discussions about food waste usually refer to the household and retail sections, more than 15% of food is dissipated before leaving the farm. As an example, due to price volatility, farmers may not end up moving products into the market since the food prices may be lower than the costs of processing and shipping. From damaged crops due to environmental and biological factors to products that do not meet cosmetic market standards, these are a few of the reasons that lead to food loss and waste during the production stage.
Then, in the handling and storage stage,food waste and loss can occur due to numerous different factors, but it mainly boils down to improper handling and storage. In the case of vegetables, loss predominantly happens because of spillage and degradation during loading and unloading and improper transportation and storage. Then, when it comes to meat products, loss often occurs due to condemnation in the slaughterhouse while, for fish, spillage takes place during the icing, storing, and packing processes. Despite high-income countries having adequate storage facilities in the supply chain, food loss still happens during the storage stage due to technical malfunctions, overstocking, or inadequate temperature.
While some inevitable losses happen during the processing and packaging stage such as the loss of milk during the processing of yoghurt, most of the losses in this stage of the supply chain occur due to technical problems. Similarly, packaging materials can contribute to food loss if they are not designed to preserve the freshness of the products.
Subsequently, in the transportation and distribution stage, food is lost, as the name implies, amid its transportation. In developing countries, for example, products may not meet cosmetic standards since they acquire bumps and bruises along the journey. Then, if food is delivered after its prime freshness window, it gets rejected in most cases. In Japan, for example, “the rule of one-third” entails that food and beverages must be delivered within one-third of their shelf life.
Finally, in the consumption stage, food is either wasted or lost in households or other food service establishments. In truth, the largest amount of food waste occurs in households, with 76 billion pounds of food being wasted annually per person in the United States. Moreover, the food wasted at this stage also has the largest resource footprint in the supply chain because of the resources utilised for its transportation, storage, and cooking.
A sustainable food value chain
While acknowledging the effects of food waste as well as its causes is crucial, in order to move forward, innovation is necessary. In fact, according to ReFED’s 2030 roadmap, the United States could reduce food waste by 45mn tonnes a year, cut GHG emissions by 75 million metric tons, and save food equivalent to four billion meals for those in need with the right policy changes and investments.
Since food waste has both societal and environmental effects, a sustainable food value chain should produce and distribute food in a way that is environmentally, socially, and economically sustainable. Essentially, this means that the food chain should function in such a way that it has minimal impact on the environment while ensuring that people have access to nutritious food and supporting the livelihoods of farmers and other food system employees.
A sustainable food value chain presupposes that all resources are used efficiently and sustainably and that waste is minimised. For instance, the food that is wasted during the production stage could be used to produce biogas or fertiliser through anaerobic digestion. Similarly, the ‘ugly’ food that doesn’t meet cosmetic standards could be kept out of landfills by being upcycled. That being said, for this transition to be resilient and sustainable, change needs to happen across the entire food chain.
For instance, in the production stage, food loss could be minimised through precision agriculture and improved agricultural practices such as crop rotation. However, precision agriculture technology will only work with education regarding sustainable agricultural practices and technologies. Alternatively, ‘waste’ can be repurposed by identifying alternative markets that might be interested in ‘imperfect’ products. Similarly, since the vegetables and fruits that do not meet cosmetic standards are still nutritious, they could be donated to food-insecure communities.
On the other side of the food chain, awareness is key to reducing food waste at the consumption stage. The problem of food waste boils down, especially in developed countries, to cultural expectations and preconceptions regarding food and its transition to ‘waste’. From shopping locally and more responsibly to using leftovers and composting food scraps, these are just a few examples of how food waste can be reduced at the household level.
Food waste minimisation: a necessity
From consumers composting food scraps and restaurants collaborating with food banks to edible by-products being developed into ingredients and local food distribution being promoted, a sustainable food value chain is achievable through collaboration.
However, food waste and loss need to be halved per person for the 2030 SDGs to be met, hence these tweaks in the food supply chain need to be treated as priorities instead of options. Since the effects of food waste are visible not only from an environmental perspective but also from an economic and societal one, an equitable and sustainable food system should result in improved food security and economic savings in addition to lowering greenhouse gas emissions and enhancing biodiversity.
Google Cloud & Harris Poll shared that 59% of executives overstate how they approach sustainable messaging. Here’s how companies can improve their efforts. By Lucy Buchholz from Sustainability Magazine • Reposted: May 29, 2023
Sustainability has become a popular topic as you hear climate change news daily. Ocean temperatures are rising, leading to melting glaciers and migrating ocean species. Storms have become more volatile, increasing the number of floods and torrential storms worldwide.
Research shows climate change has strengthened hurricanes and raised storm surges due to rising sea levels. In late 2022, you could see the planet’s wrath through Hurricane Ian. The Category 5 storm devastated the Southeast, especially Florida.
Tom Knutson, a senior scientist at the National Oceanic and Atmospheric Administration (NOAA), says rising sea levels exacerbate flooding from hurricanes. The problem will only worsen as rainfall rates rise this century.
Many have experienced the devastating effects, leading to a push for more sustainability efforts. You may have found ways to lower your carbon footprint by reducing your carbon dioxide (CO2) emissions. What about the rest of the country?
Talking about sustainability efforts is easy — following through with actions is a different story. Many Americans say they incorporate sustainable practices only to impress their friends. Reality shows another picture.
A March 2023 survey finds 53% of Americans exaggerate their sustainable practices. The same poll reveals 54% will revert to unsustainable actions if they’re alone.
Jessica Hann, senior vice president of Avocado Green’s brand marketing and sustainability, says: “When it comes to sustainability, it matters less what people think and more that we all just do the best we can.”
The detrimental impact of greenwashing
Organisations that greenwash mislead customers about the environmental impact of their products and services. They may also use climate-friendly initiatives for PR to cover their environmental malpractice.
A 2023 survey finds more than half of companies admit to greenwashing. Google Cloud and Harris Poll asked executives how they approach sustainability messaging – 59% said they overstate or inaccurately represent sustainable practices.
For the planet’s sake, greenwashing needs to come to an end. Better knowledge and improved technology allow you to be friends with the environment instead of an enemy. These four strategies demonstrate how employers can help themselves and their employees improve their sustainability efforts:
1. Apply for sustainability certifications
A terrific way to prove your sustainability initiatives is to achieve certification. For example, you can receive Leadership in Energy and Environmental Design (LEED) accreditation if your building complies with the requirements. Getting LEED requires passing an examination with the United States Green Building Council.
LEED is one of the most popular accreditation programs, but many others exist. For example, there’s the Sustainable Agriculture Initiative (SAI). This program tracks organisations in the agricultural industry and scores sustainability efforts by awarding bronze, silver or gold status. Achieving SAI’s gold equivalence means your organization has high marks in biodiversity, soil management and greenhouse gas (GHG) emissions.
2. Introduce renewable energy
Buildings have significantly contributed to current climate issues. Data from the International Energy Agency reveals they are responsible for approximately 35% of global energy use. These structures require burning fossil fuels, using steel and cement in construction, and generating electricity and heat. The current blueprint for energy use is less sustainable as demand grows with the world’s population.
One way to reduce your employees’ carbon footprint in the office is to introduce renewable energy. The easiest way to do that is with solar panels. These systems harness the sun’s power and convert it into electricity for your building. You’ll create energy instead of relying on the electrical grid.
Now is an excellent time to buy a solar panel for residential and commercial purposes. The federal government extended the solar tax credit through 2033. Purchasing solar panels allows you to get a 30% rebate on the panels, labour costs and various equipment required for installation.
Today’s businesses must be conscious of their environmental impact. It matters for their carbon footprint and environmental, social and governance (ESG) scores. Your ESG rating is vital because it demonstrates your social responsibility to investors and consumers.
One way to improve your ESG scores is to rethink your supply chain and make it more efficient.
For example, consider your suppliers. Are they domestic or international? International partners may have low costs, but the environmental impact is more significant due to the higher demand for fossil fuels.
You can shorten the supply chain by partnering with domestic companies – preferably in your state. These businesses shorten your lead times and reduce your business’s environmental impact.
4. Conserve water
Water is critical in industries like agriculture, construction, fashion and more. Even if you don’t work directly with it, you still need it for bathrooms and water fountains inside the office. The world’s freshwater supply has increasingly become concerning. Cities and states in the Southwest often implement water limits to conserve the resource in the summer.
Your office can become more sustainable by increasing water efficiency. Use low-flow faucets and toilets to minimize use and only consume what’s needed. These systems reduce water usage and lower the money spent on this utility. Nowadays, you can utilize smart technology to monitor use and see where to improve.
Help employees help the planet
Sustainability has become a vital topic of discussion lately. The conversation is necessary as the world faces the wrath of climate change. Most people agree it’s a problem but don’t always take the required actions.
Employees spend a large part of their day in the office, so you should help your colleagues reduce their carbon footprint at work. Incorporate renewable energy and obtain sustainability certifications. These actions demonstrate care for the environment and inspire employees to do more at home.
By Eric Linxwiler from mytotalretail.com • Reposted: May 25, 2023
The days when brands and retailers could turn a blind eye to where their products come from are over. Amid heightened awareness of social and environmental abuses throughout the supply chain, governments around the world are moving quickly to hold businesses accountable for the actions of their suppliers.
New supply chain due diligence laws are passing by the month across the globe, and the United States’ Uyghur Forced Labor Prevention Act (UFLPA) is one of the strictest. Enacted last summer, the law forbids the importation of any goods produced or manufactured wholly or in part in the Xinjiang region of China on the presumption that were made with forced labor. It’s not sufficient for businesses to simply stop importing from Xinjiang, since U.S. Customs is authorized to stop shipments from any country of origin. Indeed, initial enforcement statistics for the UFLPA show that the majority of the 3,588 shipments detained during the first nine months of the law have originated from countries other than China.
The law’s scope covers all sectors and industries. When the law first went into effect, Customs singled out cotton, tomatoes and polysilicon as high priority commodities, but the agency has stressed that its enforcement priorities will evolve in response to changing data and intelligence about which products are most at risk. The agency has already started scrutinizing additional categories, including aluminum, steel, PVC and auto parts. Detainments under the law are likely to increase going forward, as Customs hires new agents and Congress continues to call for much tougher enforcement of the law.
To comply with the UFLPA and avoid potentially long and costly shipping detainments, brands and retailers need to implement two tactics in tandem: prevention and documentation. Retailers can drastically reduce the risk of forced labor in their supply chain by more closely vetting and monitoring their suppliers and strategically cutting high-risk vendors from their supplier base through supply chain mapping. This creates visibility into a company’s supplier base, allowing it to document all factories and suppliers involved in the transformation of raw materials into finished goods. Amid the growing complexity of the supply chain, this transparency is critically necessary for brands to make the most responsible procurement decisions.
Supply chain mapping alone isn’t enough to ensure compliance with the UFLPA, however. Retailers must also implement a system for tracking and documenting the complete chain of custody for all material components of every product they source. These records are key for rebutting the UFLPA’s presumption of forced labor.
In newly expanded guidance that Customs shared this past winter, the agency writes that importers must be able to provide documentation detailing “the order, purchase, manufacture and transportation of inputs throughout their supply chain.” Examples of that include records substantiating the parties involved in the sourcing and manufacturing of goods; documentation of the payments for and transportation of raw materials (including invoices, contracts, purchase orders, and other proofs of payment); and transaction and supply chain records (including packing lists, bills of lading, and manifests).
This poses a challenge for brands and retailers since most lack the proper systems to document the full provenance of their products and centralize supplier information, especially beyond the first and second tier. Even for businesses with vast supplier networks, however, the process can be made manageable by a multi-enterprise supply chain platform, which can help them easily collect and organize the documentation they need to adhere to the UFLPA and other global ESG regulations.
Eliminating Forced Labor, Preventing Detainments
In response to demand from our customers, TradeBeyond recently introduced a chain of custody tracking system as part of our platform’s order management module. It introduces a failproof process for tracking chain of custody and linking relevant documentation to purchase orders, including invoices, declarations and bills of lading, while creating safeguards to prevent orders with unfulfilled requirements from being shipped.
Our system lets retailers clearly define all their chain of custody requirements for each order to their suppliers, including optional and mandatory documentation. Vendors can then easily see a buyer’s requirements and attach all documentation. The system streamlines traceability processes for retailers while serving as a crucial safeguard by ensuring that all required documentation is centralized so it cannot get misplaced in lost emails with critical attachments.
In addition to introducing crucial visibility by centralizing documents in a readily accessible location, the system automatically flags any problems with chain of custody so merchandisers can correct them before shipments hit the water. As an additional safety measure, smart notifications alert retailers about orders that have unmet requirements. Visual dashboards conveniently show users at a glance how many orders have outstanding chain of custody issues, and whether key documentation has been requested, submitted, approved or rejected.
This technology will increasingly become standard as businesses continue to adjust to the UFLPA’s new normal, especially as reports mount about long and extremely costly detainment delays under the law. Of all the shipments detained so far under the UFLPA, more than half are still awaiting a decision from Customs, according to the agency’s latest data. Companies in violation of the law could face fines of up to $250,000, on top of the costs of wasted merchandise and missed retail windows.
Having an advanced platform to obtain, track and organize critical chain of custody documentation can help companies avoid these long detainments and, more importantly, it can prevent them from sourcing from high-risk suppliers in the first place. This is the kind of due diligence that’s necessary for businesses to permanently eliminate forced labor from their supply chains.
Eric Linxwiler is senior vice president of TradeBeyond, a company that connects retail supply chain operations from product development to delivery.
Educators are looking at ways to tackle the ambiguity that exists around definitions and measurement. By Aruni Sunil from Sifted.com * Reposted: May 23, 2023
Researching and teaching sustainability is high on business schools’ strategic agendas. At the same time, startups are struggling with measurement, reporting, definitions, action and strategy — and the path to net zero.
We looked into how sustainability is currently taught at business schools, how it’s changing and what it should grow into so that Europe’s startups can achieve their sustainability goals.
Founders want more
For Laurence Lehmann-Ortega, professor of strategy and business policy at HEC Paris, companies struggle to measure environmental and social aspects because there’s a lack of standardisation.
“In finance, we’ve been building the standards for the past 70 years or so,” she says. “So there are no clear standards to measure ESG and I’m not sure we’ll get to very clear standards in the near future — the only common metric we’ve got now is measuring carbon emissions.”
It can be reductionist to measure just carbon emissions — metrics should be more industry and product-specific. For example, if your product is going to have a big impact on biodiversity because it’s in the agricultural space, it’s crucial to think about biodiversity first instead of carbon and the associated human rights challenges around agricultural commodities.
The only common metric we’ve got now is measuring carbon emissions That’s where business schools could come in.
For Prateek Mahalwar, founder of Bioweg — a startup producing bio-based ingredients to replace microplastics in personal care and food products — sustainability should be taught at business schools with one part focusing on what sustainability means in the broadest sense, and the second part focusing on quantification.
He says that discussing case studies tackling different aspects of sustainability such as energy or the use of raw materials is key for students to understand how sustainability works in the real world of business. It’s especially important to understand how startups can adhere to the new laws and regulations around sustainability such as the plastic packaging regulation, he adds.
Bioweg had MBA students working with its team through the Creative Destruction Lab (CDL), a programme at HEC Paris that allows management students to work directly with companies, helping them develop financial models, evaluate potential markets and fine-tune their strategies.
“It’s a win-win — for the startup as well as for the student, not only in terms of exchanging knowledge or doing something practical, but also from the angle that there is a possibility for startup founders to hire them or get into the ESOP pool,” Mahalwar says.
A to ESG
As well as experiential learning through programmes like CDL, HEC Paris teaches sustainability as part of its strategy and entrepreneurship programmes.
Lehmann-Ortega says that there are two ways that sustainability is taught as part of strategy in theory. The first is how a business can adapt and rethink their business model to be more sustainable, and the second is advanced strategy which is about being “more proactive and coming up with a new business model”.
She says that there’s also differences in how different subjects address the topic of sustainability. “For an accounting professor, it’s about how carbon emissions can be measured and measuring the environmental and social impact of the organisation; for finance professors, it’s about how to finance it; and for marketing, it’s about how to educate your customer to think about it.”
Other business schools are also encouraging students to take part in environmentally and socially relevant initiatives.
Fabien Koutchekian was part of the CDL programme and is the cofounder of Genomines, a biotech that enhances the natural ability of plants to absorb metals. For him, teaching sustainability is primarily about tackling misinformation in the sector and for entrepreneurs to be more involved in the space of regulations and policy making.
“There’s this mentality now that we are doomed and nothing will save us from what the previous generation has done to the environment. But I don’t believe this — we have to fight, we have to create startups, create innovation and change the regulatory environment, to spur innovation and research in the field,” he says.
For Lehmann-Ortega, sustainability is here to stay in business schools.
“We don’t need standalone courses about sustainability — this doesn’t make any sense anymore. Every single course should have it — it’s about how you adapt the curriculum to the current shift that’s going on in the world,” she says.
“This reminds me of what happened 10 to 15 years ago with the shift to digital. We all had to integrate classes about digital marketing and so on, and now you can’t teach marketing anymore without digital.”
Mahalwar agrees, adding that sustainability isn’t dismissed as a passing fad anymore — it’s part of the core business in both startups and corporates. “Companies are paying attention to whole supply chains and committing at every level to look into carbon emissions, ESG goals and so on.
“This creates a need for future hires to have knowledge in that area, and not only people who go into businesses with impact at their core, but also in other areas such as finance, strategy, product and procurement.”
At any given time, there are about a million green startups exploring new energy solutions. As of 2023, there are also at least 13k large and medium-sized companies in Europe transitioning towards more sustainable operations.
This has to come from students, because they are the future of politics, the future of innovation and the future leaders
“There hasn’t been a single moment in the history of mankind where there were so many brains solving the same issue at the same time. It needs to keep going and we need to put in the work to find solutions,” says Koutchekian.
“More capital is needed and politicians have to create policies that stimulate the economy along with taxing polluting activity and so on — and this has to come from students, because they are the future of politics, the future of innovation and the future leaders.”
Young people rally in front of the California statehouse in support of climate justice at a Fridays for Future demonstration on April 21, 2023. Image: Lynn Friedman/Flickr
By Mary Mazzzoni from triplepundit.com • Reposted: May 20, 2023
Investing in viable solutions to social and environmental problems can turn a profit — and the most lucrative ideas may not come from where you’d expect. That’s the philosophy behind Village Capital. The nonprofit launched in 2009 under the tagline “democratizing entrepreneurship.” Though it’s based in Washington, D.C., its founding mission centers on identifying and supporting innovators outside the big coastal cities that receive the lion’s share of venture funding.
Over the past 14 years, Village Capital has supported nearly 1,000 such startups through 45 U.S.-based accelerator programs — which provide funding and mentoring to entrepreneurs with smart ideas to solve big problems.
One of its most recent accelerators squares in on the crucial issue of climate justice, with a call for innovators on the front lines of climate change to submit locally-driven solutions for backing from Village Capital.
What is climate justice?
For the uninitiated, climate justice refers to the imbalanced nature of the real-world impacts caused by climate change: Those who fare the worst amidst natural disasters and sea-level rise tend to be poor and underserved, and as such have contributed least to the greenhouse gas emissions that cause climate change. For context, a billionaire will produce a million times moregreenhouse gas emissions in their lifetime than the average person, according to research from Oxfam.
The related cause of environmental justice refers not only to the impacts of climate change, but also the sources of climate-inducing pollution — and where they’re located. In the U.S. in particular, years of segregation has created a situation in which communities of color are far more likely to be in the direct vicinity of polluting sites like oil refineries and chemical plants. A bombshell 2021 study from the U.S. Environmental Protection Agency found that people of color are exposed to far higher levels of air pollution during their lifetimes than white people, regardless of income level.
Again, people living in communities that have faced chronic disinvestment for decades are more likely to be poor, and as such consume far fewer of the goods and services that these polluting industries provide. Yet they’re still saddled with the impact, whether that’s long-term air pollution exposure that can lead to preventable illness, or catastrophic events like leaks and explosions.
Impacted communities have sounded the alarm about environmental and climate justice for decades, but the issues are only more recently gaining attention on the global stage. A global loss and damage fund to help developing countries cope with the impacts of climate change was finally pushed across the finish line at the COP27 climate talks in 2022, although it will be years before it’s up and running. U.S. President Joe Biden has also made justice a central pillar of his climate plan, with billions in new investments going toward efforts to reduce emissions and pollution in underserved communities.
Still, government investments have by no means reached the scale of the challenge — making private-sector interventions like Village Capital’s accelerator essential to creating the widespread changes needed to cut the problem down to size.
A young demonstrator shows her support for climate justice. Image: Oxfam International/Flickr
Inside Village Capital’s climate justice accelerator
Announced last month, Village Capital’s accelerator is seeking early-stage startups that support immigrants, refugees and communities of color on the front lines of climate change in the U.S. In partnership with the WES Mariam Assefa Fund, Village Capital will provide grants and coaching to 10 to 12 startups with promising solutions that help their communities prepare for and adapt to climate impacts. The accelerator is fairly industry-agnostic, with startups across the climate tech, financial tech and property tech spaces encouraged to apply.
“We are looking for impact-driven startups that are solving critical challenges for people and communities who are disproportionately impacted by climate change,” Elizabeth Nguyen, economic opportunity practice lead for Village Capital, told TriplePundit. “We’ve been very intentional about identifying the solution types, which thematically fall into: disaster preparedness, public action and civic response, resilient housing and cities, and overall support for immigrants and refugees. Each one of these solution types prioritizes supporting people and communities and enables them the ability to respond to the impact of climate change.”
Along with grant funding, the selected entrepreneurs will receive invaluable training on how to further scale their businesses and attract investors, including help with a development plan to chart the course for growth. Through Village Capital’s unique peer-selected investment model, the cohort of entrepreneurs will decide which two climate justice solutions will be eligible to receive an additional $100,000 in investments from WES Mariam Assefa, Nguyen said.
“This investment, especially at an early stage, has the potential to change the trajectory of a company, considering many immigrant and refugee founders often don’t have strong social networks or support systems that founders who may have been born in the U.S. have,” she explained. “We also can’t stress enough how important social capital, mentorship, and connections are to early-stage companies. Village Capital provides not just training and financial support, but introductions to relevant mentors who are in the refugee and immigrant space and climate tech space. Our support enables our founders to walk away with tangible ways to speak to investors.”
Championing locally-driven solutions to climate challenges
Importantly, Village Capital aims to support locally-led solutions driven by the people and organizations that experience climate impacts in their communities firsthand.
