By Ignacio Gavilan Director, Sustainability, The Consumer Goods Forum – From the Consumer Goods Forum • Posted: February 18, 2023
Our relationship with plastic needs to change, and fast. The urgency around the plastics issue has been felt even more keenly since negotiations for a legally binding global plastic treaty began last month. There is no doubt that plastic can have an important role in getting people certain food, drinks and other products in a safe and reliable way. But it is critical that we use less plastic and, wherever possible, better plastic to protect the natural environment while meeting the needs of our growing global population. Ultimately, we need a better system that supports a circular economy for plastics, where it is used again and again in many forms, instead of becoming waste or pollution.
For the consumer goods sector, this means dramatically stepping up our game when it comes to redesigning plastic packaging upstream while increasing collection, sortation and recycling downstream. Unfortunately, there is still a lot of plastic packaging that is designed poorly. For example, a lot of plastic packaging still contains problematic materials like PVC, meaning that most plastic packaging still isn’t recycled and ends up in landfill or incineration.
This is why the 40 retailers, consumer brands and convertors in The Consumer Goods Forum’s (CGF) Plastic Waste Coalition of Action worked with industry experts, recyclers and plastics associations from over 25 countries to develop the Golden Design Rules for plastic packaging. Thirty-three leading multi-national companies have now signed up to implement one or more of these rules across their plastic packaging portfolios by 2025. These rules are a set of voluntary, independent and time-bound commitments that aim to minimise waste, streamline designs and simplify the plastic recycling process – ultimately increasing recycling.
The rules are building momentum to deliver the further design changes necessary to meet the targets laid out in the New Plastics Economy Global Commitment. Set up by the United Nations and the Ellen MacArthur Foundation, the Commitment is a global initiative to create an entirely circular plastics economy.
There are nine Golden Design Rules. The first is of particular significance. It focuses on increasing the value of PET recycling. PET is polyethylene terephthalate, one of the most common plastic materials. Typically, it’s used in food containers, drink bottles and the synthetic textiles in our clothing. In fact, PET bottles represent 13% of all plastic packaging on the market. Consequently, improving PET recycling is essential to achieving a circular economy for plastics.
One of the key issues with PET recycling is the use of pigments and dyes in plastic bottles, which can make it difficult and expensive to sort bottles into different colour streams for recycling. However, recycling lots of different coloured PET bottles together means you end up with a murky, low quality recycled plastic that isn’t suitable for use in consumer packaging. Unfortunately, this means that many plastic bottles still aren’t recycled back into plastic bottles.
Golden Design Rule 1 aims to address this. It outlines that all bottles should be clear or translucent blue or green as these are the easiest to sort and have the highest material value once recycled.
There are other factors besides the bottle’s colour that can impact on its recyclability. Therefore, Golden Design Rule 1 also lays out specifications for the size of labels on PET bottles, the materials that can be use and the glue used to attach them, so that these aren’t problematic when it comes to recycling.
The rest of the rules cover topics like removing problematic elements from plastic packaging (e.g. PVC, PS, EPS); eliminating excess headspace in flexible packaging; eliminating unnecessary plastic overwraps; improving the recycling value of PET thermoformed trays; and reducing the use of virgin plastic.
Some of our members have already made fantastic progress when it comes to better plastic packaging design. For example, to celebrate Earth Day this year, soft drinks and food giant PepsiCo launched label-free PET bottles in China on e-commerce channels, following an initial launch in South Korea in October 2021. By removing both the plastic label of a traditional PET bottle and the ink printing on the closure, Pepsi was able to reduce the product’s carbon footprint throughout its life cycle and make these bottles easier to recycle. Additionally, to increase plastic circularity, Pepsi also included 24% recycled PE in the secondary shrink film.
Chemical and consumer goods multinational Henkel is working to transition many of the PET bottles in its portfolio to clear PET. In Italy, for example, Henkel’s brand Nelsen’s, a hand dishwashing soap, is using now transparent PET bottles rather than white. Also, 50% of Henkel’s global shower gel portfolio of its main brands including Fa, Dial and Bernangen are packed in clear PET.
