From the Reuters Events Sustainable Business vs. CSRWire • Reposted: October 7, 2023
The urgent call to decarbonize has thrust sustainability into the spotlight on the corporate stage. Whilst the growth in reporting has created an expansive list of pressing priorities.
But how are businesses preparing for the comprehensive and complex reporting landscape? Where are they investing today, and perhaps more pertinently in the years to come, to meet the needs of regulators and climate-conscious stakeholders? And how are today’s businesses strategizing to meet their sustainability ambitions?
Discover the answers to these pivotal questions in the Reuters Impact Global Sustainability Report 2023, a valuable resource that will help shape your sustainability strategy, chart your investment course, and provide a meaningful benchmark against industry peers.
Our unique, proprietary dataset, assembled using survey responses from more than 570 sustainability practitioners and decision-makers globally, provides a detailed examination of how sustainability investments are shifting towards a new set of technologies, where businesses are setting their sustainability priorities and the strategies being pursued to meet them.
Our research has unveiled several key findings:
Data analysis and emissions accounting solutions are the leading destinations of business investment for sustainability purposes today, but by 2026 a new suite of technologies is expected to lead the way.
Our technology investment leaderboard highlights differences in investment approach between companies operating in North America and those in Europe. Are European organizations still sustainability’s trailblazers?
Energy and decarbonization is a top priority for a leading majority of organizations responding to our survey, however there is a distinct mix of strategies being pursued to reduce remissions.
Legos are designed to last for decades. That posed a challenge when the toymaker tried to switch to recycled plastics. AP Photo/Shizuo Kambayashi
By Tinglong Dai, Professor of Operations Management & Business Analytics, Carey Business School, Johns Hopkins University, Christopher S. Tang, Professor of Supply Chain Management, University of California, Los Angeles and Hau L. Lee, Professor of Operations, Information & Technology, Stanford University via The Conversation • Reposted: October 7, 2023
This commitment isn’t just for show. Lego sees its core customers as children and their parents, and sustainability is fundamentally about ensuring that future generations inherit a planet as hospitable as the one we enjoy today.
So it was surprising when the Financial Times reported on Sept. 25, 2023, that Lego had pulled out of its widely publicized “Bottles to Bricks” initiative.
This ambitious project aimed to replace traditional Lego plastic with a new material made from recycled plastic bottles. However, when Lego assessed the project’s environmental impact throughout its supply chain, it found that producing bricks with the recycled plastic would require extra materials and energy to make them durable enough. Because this conversion process would result in higher carbon emissions, the company decided to stick with its current fossil fuel-based materials while continuing to search for more sustainable alternatives.
Business leaders are increasingly integrating environmental, social and governance factors, commonly known as ESG, into their operational and strategic frameworks. But the pursuit of sustainability requires attention to the entire life cycle of a product, from its materials and manufacturing processes to its use and ultimate disposal.
The results can lead to counterintuitive outcomes, as Lego discovered.
Understanding a company’s entire carbon footprint requires looking at three types of emissions: Scope 1 emissions are generated directly by a company’s internal operations. Scope 2 emissions are caused by generating the electricity, steam, heat or cooling a company consumes. And scope 3 emissions are generated by a company’s supply chain, from upstream suppliers to downstream distributors and end customers.
Currently, fewer than 30% of companies report meaningful scope 3 emissions, in part because these emissions are difficult to track. Yet, companies’ scope 3 emissions are on average 11.4 times greater than their scope 1 emissions, data from corporate disclosures reported to the nonprofit CDP show.
Lego is a case study of this lopsided distribution and the importance of tracking scope 3 emissions. A staggering 98% of Lego’s carbon emissions are categorized as scope 3.
From 2020 to 2021, the company’s total emissions increased by 30%, amid surging demand for Lego sets during the COVID-19 lockdowns – even though the company’s scope 2 emissions related to purchased energy such as electricity decreased by 40%. The increase was almost entirely in its scope 3 emissions.
As more companies follow in Lego’s footsteps and begin reporting scope 3 emissions, they will likely find themselves in the same position, realizing that efforts to reduce carbon emissions often boil down to supply chain and consumer-use emissions. And the results may force them to make some tough choices.
Policy and disclosure: The next frontier
New regulations in the European Union and pending in California are designed to increase corporate emissions transparency by including supply chain emissions.
The EU in June 2023 adopted the first set of European Sustainability Reporting Standards, which will require publicly traded companies in the EU to disclose their scope 3 emissions, starting in their reports for fiscal year 2024.
California’s legislature passed similar legislation requiring companies with revenues of more than $1 billion to disclose their scope 3 emissions. California’s governor has until Oct. 14, 2023, to consider the bill and is expected to sign it.
At the federal level, the U.S. Securities and Exchange Commission released a proposal in March 2022 that, if finalized, would require all public companies to report climate-related risk and emissions data, including scope 3 emissions. After receiving significant pushback, the SEC began reconsidering the scope 3 reporting rule. But SEC Chairman Gary Gensler suggested during a congressional hearing in late September 2023 that California’s move could influence federal regulators’ decision.
This increased focus on disclosure of scope 3 emissions will undoubtedly increase pressure on companies.
Because scope 3 emissions are significant, yet often not measured or reported, consumers are rightly concerned that companies that claim to have low emissions may be greenwashing without taking action to reduce emissions in their supply chains to combat climate change.
At the same time, we suspect that as more investors support sustainable investing, they may prefer to invest in companies that are transparent in disclosing all areas of emissions. Ultimately, we believe consumers, investors and governments will demand more than lip service from companies. Instead, they’ll expect companies to take actionable steps to reduce the most significant part of a company’s carbon footprint – scope 3 emissions.
A journey, not a destination
The Lego example serves as a cautionary tale in the complex ESG landscape for which most companies are not well prepared. As more companies come under scrutiny for their entire carbon footprint, we may see more instances where well-intentioned sustainability efforts run into uncomfortable truths.
This calls for a nuanced understanding of sustainability, not as a checklist of good deeds, but as a complex, ongoing process that requires vigilance, transparency and, above all, a commitment to the benefit of future generations.
From Sustainable Brands • Reposted: October 7, 2023
A new study by Magna, Teads and Project Drawdown confirms consumers are relying on brands to create a clear, tangible and compelling vision — backed by substantive action — to guide them toward more sustainable lifestyles.
Today, MAGNA — the investment and intelligence arm of IPG Mediabrands — released a study conducted in partnership with Project Drawdown and cloud-based, omnichannel advertising platform Teads to better understand consumer perspectives on sustainability, especially as it relates to the continued barriers that prevent more sustainable lifestyles.
MAGNA surveyed 9,112 people in the United States, the United Kingdom and Australia, and held five focus groups in the US. Along with echoing recent research from Sustainable Brands® and Deloitte on the most common, ongoing barriers to consumer adoption of more sustainable habits and lifestyles (expense and lack of access), the study found that despite these barriers, people remain motivated to ensure a better future — with 99 percent of people agreeing that they can be motivated to take sustainable action.
“The climate crisis is, in part, a communication crisis,” said Jonathan Foley, Ph.D., Executive Director of Project Drawdown. “We already have the solutions we need to turn things around; but we are still paralyzed by misinformation, fear and the lack of will to act. We need a clear and compelling vision to move forward — a vision of a better future, where we come together to stop climate change, and build a better world for all. That could change the world.”
Additional key findings confirm the imperative for brands to be part of the conversation: 77 percent of respondents said they wanted brands to take a stance on sustainability. Furthermore, 75 percent somewhat or strongly agreed that if brands took meaningful action on sustainability, it would have a tremendous impact on the environment; and 35 percent would be motivated to act, if they see brands have, too.
A brand that offers tangible, relevant data in advertising — such as a statistic on how much water was saved in manufacturing — scores better than ambiguous messaging. Defining sustainability itself, a broad term that can vary by product category, makes a difference in helping consumers align around a company’s actions.
The study also ranked which channels consumers favor more when receiving sustainability messaging. Advertising, at 66 percent, was the optimal channel; followed by social media (62 percent), newsletters (57 percent), and influencers and other brand representatives (52 percent).
But advertising itself is also in the hot seat, thanks to its until-recently-unchecked carbon footprint — initiatives such as Scope3 and Ad Net Zero have emerged to help ensure the climate impacts of the messengers no longer undermine their sustainability messaging.
“Sustainability practices are good for business, with innovation, transparency, and information key for brands to strengthen their customer relationships long term,” added Neala Brown, SVP of Strategy & Insights at Teads. “While brands should ease customer hesitations toward adopting a sustainable lifestyle and given advertising as an optimal channel for that messaging, we are simultaneously working with our brand partners to reduce their own digital carbon footprint with supply chain and media optimization via direct publisher relationships.”
Authenticity and credibility — with heightened awareness and scrutiny of sustainability claims and sensitivity to greenwashing, brands must ensure both their communications teams and the content creators they partner with are versed and confident in the validity of the claims they espouse.
Sustainability education needs to be a collective effort. Image: Photo by Kenny Eliason on Unsplash
By Julie Linn Teigland, Area Managing Partner, Europe, Middle East, India and Africa, from the World Economic Forum • Reposted: October 5, 2023
The world is grappling with the pressing issue of climate change and our younger generations will bear the brunt of its consequences.
The first step towards meaningful change in anything – including sustainability – is education and a collective effort is required from corporations, governments, NGOs and educators alike.
Today’s younger generations undoubtedly hold the key to a more sustainable future, but channelling their enthusiasm into lasting change poses a significant global challenge for us all.
The global EY organization, in collaboration with JA Worldwide, recently published a report to find out ‘How can we empower the next generations to build a more sustainable future?‘. One of the report’s main findings is that the responsibility for delivering effective sustainability education lies not solely with educational institutions but with a collaborative effort from a coalition of organizations working hand-in-hand with educators around the world.
How can business leaders and corporations play their part in delivering truly effective sustainability education, both inside and outside the classroom? Here are five strategies to consider.
1. Host expanded learning opportunities
Our report found that hands-on learning experiences were critical in delivering truly engaging and effective sustainability education. There are many opportunities for companies and NGOs to get involved and collaborate with educators here by sponsoring workshops and activities, for example, that better engage students.
The Sustainability and Environmental Education organization’s ‘Young Changemakers’ course is an excellent example of this approach in action. The course inspires young school-age people by offering creative events and workshops that involve local businesses, charities and community organizations to bring sustainability challenges to life.
2. Provide educators with the tools to share additional context
Our report found that while social media plays a significant role in educating younger generations about sustainability, they trust teachers and schools more for this education. More than a quarter of Gen Z and Gen Alpha list schools and teachers as the top sources from which they would like to receive more information about sustainability.
With this in mind, corporations and NGOs should collaborate with schools to equip them with the tools to provide vital context to the raft of social media information younger generations are exposed to.
To give a practical example, the EY Future Skills Workshops, collaborating with EY, Code.org and Microsoft, have been established to help educate young people on sustainability topics not commonly taught in schools, utilizing innovative approaches and new technology. Programmes like these help empower educators and bridge the gap between traditional learning and digital-age awareness, ensuring that students can critically evaluate and apply the information they encounter on social media.
3. Strengthen ties with groups in local communities
Governments are seen as those primarily responsible for building a more sustainable world, but the reality is that real change happens with all of us at an individual level.
Corporations can make an impact here by collaborating directly with local community groups. The global programme EY Ripples is an example of this, fostering corporate responsibility by empowering individuals to use their skills for positive change. Through the programme, nearly 500 projects have been completed to date, each dedicated to scaling small businesses that contribute to one or more of the UN Sustainable Development Goals, with the ultimate goal of positively impacting one billion lives in our communities by 2030.
Initiatives like these support individuals to create meaningful change within their communities, helping to make sure that sustainability is not just a global goal, but a local reality.
4. Provide information to help consumers make better decisions to reduce their carbon footprint
A recent IBM survey found that 41% of consumers would buy more sustainable products if they had a better understanding of how their purchase made an impact. And yet, according to Euromonitor, only 10% of global companies believe their sustainability communication to general consumers in 2023 is highly effective.
Truly proactive corporations are not only redesigning their products to make them more sustainable, but they are also engaging consumers through transparent communication. By demonstrating the environmental benefits of sustainable choices, companies can empower consumers worldwide to make informed decisions that reduce their carbon footprint.
The reality is that Gen Z expects the companies they join to have such programmes in place and companies should be prepared to get ahead of the curve if they want to attract the best talent.
5. Work with local and national governments to promote sustainability education and environmental action
Policymakers can improve sustainability education through better communication of existing sustainability programmes, the creation of new initiatives and by better aligning priorities and actions.
UNESCO’s Education for Sustainable Development (ESD) for 2030 programme does great work to this effect. It is also encouraging to see the EU include skills development as a key pillar of its Green Deal Industrial Plan, with proposals for Net-Zero Industry Academies that will help roll out up-skilling and re-skilling programmes in strategic industries. Programmes like these not only prepare the workforce for sustainable careers, they also reinforce the importance of sustainability in education and professional development.
To conclude, it is the shared responsibility of corporations, governments, NGOs, and educators to empower younger generations with the knowledge and tools necessary to build a sustainable future, ensuring that they inherit a planet capable of sustaining life as we know it.
By expanding learning opportunities, equipping educators, engaging with local communities, providing information for informed consumer choices and collaborating with governments, we can work together to pave the way for a brighter and more sustainable future for all.
By Carolyn Berkowitz, Forbes Councils Member via Forbes • Reposted: October 5, 2023
In recent months, efforts to stop the enactment of environmental, social and governance initiatives and reporting by promoting false narratives have reached a fevered pitch. As a rule, executive business decisions should be driven by data and facts. And the data shows that ESG policies and practices are not only good for society but also good for business.
1. ESG practices result in bottom-line advantages.
Key data points supporting this conclusion include:
• Three-fourths of Americans believe companies need to positively impact society, the 2021 Porter Novelli Purpose Premium Index reported.
• Large U.S. corporations that best meet stakeholder needs “had a 4.5% higher profit margin, 2.3% higher return on equity and paid five times more in dividends,” according to research by JUST Capital and CNBC.
A KPMG survey found that 70% of U.S. CEOs said their ESG programs improved their companies’ financial performance.
2. Purpose helps companies win the ‘talent war.’
Long-term business success depends on attracting and retaining top talent. Even as the talent market fluctuates, there is growing evidence that the best employees join companies that are purpose-driven and remain loyal when their values align with the organization and they are contributing to the corporate purpose. The data cited below shows the correlation between purpose-driven initiatives and employee engagement, satisfaction and motivation.
• About 70% of potential employees are more likely to apply for and accept an offer from a socially responsible organization, according to a 2021 IBM survey.
• More than 40% of employees are “reconsidering their current job because their company is not doing enough to address social justice issues externally,” research by Porter Novelli found.
• A report by Citi (download required) said millennials are willing to forgo around 14.4% of their compensation to work at companies that are socially responsible.
3. ESG can help organizations mitigate risk.
Risk mitigation is a key component of corporate compliance requirements, performance measures and, ultimately, valuation. The impact of climate change is of growing concern for business continuity, and adhering to ESG reporting mandates in the European Union is required to compete globally.
• In 2020, a special report by Edelman said 92% of U.S. investors agree “a company with strong ESG performance deserves a premium valuation to its share price.”
• Volatility is higher for those with a poor ESG score when compared to those with high ESG scores.
• The European Union adopted a corporate sustainability reporting directive in 2022, with full compliance from global companies required by 2024.
Building a positive reputation with key stakeholders is essential for a company’s growth. It enhances trust, customer loyalty and brand preference, which, in turn, leads to increased sales and profitability. A strong reputation also helps companies withstand crises and earn the trust of communities.
• A low ESG score can result in only a 10% willingness to buy, but a high ESG score can result in a 67% willingness to buy, according to a report by RepTrak (registration required), which analyzed data from its corporate reputation database.
• Research commissioned by Dotdash Meredith and Omnicom Media Group analyzed “the future majority,” a group defined in the study as “Black, Latina, AAPI women and LGBTQIA individuals 40 and under.” Nearly 90% of respondents said they will prioritize taking the time to “research brands, including their values and how they support the communities I care about.”
• Nearly 65% of consumers expect companies to talk about their behavior and impact on the world, research by FleishmanHillard found.
Getting Started With ESG
Despite the data-driven business case for ESG and CSR and its increasing importance to stakeholders, corporate executives are not sufficiently resourcing this function. Recent data from the 4th Annual CSR Insights Survey by the Association of Corporate Citizenship Professionals, where I’m CEO, offers insight. The data, from CSR and ESG professionals at nearly 149 leading companies, showed real-world consequences of constricting ESG resources in the current business environment: 86% of respondents said their responsibilities had increased over the past year, which led to longer hours for 61% of those surveyed, burnout for 50% and mental health concerns for 19%.
Amid a turbulent backdrop, businesses must keep sight of the inherent value of ESG and resource it appropriately. To get started:
1. Determine your CSR and ESG strategy.
One key step toward developing an effective strategy is to conduct a materiality assessment, or, for those who have already done so, revisit it with fresh eyes. These assessments identify and prioritize social and environmental issues critical to a company’s success and are aligned with stakeholder input. While traditionally associated with larger corporations, organizations of all sizes should routinely evaluate areas impacting their business significantly. Although not mandatory, a materiality assessment serves as a road map for prioritizing CSR and ESG initiatives.
2. Communicate in the language of your business.
In today’s landscape, it’s important to communicate about these efforts in ways that align with the company’s core language and values. Focus messages on the business’s unique expertise on the issue and the concrete positive impacts of the effort, e.g., how and why a communications company is providing broadband access in underserved communities and the impact of the results on education and economic opportunity.
3. Resource the strategy and programs for results.
Starving CSR and ESG efforts of the resources required to achieve intended outcomes is an invitation for risk. If initiatives aren’t adequately staffed or funded, the outcome leads to the potential for community criticism, employee ill will and political fodder to those who are intent on dismantling ESG. CSR and ESG are inexpensive functions. When resources are cut, impact diminishes because reporting and compliance take priority over strategy and effective execution.
To secure a more prosperous future for both business and society, businesses can use the data available to them and resource the functions within their organizations that are steering the strategies that center around sustainability and corporate responsibility.
The U.S. government is the single largest buyer of services and goods, like vehicles. That has an impact on the economy. Photo: Saul Loeb/AFP via Getty Images
By Jesse Burkhardt, Associate Professor of Energy Economics, Colorado State University and Lauren Gifford, Associate Director of the Soil Carbon Solutions Center, Colorado State University via The Conversation • Reposted: October 4, 2023
Each year, the federal government purchases about 50,000 new vehicles. Until recently, almost all of them ran on diesel or gasoline, contributing to U.S. demand for fossil fuels and encouraging automakers to continue focusing on fossil-fueled vehicles.
That’s starting to change, and a new directive that the Biden Administration quietly issued in September 2023 will accelerate the shift.
The administration directed U.S. agencies to begin considering the social cost of greenhouse gases when making purchase decisions and implementing their budgets.
That one move has vast implications that go far beyond vehicles. It could affect decisions across the government on everything from agriculture grants to fossil fuel drilling on public lands to construction projects. Ultimately, it could shift demand enough to change what industries produce, not just for the government but for the entire country.
What’s the social cost of greenhouse gas?
The social cost of greenhouse gases represents the damage created by emitting 1 metric ton of carbon dioxide, methane and other greenhouse gases into the atmosphere.
By directing agencies to consider those costs when making purchases and implementing budgets, the administration is making it more likely that agencies will purchase products and make investments that are more energy efficient and less likely to fuel climate change.
The Department of Defense has been taking steps to reduce emissions for several years. Many of its military bases have solar panels, which can produce renewable energy for a few buildings or larger installations. Photo: U.S. Navy
While only a fraction of the roughly $6 trillion that the U.S. government spends each year would likely be considered under the new directive, that fraction could have far-reaching impacts on the U.S. economy by reducing demand for fossil fuels and lowering emissions across sectors.
Estimating the cost
The Obama administration introduced the first federal social cost of carbon to incorporate climate risk in regulatory decisions. It’s calculated using models of the global economy and climate and weighs the value of spending money today for future benefits.
When the Trump administration arrived, it cut the estimated cost from around $50 per metric ton to less than $5, which justified rolling back several environmental regulations, including on power plant emissions and fuel efficiency. The Biden administration restored an interim price to about $51, with plans to raise it.
Recent research suggests that the actual social cost of carbon is closer to $185 per metric ton. But carbon dioxide is just one greenhouse gas. The new directive takes other greenhouse gases into consideration, too – in particular, methane, which has about 80 times the warming power of carbon dioxide over 20 years.
Estimates of the social cost of methane, which comes from livestock and leaks from pipelines and other natural gas equipment, range from $933 per metric ton to $4,000 per metric ton.
Oil and gas wells and pipelines are a common source of methane emissions, including what the Environmental Protection Agency estimates to be more than 3 million abandoned wells across the U.S. AP Photo/Eric Gay
Without directives like these, decision-makers implicitly set the cost of greenhouse gas emissions to zero in their benefit-cost analyses. The new directives allow agencies to instead compare the expected climate damages, in dollars, when making decisions about vehicle purchases, building infrastructure and permitting, among other choices.