“We’ve seen time and again that top-down solutions will not be sustainable or effective because they don’t have a full understanding of the needs in a community,” Nguyen said. “Locally-led startups also ensure that the solutions elevate the communities collectively so they are not left behind in the wave of innovation, a challenge that has unfortunately already been reflected in the history of climate tech solutions.”
The company’s accelerator model is proven to work, with over 150 accelerators supporting more than 1,400 startups globally. Entrepreneurs graduating from Village Capital accelerators raised three times more capital and earned 2.3 times more revenue compared to a control group, according to an impact study commissioned by the company.
The company’s separate venture capital fund, VilCap Investments, has invested in over 100 peer-selected startups from across these accelerators — again, with a focus on founders who are often overlooked. Nearly half (46 percent) of startups in the fund are led by women, and 30 percent are led by people of color. A stunning 80 percent are based in states outside New York, California and Massachusetts, which together receive about half of all global VC funding, according to Village Capital.
“By catalyzing locally-led startups and strengthening the ecosystem for these entrepreneurs to succeed, we can create the biggest and most sustainable impact, one that improves and increases services and resources for the communities who need it the most,” Nguyen said.
Applications for the accelerator close on May 25, 2023. Full details and eligibility criteria can be found here.
As with other forms of anxiety, climate anxiety must be navigated with great care; and it is essential that the younger generation have allies around them when facing such an enormous challenge as climate change. By Michael Sameul, MBE from Sustainable Brands • Reposted: May 19, 2023
This week we are marking Mental-Health Awareness Week, the theme of which is anxiety — which has become prevalent across society, particularly for young people.
Some have described the UK as an “anxious nation.” Studies suggest that more than 8 million people in the UK are experiencing anxiety at any given time. It affects many children and young people. The last few years have seen anxiety and other mental-health conditions escalate in children and young people. Whereas one in eight children suffered from a mental-health illness pre-pandemic, this has now increased to one in six.
One of the growing elements of anxiety is climate anxiety. This amounts to distress about climate change, its impacts on the landscape and human existence, and what might happen if action is not taken in time to avert disaster. It can manifest as chronic fear of environmental collapse and intrusive thoughts about the long-term future of humanity.
The ONS has reported that, behind the cost-of-living crisis, climate change is the second biggest concern facing adults in the UK — with 74 percent feeling worried about climate change to some extent.
It is important, however, to understand that there are essential differences between worrying about climate change and having climate anxiety. Worry is often a motivator: If you are worried about something, it can prompt you to take action to try and resolve it. Anxiety is more extreme, overwhelming and, at times, debilitating. Its effects range from a racing heart and shortness of breath to being unable to maintain social relationships or function in your daily life at work or school.
Climate anxiety affects people of all ages and walks of life, but its impacts are not even. It is felt most acutely by those living on the frontline of climate-related disasters and those who feel they have the most to lose in the event of long-term environmental catastrophe. As such, in the UK, climate anxiety disproportionately affects children and young people who are worried about the state of the world they will inherit.
Recent research has revealed that climate change is causing widespread, deeply felt anxiety among young people in the UK. More than 50 percent of 16- to 25-year-olds interviewed by the University of Bath reported that they felt anxious, powerless and guilty about climate change. Similarly, the youth non-profit organisation Force of Nature found that more than 70 percent of young people feel hopeless in the face of the climate crisis and as many as 56 percent think that humanity is doomed.
As Chair of the Anna Freud Centre, a children’s mental-health charity, I have witnessed the extent to which the climate crisis impacts young people’s mental health. As with other forms of anxiety, climate anxiety must be navigated with great care; and it is essential that the younger generation have allies around them when facing such an enormous challenge as climate change.
The Princess of Wales, our Centre’s Royal Patron, has highlighted that mental health in the early years is a crucial determinant of life prospects. So, now more than ever, it is important to ensure that children and the people that care for them don’t try to take on these challenges in isolation. The first step in helping children and young people cope with climate anxiety is being open and available to talk about their concerns with them. Climate change is a very real and pressing issue; so, it can be counterproductive to try and minimise a young person’s fears about it as this may lead them to internalise their anxieties. Instead, talking about the issue with them in an age-appropriate way and validating their feelings is crucial.
Only 26 percent of the young people surveyed by Force for Nature felt that they knew how to contribute to solving the climate crisis; and the sense of helplessness that may be felt by the remaining 74 percent can be very dangerous. Therefore, it is important to encourage young people to try and find manageable solutions and productive ways of addressing their emotions. Rather than always offering reassurance, try responding to their questions with another question. For example, ‘I know you are worried aboutplastic pollution; so, what can we do to minimise our own plastic use?’ This can help break what may seem like a larger problem down into smaller, more manageable pieces that have more easily identifiable solutions.
Ultimately, climate change and its impacts can feel overwhelming for anyone; so, it is essential that no one tries to bear this burden alone. By demonstrating that you understand a young person’s concerns and are available to discuss them, you can help them alleviate their worries and find out what their personal contribution looks like.
Ongoing issues such as the impacts of the cost-of-living crisis and war in Ukraine already provide plenty of daily anxiety. But as our newsfeeds are increasingly inundated with stories about environmental and climate-related disasters, the lesser-known climate anxiety should be openly discussed and addressed.
As advertising regulators, consumer watchdogs and even governments take a tougher stance, the risks of getting it wrong grow significantly; and the pressure is on communicators to up their game and back up their claims. By Tom Idle from sustainable brands.com • Reposted: May 18, 2023
It’s officially, and legally, getting harder for brands to greenwash. In Europe, the EU Parliament has just voted to ramp up regulation to deter companies from making ‘carbon-neutral’ claims that can so easily mislead consumers into believing the products they are buying are good for the environment. Proposed new anti-greenwashing rules – said to represent a “significant victory for consumers and the environment” – were voted by an overwhelming majority of 544 votes in favour, 18 against and 17 abstentions.
This paves the way for EU nations to adopt their own laws that will ban dubious claims and “strengthen the fight against greenwashing by banning practices that mislead consumers on the actual sustainability of products,” as put by EU Justice Commissioner Didier Reynders. The move will effectively ban the use of generic ‘green’ marketing claims such as ‘environmentally friendly,’ ‘natural,’ ‘biodegradable’ and ‘eco,’ if they are not supported by evidence. Brands won’t be able to suggest a whole product or service is ‘sustainable’ when only a part of it is, either. And only official sustainability certification schemes will be recognised when it comes to marketing claims.
Where carbon offsetting is used, companies will no longer be able to make ‘net-zero’ or ‘carbon-neutral’ claims, which have long been criticised by campaign groups for seriously misleading consumers. In fact, banning the use of offsets as the basis for carbon-neutral claims is already happening. In the UK, the Advertising Standards Authority has spent the last six months reviewing the landscape and is about to commence stricter enforcement procedures. Brands are set to be banned from declaring their products or services are carbon neutral using offsets, unless they can prove they are actually working. This has coincided with a renewed focus on the true impact of offsets. In January, a Guardianinvestigation found that 90 percent of the rainforest project-derived offsets generated byVerra, one of the world’s biggest offset certifiers, were “worthless.” Verra strongly disputed the findings, but it got the world talking — not only about the value of offsetting, but the validity of making carbon-neutral claims more generally.
Greenwash clampdowns are also underway in the UK investment scene. The fact that so-called ‘sustainable’ pension funds are still entrenched in oil and gas firm funding has prompted the UK’s Financial Conduct Authority to publish anti-greenwashing rulesdesigned to clean up the labelling of investment funds.
6 CRITICAL STEPS TO AVOID GREENWASHING
Sustainability stakes are high; so are stakeholder distrust and scrutiny. So, how can your brand win the trust, loyalty, and advocacy of conscious consumers while protecting your reputation from greenwashing? Join us as Simon Mainwaring outlines 6 critical steps to avoiding greenwashing, building brand love and enabling consumers to live the sustainable lifestyles they seek at Brand-Led Culture Change – May 22-24 in Minneapolis.
In the US, the Federal Trade Commission has updated its Green Guides for the first time in more than a decade, with a similar goal – to make it harder for companies to fall into the trap of making overblown sustainability claims about the products and materials they use.
Obviously, it will take time to completely stem the tide of greenwash; but incoming regulation and improved standards are having the desired impact, as evidenced by recent action taken to halt greenwash from the likes of airlines including Etihad andLufthansa. Yet, in the race to win more savvy consumers and meet increasingly ambitious sustainability goals, avoiding greenwash remains a challenge. Even companies forced to row back on their ambitions face huge scrutiny. Just look at the backlash footwear business Crocs received this week having announced plans to push back its net-zero target from 2030 to 2040 after recording a 45.5 percent increase in absolute emissions year-on-year after acquiring another company. The new goal might be “more credible and realistic;” but consumers expect more transparent and sophisticated communications from brands.
And that is proving to be a real struggle. New research suggests that while marketing professionals acknowledge the need to be braver when it comes to sustainability communications to avoid greenwashing, more than a third of them lack the capacity or knowledge to do so. At a time when more brands claim to have a sustainability-related story worth sharing (41 percent versus 25 percent in 2021), the survey suggests the situation is getting worse; capability gaps were cited by 35 percent of respondents, versus 20 percent in 2021. This is especially a concern given that more brands have sustainability as a KPI in their marketing functions – up from 26 percent in 2021 to 43 percent today: “It’s remarkable that even though 94 percent of marketers are willing to be brave to drive transformative change, organizations still behave in the same way,” says Ozlem Senturk, a senior partner with Kantar, which was behind the research.
This research echoes the key findings of a recent Chartered Institute of Marketing survey, which showed half of companies were reluctant to work on sustainability campaigns for fear of getting tripped up and accused of greenwash.
As with many sustainability challenges, solving the greenwash problem can benefit from a collaborative response. That’s certainly the view of the team behind Creatives for Climate— which has just launched a new platform designed to help communicators ‘reskill’ for sustainability communications. The website features a training program called Greenwash Watch — which provides a useful analysis of anti-greenwashing regulation and rulings and provides a framework from which to craft credible strategies that do not mislead consumers.
As advertising regulators enforce tougher sanctions, consumer watchdogs get more savvy and even governments double-down on their efforts, the era of unsubstantiated green claims from corporates is over. But as the risks of getting it wrong grow significantly, the pressure is on communicators to up their game and be sure to back up their claims.
Today, we are living in a peculiar time with growing uncertainties such as high inflation and high interest rates. As a result, many global brands have scaled back their operations and reduced headcounts to brace themselves for further shocks down the road.
While all seems doom and gloom, sustainability remains a bright spot on the horizon. More businesses are looking to drive growth through sustainability. This means not only focusing on top-line growth but also bottom-line growth, while also augmenting social capital by driving positive impact that benefits communities and the environment.
Over the course of my company’s work with several of the world’s largest hospitality chains, airlines and cruise liners in the area of sustainable guest amenities, we help brands reach new consumers in the hospitality and travel industry. As recipient of the United Nations Sustainable Development Goals Pioneer for Circular Economy, I know first-hand the impact sustainability can have on business.
Below are three practical ways brands can aim to improve their overall business value, performance and positive impact.
The global intangible asset value grew from $61 trillion in 2019 to $74 trillion in 2021. According to research from McKinsey & Co, businesses in the top quartile for growth invest 2.6 times more into intangible assets than “low-growers.”
With more and more companies realizing that a portion of their value can be derived from intangibles, many are pouring in resources to strategically grow their intangibles—with sustainability being an area of focus. According to a 2022 study by NielsenIQ, 78% of consumers say “a sustainable lifestyle is important to them.”Brands that invest in sustainability can attract more customers and, in my experience, typically charge a higher price for their products.
In October 2022, LVMH announced an energy efficiency framework in partnership with shopping mall owner, Hang Lung Properties, which is expected to reduce the retailer’s energy footprint. From my perspective, I expect more value would eventually be derived from growth in their intangible value rather than actual energy cost savings.
Brands interested in positioning themselves as sustainable need to come out with more interesting stories in today’s competitive market. Simply changing your packaging and reducing energy costs is no longer sufficient to convince consumers of your sustainability edge. Impact has become a more objective yardstick to evaluate whether or not your brand is truly sustainable, and this is closely intertwined with scale to derive the actual impact of a brand in the world.
Create A Superior Business Model With Circular Design
According to the United Nations, the circular economy is a “new and inclusive economic paradigm that aims to minimize pollution and waste, extend product lifecycles and enable broad sharing of physical and natural assets.”
Given the increasing cost pressures experienced by businesses today, this new paradigm allows brands to generate value with minimal resources and correspondingly lesser impact on the environment. Recently, H&M, a large fashion retailer, pledged to be climate positive by 2040 through a textile reuse model, promoting circular design.
Circular design can be a profitable venture when brands are able and willing to make the adjustments necessary to change the status quo. Embracing a new circularity paradigm requires a holistic end-to-end understanding from the get-go. This includes product design, which minimizes the use of materials and takes into consideration the advantages of the different types of materials, a packaging approach that delivers the appropriate outcome without over-packaging, as well as a supply chain strategy that balances business performance and environmental impact.
Reach New Consumers With Sustainable Business Models
Thirdly, sustainability can also open up new business opportunities for consumer brands. Sustainability is not just about reducing carbon emissions and waste; it also involves creating innovative solutions to environmental challenges. Sustainable practices can lead to the development of new products, services and markets.
To reach new consumers with sustainable business models, brands can aim to position sustainability at their core. Consumer brands not only have the power to uniquely differentiate themselves in today’s crowded marketplace but also create an enduring competitive advantage that could lead to even greater possibilities and enhanced brand value.
If needed, consider looking for credible partners as a way to leverage each others’ strengths to drive sustainability initiatives. Ideally, a partnership should only require minimal investment, without the need for brands to reinvent the wheel. Look for a complementary partner with a successful track record; repeat customers, deep capabilities and a rich ecosystem can each be powerful multipliers for creating exponential outcomes.
By embracing sustainability, consumer brands can increase their brand’s intangible value, create superior circular design and open up new opportunities with new business models. With intangible value becoming a differentiator, your biggest gain could be from your sustainability initiatives—provided they are done authentically and with the right priorities.
A refinery in the US owned by ExxonMobil, one of the companies invested in by supposedly ‘green’ funds. Photograph: Barry Lewis/In Pictures/Getty Images
Warning comes as UK watchdog set to tighten rules for asset managers given short-term targets. By Bewtasy Reed, Editor from the Guardian.com • Reposted: May 15, 2023
People investing their pensions in funds that claim green credentials are being warned they may actually be backing the world’s largest oil and gas companies.
It also found that 25 members of the Net Zero Asset Managers initiative had invested in those companies and some had increased their holdings in 2022. NZAM said its international initiative started two years ago and investors needed time to change their strategies.
The warning comes as the UK’s Financial Conduct Authority prepares to publish anti-greenwashing rules that are intended to clean up how investment funds are labelled.
Just under 50% of all UK employees now pay into employer schemes or private pensions where they can make a choice about how their money is invested – a huge rise since 2012 when employers became legally obliged to automatically enrol workers in a workplace scheme. Most people with a private pension or a stocks and shares ISA make a choice as to how their money is invested and many emphasise sustainability.
The financial industry has reacted by creating funds badged as sustainable, climate, carbon, transition or ESG – short for environmental, social and governance.
“What we found is that these funds, despite their names, can often include sometimes large positions in fossil fuel companies,” said Maeve O’Connor, one of the report’s authors, and an analyst at the Carbon Tracker Initiative. “For retail investors that could be seen to be misleading. If I’m investing in a green fund, do I want my investment to be going to ExxonMobil? Probably not.”
According to the report, BlackRock’s ACS Climate Transition World Equity Fund says it invests in companies “well-positioned to maximise the opportunities and minimise the potential risks associated with a transition to a low-carbon economy” – but it has $219m in 10 of the 15 leading oil and gas companies.
O’Connor said asset managers were usually given performance targets over short periods, which might influence their thinking. She said: “They could be assessed over two to five years and that timescale doesn’t really fit with the realities of the energy transition.”
Coalitions such as UK Divest and Share Action campaign for pension funds to be invested sustainably. Robert Noyes, an energy economist at Platform London, part of UK Divest, said that with about £2tn invested in pensions, it was the largest source of investment in the UK and people should ask their pension providers for information.
“People should ask three questions,” he said. “Does it invest in the problem, like a company that spends money on fossil fuels? Does it invest in things that drive changes in the real economy that lead environmental programmes? So, for example, it’s hard to see how investing in Microsoft is driving a change towards net zero.
“And thirdly, is it vocal about the need for political action?”
A spokesperson for NZAM said that while its partners “share Carbon Tracker’s perspective that the oil and gas industry must very rapidly decarbonise to meet the urgency of the climate crisis, the Net Zero Asset Managers’ commitment statement does not require signatories to choose equity holdings to meet a particular climate target”. It added: “Passive investors cannot divest from the oil and gas sector without significantly changing their investment strategy.”
NZAM expected those funds with passive portfolios to engage in dialogue with companies, proxy voting and policy advocacy to align their holdings with the 1.5C commitment. Asset managers depended on governments to follow through their own commitments under the Paris agreement, the spokesperson added.
By Tina Casey via triplepundit.com • Reposted: May 11, 2023
The bond market sneezed in 2022, and green bonds caught the same cold. Fortunately, according to some analysts, green bonds are in the position to rebound this year. In the case of municipal green bonds, that provides new opportunities for cities to make climate-resilient investments in their future, and corporate citizens are among those to reap the benefits.
What are green bonds?
Assets in global sustainable and green bonds reached $516 billion at the end of 2022, an elevenfold increase over the past decade, according to a recent analysis from Morningstar. Verizon, one of the largest corporate green bond issuers in the U.S., made headlines this weekwith its fifth billion-dollar green bond since 2019.
So, what are green bonds anyway, and why do they matter in the world of finance? As with any bond, green bonds are issued by companies and governments as a way to raise money. Investors purchase the bond, and they’re paid back later with interest. But in the case of green and sustainability-linked bonds, the funds are specifically earmarked for projects that positively benefit people and the environment.
As Fidelity described in a 2021 white paper, green bonds reflect a broader focus on socially and environmentally beneficial goals among U.S. investors. “This trend toward sustainability, commonly demonstrated through reusable bags, hybrid cars and renewable energy sources, has also gained popularity in the municipal bond market through the issuance of green bonds,” the white paper reads. “Municipal green bonds, issued by state and local governments to fund environmentally beneficial capital projects, are not currently a large percentage of total municipal bond issuance, but have recently gained significant traction.”
The municipal green bond trend is relatively new. Massachusetts kickstarted the movement in 2013, and green bonds are still a small part of the overall municipal market, which totaled $470 billion in 2020. Municipal green bond issuance tripled over a rolling five year-period ending in 2020, with an impressive 40 percent jump between the final two years to reach a then-record of $14 billion, according to Fidelity’s analysis.
Despite the strong showing, Fidelity emphasized that green bonds are a new phenomenon. “[It] is too soon to determine if there will be a consistent cost advantage” for issuers, investors or municipalities over the long run, Fidelity found, though the firm did make note of “the intangible environmentally friendly purpose for which the bonds are issued has its own intrinsic value.”
A comeback for green bonds
Fidelity’s outlook was prescient. In February of last year, S&P Global explored the possibility of a jump to $60 billion for municipal green bonds in 2022. However, when the dust settled after a tumultuous economic year, a mixed picture emerged for bond markets overall.
“Up until 2022, green bond funds experienced a relatively sanguine period of positive returns and low volatility compared with conventional bond products,” Morningstar wrote. “That relationship flipped, however, last year, as green bond funds experienced steeper losses and higher volatility in 2022.”
Still, the picture for green bonds was more rosy than the overall bond market, which took a beating amidst economic uncertainty last year. “Net inflows into global sustainable bond funds slowed down in 2022 but remained positive, while traditional bond funds experienced massive outflows in the challenging market environment,” Morningstar found.
Further, it appears that a rebound is taking shape. In January of this year, S&P Global took another look at the global situation for corporate green bond issuance. Although issuance dropped steeply from 2021 to 2022, S&P described the context of a broader slowdown in bond issuance overall, driven by “volatile markets, inflation, rising interest rates and geopolitical uncertainty.”
S&P painted a more optimistic picture for 2023, based largely on supportive policies in China and the U.S., where the new federal climate and energy legislation promoted by President Joe Biden provides for $386 billion in spending over the next 10 years and a $265 billion increase in tax incentives.
S&P also cited Charlotte Edwards, a head of environmental, social and governance (ESG) research at Barclays, who expects growth in corporate green bond issuance to increase 30 percent this year, rebounding to 2021 levels.
A new threat for municipal green bonds
Here in the U.S., the renewed activity in the municipal green bond area could be hampered by partisan Republican policies designed to thwart ESG investment under the umbrella of the “woke capitalism” canard.
For example, last week in Florida, Republican Gov. Ron DeSantis signed anti-ESG legislation that prohibits some ESG bond sales outright and prevents state office holders from considering ESG goals.
In addition to raising potential legal liabilities for financial officers, Reuters took note of how the new law could negatively impact municipal bonds. “Lawyers and credit analysts said the new law could deny municipalities access to large pools of ESG-mandated capital,” Isla Binnie and Ross Kerber of Reuters reported, citing Thomas Torgerson, co-head of global sovereign ratings at DBRS Morningstar.
Those concerns are well founded. In Texas, the city of Anna lost more than $277,000 on a bond sale last year after Republican Gov. Greg Abbott signed anti-ESG legislation into law. The loss was attributed to a drop in competition following the new law, which precluded the highest bidder.
Based on a Wharton analysis of the Texas law, the firm Econsult Solutions, Inc. anticipates millions more in losses for other states considering anti-ESG legislation, including Kentucky, Louisiana, Missouri, Oklahoma and West Virginia as well as Florida.
Signs municipal green bonds are ready to turn the corner
Municipalities in states that are free of partisan interference can expect to fare better, along with their taxpayers, residents and businesses.
For example, the city of Turlock, California, has gained a significant new corporate citizen thanks to a $63 million municipal green bond issued by the California Public Finance Authority. The company in question is Divert, Inc., which describes itself as “an impact technology company on a mission to Protect the Value of Food.”
In April, Divert broke ground on its new facility in Turlock, which will convert food waste into carbon-negative renewable energy. In addition to helping California meet its climate goals, the new facility will create new jobs in Turlock and help the company’s retail and food industry clients improve their sustainability profiles by cutting down on food waste.
Divert clients can also anticipate bottom-line benefits from data collected through the waste-to-energy operation. The overall plan also encompasses a food donation program, helping to reduce food waste at the starting point.