Henkel also champions floatable sleeves on bottles instead of traditional labels, as they can easily be separated during the recycling process. To date, the company has introduced them across its fabric softener portfolio, including the Vernel brand. It will soon roll out floatable sleeves across all its sleeved bottles.
Global packaging company Amcor developed a 100% PCR and label-less PET bottle in Argentina. This launch was in partnership with Danone, global food and beverage company, and Argentinean moulded plastic Moldintec, for the water brand Villavicencio.
This innovation is groundbreaking for two reasons. First, it eliminates unnecessary plastic by removing the plastic label. Secondly, it makes the bottles more recyclable, because there’s less risk that labels or adhesives contaminate the recycling process. It also removes the need for sorting and separating labels and bottles, making it more cost-efficient.
What’s more, the new label-less bottle is made from 100% post-consumer recycled content and has a reduced carbon footprint of 21% compared to its previous incarnation.
These are just a few leading examples of companies implementing the Golden Design Rules and putting good intentions into action. This kind of innovation represents the way forward for designing plastic packaging in the consumer goods sector. Of course, there’s still much work still to be done, not least scaling these trailblazing initiatives across the whole industry. Indeed, the adoption of such practices should be an immediate priority.
The CGF Golden Design Rules provide a playbook for implementing the vital design changes that we know are needed, so that, for the sake of the planet, we can tackle the increasingly urgent problem of plastic waste and accelerate the transition to a circular plastics economy.
If you want to find out more about the Golden Design Rules, or think they could be relevant to your organization, please contact us using this link and we will be able to provide more detail and answer any questions you may have.
When it comes to forest products, Bio Pappel, HP, Melissa & Doug, REI and Amazon are all leaders in responsible sourcing. What does this commitment look like in practice?
From the Forest Stewardship Council • Posted: February 17, 2023
More and more consumers are demanding sustainable attributes in the products they buy — encouraging retailers and consumer packaged goods companies to reap the benefits of this opportunity by providing products with tangible, credible environmental and social benefits.
When it comes to forest products, Bio Pappel, HP, Melissa & Doug, REI and Amazon are all leaders in responsible sourcing — a fact that earned them Forest Stewardship Council Leadership Awards for their deep commitment to responsible forestry and for making thousands of FSC-certified products available to businesses and consumers. What does this commitment look like in practice?
Bio Pappel is one of the largest recycled-paper manufacturers in North and South America, and the first Mexican company that is FSC certified for use of 100 percent recycled raw material in paper production. While Bio Pappel may not be a household name, it supplies some of the biggest brands — including Amazon and Titan packaging, Samsungpackaging, Xerox paper, Scribe and pen+Gear notebooks, LALA Yomi milk and yogurt packaging, and Kirkland Signature food items. Its products can be found in Walmart, Costco and other major retailers.
“At Bio Pappel, we like to say that we are generating shared value,” says Israel Martinez, auditor at Bio Pappel. “In this sense, FSC certification gives us the guarantee of sustainable management of raw material coming from forests or recycled material used to produce paper — which consequently encourages more responsible consumption and allows end consumers to be more aware of their footprint on the planet.”
For more than a decade, HP and World Wildlife Fund have worked together to achieve HP’s responsible sourcing goals— including zero deforestation for its HP-brand paper and paper-based packaging. This collaboration has included the development of HP’s industry-leading responsible fiber-sourcing policy; By 2020, HP met this commitment with FSC-certified or recycled fiber sourced for over 95 percent of HP brand paper and paper-based packaging.
HP continues to expand on its commitment to responsible sourcing with additional efforts rooted in protecting, restoring and improving the management of forests. One example is HP and WWF’s work to increase the area of FSC-certified forest in China to 219,830 acres by 2025. As of July 2022, over 33,000 hectares (81,000 acres) of forest have been FSC certified in China.
Over the next decade, HP and WWF’s efforts will include collaborating with local communities and forest managers to increase FSC-certified forest areas in key landscapes, as well as identifying and addressing obstacles to obtaining FSC certification and improving forest-management practices. Ultimately, HP has committed $80 million to restoring, protecting and improving the management of nearly a million acres of forest — an area approximately five times the size of New York City.