The vehicle fleet as an example
The federal vehicle fleet is a good example of how the social costs of greenhouse gases add up.
Let’s compare the costs of driving an electric Ford Focus and an equivalent conventional-fuel Ford Focus.
Assume each vehicle drives an average of 10,000 miles (about 16,000 kilometers) per year – that’s less than the U.S. average per driver, but it’s a simple number to work with. The damages from emissions in dollars from driving a conventional Ford Focus 10,000 miles are between $133 and $484, depending on whether you use a social cost of carbon of $51 per metric ton or $185 per metric ton.
The climate harm from driving an equivalent electric Ford Focus 10,000 miles, based on the average carbon dioxide emissions intensity from the U.S. electricity grid, would be between $59 and $212, using the same social costs.
Scale that to 50,000 new vehicle purchases, and that’s a cost difference of about $4 million to $13.5 million per year for emissions from operating the vehicles. While producing an EV’s battery adds to the vehicle’s emissions up front, that’s soon outweighed by operational savings. These are real savings to society.
The U.S. government is also a major consumer of energy. If agencies begin to consider the climate damages associated with fossil energy consumption, they will likely trend toward renewable energy, further lowering their own emissions while boosting the burgeoning industry.
How the government can shift demand
These types of comparisons under the new directive could help shift purchases toward a wide range of less carbon-intensive products.
Much of the U.S. government’s spending goes toward carbon-intensive goods and services, such as transportation and infrastructure development. Directing agencies to consider and compare the social cost of purchases in each of these sectors will send similar signals to different segments of the market: The demand for less carbon-intensive goods is rising.
Because this new directive expands to other greenhouse gases, it could have broad implications for new permitting for oil and gasdevelopment and agricultural production, as these are the two largest sources of methane in the U.S.
While this decision is not a tax on carbon or a subsidy for less carbon-intensive goods, it will likely send similar market signals. With respect to purchases, this policy is akin to tax rebates for energy efficient products, like electric vehicle incentives in the Inflation Reduction Act, which boost demand for EVs.
When we think of sustainability, of doing what we can in business and society to preserve and protect the environment, it’s easy to want to think of quick fixes; things we can do right now to solve the problem. We think in terms of products that we can buy to help, and products to avoid; processes to implement, and those to abandon. We want to solve the problem and move on to something else.
But sustainability is not a trend. It will not fade away or be replaced by a new trend. As such, our collective responsibility cannot fade. Operating sustainably is the new way of doing business. We must operate thoughtfully with an eye on how our decisions may impact those that come after us, down the road and into the future.
The concept is not new. I’ve always been fond of the adage, the world is not given by his fathers, but borrowed from his children.
As I wrote last November, despite the well-intentioned efforts of governments and international bodies, like the United Nations’ Climate Change Conference, industry need not wait for regulation to act on emissions, energy, and waste. We can, and many organizations have, act now to reduce and eliminate our carbon emissions, to increase our use of renewables, and to insist that our supply chains are aligned with our missions.
For our part at Hitachi, we are aggressively implementing initiatives to improve our environmental footprint, from our energy usage and emissions, all the way to the products and solutions we develop that are more eco-friendly than previous iterations. We are also expanding this work to involve our extensive partner ecosystem to ensure that everyone with whom we work is on the same sustainability page as we are. Our corporate goals are well documented, to be carbon neutral as a global company by 2030, and to be carbon neutral across our entire value chain by 2050. And while there is tremendous work being done, there’s much more to come.
Like many, I was heartened by the recent Global Electricity Report 2023 from the global energy think tank, Ember, that reported electricity generation was its “cleanest ever” in 2022, falling to a record low of 436 gCO2/kWh, due to dramatic growth in wind and solar generation around the globe. In fact, the report noted that more than 60 countries “now generate more than 10% of their electricity from wind and solar.”
The Future is Not Ours
As we spend Earth Day speaking of policies, programs, and targets to be more environmentally responsible, I encourage you to think of the potential value of all your programs on the future. When we ingrain sustainability into everything we do, with a view of the impact of our decisions on the next generation, it sets in motion actions for the next generation to replicate; momentum is generated and perpetuated, ad infinitum.
A little more than 100 years ago, Theodore Roosevelt said, “I recognize the right and duty of this generation to develop and use the natural resources of our land; but I do not recognize the right to waste them, or to rob, by wasteful use, the generations that come after us.”
The future is not ours, but it is our responsibility. And unless you haven’t been paying attention, our children, the next generation, are in many ways taking a more proactive leadership role in this area than we are. They are demanding action, and it is time for us to step up and meet the challenge.
Let us demonstrate to them, through decisive action, that we are listening and that we are committed to creating a better world for them. It is time to set aside short-term thinking and embrace a long-term approach that considers the implications of our actions on future generations.
Indeed, let us be inspired by the leadership of our children and work together to create a greener future. By doing so, we can ensure that we leave behind a legacy we can be proud of – a world that is healthy and sustainable.
For more on Hitachi Vantara’s eco-first approach to data centers, view here.
New free e-learning platform empowers the future of a responsible tourism industry
The ‘Sustainability Expert’ initiative was launched during the ANTOR Media Awards Gala Dinner in London.
The new free-to-use e-Learning platform provides a “convenient and easily accessible” resource for responsible tourism education and training worldwide.
It serves as a singular hub for the global travel industry, highlighting organisations, destinations and travel brands committed to environmental stewardship, cultural responsibility, and eco-conscious practices.
The hub, curated by Equator Global, enables individuals to attain the Sustainability Expert certification by successfully completing a minimum of four courses from the 28 free courses featured.
It is endorsed by leading travel and tourism players and underscores the collective responsibility of the worldwide travel industry in working together towards shared goals, in building a sustainable future.
Courses cover a wide spectrum of topics, including Costa Rica’s Pura Vida eco-tourism pledge, Switzerland’s Swisstainable programme and Finland’s Sustainable Travel objectives.
Participants will also be able to delve into Alaska’s conservation endeavours and explore the preservation investments made by AlUla, Thailand and Egypt to protect their timeless cultural treasures, among other topics.
Ian Dockreay, CEO of Equator Global and Travel Uni, said: “For the first time, travel and tourism professionals worldwide can gain recognition as advocates for this crucial initiative for free.
“By just investing their time in learning about the eco efforts of destinations and travel-related companies, they will be better equipped to advise and guide consumers in their holiday choices.
“With travellers increasingly prioritising sustainability in their travel decisions, it is imperative that those arranging their trips can provide informed and confident guidance.”
By Karthik Balakrishnan from Supply and Demand Chain Executive • Reposted: October 3, 2023
Ultimately, sustainability-linked investments result in reduced liabilities, reduced risk of stranded assets, and reduced risk of regulatory backlash, and improved unit economics and supply chain resilience.
In recent years, corporate sustainability efforts have focused on measurement and reporting. We’ve heard the phrase “what gets measured gets managed” countless times and taken it to heart. The result has been a robust carbon accounting and reporting universe filled with tools that can estimate the emissions for every industry, and an alphabet soup of reporting standards. This result, however, hasn’t been particularly promising. Even companies with the most ambitious climate goals and robust measurement and accounting programs have had trouble cutting their emissions. It turns out that simply measuring something doesn’t mean it’s going to be managed. Measurement is an important first step for an organization to understand and prioritize sustainability efforts. However, sustainability is about the real-world impact that can only be achieved with real-world investments, not an endless cycle of measurement and reporting. Put another way, what gets measured might get managed if you can show that the upfront costs of sustainability are truly investments in a classical business sense, with benefits including ROI, customer retention and risk mitigation.
When your organization is part of a complex supply chain, achieving sustainability targets is made difficult because the investments needed to meet your sustainability goals often involve assets outside of your organization. In these cases, a business justification is especially important, since achieving your targets will only come from partnering with other organizations and showing them the benefits of either investing in their facilities on your behalf, or accepting direct investments for actions and equipment that they might not otherwise purchase.
The first step is to map the key outcomes that apply to your business that can be enhanced by sustainability- and ESG-linked investments. For example, a product’s unit economics can each be improved by changing designs to use less raw material, adjusting production dies and molds to waste less material, and switching to equipment which uses less fuel and is easier to maintain. An existing factory or distribution center can benefit from lower insurance costs by investing in solutions for climate resilience. Meanwhile, a brand-new factory can benefit from a lower cost of capital by investing in future-proof clean technologies that reduce the risk that the facility ends up as a stranded asset due to changing market demands or regulatory conditions.
In all of the examples above, the benefits of sustainability-driven efforts actually benefited the business as a whole. Instead of a green premium, these businesses would benefit from a green return.
As sustainable technologies improve and become more mature, these returns will only improve as well. Holistically studying the impacts of sustainability and ESG investments allows supply chain leaders to build a business case for sustainability that goes beyond marginal abatement curves. Simply focusing on minimizing the cost of sustainability is not a winning strategy when the cost of capital is high. Instead, it’s critical to show how sustainability-linked investments maximize return and positively impact financial outcomes. This is especially helpful when making a case for investment to a key supplier or manufacturer, who may be reluctant to make the process, material or equipment investments standing between you and your sustainability goals.
There is, of course, the elephant in the room. Is it even worth considering ESG and sustainability given all of the controversy and political turmoil surrounding the term? After all, a modern supply chain is fine-tuned, and ultimately performs best by minimizing all sorts of risk, especially those like political risks that live outside your control. The answer, surprisingly, is yes. There are several real unassailable trends that have gained momentum in the last couple of years. In the wake of the Inflation Reduction Act (IRA), passed in August 2022, 80% of money allocated by the bill for clean energy and sustainability projects has gone towards Congressional districts represented by individuals who publicly oppose ESG messaging. Deployments of large, utility-scale solar projects follow the annual resource (how much sunlight is available in a given year) independent of political boundaries. And regardless of the political sentiment, over two-thirds of consumers consider sustainability positively when making at least some of their purchase decisions — nearly sixteen times the number that are influenced negatively by sustainability. Fundamentally, the science and economics of sustainability are sound, and while reporting frameworks and standards may change, the real-world drivers which led to the creation of ESG remain. The bottom line is that while the term “ESG” is facing backlash and the name will change as it has in the past, these principles are being “hardwired” into financial strategies in all but name at full speed. The ROI of sustainability not only shows up at the level of the individual initiative, but increasingly contributes to the overall financial position and investability of the company as a whole.
Ultimately, sustainability-linked investments result in reduced liabilities, reduced risk of stranded assets and reduced risk of regulatory backlash, and improved unit economics and supply chain resilience. Quantifying and clearly communicating these financial and performance benefits, on top of the pure ESG benefits, is critical to move beyond measurement and reporting to achieve real impact.
By Gino Sesto from Entrepreneur.com • Reposted: September 30, 2023
Key Takeaways
Socially conscious shopping is more than a trend; it’s a movement shaping the current consumer landscape.
Brands have unique opportunities to highlight their commitment to social responsibility.
In today’s dynamic retail environment, there’s a significant shift occurring in the way brands approach their customers. Historically, many industries prioritized competitive prices and discounts. However, the modern consumer is evolving, and the marketing world must follow suit. Brands are now transitioning away from emphasizing price to highlighting values, beliefs and overarching ethos. This shift from cost awareness to conscious consumerism redefines the marketing approach across sectors.
The emergence of the socially conscious consumer
Socially conscious shopping is more than a trend; it’s a movement shaping the consumer landscape. Customers increasingly make purchasing decisions based on the broader impact of their choices, whether environmental sustainability, ethical manufacturing or social justice.
Recent surveys like the Harris Poll show these changes in consumer spending habits happening in multiple industries. However, while price remains a dominant factor for many consumers, it’s not the sole consideration anymore. Although numerous shoppers still prioritize cost, a growing group is willing to pay a premium for products aligned with their values.
Take fashion as an example. Data reveals that while 22% of shoppers now consider where apparel is manufactured, 17% evaluate brands based on their sustainability initiatives. Fifteen percent examine a brand’s attitude to social issues, and 13% consider its employment practices. While these figures might appear modest, they indicate a growing inclination toward value-driven, socially conscious shopping. As modern shoppers progressively align spending habits with their values, brands that adapt to this approach will reap the benefits of a loyal and expanding customer base.
Crafting marketing strategies for diverse audiences
Successful brands are those that understand their audience’s nuances. It’s crucial to segment the audience not just by age or gender but by values, beliefs and priorities. For older generations, emphasizing cost-effectiveness and quality remains key. While baby boomers focus on price and quality, younger generations like GenZ-ers and Millennials are more inclined to consider a brand’s values and beliefs. For this generation, the key lies in the tangibles. Brands must emphasize cost-effectiveness without compromising on quality. Promotions, discounts, and loyalty programs are effective marketing tools, while Gladly’s 2022 Customer Expectations Report indicates the importance of the entire shopping experience. Convenience also makes a difference through easy returns, a seamless online shopping experience, or efficient customer service. Boomers are looking for value, but they also want ease and simplicity.
This doesn’t mean cost isn’t essential for younger consumers, but they’re more likely to pay more for products and services that align with their values. Younger audiences and people of color are even more likely to align shopping habits with their values. For these audiences, shopping isn’t just a transaction; it’s a statement. Quality, style and, most importantly, a brand’s position on social and environmental issues have all become equally significant. Brands must integrate values into the shopping experience by showcasing their efforts transparently. Clear stances on social issues and ethical employment practices are effective strategies. Collaborations with influencers who support their values, limited edition “cause” collections, or even a percentage of sales going to a social cause can also be successful
Harnessing digital channels for socially conscious marketing
In the current digital age, brands have unique opportunities to highlight their commitment to social responsibility. Digital marketing platforms allow companies to convey their values, initiatives, and beliefs transparently. Research from The Roundup shows consumers are becoming increasingly environmentally conscious, with many actively seeking out sustainable products.
This shift is supported by a 2021 study that showed 45% of consumers are willing to pay a premium for sustainable products. Additionally, 52% of the respondents emphasized the importance of purchasing from companies whose values align with theirs, marking a significant increase from 43% in 2019. Recent findings from the ninth annual Conscious Consumer Spending Index also showed a 25% surge in socially responsible spending in 2021 compared to the prior year. This data underscores the shift in consumer behavior, where decisions are influenced not just by product quality or cost but also by a brand’s ethical and societal values.
Digital platforms, especially social media, have become the epicenter for brands to showcase their alignment with social causes, sustainable manufacturing processes, and ethical sourcing. By integrating these values into their marketing strategies, brands can foster deeper connections with their audience, building a trustworthy and value-driven image. As consumer preferences continue to evolve, the significance of socially conscious marketing in nurturing brand loyalty and fostering trust becomes even more evident.
Staying nimble in a dynamic landscape
Change is the only constant in the retail world. Brands must remain adaptable as consumer preferences evolve, influenced by global events, cultural shifts, and generational differences. Success lies in understanding and catering to the modern, socially conscious consumer. Companies must balance offering cost-effective solutions and championing values, ethical practices, and social responsibility. As brands navigate this new terrain, those who genuinely connect with their audience’s values will be the ones to thrive.
Students work together on an assignment about ecosystems and environmental impacts during a seventh-grade science class in December 2020. While more schools are introducing sustainability curriculum, some are struggling to get started. (Image credit: Allison Shelley for EDUimages via Flickr)
By Gary E. Frank from Triple Pundit • Reposted: September 29, 2023
Elementary and secondary school teachers want to teach about sustainability, yet many lack the time, resources, and in particular, the tools to do so effectively. For those in the United States, help is on the way.
By 2030, the Sustainability Education Coalition aims to give more than 10 million K-12 students access to educational resources that will help them make informed decisions and take responsible actions when it comes to sustainability.
It’s a first-of-its-kind initiative aligned with the United Nations Sustainable Development Goals and launched by Discovery Education, a leader in developing digital content for K-12 teaching.
“The need for comprehensive sustainability education has never been more pressing,” Amy Nakamoto, Discovery Education’s general manager of social impact, said in a statement. “Recent statistics reveal a concerning trend: While the majority of teachers recognize the importance of teaching students about climate and sustainability, only half of them are currently addressing these vital topics within their classrooms.”
Three factors hinder teaching sustainability to K-12 students in the U.S., Natamoto said. First, some teachers have difficulty figuring out where classes on sustainability belong in their curricula.
“It could be in science classrooms, it could be in social studies classrooms, it could be in blended STEM [science, technology, engineering and math] classrooms. I think currently, teachers are having a hard time figuring out where it fits in the school day,” Nakamoto told TriplePundit.
Others feel they do not know how to teach sustainability topics, she said. Teachers need and want more support in this area, according to a report from the Smithsonian Science Education Center. Of the teachers surveyed, 69 percent said professional development on sustainability would be helpful.
“They want to be able to talk about this with their students, but they don’t know how,” Nakamoto told us. Lastly, while school administrators believe sustainability is a critically important topic to teach, they don’t know how to get the resources to do so, she said.
The Sustainability Education Coalition aims to solve all three problems. It uses insight and expertise from partner companies to create digital content for students to learn from alongside the lessons on the Discovery Education Experience learning platform, Nakamoto said. Support is specifically focused on providing STEM and sustainability education resources to school districts that would struggle to access them otherwise.
“Another way the collaboration happens, in addition to the curriculum and the content, is through strategic thought leadership that takes educators and administrators and puts them in the same rooms as these leading companies,” Nakamoto said. “So [the companies] can understand the challenges of schools to talk about these topics, and the schools and administrators can understand how companies are wrestling with these topics in more real-time.”
On the other side, company partners benefit from joining the coalition through employee engagement, Nakamoto said. Employees want to see their companies investing in initiatives that align their corporate mission with a local community mission.
“Employee engagement is leveraging the employees of our partners to be part of the story. So, we are telling their stories, we are filming them and the solutions they’re doing,” Nakamoto said. “We deeply believe in showing the people who are the leaders in this movement to the students in classrooms across the U.S.”
So far, Subaru of America, LyondellBasell, Nucor, Honeywell, and the National Environmental Education Foundation have partnered with the coalition. Each company that joins helps to unlock access to a complete library of STEM and sustainability education resources for some critical communities, Nakamoto said.
“[Sustainability] is a topic that everybody is both wrestling with and evolving with at the same time,” she concluded. “We have a big vision to grow this to represent multiple sectors, multiple interests because the sustainability story is an everyday story that we all experience just walking through the world. In order to tell that story to students, we need to be influenced by all of the sectors that are engaged in sustainability at their corporate and community level.”
Chief financial officers are integral to meeting corporate net-zero commitments. By Nico McCrossan from Greenbi.com • Reposted: September 29, 2023
Chief financial officers are responsible for a company’s financial performance and reporting, but that doesn’t adequately capture the role they play in corporate strategy.
Along with projecting the costs and revenue associated with proposed investments, CFOs must organize the resources for execution — giving them immense power over the direction and speed at which a company moves. That’s why in order for a company to transition to a net-zero business model, the CFO must not only be on board but have a hand in guiding the ship. Here are three ways CFOs can navigate that journey.
Adopt impact-driven banking practices
CFOs can help their organizations make significant progress towards decarbonization and diversity, equity and inclusion goals by adjusting corporate treasury practices to support them.
That could mean leveraging impact cash platforms, such as CNote and Impact Deposits Corp., to distribute a company’s deposits across credit unions, community development financial institutions (CDFIs) and low-income designated (LID) financial institutions. These sorts of lending institutions often tout strategies that align with corporate sustainability goals and values such as climate justice or financial inclusion.
By moving corporate deposits to banks where all lending activities are aligned to keeping global temperature increases to less than 1.5 degrees Celsius, a CFO could reduce the carbon footprint associated with the company’s deposits by more than 60 percent, according to a report by BankFWD, Climate Safe Lending Network and The Outdoor Policy Outfit.
Shifting a company’s cash holding to hundreds or thousands of CDFIs could make more operational and growth capital available to women- and minority-owned companies, because CDFIs are required to designate at least 60 percent of their funding activities for low- and moderate income populations or underserved communities. Access to capital is the top barrier to the creation, expansion and growth of women- and minority-owned businesses, according to The Black Business Alliance.
Offer greener retirement plan options
U.S. employer-sponsored retirement plans accounted for more than $11.8 trillion in assets at the beginning of 2023.
Employees — especially Gen Z employees who make up 6.1 percent of the workforce but are expected to account for 30 percent by 2030 — are more often considering companies’ ESG practices and performance when choosing where to work. A KPMG survey published in January found a third of 18- to 24-year-olds have turned down a job offer because of the organization’s ESG performance. Separately, a 2021 Morgan Stanley report found 99 percent of millennials are interested in sustainable investing.
Younger generations will be disproportionately harmed by the effects of climate change as it worsens over time, and some investors are asking that companies analyze whether defaulting to carbon-intensive investments in corporate retirement options puts younger beneficiaries’ savings at greater risk than participants closer to retirement age. The oldest members of Gen Z will reach retirement age in 2055. At that point, the global economy will need to have been operating with net-zero greenhouse gas emissions for five years to meet the goals of the Paris Agreement. That calls into question the logic of including fossil fuels investments within the retirement plans of Gen Z investors.