Another example involves community choice aggregation, which is the means by which municipalities can join forces to lobby their utility for more clean energy.
Only a handful of states have aggregation laws on the books, and one of them is California. Earlier this year, the California Community Choice Financing Authority issued municipal green bonds totaling almost $1 billion to the state’s largest community choice aggregator, Clean Power Alliance. The Alliance projects its renewable energy costs to decrease by an average of $8.3 million per year over the initial eight-year period of the bonds. The savings will be passed along to ratepayers.
It’s unfortunate that businesses and residents in some Republican-led states will have to pass on opportunities like these, but that is a problem that corporate leaders can — and should — take up with their elected representatives.
Getty Images / Morning Consult artwork by Ashley Berry
Mitigating the worst impacts of climate change will take significant investment, and the effort will require partnership across tech, energy and government, writes tech analyst Jordan Marlatt via morning consult.com • Re[posted May 11, 2023
At a time when only 29% of U.S. consumers say tech companies have a mostly positive impact on the environment, climate tech is emerging as an area that people want companies to invest in.
Power grid improvements, solar energy production and decarbonization of the atmosphere have emerged as the top areas where consumers say investments should be prioritized.
But it will take more than tech to save the world from climate change. Recent partnerships across tech, energy and government show promising developments in this space, and it will require continued joint efforts to scale climate tech.
Climate tech is emerging as a space where innovative technologies may help mitigate the effects of climate change — or even reverse them, depending on who one talks to. This corner of tech saw sizable investment late last year and at the start of 2023, before slowing down recently.
Saving the planet is reason enough to invest in technologies that will help us avert the worst effects of climate change, though investments currently aren’t happening with the level of urgency and intensity required to meet the Paris Agreement goal of limiting global warming to 1.5 degrees Celsius.
A recent Morning Consult survey shows that two-thirds of U.S. adults are concerned about climate change — about the same as the share who say they’re concerned about political polarization in the country (67%) — and there is an appetite for investment in specific climate technologies. A Morning Consult report from last summer showed that consumers expect tech to lead the way on innovation in sustainability, and investing in climate tech is one way for tech companies to make good on their ambitious sustainability goals.
Positive perceptions of tech companies’ impact on the environment are down, but people still turn to tech for answers
Tech’s perceived positive impact on the environment has declined somewhat since July 2022. This is particularly the case among Gen Zers: 15% say tech’s impact on the environment is mostly positive (down from 27% in July of last year), while 29% say it is mostly negative. These sentiments are likely tied to a rough several months for tech in which overall favorability and trust in the industry diminished, as explained in our most recent State of Technology report. When trust and reputation fall, so too do brand perceptions, including how people perceive a company’s impact across the board.
U.S. adults’ perceptions of major technology companies’ impact on the environment
Surveys conducted July 22-23, 2022, and April 14-17, 2023, among representative samples of roughly 2,200 U.S. adults each, with unweighted margins of error of +/-2 percentage points. Figures may not add up to 100% due to rounding.
That being said, people largely agree that tech has an important role to play in innovating sustainability practices, and the opportunity for tech to invest in this space is rendered all the more important by declining perceptions of the industry’s impact on the environment. Over 2 in 5 adults (42%) say major technology companies have “a lot of responsibility” for driving innovation in sustainability, just behind energy companies and the federal government. Interestingly, tech startups — the source of many exciting innovations in this space — and venture capital — where the money comes from — sit lower on the list.
Another factor to consider when discussing investments in sustainable solutions is the politicization of climate change in the United States. The issue is much more concerning to Democrats (84%) than it is to Republicans (45%). Democrats also tend to be more concerned about the impact of companies on the environment (81%) than Republicans (54%). That said, energy companies, the federal government and major technology companies are seen by Democrats and Republicans alike as the three entities with the most responsibility for driving sustainability innovation.
Making climate tech happen will take a village
Major tech companies can drive innovation in sustainability through their own venture capital arms or through acquisitions of startups, with the latter capable of helping bigger companies scale up or integrate the acquired tech into their products, services and operations. Not only do the power players have an opportunity to drum up excitement around climate tech by putting it front and center, but they also get the added PR benefit of convincing people that they’re climate advocates.
As a catch-all term, “climate tech” encompasses many technologies, from generating clean energy to scrubbing the air of carbon (and even repurposing it for energy or useful products like concrete). Of a long list of climate tech applications, consumers feel that power infrastructure improvements, solar energy production and the removal of carbon dioxide from the atmosphere should be top priorities for investment.
Of those three, carbon sequestration is the most experimental climate tech area, and has not yet been deployed at scale. However, at our current pace of emissions reductions, this technology may prove essential for hitting climate goals, and less of a last-ditch solution.
Moving climate tech forward will likely take a concerted and collaborative effort from technology companies, financial institutions, government and energy companies. But how each is best suited to help is subject to debate.
Consumers say tech companies should be the most responsible for investing in electronics recycling, electrification of vehicles and AI optimization in energy production. For energy companies, the expectation is that they should shoulder most of the responsibility for energy production, power grid improvements and decarbonization. Finally, consumers want the government to bolster cities against the effects of climate change (such as infrastructure improvements to reduce flooding risks), as well as reduce emissions in agriculture and develop water desalination technology.
Running a profitable business in the consumer packaged goods (CPG) industry isn’t easy – especially when inflation has consumers pinching pennies and hunting for basement bargains. Add that to the list of challenges the CPG industry is facing, which include lingering pandemic hurdles and conflict-zone embargoes that suppliers and manufacturers are obliged to observe.
Meanwhile, companies are under pressure to monitor their risks and impacts on environmental, social and governance (ESG) issues. That means not just finding and monitoring their ESG data, which can be a huge task on its own, but also developing a strategy complete with targets and accountability measures to reduce ESG risks and minimize negative impacts from business activities.
So, how in the world are business leaders supposed to do all of that?
The answer lies in the “G” of ESG. Strong corporate governance and commitment from C-suite executives are how organizations can manage today’s business requirements and thrive under the opportunities that this new landscape presents. After all, ESG-focused funds proved resilient even amidst recession fears — attracting $37 billion of net inflows in the fourth quarter of 2022, compared to $200 billion of net withdrawals in the broader market, according to research from Morningstar.
Which governance mechanisms drive ESG strategy?
TriplePundit sat down with Jonathan Gill, global head of sustainability advocacy at Unilever, to gain insight into the governance mechanisms that drive ESG strategy in the CPG industry. The key takeaway? ESG strategy must be integrated into overall business strategy, with the two components working in coordination to drive success across all brands.
1. Integrating ESG into business strategy
If there’s one thing to know about driving a successful ESG strategy, it’s this: ESG strategy has to be integrated into overall business strategy. Without integration, the two objectives will be competing for priority rather than working in tandem.
“Unilever’s purpose is all about making sustainable living commonplace. So that’s kind of the North Star, the way we think about everything,” Gill explained. “It’s been years since we had separate strategies for sustainability and for business. It’s one integrated strategy.”
2. Business structure facilitates ESG performance
For Unilever, this integrated strategy — which it calls the Unilever Compass — is “locked into the governance side of things,” Gill said. “The board oversees it. We have an external advisory council to make sure we’re making the right decisions and choices. It’s locked into our remuneration, but also into our structure.”
In the CPG industry, a parent company will own many different brands. While those brands have different priorities in business and in ESG strategy, the structure and the relationship between the parent company and its brands needs to facilitate ESG progression.
“We’ve got five semi-autonomous business units within Unilever, and each and every one of those business units have sustainable priorities within them,” Gill continued. “That’s agreed by the most senior level, by the executives, so the delivery is really embedded into it.”
3. Ensuring all stakeholders have their voices heard
When it comes to actually developing an ESG strategy and identifying key performance indicators (KPIs), it’s crucial to have a clear understanding of what is important to stakeholders from the beginning and throughout an organization’s ESG journey.
Whether that’s from investors, customers, employees, brands or the broader community, understanding the expectations of stakeholders will align and drive ESG strategy, Gill said. For example, the company holds bi-weekly sessions with employees and executives and operates 37 “People Data Centers” around the world to keep its finger on the pulse of what customers are looking for — among many other ways in which it engages with stakeholders.
Organizations that listen to stakeholder voices are better positioned to perform well on the metrics that matter, driving ESG performance and business growth.
Some of Unilever’s best-selling brands. Image: Unilever
4. Brands develop their own ESG priorities
It can be tempting to delegate to brands what their ESG priorities should be and how they should approach the subject. Parent companies are ultimately responsible for their brands, after all. But it is much better when those companies facilitate that development and allow brands to grow their ESG priorities organically.
“Within the Unilever Compass, the three priorities we have around sustainability are planet, health and wellbeing, and social. Our brands’ purposes generally fall within those three spaces, but we don’t have a formal way to make sure brands are focusing in specific areas,” Gill explained. “The brands themselves are responsible for identifying what their purpose is and delivering that. It has to be organic, it has to be real, and therefore top-down just wouldn’t work.”
5. Transparent accounting
When asked about the value of transparent accounting, Gill said, “We think it’s quite an important lever for change to accelerate the transition toward sustainability.”
As global ESG reporting and accounting standards are being hashed out around the globe, transparent accounting is not only important to today’s investors and consumers, but it’s also soon to become a requirement. Businesses that incorporate this practice before legislation is finalized will benefit from the ease of transition to mandatory reporting, as well as from the influx of investor dollars into ESG funds. Having the right technology in place to gather, track and report on ESG data will be essential for businesses in the future.
6. Transparent ESG goals, progress and communication
Transparency in ESG goals, progress and communication is vital for highly visible, consumer-facing companies like Unilever. The company reported regularly on the progress of its 10-year sustainability strategy, the Sustainable Living Plan, from 2010 to 2020. Some of its targets were reached, some were narrowly missed, and others fell well short. Whatever the case, the company was open about its progress and the challenges it faced along the way — and it continues to report on the new Unilever Compass strategy.
This type of transparency builds trust. Trusted voices in the ESG sphere are exactly what investors and consumers are looking for amidst the tsunami of ESG information being released by companies looking to attract today’s consumers and investors.
7. Accountability measures
Finally, accountability measures must be built into the structure of the organization. Naturally, the market will act as its own accountability measure as investors and consumers pull money from companies that are underperforming and redirect those funds to companies with stronger ESG strategies.
Internally, Unilever ties ESG performance into its executive remuneration scheme. “We have essentially eight metrics, and if you perform well on those, your bonus is higher,” Gill said. “If you’re motivated by money, then obviously you’ll be motivated to deliver on those sustainability goals.”
Not everyone is motivated by money, but it’s a strong measure to incentivize performance and show commitment to ESG strategy.
A look to the future of ESG and governance challenges
One of the biggest challenges facing business executives in all sectors with regards to ESG and corporate governance is the uncertainty of reporting requirements. There are different global reporting standards, all of which are similar but none of which are mandatory — at least not yet.
“The challenge we’ve got at the moment is there are three big standards — from the International Sustainability Standards Board (ISSB), the U.S. Securities and Exchange Commission (SEC) and the European Union (EU) — and they are big beasts of information that need to be prepared,” Gill explained. “Making them standardized — not necessarily the same, but interoperable — would be very helpful, and we’re very keen to see them being mandatory for all companies above a certain size.”
The biggest challenge in Gill’s eyes is that with the sense of urgency to enact mandatory reporting and organizations rushing to comply, there are likely to be some errors in reporting, or errors made by assurers on the audit side that could provide the anti-ESG cohort some extra fuel for their fire. In the midst of our climate emergency, the onus is on legislators to not only get the requirements in place quickly, but to make sure it’s done right.
The world is trying to limit the rise in global temperatures and take the necessary steps toward achieving net zero. It is important because, at least for carbon dioxide, this is the state at which global warming stops.
The US Inflation Reduction Act introduces tax incentives to encourage sustainability.
In August 2022, U.S. Congress passed the Inflation Reduction Act (IRA), which includes $369 billion of federal spending to address climate change, $270 billion of which will be delivered through tax incentives. These tax incentives, together with grants and loan guarantees, will be directed to clean-energy efforts to substantially reduce the nation’s carbon emissions by the end of the decade. Clean electricity and transmission will receive the lion’s share of the funds, followed by clean transportation, including electric vehicle (EV) incentives.
As tax credits will comprise the bulk of the IRA’s energy and climate funding, in the corporate sphere, the aim is to drive up private investment in clean energy, transport and manufacturing. On the consumer side, the tax incentives intend to reduce carbon emissions by making energy-saving products and services more affordable, such as rooftop solar panels, energy-efficient appliances, home batteries and geothermal heating.
The EU’s Green Deal Industrial Plan promotes technology advancements for sustainability.
In January 2023, the European Union (EU) unveiled its Green Deal Industrial Plan at the World Economic Forum, a set of industrial initiatives and reforms that support its target of achieving net zero by 2050. As part of the European Green Deal, the plan intends to enhance the EU’s global competitiveness as it transitions to a carbon-neutral economy. In addition to its circular economy action plan, this reinforces the EU’s mission to be a leader on the path to a net zero age.
The first step in the Green Deal Industrial Plan is to scale up the development and production of net zero products and technologies across the next decade, as well as reduce the carbon footprint of energy-intensive industries. The plan also proposes a Net-Zero Industry Act to boost the manufacturing of green technologies, such as solar panels, heat pumps, batteries and windmills, among others.
The EU has already implemented a clear policy framework in some of these areas (such as the Ecodesign for Sustainable Products Regulation) and has launched partnerships that promote the sustainable development of raw materials, solar energy and hydrogen, batteries, and circular plastics.
Is everything coming up roses?
Motivating the world to invest or engage more in sustainable product innovation and manufacturing has become more important than ever. Up to date, there is huge room for creativity in the R&D, engineering and manufacturing processes of sustainable solutions.
When the world is setting the stage with the focus and incentives such as the IRA and Green Deal Industrial Plan, financial or otherwise, being channeled to global and national initiatives, there can still be trade barriers, important decisions driven by emotions, etc., that are to be eliminated to optimize the benefits intended for programs such as IRA or Green Deal.
There will certainly be global competition for sustainable feedstocks and skilled personnel when all four corners of the world are aiming for sustainability. What should be in place are harmonized policies or regulations among countries in the trading of waste and the removal of limitations in the use of certain recyclable materials for better utilization of resources. While localization in some instances works well, the limitation of the import/export of waste and recyclable materials will hinder the efforts spent in efficiently achieving sustainability. Nations may end up not having enough waste as sustainable feedstock.
The concerted efforts for administrations, legislatures, agencies and the chemical industry to work together to develop solutions are the keys to opening doors. The existence of infrastructure also poses another major hurdle to overcome. Needless to say, it takes incredibly careful planning and deployment of resources to bring in the necessary infrastructure to build on.
Our Action Items
Actions that are particularly important for companies during these exciting times include instilling the element of sustainability as early as the product design stage, proactively building up emerging skills required in the arena of the global workforce, and collaborating with international stakeholders in developing sustainable supply chains.
It’s easier said than done, but there is no time like now for nations and value chains to really “open up” and work hand in hand instead of competing with each other for brains or resources. Let’s treat these initiatives as a need to develop actionable items to help realize a circular economy, this time for all.
Take decarbonization as an example to manage scope 1, 2 and 3 emissions. One single company cannot control all. The required collaborations, international or otherwise, are to take place upstream, downstream and horizontally along the value chains. If the world is to do it properly this time, we have to put behind us our difference and wholeheartedly utilize the benefits brought along by globalization.
The changes will not happen overnight, but the sooner we start, the merrier. Needless to say, policies play an important role in driving all these activities. When the requirements on recycled-content/biodegradable or recycling percentage become “mandatory,” the supply of sustainable feedstock and materials will be developed as the demand will increase, which eventually stimulates investment and manufacturing. On the other hand, more efforts will be put into product designs to facilitate both waste collection and recycling.
The World’s Sustainability Journey
Public perception of the world’s journey to sustainability and their behavior will reflect how successful we are in pursuing the same. Innovations utilizing scientific approaches provide objective, measurable, data-driven information, allowing us to make informed decisions. Education and collaboration are paramount. If there is one opportunity that all of us should work together to really change the fate of the next generations, the time is now.
They say “all politics are local.” So are effective sustainability strategies. By Danielle Allen, Sustainability Consultant, Salterbaxter via green biz.com • Reposted: May 7, 2023
Translating global corporate sustainability ambitions into local market strategies is necessary for accelerating progress — although it’s no simple task.
Companies of different sizes and cultures face similar challenges and questions around how to meet the needs of local markets while moving globally in a unified direction — and managing a broader strategy rollout across markets at different stages of maturity. Just as sustainability teams see the brand and business opportunities of localizing sustainability, so do local market activist employees and communicators.
And yet, most companies aren’t communicating how their global strategies will play out locally — in their reporting or other channels. Beyond the occasional case study showing how an aspect of their sustainability pillars has been implemented at the local level, companies aren’t telling complete, data-driven stories.
As companies look to localize global sustainability strategies, there are three challenges they must address.
1. Global sustainability strategies show the ‘big picture’ at the expense of the ‘true picture’
Global sustainability strategies must be broad and high level enough to account for all the differences of the diverse markets they cover. Global strategy is, in essence, a company average.
But averages can deflect focus and investment from the solutions and regions that need it most — and where the greatest impact can be made.
There can also be an inherent bias leading to a focus on the most pressing social and environmental issues of where the corporate headquarters is located. At Davos, many leaders acknowledged that a “one strategy fits all” global corporate approach will not drive innovation and deliver meaningful progress, and a regional picture of impact and action is needed. While global sustainability ambitions are important, sustainability leaders must understand that their location and the maturity of that market can influence the scale and type of ambitions being set and not adequately consider other local markets.
There’s been increased awareness and interest from local markets wanting to understand how they can take their company’s global sustainability goals and strategy and make them relevant to local stakeholders. One Australian food and drink business conducted a local materiality assessment that used global issues as a basis for stakeholder engagement. It enabled them to go deeper into the high-level company wide topics and understand how the specific topics translated to the local market. By understanding which aspects to dial up or down and what sub-topics were most material to the market, they were able to interpret their global strategy in a way that resonated with local understanding and needs. This local market information could then be used by global teams to prioritize resources and efforts.
2. Local regulations are becoming global requirements
A market’s specific regulatory environment is a major factor in the necessary approach to sustainability. What’s bold and ambitious in one market may be mere compliance in another.
Local regulations are becoming global requirements and impacting markets beyond a single local market. In January, the Germany supply chain act came into force, which requires suppliers for German companies to comply with new requirements related to human rights and environmental risks and violations. As the European Union prepares for its own supply chain regulations, global corporate teams need to be able to understand the cross-market implications and take appropriate action.
While global sustainability ambitions are important, sustainability leaders must understand that their location and the maturity of that market can influence the scale and type of ambitions being set and not adequately consider other local markets.
When setting global ambition levels, corporate teams should engage with local markets to understand the implications of global ambitions in those markets, including how the global strategy will be implemented in each market. Considering, and answering these questions, supports prioritization and implementation plans at a global and local level. Some questions to ask include:
Will each market be expected to deliver against the global targets equally?
Will there be a minimum standard that all markets need to meet but where some markets will be hero markets?
Are markets able to adapt the strategy depending on their regulatory or cultural context?
To what extent can global teams support local markets to set and deliver sustainability strategies through financial and resource support?
3. Top-down sustainability strategies fail to translate at the local level
The idea that global and local perspectives conflict is quickly going out of fashion. The very concept of “local” isn’t easily defined by country or city. Sometimes different countries can share more similarities than two cities in the same country.
When working with a global strategy at a local level, common frustrations are around the slow responsiveness of global teams, the reluctance of ambition and the centralization of sustainability resources. An approach that allows markets to retain flexibility and freedom to set their own goals while having overarching, thematic goals has been a more promising approach allowing markets to adopt a matrix approach rather than relying on top-down pressure.
Thinking three-dimensionally allows one market to look horizontally for support in similar markets. Companies have found that other markets with similar politico-cultural makeup often have learnings that are invaluable in understanding how to set a localized strategy and the allies aren’t always the ones that are geographically closest. The Australian businesses found more similarities within the Canadian market than they did with closer neighbors.
When sustainability teams are lean and global strategies rely on a law of averages, harnessing learnings from similar markets can be extremely valuable.
To succeed, companies must design bold strategies that are agile and adaptive.
These must be built on incremental roadmaps and supported by strong internal and external governance models, which are based on constant feedback loops across the company ecosystem. This will ensure global and local teams have the flexibility to respond to internal and external priorities, can create relevant and actional narratives that go beyond averages and set a clear direction so that everyone, regardless of location, can get behind them and be a part of delivering progress.
Let’s Change The Way We Shop’ sign outside Selfridges on Oxford Street. Photo: GETTY
By Clara Ludmir, Contributor via Forbes • Reposted May 5, 2023
With shoppers becoming increasingly mindful of their consumption choices, businesses are facing heightened scrutiny and pressure to meet new sustainability standards and adapt to evolving shopping habits. This is driving retailers to rethink their business models to make circularity part of their mindset and operations. So, how are retailers that weren’t born with sustainability at the core of their business concretely adapting to the circular momentum?
From Linear To Circular Business Models
Certain brands and retailers are paving the way for impactful mindset and operational shifts needed to truly put sustainability at the heart of their agenda. Luxury department store Selfridges developed a vision to reinvent retail through its ‘Project Earth’ initiative, built on three pillars: transitioning to sustainable materials, investing in new shopping models, and challenging the mindsets of its partners, teams and customers. In addition to aiming for net-zero carbon emissions by 2040, the retailer made a bold commitment: by 2030, 45% of transactions within the business will come from circular products and services.
Selfridges considers a transaction to be circular when it comes from a resale, rental, refill, repair or recycled product. This target is backed by continuous efforts and initiatives designed to accompany this ambitious strategic objective, such as the definition of specific targets to deliver a material transformation roadmap, new repair and rental services and in-store experiences to shift customer attitude towards circular shopping and consumption.
Rethinking The Product Life Cycle To Develop A Closed-loop System
Fashion brand Coach has also recently demonstrated its intent to take the circular momentum seriously through the launch of Coachtopia. Developed as a collaborative lab for innovation focused on circular craft, the launch marks a significant milestone for the company. Speaking to FashionNetwork.com at the label’s Regent Street flagship, Joon Silverstein, Coach’s SVP of Global Marketing and Sustainability and Head of Coachtopia, considers that this line is “rethinking the product life cycle from end to end. Creating beautiful new things from waste, designing to re-make at scale and ultimately working towards a closed loop system.” This approach is focused on producing items designed to have multiple lives, implying that they are created with the intent to be easily disassembled and repurposed into another product in the future.