As the #1 preschool brand for wooden toys, Melissa & Doug has a longstanding commitment to “making timeless, sustainable toys for a thriving and inclusive world.” The brand formalized its commitments with an initiative called “Project Restore,” to more deeply integrate sustainability culture and practices across the organization.
After obtaining FSC Chain of Custody certification in 2020, the purpose-driven toy manufacturer became the first major US toy brand to earn FSC certification for its new stationery line, which was independently certified by SCS Global Services. Melissa & Doug is on track to achieve its commitment to ensure 100 percent of paper products and more than half of its wood products sold are FSC certified by 2025.
Healthy forests are essential for people to enjoy the outdoors; they’re also essential to REI’s business. REI uses fiber and the resulting paper products throughout its operations — in the form of flyers, cardboard, shopping bags, hangtags and more. As a co-op that inspires its members to spend more time outside, sustainable forestry is a natural focus.
REI prioritizes paper-based packaging for its own products that are FSC certified or made from certified post-consumer waste, and prioritizes paper products with the same attributes. With the assistance of the Outdoor Industry Association and the Sustainable Packaging Coalition, REI published sustainable packaging guidelines to encourage and educate its vendors, including FSC as a preferred attribute. These guidelines support not only REI Co-op and Co-op Cycles, but also the brands they sell within their stores and the greater outdoor and cycling industries.
FSC is one of many third-party certifications in Amazon’s Climate Pledge Friendly (CPF) program — which currently encompasses over 350,000 products, 20,000+ brands and counting. CPF was created to help customers discover and choose more sustainable products on Amazon.
One in three consumers prefer shopping with the planet in mind, even if it means paying a little more. By Alyssa Khan, Editorial Intern • Inc.com – Posted: February 16, 2023
Knowing your customer is one of the first rules for running a successful business, and customers today care about sustainability.
One in three consumers prefer shopping with the planet in mind, even if it means paying a little more, according to a SurveyMonkey study. Sales of products marketed as sustainable also grew 2.7x faster than those that didn’t, according to a study from New York University’s Stern Center for Sustainable Business. While making your company more environmentally friendly will likely require an upfront investment, it could pay dividends in the long term, and you don’t have to reinvent your entire business plan.
Here are three sustainability tips for every business owner in 2023.
Ericka Rodriguez founded her vegan lipstick brand, Axiology, in 2014 in New York City. Though her lipsticks were originally packaged in recyclable aluminum, Rodriguez learned that their plastic components meant they often couldn’t be recycled. So she and her team of four employees began testing ways to make their packaging more environmentally friendly. They settled on a compostable, food-grade paper free of animal-sourced waxes and glue that wraps around the lipstick like paper on a crayon. While it took a year and a half and thousands of dollars to make the switch, the final production cost is now less than that of the aluminum packaging, enabling Rodriguez to lower the retail price of her flagship lipstick from $28 to $24. The new packaging also helps differentiate her brand from the competition.
1. Rethink your packaging.
Ericka Rodriguez founded her vegan lipstick brand, Axiology, in 2014 in New York City. Though her lipsticks were originally packaged in recyclable aluminum, Rodriguez learned that their plastic components meant they often couldn’t be recycled. So she and her team of four employees began testing ways to make their packaging more environmentally friendly. They settled on a compostable, food-grade paper free of animal-sourced waxes and glue that wraps around the lipstick like paper on a crayon. While it took a year and a half and thousands of dollars to make the switch, the final production cost is now less than that of the aluminum packaging, enabling Rodriguez to lower the retail price of her flagship lipstick from $28 to $24. The new packaging also helps differentiate her brand from the competition.
“I don’t think the world needs another plastic packaging lipstick brand,” Rodriguez says. “There are already so many.”
2. Consider responsible sourcing.
Nadya Okamoto and Nick Jain founded the direct-to-consumer period care brand August in 2021. The main material for their products, cotton, is the most profitable nonfood crop in the world, but farming with pesticides, fertilizers, and other chemicals can contaminate waterways and soil, creating havoc in ecosystems. So, August’s founders were committed from the start to use only sustainably farmed, organic cotton versus the popular industry alternative viscose, a type of rayon that is less sustainable and the subject of various health concerns. That means the cotton crops used for their products create fewer greenhouse gas emissions and don’t contaminate surrounding ecosystems. The average price of a 28-pack of regular tampons retails for between $10 and $11, while a 24-pack of August’s tampons is priced between $14 and $15. For Okamoto, the difference in price is worth it for her customers and her business.