Corporate financial teams can opt for retirement plan providers that actively engage with the management of companies included in their portfolios to encourage them to adopt sustainable business practices. A ShareAction report published in February ranks the 77 largest retirement plan providers across responsible investment themes.
Establish an internal carbon price
CFOs can help integrate sustainability considerations into corporate decision-making processes by applying an internal carbon price to business activities. Charging business units for the emissions associated with their operations or new investments can encourage managers across the company to align decarbonization efforts with the financial performance of their business units.
This internal “tax” on emissions can also be used to fund decarbonization efforts; financial services firm Société Générale, for example, does this by allocating funds raised by the internal carbon tax to the business units with the most impactful environmental efficiency efforts. This provides the firm’s business units with dual incentives, a carrot and a stick. By investing in carbon reduction initiatives, they can both avoid the costs of the internal carbon tax and receive incentives to cover the cost of future decarbonization efforts.
California Gov. Gavin Newsom joins New York Times correspondent David Gelles on stage at Climate Week, where he announced he would sign a pair of recently passed bills that mandate climate disclosure from large companies operating in the state. (Image: The Climate Group/Flickr)
By Mary Mazzoni from Triple Pundit • Reposted: September 27, 2023
World leaders, business executives and activists are back in New York City for Climate Week and the United Nations General Assembly — and everybody’s talking about California.
In case you missed it: Last week California legislators approved a pair of bills that require all large public and private companies operating in the state to disclose their greenhouse gas emissions to investors and the public. Business leaders organized by the sustainability nonprofit Ceres came out in support of the bill before it passed. They say their progress in tracking and disclosing the full scope of their emissions proves it’s possible for other companies to do the same.
As lawmakers and business coalitions enjoy a victory lap at Climate Week, we’re taking a closer look at the landmark legislation and the ripple effects it could send well outside the Golden State.
Why corporate climate disclosure matters
“There was a billion-dollar weather and climate disaster event every four months in our country in the 1980s. By 2010, there was one every three weeks,” Mindy Lubber, CEO and president of Ceres, said at a press conference on Tuesday. “This year, we’ve experienced more than a billion-dollar event every two weeks.”
Indeed, extreme weather cost the United States nearly $40 billion in the first eight months of 2023 alone. But the impacts these disasters and other climate disruptions have on corporate bottom lines is less understood, because many companies don’t calculate it. “People are operating in the dark,” Lubber said. “I can tell you of the 700 investors we work with, they want to understand: What are the risks from climate [change], and what are the opportunities? They cannot make a decision about building a portfolio without adequate information.”
What the California climate disclosure rules require
The two recently passed bills — Senate Bill 253 (SB 253) and Senate Bill 261 (SB 261) — are on Gov. Gavin Newsom’s desk, and he confirmed this week that he will sign them. The bills require the California Air Resources Board to develop rules that mandate public and private companies with annual revenues exceeding $1 billion to disclose their greenhouse gas emissions.
The rules will apply to around 5,500 companies doing business in California, lawmakers said. Companies will be required to disclose emissions from their direct operations (known as Scope 1) and those from the electricity they purchase (known as Scope 2) by 2026. Mandatory Scope 3 disclosure will come into force a year later, with financial penalties waived for three years as a transition period.
“SB 253 does not dictate how they should reduce their carbon emissions. But by making clear that within a couple of years these emissions are going to become public, the corporations have a huge incentive to innovate to reduce those emissions,” said California state Sen. Scott Wiener, who represents San Francisco and parts of San Mateo County. “We’re going to see in a few years who’s walking the walk and who’s just talking the talk. And I hope that after a few years before the implementation, the companies that are walking the walk are going to be a much higher number than they are today.”
Attendees are all smiles during California Gov. Gavin Newsom’s remarks at Climate Week. (Image: The Climate Group/Flickr)
Insiders predict a race to the top that goes way beyond California
Lawmakers say Californians will benefit directly from the new climate disclosure rules. “As a member who currently represents environmental justice communities who live near the harbor — who are seeing the emissions and feeling them every single day, the impacts of bad air quality, as well as the severe, tangible impacts of climate change — this will deeply, deeply benefit my constituents and constituents across the state of California,” said state Sen. Lena Gonzalez, who represents Long Beach and Southeast Los Angeles.
But given California is the fourth largest economy in the world, the implications could stretch far beyond its own borders. “As disclosure becomes real, some companies are going to step up, clean up and really lead, and other companies are going to be forced to do the same,” said Mary Creasman, CEO of California Environmental Voters, which lobbies in support of climate and environmental legislation in the state. “There’s going to be pressure out there like we’ve never seen to change business-as-usual.”
The fact that thousands of multinational companies will be compelled to disclose their emissions may also make it easier for other markets to pass similar legislation. “SB 253 marks a major advancement in detailed emissions disclosure, potentially revolutionizing corporate responsibility in combating climate change for the world, not merely California,” said Kentaro Kawamori, CEO of the carbon accounting firm Persefoni. “As the global community confronts the pressing need for climate action, California’s leadership might inspire comparable efforts in other states and countries.”
Markets including the U.K., Japan and the European Union already moved to mandate climate disclosure within the past two years. While it’s too early to say whether those rules amounted to this type of sea change, early evidence indicates it is a likely outcome. “We don’t have a lot of data yet as to how it has changed things,” Lubber told us. “But we do know when a company … makes a declaration and commitment to doing it — and that’s public and you’re showing how you’re going to do it and you’re accountable — it drives behavior change. And it probably does that as well as anything else I can think of.”
What about the SEC?
Last year the U.S. Securities and Exchange Commission (SEC) issued draft language for mandatory climate disclosure rules that would apply to all large publicly-traded companies operating in the country. The release date for the final rule has been pushed back several times and is now expected toward the end of this year. It’s also still up in the air as to whether the final SEC rule will include mandatory reporting of Scope 3 emissions.
But if and when the SEC does mandate climate disclosure, companies will be well positioned to translate the work they’re doing in California to comply with the federal rules.
“For us as an industry association, it’s very important to have harmonization among reporting requirements,” said Chelsea Murtha, director of sustainability for the American Apparel and Footwear Association, which represents more than 1,000 brands and came out in support of the legislation. “We worked with Sen. Wiener and Ceres to get language in the bill that made sure that if you were reporting to the SEC and that was a substantially similar disclosure, it would work in California. We were really glad to see pieces like that come together and make this a process that was really designed to help businesses succeed.”
The bottom line: Climate disclosure won’t fix it, but it’s a major step forward
Disclosure won’t solve our climate problems, but in the spirit of sunlight as a proverbial disinfectant, transparency is a crucial piece of the puzzle. “There’s no doubt that it’s only a first step,” Lubber told us. “Once companies analyze their risk and measure it, they can then manage it. It’s very hard to come up with a climate plan to act without knowing what the problem is.”
Ceres provides toolkits and direct consultation to help companies translate the data from their disclosures into time-bound climate transition plans, and it will continue to do so as California’s rules come into force, Lubber said.
“The public, investors and regulators want to know what is the risk to a company, and that’s why they have been calling for climate risk disclosure,” she told us. “Good information is just that — not the panacea, but it provides the base to make smart decisions about managing carbon emissions.”
By Steve Cohen from the Columbia Climate School • Reposted: September 27, 2023
To paraphrase the management icon Peter Drucker, you can’t manage something unless you measure it. Without measurement, you can’t tell if management’s actions are making things better or worse. The importance and seriousness of sustainability management requires the development of generally accepted sustainability metrics. Just as financial accounting requires agreement on terms and reporting requirements to facilitate independent auditing, sustainability requires the same level of precision. Publicly traded and owned corporations are under pressure from investors to report environmental risks, and more and more companies are disclosing environmental and social governance (ESG) measures.
A recent Wall Street Journal survey of corporate sustainability officers indicates that while more companies are disclosing sustainability metrics, there is confusion about the measures and a demand for uniform reporting requirements. According to Journal reporter David Breg:
“Public companies in the U.S. are increasingly disclosing sustainability information, but many say they find it a challenge to report fundamental climate data that many regulators around the globe likely will require under incoming mandatory reporting standards. Nearly two-thirds of respondents said their company was disclosing environmental, social and governance information, up from 56% in the prior year, according to the annual survey of sustainability officials that WSJ Pro conducted this spring.”
The reporting challenge is due to imprecise measures and a lack of experience collecting and reporting these data. That challenge will be met by sustainability professionals trained in measuring greenhouse gasses and conducting life cycle analyses. In Columbia’s MS in Sustainability Management program, we offer courses in each of those areas, and before long, hundreds of our graduates will be helping corporations meet their reporting requirements.
The U.S. Securities and Exchange Commission has been revising its proposed sustainability reporting requirements in response to a deluge of comments and has delayed issuing those requirements, once expected last spring. The political calendar of a national election next year creates extreme pressure to issue those standards this fall, and currently, they are expected in October. There will certainly be legal challenges to whatever rule is issued, but to the extent that the rules connect environmental risk to financial risk, they are well within the SEC’s enabling legislation. Additionally, the SEC is not the only body working on uniform sustainability metrics. Again, according to Breg:
“Regulators around the globe are finalizing rules that would require companies to publish standardized information after years of patchy voluntary ESG reporting based on a host of frameworks. California’s governor has said he would soon sign that state’s requirements into law. The U.S. Securities and Exchange Commission’s rules are expected later this year. European regulations are already in place and many other countries are also working on standards. The International Sustainability Standards Board hopes its climate framework, completed this past summer, becomes the global baseline.”
Assuming the SEC rules survive the ideological onslaught they will face, it is likely, just as with financial accounting, that an American rule would be highly influential and, over time, would become a global standard. If the extreme element of America’s right wing dominates the debate over disclosure and overturns the rules in the conservative Supreme Court, U.S. corporations operating globally would be subject to foreign or global reporting requirements that they would have little hope of influencing. The realpolitik of sustainability reporting requirements may convince American corporations to focus their attention on influencing rather than overturning reporting requirements. The ideological and dysfunctional side of American national politics will certainly result in court challenges to the SEC rule, but the seriousness of the effort and its impact is unknowable.
The initial SEC rule is more limited than many of the other frameworks under development and focuses narrowly on carbon disclosure. My guess is that carbon emissions from a company’s supply chain will be omitted or optional in the final disclosure rule. My view is that this initial rule is a foot in the door and, like financial accounting, will evolve over time.
A growing number of publicly traded companies and even many privately owned companies are disclosing sustainability metrics. The ideologues labeling this as “woke” management fail to understand the degree to which these measures are indicators of effective and sophisticated management. ESG measures do not drive out financial indicators, they are, in fact, correlated with financial success. The principal concerns of a private firm do not change under sustainability management. They remain profit, market share, and return on equity. But modern organizations recognize that they are operating on a more crowded, interconnected, and warming planet. These facts of organizational environments require that they manage their environmental, social, and community impacts as a part of routine organizational life.
In addition, modern organizations compete for talent, and that means that workers have influence over management behavior. Young employees care about a company’s ESG performance. The post-pandemic push for hybrid work arrangements is ample evidence that top-down management is no longer possible, and organizations must respond to employee preferences.
Corporations operate in a regulated environment. That is why they have in-house counsel and engage outside law firms on a regular basis. When employees are fired or laid-off it is not unusual for them to sue their ex-employer. An American corporation operating nationally must understand state law and even local ordinances to successfully function. Companies operating globally must understand the rules of other nations. Over 10,000 non-European companies are subject to the European Union’s new ESG reporting requirements. About a third—or over 3,000—are U.S. corporations. This regulatory environment is normal and expected and fully integrated into decision-making in modern corporations. The free market is a relative and not absolute concept. There has never been and will never be a totally free market since that is akin to anarchy. An indicator of a successful company is its ability to navigate its regulatory environment while achieving its financial goals. The widespread and growing voluntary disclosure of sustainability metrics is happening in anticipation of government regulation but also in response to investor, customer, and employee demands.
But the problem with voluntary disclosure is that the measures they use do not enable investors to compare one company’s environmental risk to another, and the disclosures are not audited. Even worse, some of the NGOs that help companies measure and report sustainability are paid by the companies they report on, so these ESG reports might be fiction, and we’d never know. Uniform disclosure metrics are urgently needed. Only the SEC, with its gatekeeper function to the public capital marketplace, has the power to develop and impose standard reporting and audit requirements.
The move to decarbonize our economy will continue to be quietly and, at times, visibly opposed by fossil fuel interests. But they are increasingly unable to counter the facts of our warming planet. They will persist and, as Mike Bloomberg’s recent initiative recognizes, will shift their emphasis from burning fossil fuels for energy to utilizing them for plastics and other petrochemicals. Bloomberg is spending $85 million to block chemical plant siting as part of his effort to reduce global warming. If petrochemical plants were required to measure and report on their air pollutants, they might well be motivated to learn how to reduce those emissions while producing what they are selling. It’s easy to see why they might oppose reporting requirements, but if the alternative is to fight siting wars with local community groups, it might be in their financial interest to measure, report, and reduce emissions.
Sustainability metrics and indeed sustainability management have finally arrived. For those of us who have been working for well over a decade to develop these practices and this profession, this is welcome but not a surprise. The climate crisis modeled and predicted in the final decade of the twentieth century is now with us. The biodiversity loss feared has also arrived. I continue to believe that we can develop a productive and growing economy without destroying our home planet. It takes brainpower, ingenuity, and technology, but most of all, our attention and concern. Carbon disclosure is a critical step in carbon management. Standardized sustainability metrics are a crucial step in realizing the vision of sustainability management.
Balancing luxury with the imperative of sustainability presents an ongoing dilemma. The challenge lies in finding a harmonious path that doesn’t compromise customer satisfaction. Achieving this delicate balance requires a multifaceted approach. By Manthati Sai Kiranfrom Business World • Reposted: September 25, 2023
The hospitality industry is known for its exceptional services. Luxury and facilities. The sector is now not only known for creating exceptional experiences for its guests but also for driving positive change. This sector presents unique opportunities and challenges.
Similar to many other industries, the hospitality sector is committed to advancing sustainable practices. But it has faced considerable adversities, particularly due to the impacts of the COVID-19 pandemic. As it looks ahead, sustainability cost stands as one of the challenges.
In mathematical terms, the hospitality industry contributes approximately 11 per cent of global carbon emissions and it is expected to grow by 85 per cent over the next few years. The growth comes at a cost and it involves a high environmental impact, including increased water usage and the generation of disposable and non-disposable waste. Implication – more emission of carbon footprint.
Balancing luxury with the imperative of sustainability presents an ongoing dilemma. The challenge lies in finding a harmonious path that doesn’t compromise customer satisfaction. Achieving this delicate balance requires a multifaceted approach.
In a recent panel discussion, industry leaders shared their strategies and best practices for addressing various issues, minimising food waste, sustainability initiatives, and inclusive and active engagement with local communities. These collaborative efforts demonstrate the industry’s commitment to making a positive impact while navigating the complexities of luxury and sustainability.
Gaurav Sinha, Hotel Manager, JW Marriot said “Sustainability is not just a path we aspire to explore as an industry, but a responsibility we embrace. Our guests, play a pivotal role alongside with us in giving back to society and preserving our precious natural resources. Through dedicated practices and innovative equipment, we aim to make a meaningful contribution. Tonight, as our conversation unfolds, we look forward to discussing these vital steps towards a brighter, more sustainable future”.
HC Vinayaka, VP Technical, EHS & Sustainability, ITC Hotels, shared strategies for minimizing food waste, from removing dustbins in cafeterias to implementing programs where food is measured every time it is thrown and target food wastage reduction year-by-year plans.
He strongly believes, educating management teams, and fostering a shared commitment to sustainability are the cornerstones to tackling food waste.
Manish Garg, General Manager, Hilton and Hilton Garden Inn Bengaluru Embassy Manyata Business Park, shared inclusive practices, that he led in his organisation. He has taken steps to include specially-abled individuals in the workforce, recognizing the importance of diversity and inclusivity. However, it’s not just about hiring, it’s about fostering an environment where everyone can thrive. This means equipping ourselves and our teams with the skills and understanding needed to work effectively with differently-abled colleagues. It’s about learning sign language, adapting communication methods, and ensuring safety measures are inclusive.
“In my experience, the biggest challenge lies in ongoing training, where we continuously strive to improve our communication and support for our specially-abled team members. In the hotel industry, there are diverse roles, such as operators, where physically challenged individuals can excel. It’s about creating an environment where they not only have a job but also feel valued and motivated to come to work, just like any other team member”, he added.
Unlike greenwashing, a quieter phenomenon raises concerns about transparency and authenticity. By Patricia Costinhas from impakter.com • Reposted: September 24, 2023
In the world of corporate sustainability, it’s not always about what companies proudly proclaim; sometimes, it’s the hushed secrets they keep that reveal their true shades of green. You’ve probably heard of greenwashing before, but now there is a subtler player lurking in the shadows: greenhushing.
While greenwashing wears its false eco-badges loud and proud, greenhushing prefers to stay in the background, quietly concealing its true colors. But make no mistake; silence can speak volumes. It raises questions about companies’ transparency, accountability, and their true sustainability efforts.
What is Greenhushing?
Though not a term that rolls off the tongue as easily as greenwashing, greenhushing has been growing in popularity. In essence, it revolves around companies deliberately opting to keep their environmental and social credentials discreet, almost as if they are hushing their sustainability efforts. Greenhushing involves downplaying or conveniently omitting mention of a company’s environmental initiatives.
Now, you might wonder, isn’t modesty a virtue? Indeed, in the realm of corporate sustainability, there is merit in humility. However, the practice of greenhushing raises a cause for concern when it comes to sustainability communication. Companies that embrace greenhushing may aim to convey that they are committed to sustainability without making a fuss about it. Yet, by choosing to remain vague and ambiguous, they can inadvertently give the impression that their environmental efforts are more substantial than they truly are.
his subtle approach to sustainability communication has its drawbacks, as it can obscure the reality of a company’s emissions and sustainability initiatives. Furthermore, it opens the door to sophisticated greenwashing tactics, which exploit this hushed narrative to create a façade of environmental responsibility.
Measuring Sustainability
Assessing a company’s commitment to sustainability in today’s corporate world can be a tough task. While financial metrics enjoy well-established and standardized criteria, the same cannot be said for sustainability metrics, which are often kept hidden.
Numerous organizations, frameworks, and industry groups within the business landscape have their own sets of reporting guidelines. This diversity of standards results in a fragmented sustainability landscape, making it challenging to compare how businesses fare in terms of sustainability targets and environmental credentials.
Then there’s the commonly designated ESG reporting field, a trio encompassing Environmental, Social, and Governance aspects. This reporting framework seeks to gauge a company’s commitment to sustainability, social well-being, and upholding ethical standards. However, it now finds itself in middle of growing scrutiny and criticism within the corporate world.
ESG Metrics and Growing Criticism
Quantifying social impact and ethical governance is no easy feat, and the absence of robust regulatory oversight has raised concerns about the relevance of ESG reporting. Many companies grapple with how to measure their environmental impact and fulfill their sustainability targets, adding to the complexity of the situation.
Last year, Tesla CEO Elon Musk made headlines by publicly denouncing ESG, going as far as labeling it a “scam.” This declaration came after Tesla’s removal from the S&P 500 ESG Index, a move that prompted Musk to voice his discontent on Twitter. He suggested that the integrity of the index provider had been compromised, pointing out the irony of oil giant Exxon Mobil retaining its top-10 position while his electric car company was removed from the list altogether.
Then there is the case of rampant greenwashing. Without clear-cut or standard sustainability reporting metrics, what we find is a breeding ground for corporations to exaggerate or falsify their initiatives.
The new EU CSRD Directive will make ESG reporting mandatory from January 2025. This means companies should start to collect their data from January 2024. Starting from larger companies and then later SMEs everyone will have to report on their sustainability efforts.
Motivations Behind Greenhushing
To truly grasp why organizations choose the path of greenhushing, we must first understand the driving forces behind it.
Resource Constraints
One significant factor in the greenhushing equation is resource constraints. Imagine a smaller company with limited manpower and budget resources. When they start trumpeting their sustainability achievements, they can quickly find themselves overwhelmed with demands for more data, additional proof, and numerous reports. These resource limitations can swiftly transform the green spotlight into a glaring interrogation lamp. Consequently, some organizations choose to maintain discretion as a shield.
Regulatory Costs
Navigating the labyrinth of regulations can be expensive, particularly for companies seeking to solidify their green credentials. The fear of incurring regulatory fines due to inadvertent missteps acts as a potent deterrent. Therefore, some organizations opt to remain under the radar until they are absolutely certain they can meet all regulatory requirements. Some companies prefer quiet, prolonged testing of their green initiatives before making grand announcements. This approach helps them avoid both the financial and administrative costs associated with compliance.
Shielding from Scrutiny
By selectively revealing their sustainability efforts, organizations can avoid intense scrutiny and accusations of greenwashing. Companies making exaggerated or false green claims not only risk reputational damage but also potential legal consequences. Thus, through greenhushing, firms can remain unnoticed by watchful eyes. An example is the recent accusation against global banking giant HSBC. They faced allegations of greenhushing when they downgraded funds exclusively invested in sustainable assets to those including environmental or social factors, without necessarily targeting a sustainable outcome. While the company claimed compliance with EU regulations, critics viewed it as an attempt to evade investor scrutiny.