In addition to embracing an innovative approach to designing products made from waste and meant to be recycled and repurposed, Coachtopia leveraged insights from a beta community of GenZ individuals to inspire and be inspired by a demographic that is more actively invested in climate change and the environment. “We believe very strongly that it’s important to create it not for these consumers but with them,” Silverstein told FashionNetwork.com, allowing this initiative to give a voice and platform to creatives and climate advocates excited to participate in disrupting fashion for the better.
The sub-brand offers a line of bags, wallets and ready-to-wear items that are available in Selfridges, Coach stores across North America and the brand’s US and UK sites.
In-Store Resale Offering Is Expanding
The second-hand apparel market is experiencing continuous growth, with sales expected to reach $350 billion by 2037 based on a report from resale platform thredUp. In the United States, 1 in 3 apparel items bought by women in 2022 was second-hand, with Millenials and GenZ responsible for more than half of the revenue. As a response to this growing demand, a number of retailers are designing in-store spaces dedicated to second-hand shopping through the launch of pop-ups, corners and own-brand initiatives.
(RE)STORE space in Galeries Lafayette HaussmannGALERIES LAFAYETTE
In Paris, leading department stores have all started to welcome circularity through dedicated store spaces and offerings. For instance, the Galeries Lafayette Haussmann launched in 2021 a (RE)STORE space of 500 square meters dedicated to second-hand players and sustainable brands. In addition to hosting Monogram, a French luxury second-hand e-tailer, the space features a number of popular online resale shops as well as sustainable brands designing clothing or products made exclusively from offcuts and recycled materials.
Brands with a large retail footprint are evolving to embed circularity in their commercial model. For example, French baby and children’s clothing brand Petit Bateau is making space in its stores for second-hand clothing with the launch of its resale program, allowing customers to both purchase or sell second-hand items in-store. So far, around 20 stores in France are participating in the initiative, with a roll-out to other European countries and Japan expected in the next year. Petit Bateau aims to be the most durable brand in this segment, with products designed to be re-worn by multiple kids, thus almost naturally expected to embrace circularity. While today, only 1% of products sold come from this program, the brand’s CEO Guillaume Darrousez shared on French TV channel BFMTV that by 2030, 1 in 3 transactions will come from the circular economy, either through second-hand or rental products.
Adopting Circularity Is Key To Customer Acquisition And Retention
As of today, retailers are for the most part engaging in the circular momentum as a means to acquire and retain shoppers, rather than to grow profits. In fact, most brands launching their resale platform via a dedicated website struggle to make it a profitable endeavour. Luxury resale platform The RealReal has yet to find an attractive economic model, reporting a net loss of $196 million in 2022 and the closure of various retail locations, which highlights the sector’s struggle to make second-hand retail a scaleable and profitable business.
However, while retailers might not drive significant revenue from recycle, repair or resale initiatives just yet, these allow them to attract a new audience: as mentioned in thredUp’s 2023 resale report, 60% of the resale market’s growth will be attributed to new shoppers, stressing the rising interest for second-hand offerings. Considering the expected size of the resale market and growing pressure on brands to become more accountable and conscious of climate change, retailers are expected to get on board and adopt circularity on a bigger scale in the next five years.
By then, we might have the answer to the following question: will circularity – whether through recycling and reusing materials to produce new items or launching an in-house resale program – ever be scaleable and profitable? Or will it just represent a fraction of brands’ industrial and commercial operations while enabling them to showcase sustainable commitments?
By Jeremy P. Shapiro, Adjunct Assistant Professor of Psychological Sciences, Case Western Reserve University via The Conversation • Reposted May 5, 2023
Cold spells often bring climate change deniers out in force on social media, with hashtags like #ClimateHoax and #ClimateScam. Former President Donald Trump often chimes in, repeatedly claiming that each cold snap disproves the existence of global warming.
From a scientific standpoint, these claims of disproof are absurd. Fluctuations in the weather don’t refute clear long-term trends in the climate.
Yet many people believe these claims, and the political result has been reduced willingness to take action to mitigate climate change. Why are so many people susceptible to this type of disinformation? My field, psychology, can help explain – and help people avoid being misled.
The allure of black-and-white thinking
Close examination of the arguments made by climate change deniers reveals the same mistake made over and over again. That mistake is the cognitive error known as black-and-white thinking, also called dichotomous and all-or-none thinking. As I explain in my book “Finding Goldilocks,” black-and-white thinking is a source of dysfunction in mental health, relationships – and politics.
People are often susceptible to it because in many areas of life, dichotomous thinking does something helpful: It simplifies the world.
Binaries are easy to handle because there are only two possibilities to consider. When people face a spectrum of possibilities and nuance, they have to exert more mental effort. But when that spectrum is polarized into pairs of opposites, choices are clear and dramatic.
This mental labor-saving device is practical in many everyday situations, but it is a poor tool for understanding complicated realities – and the climate is complicated.
Sometimes, people divide the spectrum in asymmetric ways, with one side much larger than the other. For example, perfectionists often categorize their work as either perfect or unsatisfactory, so even good and very good outcomes are lumped together with poor ones in the unsatisfactory category. In dichotomous thinking like this, a single exception can tip a person’s view to one side. It’s like a pass/fail grading system in which 100% earns a pass and everything else gets an F.
With a grading system like this, it’s not surprising that opponents of climate action have found ways to reject global warming research, despite the overwhelming evidence.
Here’s how they do it:
The all-or-nothing problem
Climate change deniers simplify the spectrum of possible scientific consensus into two categories: 100% agreement or no consensus at all. If it’s not one, it’s the other.
A 2021 review of thousands of climate science papers and conference proceedings concluded that over 99% of studies have found that burning fossil fuels warms the planet. That’s not good enough for some skeptics. If they find one contrarian scientist somewhere, they categorize the idea of human-caused global warming as controversial and conclude that there is no basis for action.
In another example of black-and-white thinking, deniers argue that if global temperatures are not increasing at a perfectly consistent rate, there is no such thing as global warming.
However, complex variables never change in a uniform way; they wiggle up and down in the short term even when exhibiting long-term trends. Most business data, such as revenues, profits and stock prices, do this too, with short-term fluctuations contained in long-term trends.
These two graphs have the same form: a long-term trend of major increase within which there are short-term fluctuations. CC BY-ND
Mistaking a cold snap for disproof of climate change is like mistaking a bad month for Apple stock for proof that Apple isn’t a good long-term investment. This error results from homing in on a tiny slice of the graph and ignoring the rest.
Failing to examine the gray area
Climate change deniers also mistakenly cite correlations below 100% as evidence against human-caused global warming. They triumphantly point out that sunspots and volcanic eruptions also affect the climate, even though evidence shows both have very little influence on long-term temperature rise in comparison to greenhouse gas emissions.
In essence, deniers argue that if fossil fuel burning is not all-important, it’s unimportant. They miss the gray area in between: Greenhouse gases are indeed just one factor warming the planet, but they’re the most important one and the factor humans can influence.
‘The climate has always been changing’ – but not like this
As increases in global temperatures have become obvious, some climate change skeptics have switched from denying them to reframing them.
Their oft-repeated line, “The climate has always been changing,” typically delivered with an air of patient wisdom, is based on a striking lack of knowledge about the evidence from climate research.
Their reasoning is based on an invalid binary: Either the climate is changing or it’s not, and since it’s always been changing, there is nothing new here and no cause for concern.
As humanity faces the challenge of global warming, we need to use all our cognitive resources. Recognizing the thinking error at the root of climate change denial could disarm objections to climate research and make science the basis of our efforts to preserve a hospitable environment for our future.
Despite growing corporate efforts to drive sustainable change and climate action, there’s an underlying issue: a lack of consumer trust towards companies’ claims on this front. By Dr. Rebecca Swift, Global Head of Creative Insights at Getty Images from Sustainable Brands • Reposted: May 3, 2023
Around the world, major environmental events and extreme weather conditions have pushed climate change to top of mind for people worldwide. According to iStock and Getty Images’ VisualGPS research, “climate change” ranks top of the list of concerns for individuals across the globe — higher than inflation, the energy crises, or issues surrounding world peace.
However, there is still a general sense of ambiguity on who is accountable for driving forward actions to combat climate risks — is it the government? Big businesses? Or are individuals most responsible? Our insights tell us people globally believe it is a shared responsibility; yet each actor’s expectations seem to be first on others, rather than on themselves.
Historically, across different industries, ad campaigns have promoted the idea of individual responsibility. We are used to seeing visuals highlighting individual sustainable practices — from recycling to biking to using reusable shopping bags. All of these concepts, mostly driven by brands and policies, reinforce the idea that sustainability is an individual responsibility.
On the other hand, as VisualGPS found, individuals believe that government is the primary agent responsible for dealing with sustainability efforts and environmental concerns related to global climate change; and that businesses are as responsible as individuals for protecting the planet and enacting sustainable practices.
Since the first UN Climate Change Conference held in 1995, people have been able to follow some countries’ governments’ progress in dealing with climate change issues, while also seeing how corporate philanthropy evolved into impactful CSR programs. Today, 7 out of 10 individuals around the globe believe they have made a lot of progress toward living a more environmentally sustainable life, VisualGPS found.
Nonetheless, despite all involved agents taking part in making a change — denoting a high level of climate awareness — there’s an underlying issue yet to be solved: VisualGPS also revealed a lack of consumer trust towards companies’ claims on this front. More than 80 percent of consumers believe products are made to seem environmentally friendlier than they are, followed by distrust of products that are labeled ”environmentally friendly” as a marketing ploy; and they believe companies claim they abide by ESG (Environmental, social, and governance) standards but do not show enough evidence for it.
The 2023 Edelman Trust Barometer reported an average five-to-one margin of respondents who want businesses to play a bigger, not smaller, role in addressing climate change. The same research found respondents have low trust in the government; in contrast, businesses continue to gain trust around the world and are the sole institution seen as competent and ethical — showing companies are uniquely positioned to bridge the sustainability trust gap, fill the void left by governments, and showcase the invaluable role they play in addressing climate change.
When it comes to deciding which company to use or buy from, 84 percent of people believe it is important that a company uses sustainable business practices and extends these to their products; yet more than half claim it’s too much work to research what brands are actively doing to mitigate climate risks. Knowing most consumers make purchase decisions based on visual content — and also expect brands to take a public stand and drive real action on social and environmental issues — companies and brands can lean on better visuals to tell their sustainability story and make their efforts known to engage with consumers.
Regularly, visuals related to environmentalism and sustainability rely on familiar visual clichés— think, the lone polar bear or hands cupping a sapling — unimaginatively used to convey environmental issues. Many brands also focus on conceptual images and videos that are too abstract to stand out or resonate in a crowded visual landscape. Instead, businesses could focus on large-scale (often policy-backed) visuals — such as actions in the realm of infrastructure, renewable energy, agriculture, water conservation, or management of green spaces — imagery representing topics and initiatives that could transcend the barrier of practices often seen as greenwashing.
As the climate crisis accelerates, consumers are becoming more knowledgeable about what is sustainable; how our decisions, products and policies impact the environment; who is responsible — and whether or not they trust corporate and government sustainability claims. In turn, businesses should look to visual images and messaging that rise to the occasion.
By Nadine Sterley, Chief Sustainability Officer, GEA and Judith Wiese, Chief People and Sustainability Officer and Member of the Managing Board, Siemens from the World Economic Forum • Reposted: May 3, 2023
Corporate sustainability has become a crucial strategic imperative.
Sustainability leaders are pivotal in shaping organizational change.
Two leaders share their thoughts on how this can be achieved.
The need for critical action to achieve climate and nature goals has elevated the role of the Chief Sustainability Officer (CSO). The private sector will play a key role in multistakeholder partnerships to actualize the impact on climate and nature.
However, this cannot be achieved without a human-centred approach, making the Chief Human Resources Officer (CHRO) role also essential for sustainability transformation.
Within the private sector, CSOs and CHROs will shape fundamental strategies for organizational change to catalyze sustainable habits in organizations and individuals.
“Sustainability, HR and organizational change can influence companies and their value chains”
Nadine Sterley, Chief Sustainability Officer, GEA Group
As the world is confronted with the consequences of the climate crisis and other environmental challenges, acting sustainably is becoming increasingly essential in companies. This is true both from a strategic point of view as well as with regard to innovations and successful recruiting. At the same time, the breadth of sustainability topics is increasing year-on-year.
The growing importance for companies to act sustainably and report on their sustainability performance has elevated the role of the Chief Sustainability Officer (CSO). Sustainability has evolved from being a niche function to a strategic one. CSOs are expected to take a key role in leading their organizations towards sustainable business practices. At GEA, the CSO role belongs to the inner circle of the company’s decision-making. It plays a crucial role in helping its executives and the entire workforce to easier understand, reasonably measure and adequately report on sustainability impacts, risks and opportunities.
As sustainability has fundamental strategic importance, GEA has put the topic at the heart of its strategic approach. In fact, sustainability is the core theme in GEA’s corporate purpose, “Engineering for a better world”, from which the company’s vision is derived: “We safeguard future generations by providing sustainable solutions for the nutrition and pharmaceutical industries.”
Moreover, sustainability has its own pillar within GEA’s Mission 26 corporate strategy and underpins the other six key levers. Taken together, they form the roadmap to ensure GEA achieves its targets. Within this framework, the CSO works strategically to ensure sustainability is integrated into all business activities and the entire company. This requires adept networking and advocacy skills and the ability to connect the dots within and outside the organization to drive sustainability transformation.
However, as important as they are, neither strategy, nor the organization or the products on their own are enough to make the key difference. What matters most to achieving real transformational change and becoming a truly sustainable company is the mindset, behaviour and commitment of a company’s employees. To help their organization succeed, employees need to be engaged, empowered, and assume a key role in the transformation. And this is where the human resources function must become part of the game. It can create a supportive environment that fosters a sustainable mindset and behaviour. It also plays a critical role in hiring and helping ensure new employees understand and embrace company values.
GEA is taking this aspect very seriously. Of GEA’s five values, the first one is: “Responsibility: We care for people and planet.” Internally and externally, our CEO, Stefan Klebert, has made it his personal mission to promote this value, thus setting the tone for all employees.
The clarity and importance placed on caring for people and planet, reinforced by GEA’s corporate purpose: “Engineering for a better world”, serve as a promise to current and future employees. This has already had a positive impact on our goal to become “Employer of Choice” in our industry. Likewise, our values and purpose set a clear expectation toward all employees and, consequently, any people-related decisions.
In addition to requesting a driving mindset towards sustainability from all employees, GEA is significantly investing in the competency development of its business leaders. Just recently, the top 160 leaders of the company, went through a comprehensive programme with a renowned business school that was strongly focused on identifying new ways of leveraging sustainability as a source for competitive advantage.
Building on that, the company’s leadership teams are now expected to develop their own strategies to create additional value for their customers by offering products and solutions that allow a reduction of energy, water, or waste. To encourage even more innovation in these areas, we set up cross-function and cross-divisional sustainability-focused hackathons to spark creativity.
As of 2023, a significant proportion of GEA’s senior leaders will participate in a variable compensation plan which is linked to GEA achieving its sustainability-related targets. For example, the reduction of CO2 emissions in GEA’s own plants and along entire supply chains will lead to higher compensation, as will the development of more efficient products that support customers in achieving their sustainability targets.
With the support of our employees, GEA is not only driving its own sustainability transformation but also the transformation of the many industries it supports through engineering excellence.
“Being Chief People and Sustainability Officer is a game changing superpower”
Judith Wiese, Chief People and Sustainability Officer and Member of the Managing Board, Siemens
The challenges to human (co-)existence on the planet from resource depletion, climate change, and unsustainable practices of the industrial age are undeniable. In the corporate world, the broader attention needed to handle sustainability issues is generally allocated to the role of the Chief Sustainability Officer (CSO). There are, however, no universal standards for what this function does or how much authority it has to be effective. At Siemens, the CSO role has been a board-level position since 2008, underscoring the importance of sustainability as a building block of our DNA and setting a strong foundation to build on. And that’s what we do, every day.
As Chief People and Sustainability Officer (CPSO) at Siemens, I have the unique opportunity to wear two hats: one for ensuring the well-being of our people and nurturing our company culture, and one for advancing sustainable practices in our own operations and all aspects of our business – multiplying the impact for our customers and communities. For me, this is a superpower. It joins two powerful elements that run horizontally across all our businesses: people and sustainability – both necessary if solutions are to be found for solving the most critical issues of our time. Add in the power of technology that Siemens brings as a technology company, and you have an unstoppable combination that actively supports the mindset shift needed for achieving a more sustainable world.
At Siemens, our push for sustainable business practices is encompassed in our 360-degree framework, containing six fields of action: Decarbonization, Ethics, Governance, Resource Efficiency, Equity, and Employability or DEGREE. Our DEGREE framework is, among other things, a commitment to ethical standards based on trust and respect for human rights in the supply chain.
DEGREE allows a holistic view of sustainability that puts people topics like employability and equity, as well as environmental and societal impact topics, in focus. We encourage continuous learning and are committed to re- and upskilling, especially green skills. In the last fiscal year, we invested €280 million in professional training and continued education to transform our workforce into sustainability ambassadors. Our highly popular Base Camp for Sustainability offers an introduction to DEGREE and 66,000 participants have completed the course already in FY23.
We value the E for Equity that helps us integrate and promote diversity, equity, and inclusion into the fabric of our company. It helps us create a workforce that reflects our customer landscape and brings a fresh perspective to the way we think about creating solutions. The intersection of people’s interests with our company values creates a sense of belonging and engagement that we both admire and appreciate.
Combining the responsibilities for sustainability and people operations allows social aspects to be complemented by proficiency in the environmental and corporate governance spheres. At Siemens, with sustainability at the core of our processes, we need relevant skillsets across our business units and corporate functions. This allows sustainable approaches to be developed in an ecosystem manner, observing the cross-functional and business governance standards required to comply with new EU Taxonomy regulations and develop non-financial reporting and accounting guidelines.
To effect change, a cultural and organizational transformation and mindset shift are necessary. The convergence of people and sustainability can be a useful tool to speed up the momentum of much-needed change in all aspects of our existence. Indeed, for a company like Siemens – undergoing the transformation from industry to global technology leader – sustainability is a tremendous opportunity. Crucially, this applies both to our own operations and to our portfolio. We have increased our CO2 reduction target from 50% to 90% by 2030, compared to 2019, and will invest €650 million in decarbonizing our activities by 2030. But our products and solutions can also help our customers with their sustainability challenges – ~150 Mio tons of emissions were avoided by customers in FY22 alone.
Those companies that recognize the power of this combination will be well positioned to be drivers of innovation and growth, increase employee engagement, and mitigate the challenges associated with rapid transformation.
As a company at the intersection of the real and digital worlds, we at Siemens believe that technology is a key driver of sustainability. Embracing a holistic view that goes beyond environmental topics, we anchor sustainability firmly in all our business and operations. We are confident that leveraging the superpower combination of technology, people and sustainability can make a difference and transform the lives of billions.
Tourists try to stay dry in a flooded St Mark’s Square in Venice, Italy, in 2018. Flooding in the region has only intensified in recent years. Image credit: Jonathan Ford/Unsplash
By Joyce Coffee from Triplepundit.com • Reposted: May 2, 2023
It has become de rigueur for companies eager to reduce their climate-related disaster risks to sign up with groups that focus on assisting corporate clients with their climate change challenges.
The Science Based Targets initiative (SBTi), for one, helps the private sector set science-based emissions reduction targets. It’s a partnership between CDP, the United Nations Global Compact, the World Resources Institute and the World Wide Fund for Nature (WWF). Another, the Task Force on Climate-Related Financial Disclosures, offers guidelines for how companies can report their exposure to physical climate-related risks, among other things.
The assistance these groups provide is timely. The U.S. Securities and Exchange Commission (SEC), which protects investors and regulates publicly-held companies’ disclosures, is considering rules to require public companies to provide climate risk-related financial data. And most (if not all) U.N. agencies and other international climate change-related programs recognize the need to address disaster risks and other forms of climate risk worldwide.
But do these groups follow climate science? That question arose last month when a distinguished engineer openly questioned climate science in a presentation to the U.N. Disaster Risk Reduction Private Sector Alliance for Disaster Resilient Societies (ARISE) and its growing membership of U.S. corporate leaders. “We don’t know if climate change is happening now, and we don’t know if it will happen in the future,” he contended.
Peruse any legitimate climate source, and it’s nigh impossible to question climate science, whether our planet is warming and the effects of greenhouse gas emissions. The U.N. has a growing set of resources, among them:
Race to Resilience, a global campaign that convenes non-government actors to build climate resilience in vulnerable communities.
U.N. Environment Program (UNEP) online course on Nature-based Solutions for Disaster and Climate Resilience, which has extended nature-based solutions certificates to more than 60,000 leaders worldwide.
Annual agreements from the U.N. Conference of the Parties, of which the Paris Climate Agreement is the best known
As the U.N. plainly asserts: “It is unequivocal that human influence has warmed the atmosphere, ocean and land. Widespread and rapid changes in the atmosphere, ocean, cryosphere and biosphere have occurred.”
ARISE, whose U.S. arm I co-chair, follows the Sendai Framework for Disaster Risk Reduction. The latest documents of the Framework — the 2015 U.N.-adopted document that calls for assessing and reporting progress on disaster-reduction plans — emphasize that disaster risks “are growing at an unprecedented rate globally, inflicting damage across sectors and vital systems for human societies and economies.”
It also maintains: “We are living outside the boundaries of what our planet can sustain, to the detriment of future generations. Radical shifts are needed to change course toward a more sustainable and risk-informed pathway, as the world is facing a projected 40 percent increase in disasters during the lifetime of the Sendai Framework to 2030.”
The Framework cites climate change on over half of its 140 pages, and the No. 1 commitment of the U.N. Plan of Action on Disaster Risk Reduction for Resilience is to take a risk-informed approach.
We must also heed another distinguished engineer, U.N. Secretary General António Guterres, who earned a degree in the field from the Instituto Superior Técnico in Portugal back in 1949. “Greenhouse gas emissions keep growing, global temperatures keep rising, and our planet is fast approaching tipping points that will make climate chaos irreversible,” he told CNBC last year. “We are on a highway to climate hell with our foot still on the accelerator.”
And we must promote companies looking to the SBTi and others for assistance in mitigating disaster risks. Onward with this important work!
Joyce Coffee, LEED AP, is founder and President of Climate Resilience Consulting. She is an accomplished organizational strategist and visionary leader with over 25 years of domestic and international experience in the corporate, government and non-profit sectors implementing resilience and sustainability strategies, management systems, performance measurement, partnerships, benchmarking and reporting.
Graham Rihn, Founder & CEO of RoadRunner Recycling, discusses how smart technology can boost a business’s sustainability credentials in six key areas. By Graham Rihn from Sustainability Magazine • Reposted: May 2, 2023
More and more, business leaders are identifying that sustainability initiatives are not only beneficial for climate change, but can also have positive impacts on a company’s bottom line, when executed effectively.
Resultantly, companies are investing in smart technology like AI, machine learning, and blockchain to help accelerate and streamline sustainability efforts, operate more efficiently and drive shareholder value.
While businesses, especially those with large national or global footprints, often face the challenge of scalability when it comes to implementing sustainability action plans across a variety of locations, a recent PriceWaterhouseCooper study found that more than 70% of sustainable goals could be accelerated through technology adoption.
New technologies can step into this arena to help businesses overcome these challenges among others. Here are six areas of sustainability businesses can improve with the help of tools such as AI, machine learning, and blockchain development.
Energy Efficiency
Businesses can optimise energy efficiency through data analysis, and, in turn, identify opportunities for reduced energy consumption and potentially lower bills. For example, connected sensor technology can adjust lighting and air conditioning to occupancy levels. Fewer people in the office can equate to less energy usage. Industrial manufacturing company, Siemens, uses machine learning to optimise data center energy consumption. In the process, the company cut energy costs by 10% and carbon emissions by 16%.
Renewable Energy
A major challenge for businesses involving climate change is sourcing energy that does not come from burning fossil fuels. In 2019, burning fossil fuels accounted for 74% of U.S. greenhouse gas emissions.
Businesses that choose renewable energy sources can use AI to increase efficiency and reduce their carbon footprint. Google installed a 1.6 MW solar array at its company headquarters as part of its plan to wholly utilise carbon-free energy by 2030. They use AI to maximise the use of that clean energy across data centers, shifting energy-intensive processes to the times of day when the most electricity is available.
Investing in renewables, committing to optimising green energy production, and employing technology to optimise usage can yield dividends in terms of climate change.
Sustainable Supply Chain
Supply chain transparency is essential for building a sustainable business and negating climate change, but tracing a product’s journey is no easy task. Blockchain technology can step in to help a business ensure sustainable sourcing methods are utilised for raw materials. Walmart recently partnered with IBM to implement a blockchain based supply chain tracking system to follow products and materials.
Before applying technology to the supply chain, it took a team more than six days to find the source of a package of mangoes being sold at a store location. Working with IBM, that team could eventually trace each package in less than three seconds. Sustainable sourcing can help businesses reduce emissions, better manage climate risks, and even streamline operations.
Sustainable Product Design
Analysing product performance data can be accomplished through AI algorithms that optimise product design for energy efficiency and recyclability.
As of 2010, Nike employed AI and machine learning to design a sustainable running shoe made with recyclable materials that maintained their standards of durability and athletic performance. The carbon footprint of the product was reduced by 30%.
Applying technology to product design can mean reductions in energy usage and carbon emissions for businesses.
Waste and Recycling Management
Sustainability measures are not only important at a product’s creation, but also when it reaches the end of its usable life. Waste accounts for an estimated 20% of methane emissions across the world.
Today, new technologies can analyse waste generation to identify areas in which organisations can reduce waste output. Waste metering technology is able to monitor the types and volumes of waste being generated to optimise service. It can also identify areas for increased recycling or waste elimination.
One example, the city of Amsterdam implemented an AI-based application in 2021 that can detect garbage and recycling on the street. It automatically maps the area and once the material is identified by the AI in real time, the information is shared with the city’s waste management department to clean up. The application is able to quickly solve waste disposal issues in Amsterdam at scale.
ESG Reporting
Embracing technologies that aid in implementing sustainable changes to businesses can also enable better, more accurate ESG reporting. Disclosing this type of information could soon become a requirement with potential new SEC Scope 3 emissions reporting rules coming in 2023 and technology adoption can help businesses be well-prepared.
Many businesses find that with the use of AI and sensor technology that data quality is improved, reporting processes can be automated, the technology can identify risks and opportunities, and they are better able to forecast future trends.
Microsoft uses AI-based carbon management software and Internet of Things for its AI for Earth programme. It can measure, manage, and find ways to reduce an organisation’s carbon footprint. That can be an attractive metric to investors measuring a company by its ESG score. Cutting emissions usually means a reduction in energy use which often translates to lower costs. Using AI for data collection and predictive analytics can provide a powerful avenue to find new methods of driving sustainability solutions.
Why apply technology to sustainability
Implementing these tools as part of a holistic sustainability program allows companies to find solutions that fit their needs and sets your business up for success in both the short- and long-term.
Smart technologies can help us accelerate the road to a more sustainable future, and the time to start is now. Implementing this technology now prepares your business for a future in which sustainability will have a bigger impact on the bottom line.
In fact, more than 74% of institutional investors said they would divest from companies with a poor environmental track record.
AI, machine learning, and blockchain technology can push businesses to achieve goals such as Zero Waste and carbon neutrality, while preparing you for the expectations of tomorrow, today.
While the volatility of economic change around us can be distracting, one thing remains clear: A new generation of expectations is shifting business for good.By Del Hudson from Sustainable Brands • Reposted: April 30, 2023
Government regulators are playing a key role in shaping how we address climate change; however, influential businesses have a chance to ensure these requirements speak to the metrics that make a true impact. Policy is a catalytic vehicle for change. As a business community, we should be embracing it as a means to address the existential threat of the climate crisis — to not do so would be irresponsible and dangerous. Recognizing the tension in the system among trade organizations, policymakers and corporations doesn’t mean it can’t be done right. For businesses and brands, creating incentives around impact reductionthat tie clearly to company goals is a key opportunity for transformative action.
It’s no secret that multiple industries have reaped the rewards of a broken economic model that relies on extractive and exploitative practices that continue to harm people and the planet. Consumer goods is one of those industries; and responsible leaders recognize it is time for a new system — one that transforms design and consumption and imagines a new way of doing profitable business. Over two-thirds of US consumers are willing to pay more for sustainable products. Globally, that number is just over a third — though that number rises to 39 percent for Gen Z and 42 percent for millennials. Capital markets will reward those that are de-risking their supply chains; and employees want to work where purpose and responsibility matters.
The argument that without perfect data we can’t do this work ignores the reality that science is always evolving. We must move forward with urgency, using the significant directional data that already exist and show where the key issues and intervention opportunities lie. Taking accountability for the full product lifecycle and impacts up and down the value chain is the only way to achieve meaningful ESG performance. It’s not about marketing single environmental or social attributes of a product. It’s not just reducing impact in owned operations while ignoring the manufacturing impact or material inputs of the end product. It’s believing that tomorrow’s customers will want (and deserve) something different than they get today.
This is hard, complex work; it won’t be completed in my lifetime. But we must move rapidly to accurately understand impact and take action with urgency. And we must be ready to learn and change as we know more. The tools to begin this work already exist. Smart businesses already see their futures. And while the volatility of economic change around us can be distracting, one thing remains clear: A new generation of expectations is shifting business for good.
By David Herpers, Forbes Councils Member via forbes.com • Reposted: April 29, 2023
As Generation Z begins to harness its buying power and make significant financial decisions, competition for its attention grows. For companies hoping to capture this generation’s business, it’s important to understand the way they view their finances and how they engage with a brand. While Gen Z’s relationship with money and brands is similar to that of its older siblings, millennials, it’s certainly not the same. Let’s look at how Gen Z approaches finances and consumer brands.
Money Habits
As with the members of any younger generation, we tend to expect Gen Z to have irresponsible spending habits and not to be the biggest savers. Studies show this isn’t the case.
Gen Z tends to spend less and save more than the other generations, contributing an average of $867 in savings per month, almost doubling what the average American saves each month ($462). One may find themselves asking, is Gen Z more fiscally responsible than the rest of us?
The answer is yes and no. One main factor leading to the high monthly average of savings is many Gen Zers still live at home. According to a 2022 study by Credit Karma, Gen Z is setting records for the number of people living with their parents following high school education. With costs of living at an all-time high, most Gen Zers are making the decision to stay home in the best interest of their short- and long-term financial security.
That said, there’s still a large portion of Gen Z that chooses to spend over saving. However, those that fall into the spending category are still taking a cautious approach. Over 68% of Gen Zers use a budgeting tool of some sort to manage their finances. Of those surveyed, 43% say they prefer the old-fashioned pen-and-paper method, while 38%, respectively, say they use online budgeting tools.
Brand Enthusiasm
Gen Zers’ cautious nature isn’t exclusive to their housing and higher costs. It extends to their relationships with brands as well. When looking at the relationship between Gen Z and brands, a recent IBM study measured brand loyalty (repeated purchases) and brand enthusiasm (active engagement between brands and customers).
According to the IBM study, Gen Z is more likely to display brand enthusiasm over brand loyalty. Known as the “generation of researchers,” this is likely due to Gen Z’s habit of turning to online platforms for reviews before making even small purchases.
Rather than committing to a brand they are familiar with, Gen Zers will evaluate all options, taking into consideration customer and influencer reviews, social media presence and value alignment. When they find a brand that checks all their boxes, they are eager to share and engage with it. But keep in mind, should the brand harm the relationship in some way, Gen Zers quickly move to purchase from a competitor.
An advantage of appealing to brand enthusiasm, as noted by IBM, is that it creates opportunities to gain insight into customers’ attitudes and purchasing habits in relation to a brand. Companies get to have conversations with customers about what they want rather than guessing. And we already have insight into what Gen Z customers crave.
Authenticity
While millennials may stray away from content that’s been highly edited and airbrushed and that poses perfect “promises,” Gen Z has taken it to the next level—by adeptly recognizing the differences between real and fake online content. As the first generation born into social media and becoming more tech-savvy than generations so far, Gen Z is quick to identify fantasy versus reality. According to IBM’s study of Gen Z’s relationships with brands, it’s clear this generation places a high value on a brand’s authenticity and prefers real content over staged content.
The concept of authenticity extends beyond advertising and product images for Gen Z; it includes the company’s impact. According to a 2019 Kearney study, 57% of Gen Z reports a brand’s social and environmental impacts are key factors in its purchasing decision. But a statement about a brand’s commitment isn’t enough to sway the generation of researchers. In fact, Gen Z will go out of its way to find—and even pay slightly more for—a product or service if it means the purchase aligns with its values.
As Gen Z’s influence on the market and society continues to grow, companies and brands can best position themselves for success by aligning with the values and habits of this generation. With a large number of consumers that can take the success of a brand into their own hands, keep in mind their financial concerns, engagement expectations and craving for authentic content, as these are likely essential to keep a brand afloat in the rise of this new generation.
David Herpers is the SVP of Digital Bank at Credit One Bank. His expertise includes wealth management, banking and product management.
While it may be tempting to take a ‘wait and see’ approach, more and more companies are developing their own solutions to mitigate this gap internally. Here are four such strategies. By JOANNA BUCZKOWSKA-MCCUMBER via Sustainablebrands.com • Reposted: April 29, 2023
Businesses across industries are under mounting pressure to adopt sustainable practices, reduce their environmental impact, and provide ESG reporting and transparency in their efforts while staying accountable to their commitments. As demand for sustainability grows, so does the need for skilled professionals and workers who can drive and implement strategy and practices effectively across organizations and supply chains. However, most companies do not have the talent with the knowledge, experience and skills to achieve their sustainability goals.
Companies are recognizing that the demand for sustainability talent is outpacing the supply; and the gap is only growing — as sustainability roles expand and new ones get created, a Corporate Sustainability Officer is just not enough. The International Labour Organization suggests that 18 million net new jobs could be created worldwide by net-zero commitments by 2030. Recent research found that 82 percent of sustainability executives believed there were significant skills gaps within their own organization to tackle sustainability requirements. The World Economic Forum has directly linked the lack of qualified talent as being one of the significant barriers to implementing sustainability strategies; while the UN Global Compact has called for direct action to address this skills gap — prompting companies to prioritize and invest in skilling, upskilling and reskilling their teams.
While it may be tempting for companies to take a ‘wait and see’ approach, it won’t bridge this gap fast enough and will have negative effects. More and more companies — includingMicrosoft, Salesforce and Interface — are turning to mitigate this gap internally by developing and implementing their own solutions.
Bridging the sustainability skills gap internally will be fundamental for businesses in reaching their sustainability objectives. Here are four such strategies.
Make sustainability a strategic priority
First and foremost, a strong sustainability strategy sends a clear signal to potential and current employees that a business is committed to sustainability. This can be a major selling point for job seekers who are looking to work for a company that shares their values. By publicly committing to sustainability and investing in the resources needed to achieve sustainability goals, businesses can attract top talent and build a workforce that is passionate about sustainability. But it’s not just about attracting the right talent — a sustainability strategy can help to engage, motivate and develop the skills of existing employees.
Investing in a sustainability strategy can also help businesses to stay ahead of the curve when it comes to trends and regulations. As governments around the world enact more stringent sustainability regulations, businesses that are already taking a proactive approach to sustainability will be better positioned to adapt to these changes. By investing in a sustainability strategy now, businesses can ensure that they have the knowledge, skills, and resources needed to comply with future regulations and stay ahead of their competitors.
Provide training across your organization
They’re perhaps the most obvious on the list, but education and training programs are essential for building the skills and knowledge needed to implement sustainable practices effectively. These programs can take various forms — including workshops, online courses, mentoring programs, internships, etc — and can be customized to specific job functions and levels. They can be developed internally, sourced online or even co-developed with educational institutions.
The trick is ensuring that you are levelling up your current workforce while priming the incoming talent pipeline. That focus then has to consider both an internal and external training lens. Microsoft is an excellent example of how a company can tackle the sustainability skills gap on both sides — focusing on internal training for employees while also building out external learning opportunities through its Sustainability Learning Center.
Integrate sustainability into company culture
Planning and training are key tools in providing knowledge and setting the playing field but incorporating sustainability into corporate culture is what makes sustainability efforts meaningful. In 2021, the World Economic Forumreleased a study that found companies with a strong sustainability culture are more likely to attract and retain employees with the appropriate skills and knowledge — helping to mitigate brain drain.
Building a culture rooted in sustainability entails fostering a culture that prioritizes and values sustainability and encourages employees to develop their sustainability skills regardless of their job responsibilities. Companies can start by creating plans that set sustainability goals and targets, and ensuring those are communicated clearly and in a format that not only engages but enables every employee to feel that they have a role to play in the execution of the plan.
Providing channels where employees can execute sustainability goals while having the agency to develop and recommend new sustainability initiatives, rounded out by volunteering opportunities or employee resource groups, provides a rich internal ecosystem for sustainability to thrive. Acknowledging employees who exhibit leadership and innovation and celebrating teams that achieve sustainability goals is an added strategy to inspire and motivate employees to become champions of sustainability within the organization and sustain an engaged workforce.
Embed sustainability into the employee lifecycle
Companies must prioritize sustainability throughout the employee lifecycle, integrating it into major HR functions. A Harvard Business Review study found that embedding sustainability in the employee lifecycle by incorporating sustainability targets and social impact considerations into the attraction and recruitment processes can improve employee engagement and retention rates. For example, job descriptions, interview questions and selection criteria can emphasize the importance of sustainability skills and experience or even a desire to learn new sustainability skills.
Investing in sustainability initiatives can offer ample opportunities for employees to develop their skills and enhance their knowledge in this critical area. Ensuring that sustainability elements are baked into regular HR functions such as professional development, checks-ins and performance reviews will enable leaders to be aware of specialized skill development and matching employees with new opportunities within the company as they arise.
To remain competitive in the marketplace, companies must adopt proactive measures to address the sustainability skills gap — by investing in making sustainability a priority, training, and embedding it across culture and people functions. Being proactive in bridging this business challenge will only have a net-positive effect on performance across environmental and social factors; but without it, companies will be left behind.
NRG Energy, Wednesday, April 26, 2023, Press release picture
By Greg Kandankulam from NRG Energy Inc. • Reposted: April 28, 2023
Now more than ever, organizations are prioritizing sustainability planning to achieve long-term climate goals. However, not every business has a dedicated team. In many cases, leaders take on such planning as an added responsibility outside of their traditional job scope.
Like many fields, sustainability has its own language with a long list of terms related to environmental, social, and governance (ESG) factors. Being able to understand and speak the language is key to pursuing, tracking, and reporting sustainability outcomes. Here, we focus on terms in one of the most critical areas: climate.
For energy and facility managers helping to lead their companies’ sustainability efforts, these terms are essential to ensure their businesses can set appropriate climate goals, and then track and report progress using best-practice standards.
Climate vocabulary basics
Climate-related sustainability action is needed because of the impact of greenhouse gas emissions that magnify both climate change and human-induced global warming. These factors are the foundation, so it’s important to have a firm grasp of what those three highlighted terms mean.
Greenhouse gases (GHGs) are a set of naturally occurring or human-generated gases that transform the atmosphere. According to Cornell Law School, humans generate most GHGs through actions such as agriculture and burning fossil fuels for energy, manufacturing, and transportation purposes. GHGs include carbon dioxide (CO2), methane (CH4), nitrous oxides (NxO), and manufactured fluorinated gases.
According to NASA, climate change is a long-term change in the average weather patterns that have come to define Earth’s local, regional, and global climates. Changes observed in Earth’s climate since the mid-20th century have been driven by human activities that have increased heat-trapping GHG levels in Earth’s atmosphere, raising Earth’s average surface temperature. While natural processes also contribute to a changing climate, they are far outpaced by human-induced activities.
NASA defines global warming as the long-term heating of Earth’s surface observed since the post-industrial period due to human activities that increase GHG levels in Earth’s atmosphere. This term is not interchangeable with the term climate change but rather is a key component of a changing climate.
Climate disclosures
At face value, climate disclosures are not complicated at all. They are simply any disclosure your company makes about the impact of its operations on climate change, such as GHG emissions totals, use of renewable energy, or energy savings from energy efficiency efforts.
However, climate disclosures get complicated when the topic of standards and requirements is introduced. In the United States, the Securities and Exchange Commission (SEC) in March 2022 proposed rules to enhance and standardize climate-related disclosures for investors. If finalized, investor-owned companies subject to SEC regulation will be required to make certain climate-related disclosures, including information about climate-related risks.
These disclosures are reasonably likely to have a material impact on their business, results of operations, or financial condition, and certain climate-related financial statement metrics within their audited financial statements.
Beyond the SEC rules, which won’t apply to all businesses, there are other voluntary standards for climate disclosures. For example, the Task Force on Climate-related Financial Disclosures or TCFD, created by the Financial Stability Board, has issued recommendations on climate disclosures supported by more than 3,000 companies across 92 countries. The nonprofit CDP runs a widely accepted global disclosure system to help companies manage their environmental impacts.
Scope 1, 2, and 3 Greenhouse Gas Emissions
Many businesses include GHG reduction goals in their sustainability plans, which means they need to track GHG emissions and disclose annual GHG emissions from operations to show progress toward their goals.
Simple, right? Not so fast. Who’s responsible for the GHGs created by the Amazon and FedEx trucks that deliver your products to customers? What about GHGs from the electricity delivered by your local electric provider to keep your business running?
The Environmental Protection Agency (EPA) provides helpful definitions for different categories – or “scopes” – of emissions so that businesses can track and report GHGs and GHG reductions consistently.
Scope 1
Direct GHG emissions that occur from sources that are controlled or owned by an organization (e.g., emissions associated with fuel combustion in boilers, furnaces, company-owned fleet vehicles).
Scope 2
Indirect GHG emissions associated with the purchase of electricity, steam, heat, or cooling. Although an organization’s Scope 2 emissions physically occur at the facility where they are generated, they are accounted for in the organization’s GHG inventory because they are a result of the organization’s energy use.
Scope 3
Indirect GHG emissions resulting from activities not owned or controlled by an organization, but that the organization indirectly impacts in its value chain. Scope 3 emissions for one organization are the Scope 1 or 2 emissions of another organization and often represent the majority of an organization’s total GHG emissions.
Any company with a GHG reduction goal will be expected to track and report Scope 1 and 2 emissions, while Scope 3 emissions may be considered optional. The Greenhouse Gas Protocol, a global nonprofit, has developed a widely accepted corporate accounting and reporting standard with guidance for companies preparing a GHG inventory.
Net-zero emissions
The World Economic Forum defines net-zero emissions as “a state of balance between emissions and emissions reductions.” For an individual business to reach net-zero, that does not mean it cannot emit any GHG emissions from operations. It means the business must offset its Scope 1, 2, and 3 emissions through verified means of reducing other GHGs, such as through the purchase of renewable energy credits or carbon offset credits, carbon capture, sequestration, and/or other technologies.
As with GHG reporting, there is an internationally recognized standard for achieving net-zero, also called carbon neutrality.
Net-zero is becoming a rallying point for businesses across the globe. More than 1,200 companies have committed to science-based net-zero targets. Being a sustainable business is one of five pillars of NRG, and we are proudly committed to our own climate targets. As an organization, we set an ambitious goal to achieve net-zero and reduce our carbon footprint by 50% by 2025, using our 2014 emissions as our base year.
Science-based Target-setting
Did you notice the term “science-based” in the last paragraph about net-zero targets? Many companies have been criticized for greenwashing by claiming carbon neutrality with the use of various trading and accounting measures, while their operations still produce significant real emissions. According to the Science Based Targets initiative (SBTi), emissions targets are considered “science-based” if they are in line with what the latest climate science deems necessary to meet the goals of the United Nations Paris Agreement – limiting global warming to 1.5°C above preindustrial levels.
SBTi is a partnership of the United Nations, CDP, World Resources Institute (WRI), and others that defines and promotes best practices in emissions reductions in line with climate science. Nearly 1,000 organizations have set emissions reduction targets grounded in climate science through the SBTi’s guidance.
Get started
We all have a role to play in creating a more sustainable future through planning and action. When it comes to climate and energy, look for a trusted advisor who can help you implement a range of solutions to track, report, and ultimately achieve your sustainability goals.
A perpetual knowledge gap of sustainability topics has increased within the industry, cited by 35% in 2023, compared to 20% in 2021. Image: edie.net
The majority of marketing professionals feel they need to be braver and clearer in how they communicate sustainability to avoid greenwashing, but very few within the industry feel they have the capacity or knowledge to do so. From edie.net • Reposted: April 25, 2023
The World Federation of Advertisers, which represents 90% of global marketing spend, has today (24 April) published the findings of a global survey of the marketing industry. Developed in partnership with Kantar’s Sustainable Transformation Practice, more than 900 senior client-side marketers were surveyed across 48 countries.