Taking a critical stance on these motivations for greenhushing is vital. While resource constraints and regulatory costs are valid concerns, they should not excuse a lack of transparency. In an era where consumers and stakeholders demand responsible investment decisions, underreporting sustainability efforts can backfire. Some may inadvertently damage trust and credibility in their attempt to shield themselves from scrutiny.
The Sustainability Imperative
All things considered, sustainability rests on transparency and accountability. It goes beyond marketing or shielding from criticism. Despite ESG criticism, customers now focus on product carbon footprints, integral to their choices. This awareness drives firms to adjust emissions goals and prioritize strong sustainability credentials in their climate strategies.
Ultimately, the path towards sustainability is far from silent. By wholeheartedly embracing transparency and accountability, organizations can not only avert allegations of greenwashing but also make substantive contributions to the collective mission of combatting climate change and addressing environmental challenges.
Strong storms often lead to bluff erosion on the shores of Lake Superior. Credit: Juli Beth Hinds
Even when the funding is lined up for green restoration efforts in northern Wisconsin, a lack of affordable housing makes it hard to attract workers and get started. By Lydia Larsen from Inside Climate News • Reposted: September 24, 2023
Northern Wisconsin’s landscape is defined as much by the stunning shores of Lake Superior or the Bad River as the region’s seemingly endless winters. But as climate change accelerates, attention is shifting to ways of controlling a steep increase in stormwater, which means doubling down on existing management practices and turning to nature for inspiration.
Nature-based solutions involve strategies like restoring streams degraded by intense logging activity, installing rain gardens next to parking lots and buildings to absorb moisture, and bringing back wetlands to purify and protect shorelines. Such efforts not only help mitigate the effects of climate change but can also create new jobs.
Yet even when local governments, nonprofit groups and indigenous tribes can drum up the funding to take on these projects, they are stymied by a major obstacle: People who can do the work can’t find a place to live.
“Housing!” the planning expert Juli Beth Hinds yelled recently in her kitchen while watching a PBS NewsHour television segment on Living Breakwaters, a coastal resilience project in Staten Island.
The veteran NewsHour journalist Jeffery Brown had just asked Kate Orff, a renowned landscape architect, why more people weren’t putting similar nature-based solutions into practice across the United States. Orff pointed out some of the obstacles, like deciding which jurisdiction controls what, in mapping out large-scale projects that cross boundaries.
But Hinds, who works on land-use and water-resource policy, knows that housing can be an equally important piece of the puzzle. All too often, she said, planners cannot hire people for nature-based projects when affordable places to rent or buy are scarce to nonexistent.
“We have a housing crisis,” Hinds said. “But we have not unpacked this as really a critical issue in whether, and how, we’re going to begin implementing nature-based solutions at scale.” Based on her experience and conversations with colleagues, she adds, the problem is impeding projects elsewhere in the Midwest and on the East Coast as well.
In March, the statewide research and outreach group Wisconsin Sea Grant released a report on the workforce barriers to launching more nature-based solutions in northern Wisconsin, which has experienced more flooding, higher lake levels and more intense winter storms in recent years.
For the study, Hinds and her colleague Linda Reid interviewed stakeholders across four northern Wisconsin counties, from tribal representatives to county conservationists to environmental nonprofits. Housing came up in every interview, they said.
A History of Tribal Expertise
“I thought we’re gonna go up there and we’re gonna hear what kind of classes they need, or what audiences need the education,” said Reid, a consultant who works on climate resilience and water quality issues around the Great Lakes region. “And we get up there, and we find there’s a few things they need to learn, but for the most part, that is not the issue.”
Northern Wisconsin has a long history of involvement in sustainability and environmental stewardship. Reid notes that the Red Cliff Band and the Bad River Band of Lake Superior Chippewa were tending to the earth and waterways long before white settlers arrived in the 17th century and are highly invested in maintaining them. The region is also home to some of the first eco-municipalities in the United States, meaning that local governments have enshrined sustainability in their charters.
When Reid and Hinds arrived in April 2022 for four months of research, a large number of nature-based projects were already underway, like capturing or rerouting stormwater and snowmelt next to parking lots and buildings in the city of Superior and restoring streams in Iron County.
A devastating storm hit Iron County’s Saxon Harbor in 2016 leading to massive infrastructure damage and ultimately killing three people. Stream and coastline restoration in the area improves coastal resilience. Credit: Juli Beth Hinds
Excessive clear-cutting by the logging industry around the turn of the 20th century destabilized local streams by overloading them with sediment, a problem that continues to this day and creates a vast number of opportunities for stream restoration. Wetland restoration projects help draw wildlife back to their original habitats and improve water quality.
Many local governments are also working on surveying and on replacing culverts that cannot handle the increasing runoff from heavier rainfall, although such work is not considered a nature-based strategy. A robust network of nonprofit organizations are similarly involved in restoring wetlands, monitoring water quality and educating the public on remediation efforts. Northland College, an environmentally focused liberal arts college in Ashland, contributes knowledge and expertise as well.
While these projects could always benefit from more funding, local governments and nonprofit organizations can for the most part cobble together enough grants to get started. The communities are well versed in nature-based practices, and many local contractors are experienced in executing them. But to invest in more of these infrastructure changes, planners need people to fill salaried and hourly-wage jobs, with the work ranging from removing invasive plants to installing rain gardens.
“We have all of these jobs unfilled, and it’s all about housing,” Hinds said. “And then we start to peel the onion one more layer. What’s going on with housing? We’ve lost an enormous share of the rental market to Airbnb and Vrbo.”
The “Covid Effect” on Rural Rentals
After the COVID-19 pandemic took hold in the United States in the spring of 2020, prompting city dwellers to flee dense neighborhoods in search of open spaces and fresh air, the number of property owners turning dwellings into AirBnB rentals in northern Wisconsin soared, said Kelly Westlund, the housing educator for Bayfield County at the University of Wisconsin-Madison Extension.
Westlund describes the region as “a rural recreation gateway community” with abundant outdoor opportunities and beautiful scenery. Units that were once rented by locals and by people arriving after accepting jobs are now offered as vacation homes or short-term rentals.
A search of Airbnbs in Bayfield County yields options ranging from a yurt overlooking Lake Superior for $75 a night to apartments and cabins costing $200 to $300 a night. By contrast, census data shows that the county’s median monthly rent is $767. Westlund says that 44 percent of Bayfield County’s housing stock is currently considered “unoccupied,” a category that applies to seasonal vacation homes and short-term rentals that sit empty in the off season or for most of the year.
“Over the course of COVID, the Airbnb situation has just absolutely exploded,” she said. “I can’t fault individual property owners, putting their house on the market and realizing that they could really make a bundle.”
Nile Merton, who founded a local environmental consulting firm in 2016 after graduating from Northland College, contends with the housing shortage on a regular basis. His two full-time and two part-time seasonal staff members work on a variety of environmental restoration projects throughout the region, including stormwater management, controlling the spread of invasive plants, and designing and installing rain gardens to soak up the runoff from major storms.
While it’s been difficult for his employees to find a place to live in the area, they are managing.
“Whether it’s a room in a house, studio, apartment, two-bedroom, one-bedroom, they’re just not really available,” Merton said. “My employees kind of lucked out.”
Merton said that one of his employees has to drive 45 minutes to get to work. Another rents a room, he added, but it’s expensive, at $500 a month, and he barely found it in time to start work. Although Merton found a good candidate to replace a full-time worker who just left, he added, that person is still looking for a place to live.
Merton’s company, Bay Area Environmental Consulting in Washburn, is still able to take on all the restoration work he wants to accept, he said, but when it is short-staffed, he has to put off pressing management tasks for muscular work in the field.
Westlund said the housing challenges in northern Wisconsin are mirrored elsewhere in the country, with not enough homes being built and the cost of construction materials soaring in recent years.
Even when it’s available, much of the housing in northern Wisconsin is old and in need of renovation and weatherization. Given the local income statistics—the four northern counties combined have a median household income of $59,253—and the low population density, developers aren’t keen on investing in the area.
Waiting, and Waiting, to Hire a City Engineer
Because of the housing challenges, a variety of jobs that involve environmental restoration and stewardship sit open for years at a time. The report noted that the Bad River Tribal Government in Ashland offered a job to a qualified attorney who was eager to move back to the area but then backed out after she failed to find housing.
Sara Hudson has lived in Ashland for 20 years and works as its parks and recreation director. Part of her role involves managing the city’s four public beaches, which have frequently been shut down because of high levels of E. coli from bird droppings and, occasionally, human sewage. That led her to investigate and champion green infrastructure that helps protect water quality.
For the past three years, the city has been trying to hire an engineer. Every time it finds a promising candidate, “they look at how much a house costs and they’re like, ‘Oh my, really?’” Hudson said.
As of last month, the median price for a home in Ashland County was $152,000. But the Sea Grant report said that houses often require extensive renovation to meet “basic contemporary standards.”
For three years, Ashland’s public works director, John Butler, therefore doubled as a city engineer. “You don’t have time for everything,” Butler said, “and some things have to drop.” Among those things were maintaining and improving Ashland’s stormwater infrastructure.
Finally the city found a candidate to take the job, and because he knew a family member who was moving out of the area, he was able to secure housing.
Alex Faber, executive director of the Superior Rivers Watershed Association, an environmental nonprofit, said she has watched colleagues from partner organizations struggle with staffing as a result of the housing crunch. The region has talented people who know how to plan nature-based restoration projects, but not enough workers to execute them. While this has not affected her organization, Faber said, it tempers how she deals with various partner groups.
“A lot of my time is spent navigating, like, ‘Can I call up this person and ask them for help?’,” before realizing, “‘Oh, no, they’re probably pretty overwhelmed right now because they’re trying to fill three different jobs.’” she said. “They still haven’t filled that job that’s been open for a year because nobody can move here because there’s nowhere to move to.”
For Those Denied, a Paradox
Hinds said she had run into housing shortages in projects she has worked on in Vermont as well as in Wisconsin and Michigan. She encourages environmental organizers to embrace the notion that housing, and even broader development, are necessary for promoting climate resilience in communities.
And Reid, who consults on climate and sustainability efforts in Ireland as well as in the U.S., emphasized that the housing problem is global.
In the United States, she suggests, the people most affected by the housing crisis could profit the most from green infrastructure—either by being hired to work on such projects or by benefiting from climate remediation in their long-neglected neighborhoods.
“That lower socioeconomic and middle socioeconomic group that could, and should, be capable of making the improvements,” Reid said, “is probably going to be most likely to be harshly affected if the improvements aren’t made.”
From Intrepid Travel via Sustainable Brands • Reposted: September 22, 2023
Intrepid has launched one of tourism’s most comprehensive carbon-labeling initiatives, alongside new research that shows consumer demand for better transparency and understanding their personal impacts.
Today, Intrepid Travel unveiled carbon labels on over 500 itineraries, including its top 100 trips, with plans to continue measuring and disclosing the emissions of every trip. The labels, which appear on individual tour pages, will tell travelers the carbon footprint of each Intrepid tour — providing greater transparency as the company deepens its commitment to climate-conscious travel.
Joining the efforts of smaller tour operators including Adventure Tours UK and Much Better Adventures, carbon-impact information is now displayed on over half of Intrepid’s trip pages — showing the estimated CO2e of the trip per traveler, per day. Emissions are calculated by identifying the different components contributing to the overall carbon footprint — including accommodations, transportation, food provided during the trip, activities, the local operations’ office emissions and waste. A 15 percent contingency is then added to each trip’s total emissions, to account for anything unintentionally missing.
Intrepid’s Greenhouse Gas Inventory calculation process was developed in line with the best-practice requirements set by Climate Active — an ongoing partnership between the Australian Government and corporations to drive voluntary climate action in the private sector.
Carbon labeling informs consumers of the impact of a product or service on the environment by providing a CO2e kg number similar to a nutrition label, allowing customers to make better-informed decisions. Seen the most so far in the food industry – with brands including Chipotle, Just Salad, Oatly, Quorn, Strong Roots and more including carbon-impact data on their products — carbon labels can now also be found on everything from personal-care products to electronics, footwear and sportswear.
Intrepid’s new labels will help educate travelers on their own carbon footprint and make it easier for them to understand their impact. They will also be able to access information on how Intrepid is offsetting these emissions and compare the data with everyday activities. For example, 100kg CO2e is about the same as charging a smart phone 12,164 times or driving a gas-powered car about 399 kilometers.
As part of the debut, Intrepid commissioned new research from The Harris Poll that revealed 64 percent of adults worldwide have no idea what their carbon footprint is. 60 percent are more likely to book trips with a company that is transparent about their environmental impact; and yet only 38 percent find it easy to find that information. And more than 1 in 2 people globally say they would be more willing to alter their plans if they could easily see and understand the carbon impact of each travel option.
Carbon labeling is not only helpful for consumers — it may soon become the new normal as we see more scrutiny and stricter regulations on greenwashing. Intrepid hopes these efforts will encourage other businesses to take accountability and follow suit.
“Without higher government regulations or the need for ESG disclosure, it is nearly impossible to hold businesses accountable for reducing their emissions,” said Sara King, GM of Purpose for Intrepid Travel. “We cannot shy away from our impact, and we cannot effectively reduce what we do not measure. With carbon labeling, we can increase customers’ understanding of their footprint while advocating for this level of measurement and transparency to become an industry standard.”
In addition to the rollout of carbon labels, Intrepid continues to roll out lower-carbon itineraries: In 2024, the company says it will have approximately 4,000 fewer flights on trips (compared to 2023) and will be discontinuing all scenic flights.
By Steven Clarke from Triple Pundit • Reposted: September 22, 2023
As the material business risks from climate change become increasingly clear, more than a third of the world’s largest 2,000 companies have set goals to reach net zero emissions by 2050 or sooner. Many companies have gone even further, setting emission reduction targets that are in line with what the latest climate science says are needed to meet the goals of the Paris Accords and limit global warming to 1.5 degrees Celsius. They are also disclosing information about the impacts of their business on carbon dioxide and other greenhouse gas emissions, water quality and scarcity, and nature.
This is tremendous progress and highlights that companies see opportunities to be had in tackling these risks. But awash with targets and goals, investors and other stakeholders still have one core question: What meaningful and measurable actions are companies taking today, and in the near-term, to meet these targets?
Climate transition action plans have emerged as a leading framework for companies to identify, plan, and implement strategies that reduce climate-related risks and maximize opportunities. These actions should be specific, time-bound and, if possible, quantified to detail the emissions reductions that companies expect to achieve.
While targets and disclosures are both deeply important, too often companies lack a forward-looking strategy that defines how they will work to achieve these targets in the next three to five years — both within and beyond their operations.
In fact, organizations that analyze and track climate action — such as the Science-Based Target initiative, Net Zero Tracker, Transition Pathway Initiative and CDP — have found that an alarming number of companies have yet to develop these plans. For instance, out of nearly 19,000 companies that annually report their climate impacts to CDP, only 13 percent have disclosed a sufficient number of indicators to be considered a credible plan — and only 0.40 percent of companies met all 21 of CDP’s key indicators.
Every company knows that delivering on a goal takes a plan. Just as companies set goals and develop detailed plans for driving sales, investing in new markets or recruiting talent, they also need a detailed climate action transition plan for delivering on their goals for slashing emissions and addressing their exposure to climate risk.
And the pressure on companies to deliver these plans is ramping up. In 2022, Ceres counted just nine investors asking companies they held to publish transition plans via shareholder resolutions. In 2023, that number jumped to 61.
Addressing the Ceres Global climate conference in March 2023, Mary Schapiro, vice chair for global public policy at Bloomberg and vice chair of the Glasgow Financial Alliance for Net Zero, said: “If 2021 was the year of mainstreaming net-zero commitments and 2022 was the year of target-setting and developing the frameworks to operationalize these commitments, we are now calling 2023 the year of transition plans.”
The momentum is building as investors are already implementing transition action plans to mitigate the risks climate poses to their portfolios. To help companies create and implement these plans to achieve their emissions reductions targets, Ceres’ Ambition 2030 initiative and our partners have developed action-oriented guidance and tools. At a high level, we outline four components for every transition plan:
Actions a company will take to reduce its Scope 1, 2 and 3 emissions, covering its entire supply and value chains, in line with limiting global temperature rise to 1.5 degrees Celsius.
Actions to identify, manage, and address climate risks and opportunities and incorporate these considerations into core business strategy and governance.
Actions to advocate for public policies that support and enable the achievement of corporate climate targets and economy-wide emissions reductions.
Actions to consider and support workforces, suppliers, customers, impacted communities and other stakeholders in the transition to a net-zero-emissions economy.
The time for action is now, and we encourage all companies to follow these guidelines as they develop the plans to make their targets a reality.
By Cameron Allen, Research Fellow, Monash University and Shirin Malekpour, Associate Professor in Sustainable Development Governance, Monash University via The Conversation • Reposted: September 21, 2023
This week world leaders are gathering at the United Nations (UN) headquarters in New York to review progress against the Sustainable Development Goals. We’re halfway between when the goals were set in 2015 and when they need to be met in 2030.
As authors of a global UN report on the goals, we have a message to share. Currently, the world is not on track to achieve any of the 17 goals.
There is much at stake. Failing to achieve the goals would mean by the end of the decade, 600 million people will be living in extreme poverty. More than 80 million children and young people will not be in school. Humanity will overshoot the Paris climate agreement’s 1.5℃ “safe” guardrail on average global temperature rise. And, at the current rate, it will take 300 yearsto attain gender equality.
But there is hope. With decisive action, we can shift the dial towards a fairer, more sustainable and prosperous world by 2030.
What does the research say?
The set of 17 universal goals agreed in 2015 to aim to end poverty, improve health and education, and reduce inequality – while tackling climate change and preserving our oceans and forests. Each of the goals are broken down into targets.
Every four years, the UN Secretary-General appoints an independent group of 15 international scientists to assess progress against these goals and recommend how to move forwards. We were among the authors of the latest Global Sustainable Development Report published late last week.
To provide a snapshot of progress, we reviewed 36 targets. We found only two were on track (on access to mobile networks and internet usage) and 14 showed fair progress. Twelve showed limited or no progress – including around poverty, safe drinking water and ecosystem conservation.
Worryingly, eight targets were assessed as still going backwards. These included reducing greenhouse-gas emissions and fossil fuel subsidies, preventing species extinction and ensuring sustainable fish stocks.
What is holding us back?
Recent studies have identified feasible and cost-effective globaland national pathways to accelerate progress on the goals.
Unfortunately, in many developing countries, insufficient financial resources and weak governance hinder progress. In other cases, existing investments in fossil fuels have generated strong resistance from powerful vested interests. Achieving some goals, such as responsible consumption and production, will also require big, unpopular changes in habits and lifestyles, which are very ingrained.
To accelerate progress on the goals, targets must be fully integrated by government and business at all levels into core decision making, budgeting and planning processes. We need to identify and prioritise those areas that lag furthest behind. To be effective, we also need to uncover and address the root causes of inadequate outcomes, which lie in our institutions and governance systems.
Accountability also remains weak. The goals are not legally binding and even though countries have expressed their support, this has often failed to translate into policy and investments. In practice, the targets are often “painted on” to existing strategies without redesigning norms and structures to deliver improved outcomes.
If the world is to accelerate progress on the goals, governments need to play a more active part, by setting targets, stimulating innovation, shaping markets, and regulating business.
We call on policymakers to develop tailored action plans to accelerate progress on the goals in the remaining years to 2030, including measures to improve accountability.
Scientists have a major role to play too. As we argued in Nature, scientists can help us redesign institutions, systems and practices. By studying ways to strengthen governance and build momentum for tough but transformative reforms, research can overcome resistance to change, and manage negative side-effects.
What does it mean for Australia?
Australia tends to perform poorly on the goals when compared to our peers in the OECD (Organisation for Economic Co-operation and Development), ranking 40th in the world in 2023. Our best-performing goals include health and education, while progress lags on environmental goals, economic inequality and cost-of-living pressures.
While some environment agencies, businesses and local groupshave embraced the goals, Australia’s poor performance is symptomatic of limited traction and commitment at the centre of government.
Here, the goals are often seen as an international development issue rather than central to domestic policy efforts. We lack a high-level statement or any strategy or action plan for the goals. There is no lead unit or coordination mechanism in place and no reference to the goals in the federal budget. One promising development, a national Sustainable Development Goal monitoring portal, hasn’t been updated in five years.
The best performing countries have taken concrete steps to mainstream the targets and ensure accountability:
Denmark requires new government bills to be screened and assessed for their impacts on the goals
Finland has taken steps to place sustainable development and people’s wellbeing at the heart of policy and decision making. A sustainable development commission, annual citizens’ panel on sustainable development and national audits provide increased accountability
Wales requires public bodies to use sustainable development as a guiding principle reflecting the values and aspirations of the Welsh people.