The survey found that the marketing profession is lagging behind other areas of the business when it comes to understanding and embracing the broad agenda of sustainability. In total, 39% of respondents claimed they had only just started out on their sustainability journeys.
There is an understanding within the industry that corporate sustainability strategies need to be more ambitious, with 90% claiming so and a further 94% stating that marketers need to act more bravely and experiment to drive transformative change. Indeed, 43% of companies have now added sustainability as a KPI for marketing departments, up from 26% in 2021.
The industry realises that, in spite of the risks of greenwashing, companies need to be braver and smarter as to how they communicate their sustainability efforts, with 82% calling for more ambition. Additionally, 41% of brands now believe they have a sustainability story and strategy that they are “proud” to share, up from 25% in 2021.
There is, however, a widening capability gap emerging for marketing professionals. A perpetual knowledge gap of sustainability topics has increased within the industry, cited by 35% in 2023, compared to 20% in 2021. One of the issues in this regard is that sustainability no longer fits into one sole function, and a lack of metrics, definitions and complex jargon all contribute to the knowledge gap.
Key challenges highlighted by the profession include a lack of internal resources (35%), a knowledge and skills gap (35%), organisational mindset where sustainability is viewed as a cost (32%), and a lack of transparency in measurement (30%).
WFA’s chief executive Stephan Loerke said: “Marketers are finally starting to grasp the scale of the sustainability challenge, particularly the climate crisis. We have reached the point where the status quo is no longer an option.
“Radical transformation is essential. We passionately believe that marketers are uniquely placed to drive the change we need on account of their unique creativity, innovation and communication skillset. The Sustainable Marketing 2030 initiative focuses on how marketers can drive growth while embracing the sustainability agenda.”
The survey also found that 54% of marketers agreed that consumers need more education about sustainable choices and actions and that brands are well-positioned to help.
Greenwash marketing
According to a survey conducted by the Chartered Institute of Marketing (CIM) in 2021, half (49%) of UK-based marketing professionals communicating the sustainability ambitions and actions of companies are worried their work may be perceived as greenwashing, amid increased consumer demand for – and scrutiny of – environmental claims.
while more than half of the 210 respondents recognised environmental sustainability as a business priority and an existential risk (51%), there was confusion about how to communicate targets and initiatives externally. Half of the respondents said they fear their company or client being accused of greenwashing by consumers if they publish communications leading on sustainability. A key problem is the fact that 40% of marketers admit to not having qualifications relating to communicating sustainability.
The Competition and Markets Authority (CMA) will assess claims made online and in-store, including on-pack labelling and other marketing. Claims will be assessed against the Authority’s ‘Green Claims Code’ – a set of 13 guidelines for businesses and brands with consumer-facing products and services. Issues covered by the code include ensuring the accuracy and clarity of claims; not omitting important information and enabling ‘fair and meaningful’ comparison.
Study from Bain & EcoVadis suggests firms that prioritise ESG are more successful, and that those with more senior female execs also perform better. By Sean Ashcroft from supplychaindigital.conm • Reposted: April 24, 2023
New in-depth research suggests that companies that prioritise ESG are more profitable.
The study claims organisations that focus on ethics, environmental and labour practices within their supply chains have margins 3-4% greater than those that don’t.
The research was commissioned by global management consultancy Bain & Company and EcoVadis, a provider of sustainability ratings.
Called Do ESG Efforts Create Value? It also suggests that ESG-compliant companies have higher employee satisfaction and that firms with more women at board level perform better than those with fewer.
The study was based on how thousands of private companies’ EcoVadis sustainability Scorecards compared against their financial performance.
It found a correlation between advanced performance on key sustainability topics and stronger profitability and faster growth.
Most of the 100,000 EcoVadis-rated companies – 80% of which are private – are engaged in supply chain relationships.
EcoVadis says this has “strong implications” for procurement teams.
A spokesperson said: “In addition to mitigating risk and complying with due diligence regulations, using ratings in sustainable procurement programs is a vital lever in building financial success and resilience of their value chain partners.”
Eliminating negatives is about to become the minimum viable approach to social performance. Companies and suppliers benefiting people and communities will see stronger corporate brands and accelerated revenue growth. By Jeff Baldassari from sustainablebrnads.com • Reposted: April 23. 2023
Fueled by an upcoming Securities and Exchange Commission rule on human capital management, increased focus on the ‘social’ element of ESG, and rising consumer awareness of supply chain issues, social sustainability in supply chains is poised to become the next frontier for brands.
The S in environmental, social and governance performance has been gaining currency over the past couple of years; and public companies will soon have to start reporting more thoroughly on their social impact. A Bloomberg Lawanalysis of the SEC’s direction predicts that human capital management will be a front-burner topic this year, and investors will seek more disclosures to ensure that companies are walking their talk. At the same time, pandemic-driven disruptions have sparked ongoing media coverage of supply chain issues. Consumers are seeing the sausage-making, and it isn’t always pretty.
This is all to the good. Accountability can sting; but for companies that view it as an opportunity, the new focus on social sustainability in supply chains can lead to stronger corporate brands and accelerated revenue growth for suppliers pursuing positive social impact.
Focus on social impact brings risks and opportunities
What is a socially sustainable supply chain? Certainly, it’s free of negative practices such as child labor, forced labor, unsafe working conditions, below-living wages, and racial and gender discrimination. The case for excluding suppliers that layer these social costs into a corporation’s products and services is clear from both an ethical and a business standpoint: Investors, customers and employees are buying into a brand’s reputation — and “risking that over a supplier with poor ESG credentials could cost you all three,” Moody’sobserves.
Eliminating negatives is fast becoming table stakes, though. The emerging standard is net-positive impact — actively contributing to solving social problems.
“The very nature of social impact isn’t just about risk; it’s also about prosocial behavior. In other words, a company’s actions, policies and investments can and should positively impact people’s lives,” writesJason Saul, executive director of the Center for Impact Sciences at the University of Chicago. And, he notes, these social impacts can also positively affect a company’s financial performance “through competitive advantage, business growth, market relevance, brand purpose and securing license to operate.”
Stocking the corporate supply chain with companies that are broadening workforce opportunities, contributing to stronger local economies and providing other social benefits brings real supply chain reliability and ESG benefits. Suppliers that hire from a broader talent pool and create a positive work environment that reduces churn are better able to deliver consistently. Those that also build community wealth and diversify their supply chain contribute to equity and inclusion goals.
For supplier companies, delivering these positive social impacts is a differentiator — especially where other value dimensions such as effectiveness, design and price are comparable — and it will remain so until their competitors catch up.
3 big impact areas cut across supplier types
Building a socially sustainable supply chain requires reviewing and upgrading the full spectrum of suppliers — not only suppliers of raw materials, value-added inputs and finished goods, but also professional services and technology providers. That is a big universe; but when looking at it from a positive social impact perspective, most suppliers can add value in three broad areas.
Workforce development: Companies that actively recruit, train and retain people who have been excluded from opportunities or face barriers to employment can improve the lives of whole families and communities while developing untapped talent pools that provide a hedge against tight labor markets. For example, the growing second-chance (or fair-chance) movement delivers high social returns by focusing on hiring formerly incarcerated people. Nearly 70 million Americans have a criminal record; and even after they’ve paid their debt to society, many remain marginalized. Incarceration brands those it touches, trapping them in a cycle of unemployment and poverty — which can lead to recidivism. Second-chance hiring can transform their lives. It also has multiple business benefits. At U.S. Rubber, for example, we fueled substantial growth through pandemic labor shortages by making a significant investment in second-chance hiring: Ex-felons now constitute about 60 percent of our workforce.
Diverse leadership: Diversifying the supplier pool to include more companies owned and led by women and people of color — especially in fields where they continue to face barriers to entry — contributes to corporate diversity, equity and inclusion goals and expands both opportunities for the suppliers and resources for the buyers. This is also an area where corporate commitments are under a microscope and investors, customers and employees are looking for measurable progress.
The opportunity in supply chain sustainability is huge. Eliminating negatives is about to become the minimum viable approach to social performance. Public and large private companies and their supply chain partners that go beyond that to create positive impacts will reap the benefits: stronger brands, greater customer loyalty, investor favor and the ability to attract increasingly choosy workers. And in doing so, they’ll help advance prosperity for everyone.
JEFF BALDASSARI: Jeff Baldassari is CEO of US Rubber Recycling — a triple-bottom-line business that manufactures high quality fitness flooring and acoustical underlayment by giving discarded tires a second life and providing employment to a second-chance workforce.
Transforming a business to reduce its environmental impact and embrace sustainable practices isn’t a quick fix, but a journey of a thousand steps. Diageo, the beverages giant behind brands like Guinness, Johnnie Walker and Smirnoff, has been on that journey since 2008, and it’s forced it to innovate and make difficult decisions. It has been scrutinising its supply chain – last year it launched a pilot in regenerative farming for its Guinness business and announced a new hydrogen-powered glass furnace to reduce the impact of glass bottle production. And when it comes to marketing, it has rolled out brand activism training across its marketing teams to ensure that they’re equipped to talk about green issues in a responsible way. . And on Earth Day, Diageo will be switching on a huge field of solar panels in Scotland to power its packaging plant at Diageo Leven.
This Earth Day, the beverages giant talk about the lessons they’ve learned, how an innovation gap drove them forward and how they’re steering clear of greenwashing. From lbbonline.com • Reposted: April 22, 2023
LBB’s Laura Swinton caught up with a Diageo spokesperson to find out more.
LBB>What inspired Diageo to prioritise sustainability?
Diageo> Sustainability has long been a priority of Diageo and our work on it started in 2008. Environmental sustainability is key to our long term business success and we have a responsibility to care for the people and planet around us.
LBB> And what have been the key lessons you’ve learned as a business since embarking on this journey?
Diageo> We set our 2030 sustainability targets with an innovation gap built into them as we know we need to stretch ourselves to reach them. We’ve learnt partnership working is core to us making progress on our targets, and that reaching those targets will be a challenge and will take a change in approach across our business.
LBB> How does Diageo ensure that each brand can adjust to fit into those sustainability objectives in a way that works for that part of the business?
Diageo> The work our brands do on sustainability is guided by our corporate sustainability goals in Society 2030. All the sustainability action they take ladders up our commitments on packaging and waste, water and carbon.
LBB> Baileys has been accredited as a B Corp – what have you learned from this process and is it something you’re considering rolling out across more Diageo brands?
Diageo> We’re really proud of Baileys for being B-Corp certified and it’s definitely a robust process to the accreditation, so is well-deserved. We’re learning through Baileys on the process and benefits of being B-Corp certified before taking a decision on the rest of our brands.
LBB> Diageo has been getting really granular on the environmental impact of its supply chain, and there’s quite a bit of innovation involved. For example you’ve been working with Encirc on the use of hydrogen to produce glass bottles with a reduced environmental impact, producing 200 million for brands like Captain Morgan’s, Tanqueray and Smirnoff. How is Diageo enabling that level of innovation?
Diageo> Innovation is central to us achieving our 2030 goals. The hydrogen powered furnace is an example of the power and outcome of working closely with our suppliers and partners to embed sustainability across our supply chain. We’re really excited that by 2030, up to 200 million of our bottles will be net zero, which is a huge achievement in the glass industry. We also foster innovation through our Diageo Sustainable Solutions programme. This gives innovators who we don’t currently work with, to provide a solution to sustainability challenges that we put out to them. It generates new ideas and ways of working to help us tackle the trickiest issues.
LBB> How are you tracking the impact of these innovations and ensuring buy-in across the organisation?
Diageo> All sustainability reporting is in our Annual Report and ESG Reporting Index, which includes innovation work on sustainability. All employees across the business have a responsibility for helping us achieve our corporate goals, and achieving our sustainability goals is as important as delivering our financial performance. Our senior leadership group is responsible for the delivery of a subset of our ESG targets via our Long Term Incentive Plan, which helps us to embed that accountability across our business.
LBB> Diageo has some great green initiatives underway, transforming its supply chain, from regenerative farming to net zero glass bottles – but how are you thinking about the balance between talking about these projects, sharing knowledge with the need to avoid overclaiming and greenwash?
Diageo> Greenwashing is a real reputation risk when talking about sustainability. We have a robust approach to our sustainability comms and ensure that all comms on sustainability are approved by our CR and legal teams to validate the claims. Claims are only made where we have validation.
LBB> On this, Diageo has invested in sustainability training for marketers – why was that so important and what are some of the key principles or takeaways from this training?
Diageo> It’s important that everyone knows the role they can play in helping us achieve our goals, but to also have the confidence in doing so.
LBB> What are some of the challenges that the team has been navigating in putting that training into action and implementing the insights on a company-wide level?
Diageo> We’re using the training to build our marketing team’s confidence in talking about sustainability. A key challenge has been giving them the confidence to talk about it credibly without the threat of greenwashing. We’ve also recently rolled out a partnership with the Said Business School at Oxford to educate our top 600 leaders on sustainability, both within Diageo and outside of it, so they can make the connections between the work we do and the difference this can make externally.
LBB> What advice would you have for marketers that are still wrestling with all of this?
Diageo> It’s an exciting but difficult space! If you’re ever not sure on putting something out on sustainability, ask your experts and listen to their advice. Also, read around what others are doing in sustainability marketing and see where companies are being caught out for greenwashing and what you can learn from this.
History shows the CIO role is well positioned to broker a more environmentally sustainable way of doing business. But adjustments are required as the landscape shifts. By Mark Chillingworth from CIO • Reposted: April 21, 2023
Over 90 wildfires ravaged Spain’s Asturias principality in March this year. Though not as cold and wet as northern Europe, March is still the tail end of winter in northwest Spain, a region not typically considered a tinder box. But the climate emergency is steadily changing that.
But Spain’s predicament isn’t unique. Across the world, climate change has bitten hard into the economies of tech-centric California, again due to wildfires. Australia and Pakistan have seen communities wrecked by large-scale flooding and continual rain, while in 2022, Europe had its hottest summer on record.
There is a need and realization by the business world to be more environmentally sustainable since organizations are seeing an impact on the bottom line as a direct result of climate change. So the CIO, the technologies they deploy, and the partnerships they form are essential to the future of a more environmentally sustainable way of doing business.
A question of time
Thomas Kiessling, CTO with Siemens Smart Infrastructure, part of the German engineering and technology conglomerate that makes trains, electrical equipment, traffic control systems, and more, understands that time is running out. His concerns are backed up by the Intergovernmental Panel on Climate Change (IPCC), which on March 20, 2023, said it’s unlikely the world will keep to its Paris Climate Accord promises.
And if the world’s temperatures rise by or above 1.5 degrees Celsius, businesses will feel further impacts to their bottom line, including increased supply-chain issues on a network already overstretched and fragile. Food and water insecurity will increase, and energy systems, housing stock, insurance, and currency markets will all become more volatile—a worrying set of scenarios for business leaders and boards.
CIO enablement
Historically, CIOs have been vital enablers during times of major change, championing e-commerce, digital transformation or agile ways of working. Organizations responding to the climate emergency are, therefore, calling on those enablement skills to mitigate the environmental impact of the business.
use of unsustainable practices and resources. As with most business challenges, data is instrumental. “Like anything, the hard work is the initial assessment,” says CGI director of business consulting and CIO advisor Sean Sadler. “From a technology perspective, you need to look at the infrastructure, where it’s applied, how much energy it draws, and then how it fits into the overall sustainability scheme.”
CIOs who create data cultures across organizations enable not only sustainable business processes but also reduce reliance on consultancies, according to IDC. “Organizations with the most mature environmental, social, and governance (ESG) strategies are increasingly turning to software platforms to meet their data management and reporting needs,” says Amy Cravens, IDC research manager, ESG Reporting and Management Technologies. “This represents an important transition toward independent ESG program management and away from dependence on ESG consultants and service providers. Software platforms will also play an essential role in an organization’s ESG maturity journey. These platforms will support organizations from early-stage data gathering and materiality assessments through sustainable business strategy enablement and every step in between.”
Sadler, who has led technology in healthcare, veterinary services, media firms, and technology suppliers, says consultancies and systems integrators should be considered as part of a CIO’s sustainability plans. Their deep connections to a variety of vendors, skills, experience and templates will be highly useful. “It can often help with the collaboration with other parts of the business, like finance and procurement as you have a more holistic approach,” he says.
The IDC survey further finds that the manufacturing sector is leading the maturity of ESG strategies, followed by the services sector, indicative, perhaps, of industries with the most challenging sustainability demands to get on the front foot.
CIOs in organizations already with ESG maturity adopt data management, ESG reporting, and risk tools. In the 2022 Digital Leadership Report by international staffing and CIO recruitment firm Nash Squared, 70% of business technology leaders said that technology plays a crucial part in sustainability.
“CIOs are in a great position to demonstrate their business acumen,” says Sadler. “They can cut costs and generate additional revenue streams.” And DXC Technology director and GM Carl Kinson says IT is now central to cost reduction, while high inflation and rising energy costs make CIOs and organizations assess their energy spending in a level of detail not seen for a long time. This will have a knock-on environmental benefit. Kinson says CIOs are looking to extract greater value from enterprise cloud computing estates, application workloads, system code, and even the use or return of on-premise technology in order to reduce energy costs.
“We’re working with clients to set carbon budgets for each stakeholder to make them accountable, which is a great way to make sure all areas of the business are doing their bit to be more sustainable,” says Sadler.
Great expectations
Falling short of corporate sustainability goals will not only upset the board but exacerbate the search for skills CIOs face, which, in turn, complicates strategies to digitize the business.
Becoming an environmentally sustainable business is core to the purpose of a modern organization and its ability to recruit and retain today’s technology talent.
Climate urgency also impacts CIOs themselves in their employment decisions, too. “I would need to understand the sustainability angles of an organization,” says James Holmes, CIO with The North of England P&I Association, a shipping insurance firm. Business advisory firm McKinsey also finds that 83% of C-suite executives and investment professionals believe that organizational ESG programs will contribute to an increase in shareholder value in the next five years. And the Nash Squared Digital Leadership Report adds that due to the urgent global move to integrate sustainability into core business operations and the customer proposition, it’s important that digital leaders have what it calls a dual lens on sustainability.
Part of that increased shareholder value will be to ensure the business is able to meet the evolving regulations surrounding environmental sustainability. For CIOs in Europe, the EU Sustainable Finance Disclosure Regulation was adopted in April 2022, and the Corporate Sustainability Reporting Directive (CSRD) secured a majority in the European Parliament in November 2022. California also introduced environmental regulations in September 2022, and other US states are likely to follow.
“Regulation can be pro-growth,” Chi Onwurah, shadow business minister in the UK Parliament and a former technologist, recently said at an open-source technology conference. “Good regulations create a virtuous circle as more people trust the system.”
CIOs and IT leadership, whether in the UK or not, are integral to make organizations more environmentally sustainable in order to help stave off environmental collapse. No vertical market can operate effectively during an ongoing environmental emergency unless a technological response based on collated data is enacted and supported across the organization.
During the Covid-19 pandemic, CIOs and IT leaders enabled new ways of adapting to change, and these need to continue as environmentally sustainable business processes become greater priorities.
With Earth Day approaching and stricter laws on the horizon in the EU and the UK, figures from the creative industries take stock. F
rom lbbonline.com • Reposted: April 21, 2023
Greenwashing. We’ve been talking about it for years, but still many brands are struggling to kick the habit. Whether it’s deliberately making false claims about carbon emissions, or (intentionally or unintentionally) hiding a toxic company behind a comforting cloud of fluffy, feel-good green haze, it’s a practice that lingers like pollution.
So, with the stick coming in to take the place of the carrot, how can brands and agencies skill up and clean up their act?
Rob McFaul, co-founder, Purpose Disurptors
How do we avoid greenwashing? It’s a question that comes up nearly every time we onboard a new agency to the #ChangeTheBrief Alliance, our sustainability and climate learning programme for the industry. It’s a signal that the industry is recognising they need to skill up and fast, especially as greenwashing moves up the regulatory agenda.
We all need to be sustainability professionals now. We all need to be comfortable asking the right questions of the brands we work with, and become familiar with the net zero pathway for a brand’s sector: What changes are required and when? What are the brand’s actions in response to reaching net zero? Are brands being transparent and ambitious enough in their current actions and future ambitions?
Essentially, we need to shift our perception of sustainability as just a slogan toward understanding it as a clearly defined pathway for that brand to transition to reach net zero. If we can’t find the answers to our questions…
Then take a moment to pause.
You could be greenwashing.
Greenwashing only maintains business as usual and delays the transformation we know we need to create a thriving future.
Juan Jose Posada, CCO, Grey Columbia
I think the creative industry – maybe as a reflection of the people that make it – has been, for years, pushing for more responsible, more environmentally concerned brands on all fronts: design-wise, communicationally, and with the products themselves.
However, the pace of these changes has been too slow and totally insufficient. If manufacturers, brands, communication actors and society can’t understand change needs to happen at a faster pace and in a more honest way, then regulators will have to step in. It will take everyone’s effort; we’re simply not doing enough as a society who’s self-inflicting at a faster pace than it is healing its wounds.
But also, one thing that has bothered me – having taken part in many initiatives seeking popular support – is how indifferent people can be. It is heartbreaking.
People are watching closely and judging greenwashing mercilessly, so for brands it just isn’t worth taking the risk.
Valerie Richard, Head of corporate social responsibility, BETC Paris
In France, advertising’s accountability about climate change has been heavily questioned during the last few years. The public debate ended up with reinforced regulations and new legislations introduced. Advertisements now have to include messages with an environmental argument to fight against greenwashing. In 2021, these measures lead to the signing of the Climate & Resilience law that regulates some types of advertising. For example, it is now forbidden for an advertiser to claim that a product or a service is carbon-neutral without precise proof or detailed efforts. Brands can lead themselves to financial sanctions otherwise. Also, ads for automotive brands are now regulated and have to include the environmental rating of the car shown. This rating varies from ‘A’ (low CO2 emission) to ‘G’ (high emission of CO2).
As you know, French people love to debate endlessly. And these measures have opponents and supporters. In a more objective way, a 2022 Greenflex/ADEME survey indicates that 84% of people in France need to see proof in order to believe a brand’s commitment to the environment. It constitutes a four point increase to the same 2021 survey. The survey also demonstrates that only 30% of French people generally trust large companies – a significant drop from a number that was close to 58% between 2004 and 2016. So, even though we have strict regulations in place, there is still a lot of trust to gain between brands and consumers.
Facing this enormous challenge that we have to overcome against the climate crisis, we need to go beyond regulations. As communication professionals, it is our duty to orient brands towards a type of advertising that is clearer about actual commitments. We are also blessed with a superpower: our creativity and our unique ability to make products and lifestyles appealing. Now is the time to make the need for urgent global environmental action sexy.
Ad Net Zero
Greenwashing may be unintentional, leading to accidental or even well-meaning greenwashing. No matter how it happens, there is simply no place for misleading environmental claims, given the importance of people trusting the advertising of sustainable products and services.
As the world transitions towards a net zero economy, it is vital that advertisers and brands can showcase everything they can offer. Ad Net Zero has a training qualification to help people working in the advertising and marketing services industry. This includes providing an understanding of the regulatory landscape, reviewing examples of rulings by regulators – for example, in the UK, the ASA – and providing global examples for those taking the international training. It also offers practical tips for anyone working in advertising, such as ‘greenwash checks’ for client work, how to upskill their teams in an engaging way, and how to proactively reframe existing work if needed.
Over 1,000 people from across 130 companies have taken the training to date, and we encourage everyone to sign up.
We also recommend everyone keep an eye out for rule updates. We try to make this simpler for supporters by providing updates from the ASA and in addition, the CMA, which has green claims guidance. Both these organisations also offer supportive information on their websites.
Alex Thompson, strategic planner, Ardmore
As long as sustainability is an important issue for consumers, greenwashing remains a problem to be solved for brands and agencies. Advertising performance is directly tethered to brand reputation, and marketers will always pursue avenues that benefit this metric – sustainability messaging included.
The pending EU and UK regulations may therefore be a double-edged sword. It’s great that efforts are being made to help stave off dubious eco claims, but we may see businesses hop off the sustainability train if it becomes more laborious to shout about it in their advertising. Reputation will always be a strong motivator for brands to change behaviour for the better, and sustainability is no different.
The rub is that we need a real, quantifiable proposition. You can’t market something if the claims don’t stack up, and so for marketers, this means calling out unsubstantiated statements to deliver campaigns that are both impactful and transparent. We must ensure that marketing activity is built on strong foundations of data and insights, so that greenwashing isn’t an issue.
For this to work, brands must also be honest about what they can promote, and recognise that it’s okay if the changes to their sustainability practice have been incremental. Consumers will always respect and appreciate a willingness to progress and improve.
Ardmore is on its own sustainability journey, and key to our commitment to deliver a sustainable model for advertising is acknowledging that Rome wasn’t built in a day. So, whilst it’s tempting to present your green machinations as transformative and revolutionary, just showing that you’re moving in the right direction can go a long way.
U.S. President Joe Biden arrives at the Wolfspeed semiconductor manufacturing plant in Durham, North Carolina, for the kickoff of his “Investing in America” tour last month. (Image credit: Official White House Photo by Adam Schultz)
By Tina Casey from triple pundit.com • Reposted: April 20, 2023
The Joe Biden administration fought tooth and nail to pass new laws that transform the carbon-heavy U.S. economy into a climate action hero. The results are beginning to show. Both the Inflation Reduction Act and the CHIPS and Science Act provide federal tax credits for manufacturers to onshore their operations in the U.S. Red states are benefitting from the renewed U.S. manufacturing boom as well as blue states, further undercutting the anti-ESG movement promoted by high-profile Republican office holders.
U.S. drops the ball on climate action
Ironically, the U.S. sparked the solar technology revolution back in the 1950s when the National Aeronautics and Space Administration (NASA) was searching for energy to power operations in orbit. The U.S. continued to dominate the global solar industry for decades.
Unfortunately, by the time former President Barack Obama took office in 2009, overseas manufacturers had caught up and raced ahead. In addition, the mainstream market for renewable energy was only beginning to take shape. The overall, installed (aka levelized) cost of solar panels and wind turbines remained high relative to fossil energy during President Obama’s time in office. Blowback against his Clean Power Plan and ongoing competition from overseas manufacturers provided two additional obstacles.
The clean power manufacturing situation worsened under former President Donald Trump. He took office as a strong supporter of fossil energy and pulled the U.S. out of the 2015 Paris Agreement on climate change. Though he talked a big game about bringing back U.S. manufacturing jobs, he disengaged with the job-creating, global decarbonization movement. His U.S. manufacturing policy was failing long before the COVID-19 pandemic struck in March of 2020.
The Biden administration picks up the ball and runs with it, spurring billions in U.S. manufacturing commitments
The new Biden-supported legislation provide a sharp contrast in both policy and circumstances. In addition to substantial tax breaks, the Biden administration is benefitting from the continuation of Obama-era initiatives that fostered a drop in the cost of renewable energy hardware while addressing obstacles in the “soft” area of costs related to inspections, permits, marketing and other administrative areas. Leading U.S. corporations also continued to raise the demand for renewable energy by leveraging their buying power throughout the Trump administration.
The results have been striking. On Jan. 11, for example, the South Korean Firm Hanwha Solutions Corp. announced a $2.5 billion plan to construct a solar manufacturing campus in Georgia. The soup-to-nuts campus will include facilities to manufacture solar ingots, wafers, cells and modules.
That’s just one example. Last week, the Financial Times credited the Biden administration with attracting new corporate manufacturing commitments totaling more than $200 billion since the Infrastructure and CHIPS bills passed last year. “The investment in semiconductor and clean tech investments is almost double the commitments made in the same sectors in the whole of 2021, and nearly 20 times the amount in 2019,” reported Amanda Chu and Oliver Roeder of the Financial Times, citing data the paper compiled on U.S. manufacturing deals.
“While the FT identified four projects worth at least $1 billion each in these sectors in 2019, there were 31 of that size after August 2022,” they added. The Financial Times also took note of 75 other new clean tech manufacturing projects in the U.S. of $100 million or more.
Who’s afraid of the ESG?
Chu and Roeder of the Times concluded by observing that additional guidance on the tax credits is forthcoming from the Biden administration, leading to the announcement of even more projects in the near future.
Red states are already jostling with blue states for a share of the action, regardless of state-level Republican officials who have been railing against “woke” capitalism and ESG (environmental, social and governance) factors being used in investing. The anti-ESG movement purports to protect public pension funds, but it is nothing more than a thinly disguised effort to protect fossil energy stakeholders.
Georgia is a case in point. The Republican-led state never enacted a renewable energy portfolio standard or even set voluntary renewable energy targets. It has lagged behind other states in terms of increasing access to renewable energy within its borders. However, Georgia policymakers seem to have no problem with enticing clean energy industries to set up shop in the Peach State.
Hanwha company Qcells opened its first solar panel factory in Dalton, Georgia, in 2019. That put the state on the map as host to the largest factory of its kind in the Western Hemisphere, and Republican Gov. Brian Kemp has been effusive in his praise for the company’s decision to add another $2.5 billion to the state’s economy.
“Qcells will build a new facility in Cartersville and add a third facility to its Dalton location, creating more than 2,500 new jobs in northwest Georgia. These investments are expected to bring Qcells’ total solar panel production capacity in Georgia to 8.4 gigawatts by 2024,” the governor’s office reported in January.
“With a focus on innovation and technology, Georgia continues to set itself apart as the No. 1 state for business,” Gov. Kemp stated. “Georgia provides a business-friendly environment that means jobs for hardworking Georgians in every corner of the state and success for both existing and new companies. We’re excited for Qcells’ continued success in the Peach State.”
Those “business-friendly” words are at odds with Kemp’s support for anti-LGBTQ legislation, but the point has been made. Georgia and other red states don’t care if their new Biden-enabled, home-grown industries export technologies that shrink the fossil energy profile of the US. Regardless of their political posturing, they just want the jobs.
By Mary Riddle from triple pundit.com • Reposted: April 20, 2023
The collective power of small- and medium-sized enterprises (SMEs) — defined as those employing less than 500 employees — is far greater than many may expect. Together SMEs make up 90 percent of businesses worldwide and affect the livelihoods of more than 2 billion people.
In Europe, SMEs reign supreme — accounting for 99 percent of all companies and 63 percent of business-related emissions across the EU. Business owners in Europe have faced incredible challenges in recent years — from the pandemic, to supply chain disruptions, to inflation and labor shortages. Creating and implementing a sustainability program is difficult work during normal times, but recent crises have compounded the challenges.
Together, SMEs could wield significant influence over their industries, including suppliers, vendors, customers and other stakeholders, as well as their neighborhoods. With the help of SME Climate Hub, a nonprofit global initiative empowering small- to medium-sized businesses to take climate action, Meta is working to help SMEs overcome barriers to creating more sustainable business operations, one company at a time.
Harnessing Meta’s power of convening to help SMEs
“Meta has over 200 million businesses that use Meta platforms, so as a company we are uniquely positioned to help,” said Eoghan Griffin, Meta’s head of sustainability for Europe, the Middle East and Africa. “We have a brilliant convening power.”
Traditionally, Meta has focused on enabling business, particularly SMEs, to navigate the digital transition — from e-commerce to social media to communications, Griffin said. “Recently we have been looking at how to support SMEs in the green transition, as well,” he continued. “We knew informally that small businesses are struggling with supply chain requirements of larger companies, the complexity in navigating terminology, and customer expectations. Their customers are asking for this.”
To address these challenges, Meta collaborated with the SME Climate Hub to create the Meta Boost Guide to Green, a sustainability training program for SMEs in Europe. “Guide to Green was a huge success,” Griffin said, “and we heard from businesses loud and clear that they want more support and guidance.”
The Guide to Green offers information to help businesses incorporate sustainability into their company operations, as well as ways to communicate their stories.
Many small businesses are already playing their part on climate action and are using Meta’s platforms to support their businesses. For example, family-run Hippersons Boatyard in Norfolk, U.K., is taking a leadership role in promoting climate action within the local community. The Sparrow family, who run Hippersons, is working with their neighbors to increase recycling and rewilding. On top of that, they are embedding climate action into their own business operations through efforts such using lower-carbon fuel alternatives and providing discounts for those who use the train to get to the site rather than driving.
Belfast-based local produce delivery service, Farm Next Door, is encouraging customers to switch to ethically-grown produce from local farmers through educational programming. They also host events that help customers understand the various steps involved in growing produce and the benefits of buying local. The company has found this to be a great tool for engaging with its customer base and encouraging them to buy from Farm Next Door.
Breaking down SME barriers to sustainability
In 2022, Meta partnered with Accenture to learn more about the barriers that SMEs face to implementing sustainability programs — and they came away with three high-level findings.
Making the business case. “First, there is a need to provide and boost the value case for this kind of work,” Griffin said. “We need to showcase success stories, provide funding and provide value. Demonstrating and enabling that value is a critical barrier.”
Understanding how to take action. SMEs also need help in knowing what matters most. “The climate change landscape is rapidly evolving. There is an overload of information from external sources, and it mostly targets different kinds of businesses,” Griffin explained. “We need to cut through the noise to address what kinds of actions SMEs can take.”
A big part of this is understanding what climate action looks like for smaller businesses with fewer resources, because it will look different than it does at a major multinational. “SMEs can’t do everything, nor should they have to do the same things as a big company that has a bigger footprint,” Griffin said. “However, SMEs can be massive drivers of change. They have a galvanizing and accelerating role and opportunity in their communities.”
Keep it simple. “The third big challenge is that we need to make it massively easier to deliver these changes,” Griffin said. “COVID taught us that: With supply chain disruptions and the cost of living crisis, somehow we need to make [sustainability] a lot smoother and easier for them. It is not realistic for SMEs to spend four or six months to put together sustainability plans, but Meta can get valuable, third-party content to as many businesses as possible.”
As part of its work in the EU, Meta is also looking to ensure that sustainability information is available in as many countries and cultural contexts as possible. Meta Boost Guide to Green is translated and available in the local language for some of the company’s EU markets. The training was also piloted with SMEs throughout Europe to ensure the programs were relevant for business owners across the region.
“Our flagship partner, SME Climate Hub, has been a critical partner in guiding us,” Griffin said. “They have a pledging tool, which allows businesses access to even more external validation. We don’t want to duplicate what other organizations are doing. We want to highlight the external resources, like SME Climate Hub, that are already available. Much of our guidance is highlighting the great work they are doing already.”
The collective impact of SMEs
Historically, SMEs have been underrepresented in many of the agencies and programs dedicated to reducing business emissions. “The U.N. and other agencies are focused on the emissions of large businesses, but collectively, SMEs have a huge impact, and they have been neglected in terms of support,” Griffin said.
“That led us to creating this program,” he continued. “We aren’t a consulting firm, but we do think we have a brilliant convening factor and can get access to a lot of businesses at the same time. We are excited to support businesses in their journeys where we can.”
While small businesses individually have small levels of greenhouse gas emissions, their collective action can help eliminate business sector emissions and galvanize communities.
“No one is putting the blame on SMEs,” Griffin hastened to say. “As a large company, we have a huge focus on ourselves. However, collectively, SME emissions account for 63 percent of all business emissions in Europe. Sixty-six percent of customers want businesses to take a stand on climate, and SMEs have enormous reach in their communities. There is a huge opportunity there.”
And Griffin noted that when SMEs succeed, Meta also succeeds. “We are always keen to develop and deepen the relationships we have with SMEs, and there is a lot of shared social value within that,” he said. “Our training reached over 1 million SMEs, and in a climate crisis, we get to contribute to the drumbeat of stories that highlight how important this is and where the resources are.”
Meta continues to partner with businesses of all sizes to help them establish communications plans and campaigns around their sustainability progress. “When a business is ready to communicate their stories, Meta is ready to help them do that,” Griffin concluded. “Those stories can lead to more brand loyalty. We can help translate the sustainability work that they’re doing into tangible business opportunities.”
This article series is sponsored by Meta and produced by the TriplePundit editorial team.
A growing number of consumers don’t trust sustainability claims, and many sustainable companies are shedding the label. How can companies be sustainable in a world full of greenwashing? Photo: GETTY
By Blake Morgan, Senior Contributor via Forbes • Reposted: April 18, 2023
For years, every industry, from beauty to tech and fashion, has raised claims of being eco-friendly.
But customers are starting to see through sustainability claims. They want to support sustainable brands and products, but confusion and deceit have caused them to question if companies are actually eco-friendly.
A large part of delivering a great customer experience is prioritizing sustainability and being honest about it.
Customers Want Sustainability but Get Greenwashing Instead
Sustainability used to be a company’s golden ticket to higher sales, with more than 60% of US consumers saying they would pay more for a product with sustainable packaging.
But customers are starting to see through many companies’ claims to realize they aren’t as eco-friendly as they say. Nearly one-quarter (23%) of US adults don’t believe companies’ sustainability claims. Research found that 42% of green claims are exaggerated, false, or deceptive. Much of that deceit is due to greenwashing when a company makes sustainability claims without notable efforts to back them up. Greenwashing comes in many forms, including vague claims and misleading labels.
Greenwashing lessens a brand’s reputation, negatively impacts a customer’s experience, and lowers their ACSI customer satisfaction scores. The bottom line is this: customers want brands to practice genuine sustainability efforts, not to put on a show or slap a label on a product without backing it up.
Honest Brands About Sustainability
Amid all the confusion, customers simply want brands to be honest about sustainability. And that often looks like quietly doing the work.
For some brands, honesty means stepping away from the sustainability label. Fashion brand Ganni has dozens of stores and wholesalers across the US and Europe. Despite its most recent collection being 97% climate responsible, the company has never claims to be a sustainable brand. The founders realize that by its very nature, fashion isn’t sustainable—it encourages consumption. So although Ganni isn’t labeled as sustainable, it is a leader in sustainable fashion.
Australian clothing brand Etiko has consistently earned an A+ sustainability rating. But the company recently said it is no longer a sustainable brand. Although the brand’s practices and values won’t change, it believes “that the word ‘sustainable’ has become tarnished by greenwashing over the years, ultimately diluting the value of the message.”
For other brands, being honest about sustainability means raising the bar on what it means to be eco-friendly. Alter Eco sells chocolate made using clean, green, responsible processes in Central and South America. Its packaging and wrappers aren’t just industrial compostable but backyard compostable, which means customers can compost the items themselves. For Alter Eco, it isn’t about sustaining the environment; it’s about rebuilding and regenerating it.
Honest About The Work Still To Do
Sustainable brands are honest about their goals and progress and the work that needs to be done.
These companies take a stand and set an example for others to follow.
Food brands, including Clif and Sambazon, have joined initiatives like the Ellen MacArthur Foundation Global Commitment to create a world where plastic never becomes waste or One Step Closer to Zero Waste, among others. These companies match their words with actions and provide transparent updates about the progress toward their sustainability goals.
Sustainability matters. The best antidote to greenwashing is accountability. Sharing transparent updates and holding a company accountable—internally and to customers—shows honest sustainability efforts. Customers don’t always expect companies to be perfect—but they expect them to try.
Brands need to walk the talk. This Earth Day, be honest about sustainability and the progress that still needs to be made.
Blake Morgan is a customer experience futurist and the author of The Customer Of The Future. Sign up for her weekly email here.
By Dan Berthiaume, Senior Editor, Technology from Chain Store Age • Reposted: April 15, 2023
A new survey reveals widespread consumer interest in sustainable products, but there are a lot of nuances.
The vast majority (86%) of respondents want brands to provide more sustainable products, and 72% are already familiar with the sustainable products and alternatives available on the shelves, according to shopping rewards app Shopkick, which surveyed more than 10,000 consumers across the country to understand their values around sustainability and how they incorporate them into their shopping behavior.
When it comes time to purchase a product, more than half of all respondents (55%) consider the sustainability practices of a brand. However, drilling a little deeper, Shopkick found that consumer interest in sustainability is not uniform across every type of product or absolute. For example:
Close to eight in 10 (78%) respondents say that groceries are the most important category for sustainability. When asked about the specific types of sustainable products they tend to buy, a slim majority (52%) purchase recyclable alternatives (such steel straws or glass tupperware) and products with less wasteful packaging. Significant numbers of respondents will purchase fresh produce (37%) and eco-friendly products like natural soap (30 percent).
When asked why they consider a brand’s sustainability practices, 60% of respondents cite a desire to reduce production waste, 54% say they are concerned about the environment overall, and 49% want to create a better world for next generations.
About four in 10 (39%) respondents say they are willing to pay more for sustainable products. Of those willing to buy sustainable products at a higher price, most (70%) would pay one to five extra dollars. Additionally, 63% of respondents say that sustainability is just as important as budget friendliness.
If a brand is not committed to sustainability, more than half (52%) of respondents say they would still buy from them. However, 23% say they will wait for the brand to produce a more sustainable alternative and 19% would switch to a brand that aligns with their values.
Forty percent of respondents say they have purchased more sustainable products now than they did a year ago, and they plan to purchase even more sustainable products a year from now.
Blue Yonder collected responses in February 2023 from more than 1,000 U.S.-based consumers, 18 years and older, via a third-party provider.
Implementing sustainable practices is no easy feat and often takes years. But brands must understand consumer priorities and show a commitment, no matter how formidable the challenge. From Ipsos • Reposted: April 14, 2023
KEY FINDINGS:
Consumers, more than ever, are pushing brands to become more sustainable, Ipsos research finds
38% of Americans say manufacturers and retailers should be responsible for reducing unnecessary packaging
More brands than ever feel pressure to show their sustainability agenda—but being a sustainable brand has different meanings to different consumers
Numerous brands in 2023 aim to show they are implementing sustainable practices in response to consumer concerns about the environment and climate change—but are often unsure where to start. Ipsos research on sustainability provides a guide for companies on key questions to ask themselves as they look to implement sustainable goals.
How does my audience perceive my brand in terms of its sustainable and environmentally responsible practices?
How prevalent is sustainability in the context of my specific markets, product categories, and competitor brands?
What can I implement almost immediately that will improve the perception of my brand as it pertains to sustainability?
Consumers are awash in products
Consumer spending in the United States hit an all-time high of $13.3 trillion in the third quarter of 2019, up from $10.5 trillion in 2010 and $8.2 trillion in 2000. They are spending more than ever on personal care items, consumer electronics, and clothes. The average American buys 66 garments a year.
Consuming has become easier, as shoppers no longer have to comply with restrictive store hours. Goods have become cheaper, even when they must be shipped halfway around the globe. Consumers also dispose of the products they buy faster than ever when they reach programmed obsolescence or simply because they get bored with them.
Most of these products end up in landfills; the average American disposes of 4.4 pounds of trash every day, which translates into 728,000 tons of daily garbage, or 63,000 garbage trucks full. Every year, Americans throw away 9 million tons of furniture, 9.4 million tons of consumer electronics, and 14 million tons of clothing (double the 7 million tons tossed 20 years ago).
For many Americans, sustainability is becoming a priority in the face of relentless consumption, with surveys showing a desire to pivot toward more meaningful and responsible consumption choices.
Who should be responsible for combating the climate crisis?
Ipsos Global Trends 2023 shows that 80% of people in 50 markets around the world believe the planet is heading for an environmental disaster unless consumers change our habits quickly, yet only 39% believe their country has a clear plan in place for how people, government, and businesses are going to unify to tackle climate change, according to an Ipsos poll of 30 countries from 2022.
People feel the burden of responsibility. In a global survey from Ipsos, 72% agreed that if ordinary people do not act now to combat climate change, they will be failing future generations and 68 percent said that if companies do not act to combat climate change, they are failing their employees and customers. Globally, 65% believe that if their government does not combat climate change it is failing citizens.
These concerns are prompting brands to become more sustainable. When asked, “Who should be responsible for finding a way to reduce unnecessary packaging?” 40% of people surveyed said everyone, 38% said manufacturers and retailers, and only 3% said consumers alone. Product packaging is something that brands (not consumers) own and control, yet consumers influence business decisions by which brand they buy, based on its environmental impact.
And when it comes to implementing sustainable practices, organizations must also be conscious of public perception and overpromising—especially when there may be aspects outside their control. A major international airport, for example, recently committed to becoming carbon neutral by 2030. However, the pledge only reflects the airport’s infrastructure. There is a danger that, in the public’s view, the commitment should also include the emissions from the 1,300 flights that take off or land there every day. Doing the right thing on sustainability, while also managing public perceptions, is not an easy balance to get right.
What consumers believe contrasts with how they shop
Brands also face a tricky factor in consumer behavior itself. While many people claim to be concerned with the environment, their efforts to live in a more environmentally friendly way often fall short and they default on easier actions.
An Ipsos study revealed that almost 90% worldwide are confident in recycling and using low-energy lightbulbs. Conversely, only 55% would consider switching to a mostly plant-based diet, and 59% would avoid driving a car and long-distance air travel.