Australia’s first wellbeing framework is an important step forward. The framework of 50 indicators has considerable overlap with the goals, despite notable exceptions such as the lack of a poverty indicator or any specific targets or benchmarks.
By Tim Lamont, Research Fellow, Lancaster University via The Conversation • Reposted Septsmber 21, 2023
We’re witnessing first-hand an alarming decline of the world’s ecosystems, which is having a devastating impact on the people who rely on them. In many cases, it’s no longer enough to just protect what remains – degraded ecosystems must be restored.
Expanding restoration efforts at the rate required will only be possible with committed buy-in from local communities, regional and national governments, civil society and – crucially – the corporate sector.
Many businesses are starting to embrace this vision by launching ambitious restoration projects to replant trees, wetlands, coral reefs and mangroves that far exceed their legal responsibilities.
These endeavours are promising. In some cases, these projects are even delivering significant benefits. But according to a study, which was carried out by myself and several colleagues, we can’t be sure whether large corporations are making good on these environmental promises.
The hidden reality
We delved into the publicly available sustainability reports of 100 of the world’s biggest businesses. Our aim was to summarise the extent of their restoration work and its impacts.
What we found was both eye-opening and disconcerting. Two-thirds of these corporations stated that they carry out restoration activities. But the devil lay in the detail — or, in this case, the lack thereof.
Many of the corporate sustainability reports gave very little evidence to back up their claims about ecosystem restoration. They lacked rigour in defining restoration, outlining methodologies and quantifying outcomes.
They also failed to clearly distinguish between projects designed to merely align with legal responsibilities and those that would genuinely contribute to global restoration goals.
The majority (80%) of the reports failed to disclose how much money they were spending on ecosystem restoration. And 90% didn’t report any of the ecological impacts that their work had. A third of the reports didn’t even say how big their projects were.
In essence, the evidence supporting many corporate-led ecosystem restoration projects is glaringly inadequate.
The potential power of ‘Big Business’
The world’s largest businesses are powerful entities. They possess the resources, wealth, logistics expertise and influence to play a pivotal role in the mission to restore the world’s ecosystems.
Imagine a world where corporations use their vast finances, labour forces, manufacturing capabilities and social influence help rebuild forests, wetlands, savannas and coral reefs around the globe. It’s a vision of corporate responsibility that goes beyond mere compliance with environmental regulations.
But ecosystem restoration is notoriously difficult to do well. It requires careful and strategic consideration of a range of environmental and social factors.
Genuine attempts to restore ecosystems can sometimes do more harm than good. They can, for example, accidentally cause environmental damage, disempower local people and landowners or destabilise local governance. Some corporations also oversell their efforts to gain an undeserved boost to their reputation (a practice known as “greenwashing”).
Better reporting will be essential for big businesses to become genuine leaders of global ecosystem restoration. It will allow us to properly track the progress of corporate-led initiatives, hold businesses to account against the claims they make, and learn from those businesses that are leading the way.
In our paper, we suggest that the rigour of corporate reporting could be improved by implementing several key principles taken from restoration science.
For example, corporate sustainability reports could better meet the principle of “proportionality” (understanding how much restoration activity has been carried out) by providing information about the spatial extent and number of organisms planted in each individual restoration project that a company carries out. It would then be possible to evaluate the likely scale of the project’s impact.
The principle of “permanence” (committing to long-term restoration commitments) could be better evidenced by companies reporting on the number of years they’ve committed to maintain, monitor and report on projects after they’ve been started.
By reporting in ways that adhere to scientific principles like these, companies will be able to demonstrate much more convincingly that their efforts in ecosystem restoration are delivering the environmental and social benefits that they claim.
Big business is showing an increasing interest in contributing to global sustainability. As part of this movement, corporate-led ecosystem restoration could become a valuable asset in the battle to protect our planet’s vulnerable ecosystems. But it will only work if we can ensure transparency, accountability and adherence to best practice.
The idea of big business helping to rebuild the planet is an alluring rhetoric. Now it’s time to back it up with evidence.
By Supriya Jha, Chief Diversity and Inclusion Officer, SAP via World Economic Forum • Reposted: September 20, 2023
A debate in the United States around affirmative action has placed doubt on the future of broader diversity and inclusion (D&I) policies in the workplace.
The adversity around proactive D&I can provide an opportunity to revisit internal policies and practices to strengthen them.
Here are four things organizations can do to ensure D&I goals stay on track.
Diversity and inclusion (D&I) is under fire. In the United States (US), the courts recently ruled that race could no longer be a factor in university admissions, defeating affirmative action policies. There is now a passionate and polarizing debate on whether D&I strategies in the corporate environment lead to equity or bring down meritocracies.
To make matters worse, the narrative of defunding D&I initiatives in the corporate arena can unnerve companies’ small D&I teams. As we stand in the throws of this debate, it should be clear that D&I has not been a fleeting trend and remains an imperative that shapes the fabric of organizations and society.
The US trajectory on D&I might seem uncertain but the need for it is clear, including at a global level. Today’s challenges are opportunities to refine and strengthen our strategies so workplaces and communities are genuinely inclusive.
Maintaining the path to an inclusive future
As organizations stand at a crossroads, here are four things that can keep one grounded in the D&I journey:
1. Cultivating a sense of belonging
D&I is not a checkbox exercise; a common misconception is that it targets only people of colour. The purpose of D&I is to nurture a sense of belonging regardless of individual differences. When individuals feel welcomed, valued and respected, they contribute their best.
Gone are the days when people can simply be viewed as organizational assets: employees want to be valued as individuals and creators of change. Nothing cultivates belonging more than love and care – that’s evident as we feel genuinely connected to familial units, societies and organizations that care for us.
Nurturing that belonging in the workplace requires genuine and consistent leadership, commitment and vision. When I reflect on the many actions companies took during the pandemic, the most compelling ones contributing to higher retention involved leaders being accessible and present to listen to employees.
Creating opportunities for leaders to listen to and act on the needs of their diverse employee base is a strategy that works well in many directions. From the CEO to the front-line manager, empathetic listening skills assure employees they are heard and seen.
2. Doing the groundwork for our future
Efforts in the D&I arena are not momentary but also exist for future generations.
As a mother of two girls, I have a vested interest in driving forward D&I in organizations. I want my daughters to experience a workplace where they can be themselves and their differences and uniqueness are celebrated. They should be provided with opportunities based on their skills and talent.
More importantly, the workplace should help staff optimize their potential instead of wasting time fitting into cultures made by a homogenous majority. My hope is the pandemic-induced flexible and remote work policies don’t become exceptional but are normalized across industries where feasible. Additionally, providing employees with tools to recognize and address unconscious biases via continuous education and training can help raise collective awareness and foster a more inclusive environment.
Having served in the [diversity and inclusion] space for over 16 years, I’ve learned that [it] is not a one-time action; it requires resilience and constant adaption.”— Supriya Jha, Chief Diversity and Inclusion Officer, SAP SE
3. Unleashing the power of employee resource groups
Employee resource groups are beacons of progress in a company’s journey. hese networks are voluntary, employee-led groups that unite individuals with shared backgrounds, experiences, identities or interests. More importantly, they need to be open to all – so that the “upstanders” – not bystanders – and allies can find a space to learn and grow.
Spaces for shared experiences spark conversations that lead to meaningful change for the community and business. Making employee resource groups part of the business strategy with executive involvement has been tried and tested in most organizations. Enabling these groups to contribute to partner, supplier and community interactions can further help unleash the collective’s power. What makes for great strategy within the workplace can translate to a growing movement in society and the marketplace.
4. Consistency is key
Having served in the D&I space for over 16 years, I’ve learned that it is not a one-time action; it requires resilience and constant adaption. To bring about lasting change, we must show evidence of incremental progress. But any win is worthwhile, even minor achievements.
It is essential to remember that accumulating these steady, incremental steps leads to success overall. As we navigate the complexities of implementing D&I strategies, let us recognize that it is not about a destination but the journey.
Inculcating inclusive hiring practices at all levels, fostering environments that champion the engagement of neurodivergent talent and opening doors for underrepresented businesses will all set us on a path to a more equitable future. Setting clear and measurable goals, recalibrating at every step, celebrating the diversity and uniqueness of the workforce and amplifying the achievements loudly are the factors contributing to success.
Ultimately, our quest for belonging is a tapestry woven with threads of diverse experiences, united by a shared purpose. Let us continue weaving this tapestry, creating a world where our differences are not divisions but vibrant threads that enrich the canvas of human existence.
A new Veolia North America survey of 245 large U.S. companies shows that more than half will have ambitious goals addressing net zero carbon, zero waste to landfill, zero liquid discharge, and targeted increases in water efficiency, reuse, and waste recycling by 2025, with many firms already setting specific targets.
The survey shows reductions in greenhouse gas emissions are the top sustainability priority for most firms, but it is clear that priorities to address water and waste reductions are catching up.
While the commitments being made by firms are encouraging, the data in the new Veolia survey shows that the majority of companies have yet to identify specifically what the exact steps are to achieve their most ambitious medium- and long-term commitments.
Here are some highlights of the survey, which was conducted over the past year:
60% of firms identified specific projects and initiatives to achieve their short term sustainability goals (less than five years), while 37% had not.
40% of firms reported that reducing operational costs is a very important driver for pursuing sustainability goals.
While investments included in the landmark U.S. Inflation Reduction Act have gone far in providing firms with the financial support they need to convert to sustainable practices, it will not be enough to meet all their needs. Based on an analysis by the International Energy Agency and Boston Consulting Group, the overall transition to sustainable energy across U.S. industries will require at least $18 trillion in additional capital by 2030.
“This survey provides many important insights on how firms across America are responding to the growing concern around climate change, and why they are looking to reduce their impact on carbon emissions, waste streams and water use,” said Veolia North America President and CEO Fred Van Heems. “A large number of companies are genuinely committed to achieving sustainability objectives, yet they are not sure how to begin, which is keeping many of them from moving forward. The good news is there are solutions available to get them on track and help them sustain momentum.”
The survey findings point to the need for more urgency in clearing the way for industries to adopt more sustainable practices as soon as possible, according to Charles Iceland, Director of Freshwater Initiatives for the World Resources Institute, an environmental think tank based in the U.S.
“It’s clear from this survey that for large companies that are genuinely committed to operating on a more sustainable basis, more resources and data are needed to help them determine where their greatest needs are so they can take effective action,” Iceland said.
The survey found that a majority of companies are committing to sustainability goals primarily because of reporting requirements, regulatory compliance, cost savings and brand reputation. Of the firms surveyed, roughly one-third said the environmental risks to their operations were not a very important driver.
The survey findings are being announced one year after passage of the U.S. Inflation Reduction Act, which was meant to kickstart the economy with investments in critical infrastructure, with a special focus on initiatives that will help meet sustainability goals for addressing climate change.
The survey found that many respondents are prioritizing sustainability initiatives because of the incentives and opportunities available in the IRA legislation and other factors such as regulatory requirements and investor focus on climate disclosures.
What remains a challenge, the survey showed, is that companies still lack the funding to support the transition and take the concrete steps necessary to achieve their goals. They also are struggling to achieve alignment of internal goals and responsibilities and easy access to data to understand where they are and track progress.
“Before firms can invest in reducing their impact on the environment and become more sustainable, they need information on their current baseline, such as data on their energy emissions, waste and water use,” said Patrick Schultz, President and CEO of VNA’s Sustainable Industries and Buildings division. “This will enable them to choose measures that can be immediately and easily implemented, and ones that may require a strategy to mitigate over time.”
Schultz added, “This kind of analysis is only effective if it is conducted holistically, taking into account each firm’s contributions not only to high-profile factors like greenhouse gas emissions, but also equally important considerations like reducing landfill waste and preserving water resources. This is what Veolia North America means by triple zero – achieving net zero goals for energy, waste and water.”
By Josh Bersin from Harvard Business Review • Reposted: September 18, 2023
The EU has long been committed to improving worker well-being, claiming it wants to create more transparent and predictable working conditions for all its 182 million workers. Now, it’s moving ahead with this objective on a number of fronts:
Its Work-Life Balance Directive, which came into effect in 2019, aims to set minimum standards for paternity, parental, and career leave as well as flexible work arrangements.
Its Corporate Sustainability Reporting Directive (CSRD) mandates that, starting in May 2024, any company with €40 million in net turnover, €20 million in assets, or 250 or more employees that trades in Europe publish detailed information about their efforts to address a range of sustainability challenges.
In recent years, many companies hired a chief sustainability officer and established a set of high-priority programs to reduce carbon emissions and the risk of global climate change. The enactment of these new regulations signals a new era in which it’s time to extend the concept of sustainability to include similarly critical issues with the workforce — an idea I call people sustainability.
People sustainability takes a holistic approach to corporate human capital practices, including diversity and inclusion, well-being, employee safety, and fair pay. It raises these human capital issues to the C-suite and obliges chief human resource officers to work with chief sustainability officers on these programs. It means that your employee well-being efforts are no longer delivered piecemeal, which was ineffective no matter how well-intentioned or resourced they might be.
The EU is essentially saying that all these “HR programs” are much bigger than HR: They now fall into the category of global citizenship mandates, and companies must treat and report them as such.
How to Integrate People Sustainability into Your Company
I’m talking to European and U.S. firms about how they are gearing up for the Corporate Sustainability Reporting Directive and developing people sustainability metrics. Here are examples of how a few companies are approaching this:
Heineken has developed standard measurements of human rights, fair pay, and even living conditions for all its contract workers helping it deliver beverage sales around the world.
Enterprise software leader SAP has coupled its industry-leading diversity program to new pay equity and sustainability initiatives. For example, the company now openly publishes all pay bands so employees can see where they are and the pay scales for all new jobs posted. In parallel, it provides hiring and workplace support for neurodivergent employees. After undertaking a progressive gender pay equity analysis, it inaugurated a very aggressive program of promotions of women into senior leadership — all long-term “people sustainability” strategies.
Financial services firm Liberty Mutual sees people sustainability as a factor in limiting the global risks of its customers, partners, and employees in the face of accelerating climate change. Chief sustainability officer Francis Hyatt, who previously served as executive vice president of enterprise talent practices, oversees the integration of global climate issues in the firm’s risk management approach and promotes sustainability solutions for employees, resellers, and customers. The company promotes thought-through generational and gender equality programs, and Hyatt ensures that every employee understands how their long-term safety and success is part of the company’s overall sustainability strategy. In other words, this new job function unifies all the brand’s existing HR work into the context of sustainability and helping the planet.
What links all three of these major corporations is the way each separately discovered that when you frame human capital investment in the context of sustainability, it assumes even more importance than it did before.
If you see value in this approach, where should you start at your organization? Building on the European Union’s new detailed CSRD reporting requirements, leaders will need to address issues ranging from greenhouse gas emissions to gender pay across their own operations, as well as that of their suppliers and business partners. You should try to ensure sustainability becomes a pillar of operations as early as possible, as the compliance clock is ticking.
The real action is to get your HR team to start working as soon as possible with their ESG colleagues to get people sustainability metrics and strategies into your business goals. To drive this, bring together a team including your heads of HR, DEI, and ESG, as well as representatives from your corporate finance and legal teams, to design your people sustainability program. You’ll ultimately want to see these goals reflected in your annual report and other stakeholder communications, so that these programs are seen as a core part of company strategy.
A recent survey by PwC reveals that many CEOs anticipate climate risk will affect their cost profiles and supply chains in the next year. However, despite these challenges, 60% of the surveyed CEOs do not plan to reduce headcount, and 80% do not plan to decrease compensation, as they recognize the importance of retaining talented employees.
Data like this underlines how people sustainability has become an integral strategy for corporate growth. Investors will soon begin to measure the effectiveness of a company’s well-being initiatives as a key metric of overall performance as much as its P&L.
You don’t have to be directly affected by Europe’s new sustainability laws to see that bringing together previously disconnected efforts such as DEI, purpose, or L&D under the umbrella of “long-term organizational sustainability” makes a lot of sense. You might even see it as meeting the needs of the present without compromising your future: a measure of sustainability that certainly gets my support.
Josh Bersin is founder and CEO of human capital advisory firm The Josh Bersin Company. He is a global research analyst, public speaker, and writer on the topics of corporate human resources, talent management, recruiting, leadership, technology, and the intersection between work and life. To see the original post, follow this link: https://hbr.org/2023/09/sustainability-is-about-your-workforce-too
By Alana James, Assistant Professor in Fashion, Northumbria University, Newcastle via The Conversation • Reposted: September 14, 2023
How do the clothes you buy wear out the natural world? To take stock of the damage you have to account for the materials, water and energy that went into making a garment, and the greenhouse gas emissions, chemical pollutants and other byproducts associated with its disposal.
For example polyester, a kind of plastic widely used in T-shirts, is made from oil – a fossil fuel. If you throw it out it degrades slowly, and chemicals from its dyes and surface treatments leach into the soil.
The UK consistently buys more garments than any other European country, spending more than £45 billion (US$56 billion) annually. Fast fashion, an industry trend which involves getting cheap reproductions of catwalk designs out to a mass market as quickly as possible, encourages this buying frenzy.
Much of fast fashion is known to depend on sweatshop labour and polluting factories. But alongside the demand for ever faster fashion at low prices, there is a growing awareness among consumers that something has to change.
Some firms have caught on: many brands now report their environmental footprint and have disclosed their intention to shrink it.
But how trustworthy are these assessments? My research uncovers how the fashion industry collates, analyses and assesses environmental impact data. Unfortunately, as a result of inaccurate and unreliable methods, among other issues, the true cost of fast fashion remains largely unknown.
A multitude of metrics, certification schemes and labels mark the environmental consequences of making and selling clothing. Brands have been accused of greenwashing due to the poor quality of information used in some of them.
One common product-labelling tool within the industry was the Higg Materials Sustainability Index. Introduced in 2011, the Higg Index was a rating system used by several large brands and retailers to determine and report the global warming impact and water consumption of different products, among other environmental measures.
The approach adopted by the index was challenged by the Norwegian Consumer Authority for limiting its assessment to only certain phases of a product’s lifecycle, such as the sourcing of materials. It was criticised for overlooking pollutants such as microfibres, which are released from textiles during manufacture, wear and washing. As a result, the index was suspended in June 2022.
Since then, further issues have come to light. These include:
unreliable data – measures often rely on brands self-reporting without their information being verified by an impartial third party
vested interests – many tools and indices are funded, or part funded, by organisations that could benefit from more positive reporting
tunnel vision – existing methods tend to focus on only one environmental impact, such as water use or carbon emissions, while the relationship between these factors is overlooked
paywalls – many tools require brands to pay into them. This can effectively exclude smaller businesses and limit the tool’s coverage
lack of standards – there is no official baseline to determine acceptable thresholds of environmental footprint of any one product.
Without reliable and accurate assessments of a product’s environmental impact, consumers are left in the dark. For example, a common misconception is that cotton, being a natural fibre, is better for the environment than synthetic materials such as acrylic and elastane.
But cotton requires vast quantities of water to grow, harvest and process. A standard cotton t-shirt, for example, requires 2,500 litres while a pair of jeans consumes 7,600 litres.
One fibre is not necessarily better than the other. Rather, every material and manufacturing process affects the natural world in one form or another. With such misconceptions rife, it’s difficult for consumers to make sound comparisons. That’s why accurate measures are desperately needed.
The complexity of fashion’s global supply chain, which spans thousands of miles from fields to shop floors, makes accurate measurements exceptionally difficult. Capturing an accurate picture of the industry’s environmental footprint will rely on a certain level of transparency across the industry. It will also require multiple sectors – including production, manufacturing and retail – working collectively towards a common goal.
An acceptable definition for “sustainable”, informed by standards and baselines, could empower consumers to make more informed decisions about their purchases. With Gen-Z labelled the sustainable generation, it is time for fashion to reform.
From Consultancy.UK • Reposted: September 14, 2023
Business strategy has predominantly focused on the ‘E’ in Environmental, Social and Governance policy; but fostering good growth requires a renewed emphasis on the importance of the ‘S’ pillar, according to Xynteo Managing Partner Jonah Grunsell. He explains how this can help to create socially consciousness, inclusive and profitable supply chains.
In today’s dynamic business landscape, the integration of social consciousness and inclusivity within supply chains is crucial. Enterprises that prioritise these principles not only contribute to a fairer and more equitable world but also gain a competitive edge through the fostering of stronger relationships with diverse stakeholders. So, what can businesses do to embed social consciousness and inclusivity within their supply chains at every step?
The 2022 Global Sustainability Study shows that 66% of consumers rank sustainability as one of the top five drivers behind a purchase decision; meaning that transparent communication in supply chain practices plays a pivotal role in establishing trust with consumers, investors, and stakeholders. Businesses must strive for openness regarding their sourcing, labour practices, and social and environmental initiatives. Research by Label Insight showed a staggering 94% of consumers are likely to remain loyal to a brand that offers complete transparency about its supply chain, underscoring the growing importance of supply chain visibility in understanding a business’s impact.