When it comes to shopping, Ipsos Essentials data shows that globally, just over half of citizens consider themselves to be ethical or sustainable shoppers. In the U.S., only 24% of shoppers see sustainability as a crucial factor when making a purchase, compared to 53% who say the same for affordability and 71% for quality.
Shoppers also differ on their sustainability priorities depending on the product. In baby and toddler products, for example, an Ipsos study showed that sustainability was not a top priority. Parents favored diaper brands that make a safe product for their baby (70%) and fit their baby well (60%). In contrast, only 22% care that the brand is environmentally responsible, declining by three percentage points over the last year.
How some brands are responding
As sustainability is becoming a topic of growing interest, brands feel obliged to talk to their sustainability agenda and show their actions through initiatives and commitments to various time frames. Many brands aim to eventually become carbon neutral (offsetting one’s emissions by planting trees), including:
Netflix by 2022
Apple, Microsoft, and Facebook by 2030
Amazon by 2040
Coca-Cola and Nestlé by 2050
Starbucks aims to become “resource positive” by 2030, which it defines as reducing carbon emissions, water withdrawal, and waste by 50% while expanding plant-based menu options, shifting to reusable packaging and investing in regenerative agricultural practices.
Brands rely on a range of terms to describe their sustainability initiatives, including but not limited to “carbon zero” (Hytch, a commuting app), “zero-carbon” (Zero Carbon Coffee), “climate positive” (Max Burgers), and even “air-made” (the carbonneutral alcohol brand Air Vodka).
Being a “sustainable brand” has different meanings to different consumers
Some brands are purposefully built around sustainability. “Oatly was born sustainable. Its very existence is the manifestation of their mission. Specifically, to help support ‘a systemic shift toward a sustainable, resilient food system’… to ensure the future of the planet for generations to come.”
Some brands have a purpose that aligns with sustainability
Although denim is notorious for requiring large quantities of water to create jeans, Levi’s new collection, Water<Less uses 96 percent less water. Levi’s implements sustainable practices through its entire design and manufacturing process and is working to source cotton that is 100 percent sustainable.
Some brands must shift to sustainability
Volkswagen’s mission is to power a grand switchover to electric vehicles and has enshrined the mission in VW’s new tagline, “Way to Zero.” They aim for total carbon neutrality by 2050, with the hope of creating a sustainable production process from design concept to showroom.
Implementing sustainable practices is no easy feat and often takes years. But brands, especially in 2023, must understand consumer priorities and show a commitment, no matter how formidable the challenge.
A modern, cloud-based ERP environment allows retail organizations to responsively adapt to economic and market changes based on a combination of business and ESG data, processes, metrics, and expectations. Image: GETTY
By Joerg Koesters, Head of Retail Marketing and Communications, SAP via Forbes • Reposted: April 12, 2023
Against a backdrop of inflationary pressures, rising interest rates, and a potential global recession, midsize retailers are taking stock of organizational excesses and weaknesses. And the first initiatives traditionally placed on the back burner are often related to environmental, social, and governance (ESG) improvement.
But findings from SAP Insights research indicate the industry’s traditional reaction to a potential economic downturn may not be the best option forward. In a survey of retailers with annual revenues of less than $1 billion worldwide, respondents consider sustainability as a critical part of their strategies for growing revenue, increasing business efficiencies, and strengthening brand reputation.
Incorporating ESG into decision-making uncovers new opportunities that go beyond attracting consumers with sustainable goods. In fact, retailers have made moves that optimize their supply chains and have seen benefits such as reduced supply chain disruption and lower logistics costs. Other positive outcomes include:
Moving distribution centers to locations closer to plants and consumers to enable faster response to changing demand in physical stores and e-commerce channels.
Proactively seeking alternatives to shipping service providers and carriers that reduce the distance that goods travel to dramatically reduce logistics costs.
Expanding multi-tier vendor options that demonstrate ethical labor practices to protect compliance continuity and ensure consumer confidence.
Dialing back on any of these efforts to drive short-term cost savings as a response to the economic downturn would close the door to larger business benefits and shopper and consumer value.
The good news is that midsize retailers are thinking about the best ways to respond to economic stagnation. Nearly half (45%) of organizations surveyed by SAP Insights consider it a global risk they must be ready to address. This view has led to investment in various technologies, including cloud computing, cybersecurity infrastructure, employee collaboration tools, automated business intelligence dashboards, and business process intelligence.
By leveraging all these technologies within a modern, cloud-based ERP environment, retail organizations can responsively adapt to economic and market changes based on a combination of business and ESG data, processes, metrics, and expectations.
Take, for example, Distribuciones DANA, which is known for its close relationship with customers and internationally recognized consumer products brands such as Colgate-Palmolive, Henkel, and Unilever.
The leading distribution company in Mexico across grocery, wholesale, and retail channels developed a distribution and logistics solution with a cloud ERP to bolster its reputation for reliable and efficient product deliveries. The ERP’s intelligent infrastructure facilitates smoother reservations, purchases, payments, and transportation processes and encourages teams to collaborate with greater agility and speed by automating forms and messages.
Equipped with better projections of shipping volumes, the company can better manage its transportation planning, so it can offer logistics services that provide the best coverage at the most competitive prices and with the lowest-possible mileage. Additionally, it can generate detailed information on routes, customers, and suppliers and deploy GPS systems to further support timely and sustainable delivery.
Another prime example is Super Q. The operator of convenience stores throughout Mexico is already following this approach across its 200 retail locations to enable business continuity and customer service excellence. An industry-specific cloud ERP helps the business improve information flow and visibility, accelerate finance and accounting closing processes, and reduce paperwork by eliminating spreadsheets and manual processes.
As a result of its business transformation effort, Super Q integrated 100% of its regulatory processes for manual audits. This outcome allows the retailer to make inventory information available online and process store sales data quickly for more accurate decision-making – immediately impacting operational efficiency and ensuring reporting compliance. As a result, the company now has real-time visibility into operating costs, opportunities, and risks, as well as point-of-sale and product category profitability.
As proven by Distribuciones DANA and Super Q, players across the retail value chain can optimize their revenue potential by using cloud ERP to gain a structured business perspective while embracing sustainability holistically. Doing so empowers retailers to become environmentally responsible and socially ethical brands that people want while improving promotions, demand forecasting, waste reduction, and the customer experience.
Thriving retailers value long-term ESG goals
No single strategy can recession-proof a business. But retailers that leverage sustainability data and values across their operations and decision-making can emerge stronger than their competitors.
By fine-tuning sustainability performance along with business strategies, midsize retailers can establish a habit of responsible cost savings and efficiency improvement to protect their brand and revenue generation during every downturn. And when the economy begins to recover again, they’ll be many steps ahead of the competition – seizing growth opportunities faster and more effectively.
By Mary Riddle from triple pundit com Reposted: April 11, 2023
The latest report from the Intergovernmental Panel on Climate Change (IPCC) outlines the widespread impacts and risks of climate change. The findings are grim: Global surface temperature has risen 1.1 degree Celsius above pre-industrial levels, and greenhouse gas emissions have continued their upward trajectory. Global governments are failing to meet their commitments to curb emissions, and current nationally determined contributions (NDCs) have the world on track to shoot past 1.5 degrees within the 21st century, making it far more difficultto limit warming to below 2 degrees.
As civil society fails to curb emissions and avoid the most catastrophic outcomes of the climate crisis, the private sector has an opportunity to drastically decrease emissions and lead the way to a decarbonized world.
TriplePundit spoke with Steve Varley, global vice chair for sustainability at the big-four accounting firm EY, about the ways the private sector can help change the current climate trajectory and create long-term sustainable value.
“The IPCC report is not the first time that we’ve heard a claxon and seen the red flashing lights in a report done by eminent and prestigious scientists on the climate emergency,” Varley said. “We are not acting appropriately in business or government in response to the report. Capitalism can be a powerful agent, and if we can help stakeholders create value by becoming more sustainable, then the world will be more sustainable. The private sector can help close the gap on climate response when national governments are struggling to meet the expectations of a 1.5-degree pathway.”
The fight against climate change and the road to COP28
The latest IPCC report is framing the global conversation leading up to the U.N. COP28 climate talks in December. Current NDCs — the formal term for country commitments to reduce emissions — put the world on track to see temperature increases between 2.2 and 2.4 degrees Celsius. And some governments are failing to implement their current emissions reductions strategies.
“We should be tracking how countries improve their NDCs, if at all, on the way to COP28, especially for the G20,” Varley said, referring to the Group of 20 of the world’s largest economies. “I am encouraged by where the U.K. is getting to, but all eyes are on the United States, India, China and Saudi Arabia. We need to move from pledges and promises to progress and performances.”
At the COP27 climate talks last year, the Joe Biden administration acknowledged that the public sector could not provide adequate financing to fund the transition to a decarbonized economy. A senior advisor to President Biden noted that the world needs the private sector to help unlock trillions of dollars of climate finance needed to avert the worst effects of the climate crisis, but currently, only a small fraction is available.
“As governments shrink away from meeting their commitments on their NDCs, now is the time for the private sector to step forward,” Varley noted. “For those parts of the world where there is a trust gap between civil society and business, this is our opportunity to walk the talk and show how we are decarbonizing at scale. We should come to COP28 with evidence to civil society how we are closing the gap and decarbonizing our businesses.”
Where do businesses go from here?
The business case for sustainability is increasingly apparent for the private sector, and there are several ways that companies can create value for stakeholders and engage the public. “Sustainability is the defining challenge for businesses and business leaders over the next decade, and we need to address it proportionately,” Varley said. “Capitalism can, on occasion, wreak havoc on the world, but if we bring the power of the private sector as a change agent to the world, we can make the planet more sustainable. To do that, we have to encourage the creation and protection of value.”
Additionally, the IPCC report needs to be made more available to folks outside of the sustainability sectors. “The private sector needs to translate the IPCC report into everyday descriptions so that civil society can better understand how not dealing with climate change will impact their lives and the lives of their children,” Varley told us.
The world is running out of time to act, and the next few years are critical. Governments must continue to support policies that allow for the flow of climate finance. “It’s difficult when politics does not support the climate change agenda, but the private sector is embracing and responding to the climate emergency,” he said.
“There is a quote that I like, that is often attributed to Napoleon: ‘The job of a leader is to establish reality and then give hope,’” he continued. “COP28 can establish realistic optimism and realistic hope. I am optimistic, because I see the great work in many companies around the world to decarbonize. Businesses can start the movement to overtake governments’ efforts to decarbonize at a national scale and close the gap.” The IPCC report notes that at current rates of implementation, adaptation gaps will continue to grow and that an influx of climate finance is necessary to avoid catastrophe.
While the volatility of economic change around us can be distracting, one thing remains clear: A new generation of expectations is shifting business for good.By Del Hudson from Sustainable Life Media • Reposted: April 10, 2023
Government regulators are playing a key role in shaping how we address climate change; however, influential businesses have a chance to ensure these requirements speak to the metrics that make a true impact. Policy is a catalytic vehicle for change. As a business community, we should be embracing it as a means to address the existential threat of the climate crisis — to not do so would be irresponsible and dangerous. Recognizing the tension in the system among trade organizations, policymakers and corporations doesn’t mean it can’t be done right. For businesses and brands, creating incentives around impact reductionthat tie clearly to company goals is a key opportunity for transformative action.
It’s no secret that multiple industries have reaped the rewards of a broken economic model that relies on extractive and exploitative practices that continue to harm people and the planet. Consumer goods is one of those industries; and responsible leaders recognize it is time for a new system — one that transforms design and consumption and imagines a new way of doing profitable business. Over two-thirds of US consumers are willing to pay more for sustainable products. Globally, that number is just over a third — though that number rises to 39 percent for Gen Z and 42 percent for millennials. Capital markets will reward those that are de-risking their supply chains; and employees want to work where purpose and responsibility matters.
The argument that without perfect data we can’t do this work ignores the reality that science is always evolving. We must move forward with urgency, using the significant directional data that already exist and show where the key issues and intervention opportunities lie. Taking accountability for the full product lifecycle and impacts up and down the value chain is the only way to achieve meaningful ESG performance. It’s not about marketing single environmental or social attributes of a product. It’s not just reducing impact in owned operations while ignoring the manufacturing impact or material inputs of the end product. It’s believing that tomorrow’s customers will want (and deserve) something different than they get today.
This is hard, complex work; it won’t be completed in my lifetime. But we must move rapidly to accurately understand impact and take action with urgency. And we must be ready to learn and change as we know more. The tools to begin this work already exist. Smart businesses already see their futures. And while the volatility of economic change around us can be distracting, one thing remains clear: A new generation of expectations is shifting business for good.
By Amudalat Ajasa from The Washington Post • Reposted: April 10, 2023
Solar cell panels set up on the West Campus of Arizona State University in Phoenix, Arizona.
Climate change is on the minds of many in the Class of 2027, and could be a critical factor in how current high-schoolers make their final college choices in the coming weeks. For many prospective students, climate change is an existential threat. So colleges and universities across the country are seeking and finding innovative ways to curb their emissions and become more environmentally sustainable.
A total of 413 schools, or about 10 percent of U.S. higher education institutions — where about 30 percent of full-time U.S. college students are enrolled — have signed a climate pledge from Second Nature, an organization committed to accelerating climate action through these institutions. By signing, schools vow to achieve carbon neutrality as soon as they can, according to Tim Carter, the organization’s president.
Some large institutions have been at the forefront of efforts toward sustainability, but the push is growing as colleges of all sizes join the fight. Many are also adopting solutions specific to their local community or environment.
Ohio University turns scraps to soil
Ever wondered what happens to all the uneaten food in dining halls? Where does your food go after it’s carried away on conveyor belts?
The answer is grim. Most food waste generated in college dining halls ends up in the trash and then a landfill. Food waste overall is the single most common material dumped in landfills and incinerated in the United States, according to the Environmental Protection Agency.
But at Ohio University, the kitchen is just the beginning of your leftover food’s journey.
After students leave the dining hall, trained staff separate food left on serving trays. Nearly five tons of food waste per day is collected from dining halls around campus and brought to OU’s $2 million composting plant.
The plant, which opened in 2009, features a rooftop solar array that provides about 75 percent of the system’s energy, according to Steve Mack, the university’s director of facilities management. Its rainwater harvesting system provides all the water used at the facility.
By 2012, the university was composting nearly 100 percent of its dining hall waste.
“It’s the right thing to do; food waste going towards composting is much better than going to a landfill,” Mack said. “We’ve taken what was a waste stream and turned it into a resource.”
The campus has one of the most efficient university food services in the country, despite the unique challenges posed by the all-you-care-to-eat facilities. About 99 percent of campus food waste is post-consumer — left over from trays — while pre-consumer food waste from the preparation process makes up less than 1 percent.
The school uses an in-vessel compost systemthat combines organic waste — including meat, dairy and landscape waste — with bulking agents in which naturally occurring microorganisms break down material. It’s the largest known in-vessel system at any college or university in the nation. The material is then trapped in an enclosed environment where temperatures, moisture levels and airflow are monitored for two weeks. Once removed from the in-vessel system, the compost is placed in narrow piles outside for three to four months.
Food scraps are turned into nutrient-rich soil, which is used for landscaping andfilling in intramural athletic fields. The soil has also been shared with the local school district.
All told, the university compostsabout 612 tons of waste a year. That’s equivalent to the weight of about 102 full-grown male elephants, according to the university.
Composting saves the university $14,000 each year in landfill fees and $22,000 in annual fertilizer costs, said Sam Crowl, associate director of sustainability at Ohio University.
Ball State University fires up a greener system for heating
When engineers tell you that you can’t replace a university’s 70-year-old heating system with the largest geothermal plant in the country, you’d probably heed their warning.
But Jim Lowe didn’t.
“For an engineer, it’s a once-in-a-lifetime opportunity to build a system that’s beneficial to the environment and efficient for use of energy around campus,” said Lowe, who is associate vice president for facilities planning and management at Indiana’s Ball State University.
Lowe wanted to replace the coal-fired boiler heating system, which burns coal to create steam and heat, with a geothermal power plant — which draws heat from the earth and turns it into hot water, which, in turn, is used to heat buildings.
In 2009, BSU began the daunting task — and Lowe’s team had to start from scratch.
The team building the system drilled approximately 3,600 holes that were 500 feet deep under sporting fields and parking lots, digging up streets and sidewalks to place nearly 5.3 million feet of piping.
It took eight years, but the school said the process caused very little disruption to students’ day-to-day activities. Now the largest geothermal system in the country runs hidden under the school and provides heat and cooling to “50-plus major buildings” on campus, Lowe said.
Completed in 2017, the $83 million project has cut BSU’s carbon footprint in half — helping the school get halfway to its goal of becoming carbon neutral. Lowe estimates that BSU now saves $3 million in energy costs each year.
BSU’s project has inspired nearly 65 higher education institutions to start building their own geothermal plants.
Colleges and universities “have a responsibility to protect our environment and pay it forward for future generations,” Lowe said.
University of Iowa uses resources from its backyard
Most people who stumble across the inedible outer cover of an oat grain think nothing of it, but the Quaker Oats production facility in Cedar Rapids, Iowa, looked at piles of leftover oat hulls and saw a potential energy source. The company asked the nearby University of Iowa for help. And the school jumped in.
The University of Iowa became a green-energy champion by harvesting biomass energy using resources in its backyard — the oats facility is just 25 miles away. Biomass energy is generated by burning living or once-living organisms to create heat or electricity: Think of wood, corn or soy.
Oat hulls were once a treat for farm animals, but UI began buying the crop two decades ago. Now, the university buys nearly 40,000 tons of oat hulls each year from the Quaker Oats facility, reducing its reliance on coal.
“It’s hard for anybody to find much fault in what we’re doing because it’s good on cost, it’s good for the environment, it’s good for local businesses. It’s a good thing all around,” said Ben Fish, director of utility operations at UI.
Oat hulls aren’t the only thing UI is burning to make energy.
In 2015, UI began planting and harvesting acres of a billowing, bamboo-like grass that grows up to 12 feet high. The miscanthus grass is chopped, collected and combined with renewables and non-recyclables, like the waxy backing of labels and paper, to mimic coal when burned. The university partners with a Wisconsin-based energy company that uses the grass as a primary ingredient to create renewable energy pellets. The university also contracted with farmers within a 70-mile radius to plant the grass and expand their acreage.
Months into the worldwide pandemic, the empty university exceeded its goal of 40 percent renewable energy by 2020.
UI is making strides toward a new goal: going coal-free by 2025. Fish thinks it is “absolutely attainable.”He also said oat hulls will continue to be the “foundation” of UI’s future carbon reduction planning.
In January, the EPA ranked the school No. 2 on its list of top college and university green-power users — surpassed only by the University of California system. The 1,900-acre campus gets 84 percent of its energy from green power.
“All colleges and universities are trying to reduce their carbon impact, and we all just have a different way of doing it,” Fish said. “We’ve been able to make use of what’s around us.”
University of Minnesota at Morris moves with the wind
The University of Minnesota at Morris sits in a rural part of the state, surrounded by prairie and forest areas. The small liberal arts college with fewer than 1,300 students is about 2½ hours west of Minneapolis.
The school “in the middle of everywhere” uses a localized hybrid approach to renewable energy. Wind turbines, a biomass gasification facility and a solar array generate about 70 percent of the electricity used on campus daily. Annually, the school produces more electricity than it needs.
Two 230-feet-high wind turbines with 135-foot blades tower over the university. The turbines generate 10 million kilowatts of electricity per year, but the university uses only about 5 million kilowatts. The surplus power is exported to provide renewable energy to Morris, a city with a population of about 5,000.
The two turbines supply more than 60 percent of the annual electricity used on campus. The university achieved carbon neutrality in electricity for the first time in 2020 in large part thanks to those turbines, said Troy Goodnough, the school’s sustainability director. There are many instances when all the university’s electricity comes from wind turbines, which can generate electricity with wind speeds as low as 7.8 mph and as high as 29 mph.
UMN Morris was the first public university in the country to have the large-scale wind turbines constructed, according to university officials.
“What we try to do is be on the front edge of showing what a model of rural sustainability looks like,” Goodnough said.
Additional renewable energy comes from 636 individual solar panels and agrivoltaic solar farms. Agrivoltaic farming combines solar energy generation and agriculture.
Next to campus, cows graze the land and crops flourish in a field shared by an array of eight-foot-high solar panels. The 240-kilowatt agrivoltaic array is expected to generate more than 300,000 kilowatt-hours each year.
Arizona State University proves big schools can make big changes, too
Achieving carbon neutrality tends to be less daunting for smaller colleges and universities because they emit lower emissions compared with larger ones. Larger technical universities have nearly 10 times as many students and produce roughly four times the carbon emissions per student compared with smaller schools, according to an MIT study.
But those odds didn’t deter Arizona State University, with a total campus enrollment of more than 75,000 students, from pledging to reach zero greenhouse gas emissions by 2025. It’s a goal the school crushed six years early.
“We decided to move the goal six years early in recognition of the worsening climate crisis,” said Marc Campbell, executive director of sustainability at ASU.
Between 2007 and 2017, the university increased energy efficiency in new building construction by using regenerative and sustainable materials, installing efficient cooling and heating systems, and maximizing natural light sources and shielding, Campbell said. Older buildings were retrofitted with efficient light fixtures, water-conserving shower heads and updated cooling systems.
The university built 90 on-site solar installations, which provide enough green energy to power an estimated 18,000 homes at once, according to Campbell. ASU also partnered with the Arizona Public Service, the state’s largest electric utility, on a solar farm that generates about 65,000 megawatt-hours per year of green electricity.
The school’s emissions decreased, and it reduced its carbon footprint by more than 30 percent.
By 2018, ASU was on the brink of fulfilling its pledge and began purchasing carbon offsets to meet its goal early. Carbon offsets are investments in projects that reduce or work toward the removal of CO2 emissions from the atmosphere.
The university became carbon neutral in scope 1 emissions, or emissions over which it has direct control, and scope 2 emissions, or indirect emissions, including from energy purchased by the university.
“Sustainability is now really in the DNA of ASU,” Campbell said. ASU’s School of Sustainability was the first of its kind when it opened in 2006, according to the university.
ASU has become a sustainability model for larger institutions despite increasing the size of its campus by 40 percent and increasing on-campus enrollment by 35 percent since 2007.
In January, the EPA ranked ASU No. 3 on its list of top college and university green-power users, right behind the University of California system and the University of Iowa. ASU gets 77 percent of its electricity from green energy.
ASU’s next sustainability goal: to be completely carbon neutral, including transportation-related emissions, by 2035. “It is attainable, but we still need to think through what the full road map looks like to get us there,” Campbell said.
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