Yet, transparency in supply chains goes beyond consumers, with investors, suppliers and other stakeholders also seeking clarity and openness.PwC revealed that 83% of investors believe that non-financial disclosures, such as supply chain information, are essential when making investment decisions. Enhancing communication with consumers, NGOs, and industry partners is also a vital element in creating a positive impact through supply chain practices. According to a study by the Harvard Business Review, 65% of consumers want to buy purpose-driven brands that advocate sustainability.
In the quest for responsible supply chain practices, reporting and certification play a crucial role in demonstrating a company’s commitment to transparency and accountability. Sustainability reports provide comprehensive insights into an ESG performance, showcasing their efforts to minimise environmental impacts, promote social welfare, and ensure ethical business practices.
While, environmental management certifications, such as ISO 14001, demonstrate a company’s dedication to reducing its environmental footprint and fairtrade certification guarantees that products meet strict standards, ensuring fair wages and better working conditions for farmers and workers. According to a study by the Global Reporting Initiative (GRI), 96% of the world’s 250 largest companies now disclose their sustainability performance through these reports.
A good example from the technology world is Apple, which has taken great strides both on reporting on its sustainability efforts as well as acting on the insights generated by increased transparency and tracking. This level of transparency instils trust among consumers, investors, and partners, encouraging them to support and collaborate with socially and environmentally responsible companies.
Embracing diverse and ethical strategies
True inclusivity requires forging partnerships with a diverse supplier base, particularly those within underrepresented groups such as women, minorities, and social enterprises. Businesses can support local communities, create economic opportunities and promote social mobility by actively seeking out and collaborating with these suppliers. A study by the Harvard Business Review indicates that actively embracing a supplier diversity programme can foster innovation and increase the bottom line. A procurement strategy that prioritises inclusivity expands the range of potential suppliers and fosters healthy competition within the supply base, leading to enhanced product quality and cost reduction.
One fundamental aspect of improving supply chains is ensuring fair labour practices and ethical sourcing. Businesses can take proactive steps to verify that their suppliers adhere to responsible labour standards, treat workers fairly, and provide safe working conditions. This includes regular audits, transparent supplier relationships, and collaboration with industry initiatives promoting ethical practices. By sourcing ethically, businesses can contribute to the well-being of workers, reduce social inequalities, and enhance the reputation of their brands.
Prioritising ethical sourcing practices involves scrutinising suppliers’ labour conditions, environmental impact, and compliance with human rights standards. Partnering with suppliers who align with these values ensures that products and services are not tainted by exploitation or harm to communities.
Providing suppliers with training, resources, and support can significantly enhance their operational efficiency, product quality, and compliance with ethical and environmental standards. This not only improves the overall supply chain’s performance but also promotes sustainable practices and responsible behaviour. Businesses also can make a positive impact on communities by investing in social programmes and projects that tackle pressing challenges such as education, healthcare, and infrastructure.
Prioritising local suppliers and supporting small businesses within the community can stimulate economic growth, create job opportunities, and promote entrepreneurship. Embracing local sourcing strengthens community ties, boosts regional development, bolsters community resilience, enhances quality of life, and contributes to societal progress, generating a broader positive influence beyond the business itself. The good news is that ethical business practices make commercial sense when you consider that, for example, 70% of American consumers think either “somewhat” or “very important” for companies to make the world a better place; while a huge 93% of employees believe companies must be led by purpose.
Unilever, for example, has set ambitious social targets under its ‘Sustainable Living Plan’, including empowering 5 million women through its value chain by 2020 and enhancing economic growth in local communities. Their ‘Partner with Purpose’ strategy aims to drive mutual growth that’s consistent, competitive, profitable and responsible, and influence the people they buy from to, in turn, buy from diverse suppliers, leading to the transformation of their value chain.
Nurture responsibility
Businesses must play a pivotal role in encouraging responsible consumption by engaging consumers and raising awareness about the social and environmental impacts of their products. A study by Nielsen reveals that sustainability is more important to 69% of global consumers than it was two years ago. Providing transparent information about sourcing and ethical considerations empowers consumers to make informed choices aligned with their values. By actively involving consumers in the journey towards a more socially conscious supply chain, businesses can build trust, loyalty, and a positive brand image.
Integrating social consciousness and inclusivity into supply chains enables businesses to create positive societal impact while ensuring long-term sustainability. Ethical sourcing practices, diverse partnerships, sustainable logistics, and responsible consumption are essential steps in achieving these goals.
Xynteo encourages businesses to take a proactive stance, transforming their supply chains into vehicles for change that promote fairness, equality, and environmental stewardship. Through collective efforts, we can build a more just and inclusive world, one supply chain at a time.
From Two Side Europe • Reposted: September 14, 2023
The Trend Tracker Survey 2023, the latest consumer research from Two Sides Europe, seeks to understand changing consumer perceptions towards print and paper products, looking specifically at environmental awareness, reading habits, packaging preferences and attitudes towards tissue products.
Online Shopping – Good News For Paper Packaging The shift to online shopping has accelerated dramatically in recent years. At the touch of a screen, consumers can search for a product, order and have it delivered to their door, sometimes on the same day. As consumers have come to appreciate the safety, speed and convenience of buying products online, they also are increasingly more concerned about how those products are packaged and delivered.
European consumers are demanding that retailers do more to ensure their packaging is widely recyclable, and 49% believe that paper-based packaging is easier to recycle than other materials. Recycling data reflects this belief: 82% of paper packaging is recycled, the highest recycling rate of any packaging material. Glass has a recycling rate of 76%, metal 76% and plastic just 38% (Eurostat, 2020).
71% of European consumers prefer products ordered online to be delivered in fitting packaging to reduce waste, up from 68% in 2021. 59% prefer products to be delivered in paper packaging, and perceive sustainable benefits of paper compared to other packaging materials, including glass, metal and plastic.
Consumers Demand Retailers Do More Retailers play a crucial role in the innovation of product packaging and the use of recyclable, sustainable packaging materials. In response to increasing media and consumer pressure to perform and behave in a more sustainable way, retailers throughout Europe, particularly supermarkets, are improving and communicating their environmental credentials, commitments, and achievements. Even so, less than half of those surveyed (46%) believe that retailers are doing enough to inform consumers of their commitments and achievements related to sustainability.
The survey revealed that consumers would be willing to act if they don’t think a retailer is doing enough to become more sustainable. 41% would consider avoiding a retailer that is not actively trying to reduce their use of non-recyclable packaging, and 55% would buy more from retailers who remove plastic from their packaging.
Because consumers are concerned about the impacts that packaging waste has on our planet, they increasingly expect that governments and brands, as well as retailers, do more to ensure packaging is widely recyclable. When consumers were asked to rank who they believe has the most responsibility for reducing the use of non-recyclable single-use packaging, 39% believe that governments and local authorities are the most responsible, followed by brands, retailers and supermarkets (22%), packaging manufactures (20%) and the individual (19%).
To find out more about the Two Sides campaign, and how you can become a supporter, visit www.twosides.info
An executive summary of the Trend Tracker Survey 2023 was published in June and is available to industry stakeholders on request. Visit twosides.info/trend-tracker-2023 to register your interest in receiving this summary.
By Daniel Tsai, Lecturer in Business and Law, University of Toronto and Peer Zumbansen, Professor of Business Law, McGill University via The Conversation • Reposted: September 23, 2023
In addition, the lack of government leadership and the fragmentation of the ESG landscape has created uncertainty about its future. Many firms don’t know if they should lead by example or wait to follow the pack.
The public debate around ESG, stakeholder governance, sustainability and responsible investment continues to gain momentum in the midst of all this.
In response, McGill University’s CIBC Office of Sustainable Finance hosted academics and experts from 11 countries to confront the issues of ESG, climate change governance and democratic politics. The resulting impact paper proposes several policy recommendations for governments and corporations to work together to transform ESG standards into practice.
A fully transparent and publicly available ESG and sustainability index for financial institutions and corporations would improve transparency, accountability and address the demand for ESG.
If large public corporations were required to report universal ESG metrics, it would lead to healthy competition among corporations to go above and beyond the minimum index requirements. This would allow investors and consumers to see how companies are actually implementing ESG policies, leading to increased transparency.
Meaningful disclosure will ultimately lead to a transformation of a company’s buying, production, selling and investing practices.
The BlackRock investment company in the Hudson Yards neighbourhood of New York City on March 14, 2023. AP Photo/Ted Shaffrey
Increased transparency would also help prevent companies from greenwashing by boosting their ESG ratings before quarterly or semiannual public disclosures.
This forward momentum can lead to the integration of sustainability officers, who play a key role in ensuring effective ESG implementation, into businesses and organizations.
But these tax credits need to go further. For example, the government could provide tax credits to the oil, gas and mining sectors for investing in renewable energies. The government could also allow investors to deduct related corporate losses against their personal income.
That will help spur economic growth, investment and development in beneficial industries and technologies, as we have seen with the rise of the electric vehicle industry.
The West Pubnico Point Wind Farm is seen in Lower West Pubnico, N.S. in August 2021. Image: THE CANADIAN PRESS/Andrew Vaughan
The goal should be to encourage corporations to better integrate sustainable practices within their business models and create targeted investment that favours socially responsible investment. That way, governments can use their tax systems to support technologies and business models that address climate change.
Governments can also help make the financial sector sustainable by providing favourable loans and financing for greener investment portfolios.
Governments, central banks and banking regulators can create regulations that require financial institutions to implement sustainability into their underwriting policies. This would involve placing higher interest costs on loans with poor ESG outcomes to encourage industries to invest in better ESG.
By setting transparent standards for ESG accountability, requiring corporations to participate in sustainability indexes and standards and offering economic incentives through tax reform, governments can have a transformative effect on businesses through ESG. But it requires effective leadership.
By Carol Cone from Triple Pundit • Reposted: September 13, 2023
The term ESG is fine, according to a recent poll of 1,000 Americans. Despite continued polarization related to the acronym, which stands for environmental, social and governance, the majority of Americans believe it’s the best way to describe a company’s approach to improve business, society and the environment. Before we get to the data, though, it’s important to understand why we asked this question in the first place.
How did we get here?
Over the past year, a rising chorus of conservative U.S. voices have claimed that ESG is “woke capitalism,” or corporate virtue signaling about social and environmental concerns which they see as beyond the bounds of business.
The issue drew President Joe Biden’s first presidential veto in March of this year, defending legislation related to ESG investing and bringing the issue into the national spotlight. ESG is facing such a significant backlash that BlackRock CEO Larry Fink, long one of the financial industry’s staunchest proponents for purpose and ESG, doesn’t even want to use the term — though BlackRock’s policies around society, the environment, and business governance remain unchanged.
It’s also important to establish that whatever you call them, sound ESG practices are not new, and are indeed vital to operating a responsible, ethical, and profitable business. As Fortune sustainability reporter Eamon Barrett observed, “major corporations documenting their environmental, social, and governance policies for investor scrutiny is actually a decades-old process.” At its core, ESG is a means to broaden the lens on what constitutes key drivers of business value, accompanied by efforts to measure and report on what matters for individual company operations via standardized reporting frameworks.
Americans say ESG is a-okay
We partnered with Purpose Collaborative member Reputation Leaders, a global research and thought leadership consultancy, to ask Americans what term they feel best describes “the approach companies take to improve business, society and the environment.” ESG and sustainability are tied for the top, at 23 percent each. Corporate social responsibility is second, at 21 percent, followed by purpose (11 percent), corporate citizenship (8 percent), stakeholder capitalism (7 percent) and stewardship (5 percent).
Across demographic groups, ESG and sustainability are the favored terms among men, while women prefer “corporate social responsibility,” a phrase that connotes a sense of obligation. ESG is also the top choice for younger audiences, particularly those aged 25 to 34, while consumers aged 55 to 64, prefer the term “sustainability.” There are regional differences, as well. People living in the Northeast prefer sustainability, while their Southern and Midwestern counterparts prefer ESG.
Reputation Leaders also analyzed the tone of media coverage related to Americans’ top three terms: ESG, CSR and sustainability. CSR garnered the largest share of positive sentiment at 37 percent, with sustainability in second place at 32 percent and ESG trailing at 20 percent. ESG was the only term to have a significant amount (10 percent) of negative sentiment.
What now?
This study can help support companies in exploring the terms they will use to discuss the impact their business has on society. It is important to develop a clear, shared perspective and take a long-term view.
From the United Nations to the World Economic Forum, global leaders are advocating for businesses to embed a net-positive approach into their operating models to accelerate innovation and impact. Increasingly, employees, customers, supply chain partners, and others are asking about the ESG commitments of the companies they work for or with. Business leaders need to have answers and a strong point of view on which issues are most important to their business, and why. Our best advice? Don’t worry about what you call it — stick to your organization’s long-term, strategic commitments to stakeholders, society and the environment.
When it comes to communications, here are three ways to help depolarize the conversation:
Be clear about the goals of ESG. ESG is not about imposing a set of values on business. It provides a framework for companies to assess and optimize their value and impact.
Increase transparency around ESG data and metrics. This will help to ensure that investors and other stakeholders are making informed decisions.
Embrace standardized reporting frameworks. This will make it easier to comparecompanies’ ESG performance — think: the Task Force on Climate-Related Financial Disclosures (TCFD), the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB).
Yes, the polarization will continue, especially as the 2024 presidential election nears. As the world continues to endure climate impacts from extreme heat and flooding to record-breaking wildfires, there also will be greater demand for businesses to address environmental challenges.
Scores of studies suggest that ESG — done right — drives sustainable competitive advantage and can accelerate organizational growth over the long-term. An impressive 80 percent of investors believe that companies with strong ESG practices can generate higher returns and make for better long-term investments, according to research from Morgan Stanley.
By continuing to show a link between ESG issues and the business, we can help to make the debate around ESG more constructive and less polarizing. This will ultimately benefit businesses, investors and society as a whole.
Student-Managed Investment Funds provide students with experience managing real investment portfolios. But new research shows only. a small minority of funds include environmental, social and governance (ESG) factors in their mandates. Photo: Shutterstock
By Lorin Busaan, PhD Student, Gustavson School of Business, University of Victoria and Basma Majerbi, Associate Professor of Finance, Gustavson School of Business, University of Victoria via The Conversation • Reposted: September 11, 2023
Sustainable investing takes into account environmental, social and governance (ESG) factors alongside traditional financial components. While this form of investing has existed for a long time, ESG has become a hot-button issue due to recent politicization and widespread public misconceptions around what it really entails.
ESG investing examines quantitative and qualitative non-financial data on companies. This includes environmental issues like carbon emissions, pollution and resource use; social issues like employee treatment and relationships with communities; and governance issues like diversity of corporate boards, business ethics and transparency.
A basic qualification for finance graduates is the ability to analyze the environmental, social or governance factors that create risks and opportunities for a given company and, in turn, affect investors’ returns.
Unfortunately, graduates often lack even this basic qualification, in addition to more advanced expertise required to assess the investment impacts on people and the planet.
Given the climate crisis and persistent inequality, business schools must urgently and immediately tackle the sustainability deficit in finance education. Formal instruction must be enhanced with experiential learning techniques that expose students to the complexity and nuances of sustainable investing.
Our research shows that Student Managed Investment Funds (SMIFs) — currently present at many Canadian universities — are an underused, hands-on learning opportunity for training the next generation of sustainable investment professionals.
The head of the Kansas Public Employees Retirement System testifies before a Kansas legislative committee in March 2023 about a bill that would bar the pension system from ESG investing. (AP Photo/John Hanna)
Criticisms and politicization, combined with other factors, have curtailed flows to ESG funds. This is unfortunate given the urgent need to mobilize more financial capital to address climate change, biodiversity loss and inequality.
Reforming business schools
Developing competence in sustainable investing requires a serious revision in business school finance programs.
Core courses must include sustainable investing concepts and tools as part of mainstream financial education. This is especially important given fast-evolving ESG and climate-related regulations and rising global risks that pose new threats to companies and investors.
It’s also important that students learn the limits of different forms of sustainable investing to avoid falling into the trap of greenwashing.
Many ESG strategies primarily focus on risk mitigation with, at best, a marginal impact on people or the planet. Others, such as impact investing, focus on measurable social and environmental outcomes, often using the UN’s SDGs for their impact goals, alongside financial returns.
Impact investing could unlock much needed capital for critical sectors in the net-zero transition that would otherwise be underfunded when using traditional financial metrics.
In short, sustainable investing, in all its forms, requires additional skills that are currently lacking in finance education. Social and environmental impacts can be difficult to quantify and may require longer-term perspectives and qualitative judgements about potential impacts on many stakeholders.
It’s important that students learn the limits of different forms of sustainable investing to avoid falling into the trap of greenwashing. Image: Unsplash
Student-managed investment funds
These skills are best developed through hands-on practice that supplements formal instruction. Student-Managed Investment Funds (SMIFs) provide students with experience working together to manage real investment portfolios under the guidance of faculty supervisors and industry professionals.
Canadian universities have established more than 30 funds that students oversee as portfolio managers, buying and selling stocks, bonds or other assets. The capital in these funds comes from a variety of sources, including donations from companies, philanthropic gifts from individuals or foundations, and in some cases from university endowments.
Of the 31 Canadian SMIFs we analyzed (totalling $79.5 million managed by students), only five (16 per cent) have some level of ESG consideration. Since business schools have long used student-managed funds to train the next generation of investment bankers, financial analysts and other financial industry professionals, this is surprising — and disappointing.
Authors’ analysis of SMIFs in Canada with ESG components based on publicly available data from major Canadian business schools’ websites as of fall 2022. Impact Investing Hub, University of Victoria
The gap is even more pronounced for impact investing, which is barely mentioned in any of the funds in our sample, despite universities’ commitments to the UN’s Sustainable Development Goals.
Authors’ analysis of the size of SMIFs with and without ESG components, based on publicly available data from major Canadian business schools’ websites as of fall 2022. Impact Investing Hub, University of Victoria
Sustainable finance education could benefit greatly when students work together to integrate financial, environmental and social factors in student-managed investment funds.
Learning by doing helps students develop important analytical skills, familiarizes them with key tools and data sources and helps them navigate the maze of ESG standards, frameworks and guidelines.
The role of universities
Including sustainability mandates in finance programs and student-managed investment funds will ensure Canadian universities train the next generation of sustainable investment professionals needed to accelerate the net-zero transition.
We encourage university administrators and finance educators across the country to immediately implement ESG policies for existing student-managed investment funds. In collaboration with industry and donors, new funds could also be established that focus on particular themes, like climate solutions or nature-positive investing.
One encouraging initiative in this regard is by Propel Impact, a non-profit that is collaborating with seven universities to run their own local student impact funds.
Through creative partnerships with investors, Propel has been supporting student training while benefiting local communities, with $750,000 directed by students toward 14 Canadian social enterprises over the past three years. We offer this program to University of Victoria students and hope it expands to more Canadian universities.
As we confront pressing social and environmental challenges, we can’t be discouraged by partisan sniping. Instead, we must build momentum for sustainable investing by training future financial professionals more effectively.
By Tina Casey from Triple Pundit • Reposted: September 11, 2023
With the 2023 proxy season in the rear-view mirror, financial analysts noted a sharp decline in shareholder support for environmental, social and governance proposals. However, anti-ESG proposals also failed to stick, and signs of an ESG resurgence are already beginning to emerge.
Mixed support in the 2023 proxy season
Most U.S. companies hold proxy sessions between April and June, enabling shareholders to vote on issues without being present.
Based on the outcome of the 2023 season, shareholders seem to be losing interest in ESG issues. In a June analysis, the firm FTI Consulting noted that “2023 has seen investors support significantly less environmental and social proposals than in past years.”
The question is whether or not the drop-off marks a permanent trend or a temporary reaction to current events. FTI attributed much of the decline to the “anti-ESG” agenda, explaining: “The scrutiny on institutional investor vote behavior…by the anti-ESG activists has caused institutional investors to support less environmental and social proposals in 2023.”
At the same time, anti-ESG proposals also failed to garner much support from shareholders over the past five years, the analysis found. FTI advised that other factors can also have a significant influence on ESG support. Analysts cited the 2022 proxy season, which also saw a drop in ESG support after a rules change by the U.S. Securities and Exchange Commission. The change fostered a spike in the number of prescriptive proposals to come up for a vote, and prescriptive proposals generally receive low support from shareholders regardless of their subject matter.
We don’t talk about ESG, but we do it
One area where the anti-ESG movement has clearly had an impact is in the way in which bankers, money managers and other financial stakeholders communicate. Many continue to put the principles into action while avoiding specific references to ESG, as shown by a recent Bloomberg survey.
“About two-thirds of respondents in a survey of roughly 300 Bloomberg terminal users said the anti-ESG movement that started in the U.S. last year will force firms to stop using those three letters in conversations with clients,” Alastair Marsh and Lisa Pham of Bloomberg observed last month. “However, they’ll continue to incorporate environmental, social and governance metrics in their business.”
Financiers under fire
The Bloomberg analysis is among those attributing ESG avoidance to an aggressive, partisan political environment of legislative and legal attacks on ESG investing.
Though the issue seems to have failed to gain traction among voters, fossil energy stakeholdershave been credited with motivating Republican office holders to act. Their efforts reportedly include model bills created by the American Legislative Exchange Council (ALEC), which has established a right-wing reputation with an emphasis on protecting fossil fuels.
“The finance industry is now grappling with a second year of attacks on ESG by key members of the Republican Party, including threats of litigation from state attorneys general, as well as outright bans on the strategy in some U.S. states,” Marsh and Pham of Bloomberg noted.
The attacks prompted one of the highest-profile proponents of the ESG investing movement, BlackRock CEO Larry Fink, to stop using the acronym altogether.
“I don’t use the word ESG any more, because it’s been entirely weaponized … by the far left and weaponized by the far right,” Fink told a gathering at the Aspen Ideas Festival last summer, as reported by Reuters. In the same speech, he reaffirmed BlackRock’s commitment to discussing decarbonization, corporate governance and social issues with the companies in its portfolio.
Financiers fight back
Despite the political headwinds, financial stakeholders continue to act in support of social and environmental principles. Part of the effort is happening behind the scenes, as financial stakeholders seek to convince legislators that anti-ESG bills will result in financial harm to their states.
In a recent analysis, S&P Global identified 12 states in which Republican legislators “successfully pushed anti-environmental, social and governance legislation across the finish line.” In all, 19 states now have one or more anti-ESG laws on the books.
That may seem like a substantial gain, but the legislative failures outweighed the successes. “Many anti-ESG bills introduced in 2023 … failed after chambers of commerce, banking associations and public pension officials raised concern over costs or free market principles,” S&P observed.
In addition, only four of the 25 new anti-ESG laws to pass this year remained intact by the time of the August analysis. The other 21 were substantially revised to protect state pension funds. S&P cited Indiana and Texas as examples, both of which would have faced billions in losses over 10 years without the revisions.
Taking it to the courts
Financial stakeholders are also taking their case to court. For example, last month the Securities Industry and Financial Markets Association (SIFMA) — an industry group that counts BlackRock among its members — moved to challenge new Missouri rules on ESG documentation.
The rules went into effect on July 30. As described by SIFMA, they stipulate burdensome documentation that no other state requires. SIFMA argues that the new rules put Missouri in direct conflict with the 1996 National Securities Markets Improvements Act, under which states cannot preempt standard federal record-keeping rules.
“Under existing federal securities laws, broker-dealers and investment advisers are already required to provide investment advice that is in the best interest of their customers,” the group argued as it announced the suit. “The Missouri rules are thus unnecessary and create confusion.”
The climate factor
New reporting rules established by the European Union may also motivate U.S. companies to continue making progress on ESG principles, regardless of what’s happening at home.
The new EU Corporate Sustainability Reporting Directive became effective last January. “This new directive modernizes and strengthens the rules concerning the social and environmental information that companies have to report,” the European Commission’s website reads. The new rules cover large companies as well as small and midsized companies.
In June, the Republican-led ESG Working Group in the U.S. House of Representatives released an interim report that recommended protecting U.S. companies from “burdensome EU regulations.” However, Republican leadership will have a hard time reconciling protectionism with their party’s longtime support for free market principles.
The anti-ESG movement is also floundering on the national stage. Surveys routinely reflect public support for ESG principles. Moreover, high-profile Republicans aren’t helping the case.
The hapless presidential campaign of Florida Gov. Ron DeSantis is one example. Among other issues, the Republican governor has cultivated a reputation for opposing ESG investing, highlighted by a high-stakes legal feud with Florida’s top employer, Disney, over LGBTQ rights.
Another example is the looming impeachment of Texas Attorney General Ken Paxton, a prominent anti-ESG Republican, on charges of corruption and bribery. His wife’s reported involvement with a shell company has raised additional questions about allegiance to the principles of fiduciary duty.
Looming over all this is climate change, a factor from which Florida, Texas and other anti-ESG states are hardly immune. With the exception of fossil energy stakeholders, the rising threat of climate risks will continue to influence and motivate corporate behavior regardless of the outcome of the upcoming 2024 proxy season.
Tina writes frequently for TriplePundit and other websites, with a focus on military, government and corporate sustainability, clean tech research and emerging energy technologies. She is a former Deputy Director of Public Affairs of the New York City Department of Environmental Protection, and author of books and articles on recycling and other conservation themes. To see the original post, follow this link: https://www.triplepundit.com/story/2023/esg-down-not-out/782776
By Lucy Buchholz from Sustainability Magazine • Reposted: September 09, 2023
The 2023 Fairtrade America Consumer Insights report reveals that 61% of Americans now identify the Fairtrade label, marking a 20% increase since 2021
The world’s most recognised label for social justice and sustainability, Fairtrade America, shared that recognition for the mark has more than doubled in the last four years – marking monumental progress.
According to the 2023 Fairtrade America Consumer Insights, 61% of American consumers now recognise the Fairtrade Mark, an increase of 20% from 2021.
The online study – which surveyed 2,000 American consumers and 11,000 from across 12 countries – disclosed that four in five consumers are willing to pay more for ethical and sustainability-sourced products, despite the cost of living crisis. Additionally, these findings demonstrate that shoppers are prioritising transparency amongst supply chains.
“Shoppers in the US are driving change with their purchasing power,” said Amanda Archila, executive director of Fairtrade America. “We are energised by these results and remain focused on increasing the US market for Fairtrade-certified products by meeting consumers where they are in their sustainable shopping journey and building strength with farming communities around the world.
Consumers demonstrate a growing trust in the Fairtrade mark
As trust in the Fairtrade label has steadily grown, 85% of US shoppers believe that featuring the label positively influences their perception of a brand.
In fact, two out of every three shoppers familiar with Fairtrade prefer retailers that stock certified products and globally, the Fairtrade mark remains the world’s most recognised ethical label, with 71% of shoppers having encountered it.
Among Fairtrade-certified products, coffee takes the lead with 48% recognition, and consumers are willing to pay up to 35% more for a bag of Fairtrade-certified coffee. Fairtrade chocolate closely follows with 43% visibility, and shoppers are ready to pay a premium of up to 55% for a Fairtrade-certified chocolate bar.
“We firmly believe that businesses can grow responsibly while ensuring that farmers and workers who grow our favourite foods including cocoa, coffee and bananas get a fairer deal,” Archila, adds. “And it’s clear that consumers are demanding the same.”
By Maggie Ellison from myhfa.org • Reposted: September 9, 2023
Are you aware of your surroundings? In tune with movements, trends, and fads? Understanding of the dynamic shift of generational mindsets? Giving back in big ways? Sharing your commitment to good? Consumers practically demand brands to share a deep compassion for the community they serve.
In a world of increasing social awareness, today’s consumers seek more than just a product or service. They’re seeking brands that align with their values and are dedicated to positively impacting society. According to one study, 70% of consumers said it’s important for brands to take a stand on social and political issues. It’s no longer a question of whether consumers care about brands being socially conscious but how you can integrate community and caring into your business. When you demonstrate your brand’s social responsibility, it isn’t just a marketing strategy – it reflects your values and commitment to making a positive impact.
Here are five ways to demonstrate your brand’s efforts toward corporate social responsibility:
Foster Employee Engagement
A great place to start showcasing your brand’s dedication to the community and the world is by starting with your team. One study found that 60% of employees choose a workplace based on their beliefs and values. Establishing core values will help guide you and your employees and serve as a starting point for determining appropriate causes to support. Encourage your team to get involved with volunteerism and partake in discussions about company values to help them develop a connection to the cause your company is championing. A team that believes in its cause is most likely to amplify your brand’s positive impacts!
What can you keep doing or start doing to ask your employees what matters to them?
Advocate for Causes That Align with Your Company Values
Pick a social or environmental cause that resonates with your brand’s values and aligns with your audience’s interests. From climate change to social inequity, you can use your platform to raise awareness and showcase your brand’s dedication to current events. 58% of consumers will buy or advocate for a brand based on their beliefs and values. Word-of-mouth marketing like that builds trust and community around a brand that is difficult to replicate any other way. Include messaging on furniture tags highlighting the cause – did a tree get planted for every couch produced? Did a child in need receive a backpack of school supplies for every hand-crafted table made in an impoverished area? Let people know that. Signage, tags, literature, social media tagging, and marketing messaging are easy ways to translate what matters to your customers. Commit to the commitment.
How can you highlight in all marketing channels your commitment to a cause?
Partner with Charitable Organizations
Collaborating with established organizations will ensure your efforts have a lasting impact and provide tangible support to the cause you’ve chosen to promote. This is a powerful way to leverage your brand’s reach for a good cause. Allow the partner organization to host a table within your brick-and-mortar, include their messaging in banner ads on your website, provide a give-back option for your customers to round up, and provide those funds to a non-profit that aligns. Another terrific opportunity is co-branding products or services or offering a simple add-on for customers where a percentage or all proceeds benefit the cause. This plus-up can be powerful, and the impact is far-reaching. Building trust with your audience is vital to a brand’s success, and partnering with trusted organizations to make change happen will show customers that your dedication to social change is more than a marketing tactic. 40% of consumers believe the best way for brands to display social responsibility is to collaborate with a non-profit organization dedicated to that cause.
What can you do to amplify your chosen cause and provide impact?
Engage with Your Community
Engage with your community by sponsoring local events or supporting local charities to connect with your audience face-to-face. An experiential marketing campaign that directly engages with your audience about the causes your brand cares about can foster a sense of community and shared responsibility by educating attendees and encouraging them to participate in problem-solving actively. Experiential marketing campaigns can boost your brand awareness and create loyal customers. 74% of consumers said engaging with experiential activations made them more likely to buy the promoted product. Also, 98% of consumers create social content from their experiences, and 100% share the content they create. Highlighting a social issue that resonates with your brand during community events can foster a stronger connection with your audience.
What can you step up to sponsor, or what events can you showcase your brand that impacts the community?
Be Transparent and Authentic
Throughout it all, communicate with transparency and authenticity to naturally build customer trust. By clearly articulating your brand’s core values and mission, your audience will understand what you stand for and develop a deeper relationship with your brand. In 2022, 60% of consumers said that trustworthiness and transparency were the most important traits of a brand. Consumers want to know that their money is going to a trustworthy company that will use its power to improve the world. This is why it’s important to regularly showcase your company’s steps to contribute positively to society, like charitable partnerships, co-branded products, advocating for products that are making a difference, and community engagement. By continuing to promote a social cause relevant to your brand, your audience will come to trust you for what you provide and what you stand for as a company.
How is your brand speaking to the public? Is it authentic?
Integrating social responsibility into your brand identity goes beyond superficial gestures – it’s about creating a meaningful and lasting impact. Whether through sustainable practices, ethical partnerships, educational campaigns, or community engagement, every step your business takes can contribute to a better world and deeply resonate with your customers. By aligning your brand’s core values with meaningful action, you’re building a loyal fan base and driving positive change. Remember, when you demonstrate a socially responsible brand it is more than a label; It’s a catalyst for change, and consumers today demand commitment.
A recent poll by the Smithsonian Science Education Center and Gallup finds that while a majority of U.S. teachers say they want to teach lessons in sustainable development, they do not have the supports in place to do so. Stock Photo via Getty Images
Topics like climate action and clean energy are some of the least likely topics to be found within sustainability school lessons, according to a Smithsonian-Gallup poll. By Anna Merod from K-12dive.com • Reposted: September 8, 2023
U.S. teachers feel they have far fewer supports to teach topics on sustainable development compared to those instructing in countries like Brazil, Canada, France and India, according to a poll released Tuesday by the Smithsonian Science Education Center and Gallup.
Educators in those four countries were three times more likely on average than U.S. teachers to say they have enough support to instruct on sustainability — a stark difference of 60% versus 17%.
Despite the lack of resources, the poll found a majority of U.S. teachers see value in teaching sustainability: 83% say such curriculum can have a positive global impact, while 79% say it can benefit local communities.
Insight:
Socio-scientific topics within sustainability curriculum are especially nonexistent in U.S. classrooms, as teachers shared that this type of content was the least likely to be found in their lessons, according to the Smithsonian-Gallup poll.
For instance, 32% of U.S. educators said climate action, as well as clean water and sanitation, are dedicated parts of their curriculum. While 31% cited clean energy and responsible consumption, and 26% said information about sustainable communities was included in lessons.
“We were shocked to see that the topics we would define as socio-scientific like climate action, sustainable communities, clean water, clean energy were at the bottom of that list” in regard to U.S. curriculum standards, said Carol O’Donnell, director of the Smithsonian Science Education Center.
The United Nations Educational, Scientific and Cultural Organization defines sustainable development as “a resolution to meet the needs of the present without compromising the future.” Specifically, the United Nations created 17 goals tied to sustainability that fall under a “shared blueprint for peace and prosperity for people and the planet, now and into the future.”
The Smithsonian-Gallup poll, which surveyed over 2,500 teachers and administrators in spring 2023, explored 11 of those 17 goals, including climate action, clean energy, clean water and sanitation, innovation, justice, reducing inequality, and good health and wellbeing.
U.S. teachers also said they have a lack of expertise (74%) and instructional materials (76%) to teach sustainability.
“It’s just a reality that STEAM standards or STEM standards don’t exist in large scale across the board in schools and districts,” said Monique Chism, undersecretary for education at the Smithsonian. “So when you think about curriculum resources, professional development, time for teaching this content — it’s not surprising, because it’s not something that’s been a priority that’s been placed on standards and curriculum in the system.”
While climate education pushback has surfaced in recent years, Chism said she prefers to believe the gap in resources to teach sustainable development is likely unintentional. Based on the survey, Chism said it’s hard to exactly pinpoint why K-12 schools often lack these supports.
But as schools continue to face teacher shortages, brace for budget shortfalls, and address much-needed maintenance repairs, administrators and teachers are really trying to do the “best they can” while trying to solve these broader challenges, Chism said.
Chism added it’s clear from the poll that teachers have a desire to teach sustainability intertwined with other subjects beyond science. More than 70% of U.S. teachers each said instructing on this topic can make science more accessible to students and increase their interest in current events.
State curriculum standards are beginning to shift toward sustainable development topics, O’Donnell added. For instance, she said, environmental science standards are integrated into science lessons throughout California schools. New Jersey and Connecticut now require lessons on climate change and climate education, respectively.
“We are starting to see states start to come up with this idea that sustainability matters,” O’Donnell said.
By Ken Moore from Fast Company • Reposted: September 8, 2023
Most consumers today want to buy from brands that align with their values—it’s more important to them than cost and convenience, brand loyalty, or product functionality. They will pay more for products and services that tangibly support their social, ethical, and environmental objectives—and abandon those that don’t. This sentiment has strong roots in the youngest consumers: An extraordinary 84% of teens told researchers they strive to buy based on their beliefs.
There is mounting evidence that companies benefit when they heed this message: A study from South Korea, published in January, found that food and beverage companies with strong reputations for their environmental and social initiatives generate more consumer trust and positive word-of-mouth. Unilever’s purpose-led Sustainable Living brands have grown more than the rest of its business. And new research from McKinsey found that products that made claims about their environmental, social, and governance (ESG) performance outsold products that did not.
This seems like a simple equation: Consumers will reward companies with convincing ESG stories, and those brands thrive. There is a problem, however. Only 4 in 10 consumers say they have adequate data to make sound sustainable purchasing decisions. This may explain the complaint that customers say they support green, ethical, socially responsible companies with their wallets—but often don’t. They lack the information they need to follow through.
In fact, most businesses struggle to present a thorough, compelling story detailing their environmental impact: Only 13% can map their end-to-end supply chain and four out of five have no visibility beyond their immediate suppliers. Executives surveyed by IBM acknowledged that inadequate data is the biggest obstacle to their ESG efforts.
DATA-DRIVEN INSIGHTS
This will change over the next 5 to 10 years as companies deploy emerging technologies that unlock data to enable smarter supply chains and measure their end-to-end carbon footprint, organic production, recycling track record, and other outcomes. These include:
Visibility technologies that provide a complete picture of supply chain operations, from procurement of raw materials to shipment and use of end products
Blockchains to create an immutable audit trail that tracks the provenance and the movement of goods and include verified information regarding suppliers
AI, machine learning, and predictive analytics to extract insights from supply chain data. Generative AI has the potential to do the same with unstructured ESG data.
Companies with stellar sustainability results will presumably be the first to leverage these technologies to establish their credibility with consumers and other stakeholders including regulators, shareholders, and current and potential employees. If the population of value-driven consumers is as large and committed as it appears to be—particularly millennials and Gen Z—other companies will follow suit and new ESG reporting expectations will be set. Conscious consumers will be empowered to vote with their wallets.
Enterprises will also turn to emerging technologies to share this information with consumers precisely when, where, and how they want it—online, in the store, via QR codes printed on product packaging, through smart glasses and virtual reality (VR) goggles, or at the point of sale (digital or physical.) “With AR (augmented reality), brands can turn products, packaging, and places into digital discovery channels, surfacing their sustainability efforts through a humble QR code,” notes Zappar, an AR studio in Scotland.
Three-fourths of executives surveyed by IBM said their stakeholders understand their companies’ ESG objectives and performance, but there is a disconnect. Only about 40% of consumers said they have enough information about corporate sustainability to make purposeful decisions about what to buy and where to work.
That’s a problem. It’s no time for business leaders to assume their value-driven customers are on board, because consumers have made it clear they will jump ship for a competitor that can demonstrate strong ESG credentials. As we approach an era in which all companies will have the means to do that, leaders can seize a competitive advantage by providing conscious consumers with information that empowers them to do what they find difficult today—make purchase decisions that reward companies that align with their values.
By Tara Milburn, Forbes Councils Member via Forbes • Reposted: September 6, 2023
Failure stings, and when we feel we’ve done something wrong, we respond accordingly in order to diminish the chances of repeating the error. Nothing stings more than making the same mistake twice; we know this and usually do anything to avoid it.
Failure in our corporate system works in the same way. When things go wrong, the collective recruits resources to reduce the risk of a repeat. As it stands, 69% of consumersare actively concerned about climate change. Only 50% of executives feel their organizations’ strategies are reflective of their purpose, according to a study by Harvard Business Review and EY. The health of our planet and the purpose of our work are too important to get wrong twice; somewhere, our collective brain is recruiting some serious resources.
The impact of those resources is already taking effect. The twin crises of meaning and climate have quickly changed how we do business, and stakeholders are rewarding the effort. Companies that have established that clear, shared purpose within their organizations are seeing success—a 10% increase in growth in three years, according to the same HBR and EY report.
Similarly, consumers, investors and employees have all turned climate anxiety into action. According to findings from Gartner, 85% of investors prioritize ESG factors in their due diligence. Moreover, 66% of consumers pay more for responsible and sustainable products. Sixty-six percent of Gen Z employees opt for lower-paying jobs at more ethically and environmentally responsible companies.
Failure motivates us, and our societal shortcomings motivate profound and meaningful change in our businesses. Failure is a painful education, but finding these solutions could be worth every second. Here are a few ways business owners can follow the wisdom of failure toward a better way of doing business.
P&L&G: A New Kind Of Corporate Accounting
As business owners, we’ve learned to let the numbers do much of the talking. Profit and loss statements guide most of our decisions from hiring to business development to pricing. But stakeholders are making it clear that our “giving” is just as consequential to our corporate accounting, and it’s no longer just the thought that counts.
Before they make a purchase or an investment, individuals and institutions evaluate the social efforts of organizations. They’re looking for transparent ESG metrics, developed reporting, evidence of social impact and substantial long-term goals. Internally and externally, stakeholders hold organizations to higher sustainability standards, ESG transparency and social responsibility. They’re expanding the old definition of success as shareholder value; it makes good business sense for companies to take these fundamentals as seriously as they take their profit and loss (P&L).
Stronger internal cultures, heightened purchase motivation and improved long-term loyalty are proven outcomes of well-developed corporate impact programs. We can add better profit to that list; 82% of consumers“prefer a brand’s values to align with their own.” The support and the cause can take different forms. Many giants—Patagonia and TOMS come to mind—have made corporate responsibility famous with campaigns like 1% for the planet and “buy one, give one.”
Giving can also mean improving compensation and benefit structures, donating time to your immediate community, and supporting sustainability efforts across your supply chain.
Thoughtful Products Can Speak Louder Than Pledges
As companies put more resources into corporate responsibility, the impact will come from their actions. Stakeholders know it’s not what we say but what we do that matters. Small and actionable fixes reflect the larger aims of the corporation.
Employee gifts, customer outreach, and promotional products embody a company’s values. Opt for sustainable products, support small businesses and partner with thoughtful suppliers to walk the walk.
Sharing The Sharing: How Busy Teams Find Meaning
With a plan for giving and gifting, it’s time to delegate. Sharing the lift reduces the chances that a campaign is sidetracked. More importantly, delegation empowers your team to make the difference they want to see.
Choice-based gifting—offering your team ahead-of-time selection for their onboarding or holiday packages—can decrease waste and extend the chance to have a hand in supporting sustainable suppliers, small businesses and ESG leaders. Similarly, a recent study shows 86% of employees want to weigh in on their company’s corporate giving strategy by self-selecting charities or collectively deciding on the focus of a more extensive campaign.
When we make a mistake, we mobilize; we naturally make every effort we can to do things differently next time. In the same way, the failures of our societal and corporate structures are directing our next steps, showing us the improvements we can make. If we pay attention, the natural selection of our stakeholders could reduce our chances of committing the same collective errors and put us all on the path to a better kind of business.
By Janet Schijns from accelerationeconomy.com • Reposted: September 6, 2023
The U.S. recently pledged to cut agriculture sector emissions by 50% by 2030. The sector accounts for over 10% of the overall emissions, making it a great first target. Once thought of as a “nice-to-have,” sustainability has now become a must-have not only for agriculture but also for businesses across every sector due to consumer expectations, climate change pressures, and numerous policy changes. This shift to the main stage underscores the importance of technological collaboration in formulating and executing responsible strategies that emphasize energy efficiency, carbon reduction, and waste management. This is where great partnerships can ease the burden for firms by helping them make sustainability matter.
Model Sustainability Partnerships
The Accenture Technology Ecosystem is an example of an ecosystem play in this arena. With more than 350 partners and suppliers, each selected for its exceptional, market-relevant offerings, Accenture leverages comprehensive industry insights and data-driven analytics to determine potential strategies to future technological needs. The Accenture Technology Ecosystem strives to lead in sustainability through its integrated approach.
Another example is how Microsoft, in partnership with Accenture and Avanade, is making significant strides towards a more sustainable future. This partnership is proving its worth as it embraces green software development principles, sustainable cloud migrations, and digital twin technology adoption. These efforts drive stronger performance, competitiveness, and progress toward their decarbonization goals and the journey to net zero emissions. Its joint sustainability efforts, particularly its pivotal role in the Green Software Foundation, showcase a collective commitment to constructing a trusted ecosystem that supports environmentally responsible software development.
Finally, Chrome OS demonstrates an exemplary commitment to sustainable computing. Through its cloud-first platform, which prioritizes energy efficiency, Chrome OS has created a progressive method for more sustainable computing. Collaborations with partners, including Insight Enterprises and CDW, further the goal of systemic change, enhancing efficiency across various operational areas.
Sustainability Across Industries
Sustainability extends across diverse industries, each with distinct applications and benefits that can be brought to the market by a variety of partners:
Automotive Industry: Manufacturers can utilize advanced tracking mechanisms to monitor their sustainability efforts. By setting and continually evaluating targets, they can enhance their performance in reducing environmental impact, focusing on energy consumption, waste production, and water usage. IoT partners are helping those in this industry adapt their processes and systems to utilize their technologies for sustainability gains.
Banking Industry: Green bonds and loans symbolize the integration of sustainability into financial practices. Data analytics enable banks to identify and invest in environmentally friendly projects and reduce their carbon footprints. Fintech-friendly tools from independent software vendors (ISVs) are helping to make this banking industry future a reality today.
Energy Sector: Embracing renewable energy sources such as solar and wind power, energy companies are utilizing data analytics to optimize operations and decrease environmental impact. But these efforts require a multitude of partnerships to develop software and equipment as well as do installations and service.
These are just a few examples — the widespread adoption of sustainability across various sectors reveals a transformation in corporate values and operations. Companies are not merely adopting sustainability as a trend but are integrating it into core business practices. They are guided and supported by technology partners who drive innovation and efficiency.
Finding the Right Partner
So, just how do you understand what will make a great partner for your business? Let’s explore that a little more here:
Identify the Right Partner
In the quest for sustainability, choosing the right partner is akin to finding the perfect piece in a complex puzzle. An ideal partner should have a shared vision and commitment to sustainability, backed by tangible actions and track record. Assessing a potential partner’s corporate values, technological capabilities, industry expertise, and alignment with the specific sustainability goals is essential. Conducting a thorough due diligence that includes their previous sustainability initiatives, compliance with environmental regulations, and cultural fit with your organization ensures that the collaboration rests on a foundation of common purpose and integrity.
Structure a Clear, Comprehensive Agreement
A partnership for sustainability requires a clear and comprehensive agreement, a legal tapestry weaving together shared goals, responsibilities, and performance metrics. Defining specific roles and responsibilities for each party, along with setting measurable objectives, timelines, and key performance indicators (KPIs), is essential. The agreement should also encompass financial arrangements, resource allocation, governance structures, and conflict resolution mechanisms. Furthermore, incorporating flexibility to adapt to changing regulations, market conditions, or technological advancements ensures that the partnership remains resilient and responsive to evolving sustainability landscapes.
Ensure Collaboration and Continuous Improvement
An effective sustainability partnership transcends contractual obligations and enters the realm of true collaboration and innovation. Regular communication, transparency, and joint decision-making fortify the partnership, making it more than a mere transaction. Implementing a robust monitoring and evaluation system to track progress, coupled with a commitment to continuous improvement and innovation, cultivates a dynamic collaboration. Encouraging creativity and fostering an environment where both partners can contribute ideas, insights, and strategies ensures that the partnership thrives, continually advancing towards sustainability goals with mutual respect and shared success.
Final Thoughts
By carefully selecting a partner with shared values, meticulously crafting a well-structured agreement, and fostering a culture of collaboration and continuous improvement, organizations can set the stage for a successful and enduring partnership for sustainability. It’s more than a business transaction; it’s a collective journey towards a greener and more responsible future.
Sustainability represents a complex, multifaceted challenge for modern enterprises. The collaboration between technology ecosystem partners and various industries is forging a path toward a more responsible and sustainable future. This movement is no longer confined to isolated initiatives but is manifesting as a comprehensive approach to business, reflecting a profound shift in corporate responsibility and ethical governance.
By Antony Yousefian via Sustainable Brands • Reposted: September 4, 2023
Applied to food supply chains, ambient IoT allows farmers, distributors, grocers, regulators and consumers to know where food came from, how far it traveled, how it was transported and stored, and what condition it’s in — in real time.
The world can’t count on carbon offsets to deliver us from the climate crisis. As helpful as it may be for corporations to offset some of their emissions, the greatest force for good is the everyday citizen. Specifically, it’s the well-informed, carbon-savvy grocery shoppers who buy sustainably grown produce — not just because they know the carbon footprint of bananas, zucchini, or beef; but because it’s also clear which farmers are regenerating the land to support a healthy planet.
How on earth can shoppers know? By tracking everything, everywhere, all the time.
My time in the financial markets drew me to climate tech startups and the importance of impact investing. Indicators from our planet were signaling code red. At the same time, the increased frequency of supply chain disruptions from biodiversity decline and climate change was hitting corporate profitability.
Investment funds focused on environmental, social and governance (ESG) commitments were ballooning; but I struggled to quantify or have visibility into exactly which corporations, or their products, were actually “doing good.” Quantification of the E in ESG was a real problem; and it was a multitrillion-dollar opportunity that made sense on all levels.
Since then, I’ve been involved with various innovative companies committed to tackling the issue head on — from carbon removal in supply chains to restoring biodiversity in soils. The latter led me to agriculture technology (AgTech) and the cutting-edge field of the Ambient Internet of Things(IoT) — a system of ubiquitous Bluetooth tags and cloud-based software that makes anything traceable and intelligent.
One of my first ventures into AgTech was to leverage IoT to measure leaf temperatures, soil conditions and root health — all key to driving sustainable farming decisions. It gave food producers the tools to see or digitize their risks in real-time, make improvements, and share the results with the supply chain. But the cost to acquire the data was high, which hindered scalability.
Ambient IoT changes the whole calculus because it’s based on ultra-low-cost, battery-free, stamp-sized computer sensors that can go anywhere and communicate wirelessly with existing systems or off-the-shelf, standardized network devices. Applied to food supply chains, ambient IoT allows farmers, distributors, grocers and even regulators to know where food came from, how far it traveled, how it was transported and stored, and what condition it’s in — and not only back when the food was harvested, packed or put on a truck; but in real time.
Taken together, ambient IoT data — location, time-in-transit, temperature, humidity and more — provides crucial primary data to calculate the carbon footprint not just of the food companies involved but of every individual product on a supermarket’s shelves. It’s a chief sustainability officer’s dream. Armed with this information, we as citizens can be given a choice to select food products that make the planet healthier — to do our part by eating sustainably.
Carbon visibility and trust
In a recent study by the Boston Consulting Group, 77 percent of consumers said they were concerned about the sustainability of the food they buy; 63 percent said they were trying to shop more sustainably. Their challenge? Acting on their concern.
There are a couple of reasons it’s hard for consumers to shop for sustainable food (or for that matter, sustainable clothes, cosmetics or household supplies). First is that they don’t always know which groceries are, in fact, sustainable. Second is that they’re not sure who they can trust.
In stores, consumers are bombarded by signs and food labels touting “local,” “organic” or “sustainable.” But when it comes to climate impact, such messaging can be confusing, if not misleading. Locally grown vegetables may have been stored in carbon-hungry refrigeration or cultivated in greenhouses that emit more carbon than a slow boat from another continent. And those organic fruits may have been grown with regenerative practices on a different continent and flown (then, driven miles) to the store. Yet each product does, indeed, have an individual carbon footprint that can be traced.
But in the absence of product-level carbon data, consumers look to brands for guidance, seeking those committed to “net zero” or other pledges to protect the climate. These are laudable efforts but susceptible to what the public and regulators have come to identify asgreenwashing — an act of climate fraud best combatted with credible, real-time data.
Not to mention, even responsible companies can only report on their sustainability commitments annually or quarterly — whenever a report is finished. Even monthly reporting falls short of what should be the standard for carbon tracing in the food chain: real-time, product-level carbon visibility. And only the ambient IoT can achieve that.
In response, regulators have taken it upon themselves to require producers of all kinds to prove sustainability claims through data. The best way to do it reliably and consistently is through meaningful, real-time metrics delivered through a credible medium.
Consumers live in a real-time world of social media feeds, fitness trackers and generative AI. Carbon visibility should be the next killer app — not only as it relates to what people eat but what they wear, where they vacation, and more.
Whether on people’s smartphones or via smart, digital shelf signage, supermarkets can use ambient IoT data to deliver carbon visibility the same way they engage shoppers in points clubs, digital coupons, and other social media-style promotions. Yes, gamification can help save the planet when it leads to more sustainable food consumption.
Unlocking the benefits of ambient IoT
Real-time carbon visibility is just part of the ambient IoT equation. Companies that deploy an ambient IoT infrastructure can solve other challenges, some that further support their climate goals and others that align the planet with profitability.
In addition to tracking the carbon footprint of products in their supply chain, companies can use ambient IoT data to capture missed revenues and reduce food waste. Ambient IoT can collect environmental data on elements such as temperature and humidity, even in stores and trucks, which determine freshness and shelf life. And it produces data to comply with new supply chain regulations and ensure food safety. Until now, most compliance checks have been manual, expensive and ad hoc. Ambient IoT automates compliance and cuts costs because now every product effectively shouts its status (i.e., sends data packets) on the way to supermarket shelves.
But ambient IoT is capable of even more. In the long run, to combat climate change, we must use it to restore biodiversity and put carbon back into the ground. The food system can achieve these goals through regenerative agriculture, which improves the health of soil and creates healthy plants and nutrient-rich food. There is already an ecosystem of innovative solutions to help measure the process of regenerative agriculture and accelerate its adoption. Ambient IoT has a role in that measurement.
Ultimately, ambient IoT will help mobilize data about the land and nature’s status. It can determine whether that next meal is traceable to a healthy, sustainable, regenerative source. Already, major initiatives like the EU’s regulation on deforestation-free products and the USgovernment’s Food Safety Modernization Act will require companies to prove they know where food comes from. This is a game-changer because it requires visibility into the flow of goods and materials and the ability to identify who is contributing to regenerating the land.
I’m confident that when citizens are turned onto this level of visibility, we’ll see them over-consume delicious, healthy meals. That’s how we eat our way out of climate change.
In today’s business landscape, sustainability has emerged as a core component of successful strategies. With growing concerns about climate change, social responsibility and environmental impact, organizations are increasingly integrating sustainable practices into their operations.
However, despite the abundance of sustainability strategies and environmental, social and governance (ESG) reports, there remains a lack of comprehensive assessment criteria. This gap makes it challenging for businesses to develop and formulate functional sustainability strategies that can adapt to new problems or prompt innovative solutions to existing problems.
In order to address this issue, the following is a proposed assessment model for driving business sustainability and measuring impact and effectiveness.
1. Identify the key performance indicators.
The first step in developing an effective assessment model is to identify the KPIs specific to sustainability. These KPIs will serve as measurable metrics to provide insights into the success of sustainability initiatives. By defining and monitoring these indicators, organizations can assess their performance and progress towards sustainability goals.
KPIs may include energy consumption, greenhouse gas emissions, waste reduction, water usage, employee engagement and social impact. Sustainability Magazineactually listed five widely utilized KPIs: carbon footprint, consumption of energy, supply chain miles, waste reduction and recycling rates and social impact.
The bottom line when it comes to KPIs for sustainability strategies continues to be the ESG impact that an organization has. So, in addition to the suggested KPIs, it is essential that as a business owner, you draw up your own parameters that help you assess the environmental and social impact your business has.
2. Establish baseline data.
Before implementing sustainability strategies, it’s crucial to establish baseline data. This represents the starting point against which progress can be measured. It provides a reference for organizations to assess the impact of their initiatives and determine the extent of improvement achieved.
Baseline data can include historical records of energy consumption, waste generation, carbon footprint and other relevant parameters. This data serves as a benchmark and enables organizations to track their progress over time.
A broader set of baseline data could contribute to more effective goal-setting in terms of sustainable planning and a more actionable strategy since you have the silhouette of a goal in sight. Baseline data can also be different for different sectors.
3. Set targets.
Setting clear and ambitious targets is a key component of any effective sustainability strategy. Targets provide a sense of direction and purpose, helping organizations focus their efforts towards achieving specific environmental and social objectives.
Align your targets with global sustainability goals, such as the United Nations Sustainable Development Goals (SDGs). You should aso ensure your goals are specific, measurable, attainable, relevant, and time-bound (SMART). By setting targets, your organization can strive for continuous improvement and drive meaningful change.
4. Implement sustainability initiatives.
Once the KPIs, baseline data, and targets are established, it’s time to implement sustainability initiatives. These initiatives can range from energy-efficient practices and waste reduction programs to social impact projects and supply chain optimization.
The implementation phase requires collaboration and coordination across various departments within your organization. Effective communication, training and engaging employees are essential to ensure the successful execution of sustainability initiatives.
Your implementation should not mirror that of a competitor—or any other company—but should be unique to the way your organization will reap the maximum benefits.
5. Monitor and evaluate progress.
Continuous monitoring and evaluation are vital to assess the progress of sustainability strategies. Organizations need to track identified KPIs regularly and compare them against the established baseline and targets. This monitoring process provides valuable insights into the effectiveness of implemented initiatives, identifies areas for improvement and enables data-driven decision-making.
Regular evaluations help your organization identify potential challenges, address gaps and make adjustments to strategies to ensure long-term sustainability success.
Evaluating sustainability performance is a challenging task, but researching organizations in your industry and geography can help as you study the trajectory of their strategies and achievements, or lack thereof.
6. Strive to continuously improve.
Sustainability is an ongoing journey, and organizations must strive for continuous improvement. The assessment model should promote a culture of learning and innovation, encouraging organizations to constantly seek new opportunities and approaches to enhance their sustainability strategies.
Feedback loops, stakeholder engagement and external benchmarking can help organizations identify emerging trends, best practices and areas where they can push the boundaries of sustainability. By embracing a mindset of continuous improvement, organizations can remain adaptable and resilient in the face of evolving sustainability challenges.
It’s essential to recognize that this assessment model is not a one-size-fits-all solution. Organizations should customize it based on their unique circumstances, objectives and stakeholders. The model serves as a starting point, providing a structured approach to evaluate sustainability strategies.
By leveraging the core components of this model, organizations can identify gaps, measure successes and continually refine their strategies and policies. Creating a sustainable culture in this way allows them to drive meaningful change and contribute to a more sustainable future.
Highlighting the impact of individual purchases and their associated emissions output, the app — fresh off a large funding round — is evolving to meet the daily spending directives of its users.By Geoff Nudelman from Sustainable Brands • Reposted: September 1, 2023
There’s a lot of emphasis being placed on consumer spending as a real way to drive measurable impact in the fight against climate change; but for many everyday consumers, it remains one of the most confusing avenues of action. There are dozens of standards and certifications to understand, along with a never-ending stream of data connected to purchases (both good and bad).
That’s where the potential of consumer spending/emissions measurement app Commons comes in. The app — which was launched in 2019 as Joro and relaunched this March under its current name — allows consumers to connect credit cards, bank accounts and other financial information to a system that measures the emissions output of every purchase; and it offers multiple ways to reduce impacts — whether through simple switches, more involved spending transitions or via the purchase of verified offsets.
“We learned a lot about what people were actually looking for,” Commons founder Sanchali Pal told Sustainable Brands®, noting that the app began primarily as a carbon tracking and offsetting platform. “It’s more about the spending choices we make — and that this is not one person’s responsibility, but the collective’s.”
The app is only a few years old; and while the company doesn’t share full user data, Pal said users are in the “tens of thousands.” Commons is currently available in the US and Canada(with most users in the former), and mostly used in large cities by the 25-55 demographic. So far, the app has raised $13.5 million — the company says investors include Sequoia Capital, Norrsken, entrepreneurial platform Incite, climate investors Amasia; and the founders of Headspace, Fitbit, Candy Crush and Nest; as well as public figures including actor Maisie Williams, Incubus’ Mike Einziger and Arrive, (the VC arm of Jay-Z’s Roc Nation empire).
Like a lot of tech companies and apps, the leverage is in the collected data — and the trends and spending shifts that the data show. Commons’ demographic, which is likely somewhat affluent (Pal shared that most users have a credit or debit card), offers a small snapshot of how these changes can drive impact in large, urban areas in the US and Canada. It also helps users understand the realistic impact of their purchases.
“Something that people don’t realize is that the goods and services we buy also have a footprint,” Pal says. “People are quite surprised by something like a t-shirt and how that compares to the footprint of eating a burger, for example — or how driving can have a similar footprint to buying makeup. Products and services having that footprint is a novel idea for many people.”
Pal notes that one area where the app is noticing a larger shift is in buying secondhand. The number of Commons users shopping secondhand grew 48 percent between 2021 and 2022; and Pal says content on the app and website associated with shopping “more sustainably” for apparel is some of its most popular.
There are also broader shifts happening in the ways Commons users get around. According to its 2022 Impact Report, 40 percent more Commons users took public transit in 2022, compared to 2021; and users already taking public transportation did so 75 percent more often. App users also bought 63 percent less gas than the average US consumer in 2022 and 36 percent less gas than in 2021. Lastly, it’s no surprise that Commons users also use EV stations at a high clip.
According to Pal, in 2022 the average user reduced their emissions by 20 percent and saved $200 a month via all the app has to offer.
To provide realistic updates on the impact of a particular purchase, Commons updates its data daily, monthly, quarterly or annually — depending on the specific metric. Pal notes the example of gas prices, which the company analyzes daily since the price per gallon regularly fluctuates; and the numbers Commons uses also needs to reflect inflation and other economic movers. In other cases, the movement isn’t enough to measure more than once every few months (for something such as more expensive durable goods).
Education a key component
Almost anywhere you move inside the Commons app, there’s an opportunity to learn. Whether it’s about the impact of taking one less flight or comparing your footprint to those of other users; there’s no shortage of measurable, comparable and, most importantly, actionable advice.
“Users may be looking for the kind of thing they didn’t know how to act on before using our products,” Pal says. “They may have been interested in what could have the most impact in their lives but didn’t know where to start. We have found that folks who are quite educated (on sustainability) still find the product useful.”
I was rather impressed by this once I linked up my own credit card and saw my spending data populate through the app. The home page shows a graph estimating the emissions output of all my purchases on that card in the current month and compared to prior months of my choosing.
One of the app’s newest features is breaking down purchases under a “sustainable purchases” category — which singles out specific purchasing categories such as public transit, rideshare, renewable energy and more. Under Commons’ classifications, I make few “sustainable purchases” — which I’m not particularly sure I agree with, but I would assume that category will continue to be refined.
I also appreciated a level of transparency and discussion around Commons’ choices of offsets. The company’s Offset Portfolio operates under four pillars, and users can take a rather deep dive into understanding the value and impact of each offset under each pillar. Inside the app, I was prompted to pay a certain amount each month to support these offerings (somewhat commensurate with my estimated emissions output) — which, if I took the time to sift through all of the information, I’d likely find a compelling way to reduce my personal impact.
Of course, only having “tens of thousands” of users as the sample population is ultimately a small slice of the entire consumer pool — but certainly enough to potentially influence some changes within a certain, finally comfortable section of the spending public. I could see myself making some small changes based on seeing the data there in plain sight. Once you have the graphs and metrics nicely laid out in front of you, it becomes clearer to see how the collective impact in how and where we spend could make a big difference.
“One of the advantages of what we’ve built so far is that we can connect with you no matter where you spend money,” Pal says. “Ultimately, we’re trying to shift spending behavior and show how money matters.”
Image credit: 
Eric Block On Responsible Branding 
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