“Supply chains are being challenged to be as ethical as possible,” says Okamoto. “Our deepened commitment to making sure that we stand by those values has helped us cultivate a beautiful community.”
3. Beware of greenwashing.
It’s no secret that companies overstate how environmentally friendly their products are. “For me, greenwashing is overclaiming in a significant way or lying about what you’re doing,” says Tensie Whelan, director of the Center for Sustainable Business at New York University. “Some of it is a lack of competence. This is a whole new area. We’re all learning all the time.”
While misleading claims about products being environmentally friendly are common, companies that exaggerate details about sustainability risk significant reputational damage. Greenwashing has been at the center of controversy over the past five years as companies like Tide, Coca-Cola, and Banana Boat sunscreens have faced inquiries and even lawsuits challenging various claims related to sustainability.
By Amy Brown from Triple Pundit • February 15, 2023
It’s odd to think that people are nostalgic for the earlier days of COVID-19, but a new Gallup poll shows that workers miss the increased flexibility and empathy employers adopted at the start of the pandemic. Nearly 75 percent of global employees now say they are either not engaged or actively disengaged at work. Why? It seems workers feel they are once again being treated like cogs in the machine, rather than human beings.
“The world is closer to colonizing Mars than it is to fixing the world’s broken workplaces,” Gallup’s annual State of the Global Workplace Report put it bluntly, noting that employee engagement has reached its lowest level since 2015.
In addition, stress levels among professionals worldwide are at “an all-time high.” Gallup found that 59 percent and 56 percent of disengaged employees report experiencing stress and worry frequently at work.
Employers are missing the boat on engagement
What gives? Unfair treatment at work topped the list as the leading cause of employee disengagement, Gallup found, with an unmanageable workload, unclear communication from managers, lack of manager support, and unreasonable time pressures close behind.
The report found the engagement elements with the most marked declines since the onset of the COVID-19 pandemic were:
Clarity of expectations
Connection to the mission or purpose of the company
Opportunities to learn and grow
Opportunities to do what employees do best
Feeling cared about at work
About 32 percent of the 67,000 full- and part-time employees surveyed were engaged in their work in 2022, while 18 percent were actively disengaged. Active disengagement has risen each year since 2020. The remaining respondents — 50 percent — were neither engaged nor actively disengaged. In the U.S. in particular, the latest data shows the lowest ratio of engaged-to-actively disengaged employees since 2013.
This is not just a U.S. phenomenon. Fewer than 2 in 10 European employees feel engaged at work — lower than any part of the world.
Millennials and Gen Z employees are even more disengaged
The trend of disengagement and job-hopping is even more pronounced among Generation Z and young millennials. This reporter did her own survey close to home: My millennial daughter, Marielle Velander, 30, has worked for several years in the tech industry, and she had a definite view on the Gallup findings.
“In today’s fast-paced tech scene, it seems like new titles and functions are being invented all the time, without clear job descriptions,” she said. “This was the case with my role of product operations, a new type of role that had me reshuffled in multiple organizations amid a context of ‘organizational change’ or ‘strategy definition.’ This constant reshuffling has left me and many former colleagues disengaged and unclear about how we provide value to the organization. I kept wondering why executives did not understand the revenue-generating aspects of my role.”
Her advice for business leaders looking to do things differently? “Companies should do a better job of managing change fatigue and providing clear job descriptions. They should also be more open to investing in innovative new roles, like product operations, and give these new roles a chance to show their value before folding [them] into yet another radical strategy change.”
No matter the generation, contented employees find their work rewarding and meaningful — and that happens when leaders prioritize employee well-being and engagement, Gallup found.
“Managers need to be better listeners, coaches and collaborators,” researchers recommended in the Gallup report. “Great managers help colleagues learn and grow, recognize their colleagues for doing great work, and make them truly feel cared about. In environments like this, workers thrive.”
Other recent research indicates the problem doesn’t lie in the trend toward more remote work, either. Some 52 percent of workers recently told the Conference Board that having a caring and empathetic leader is more important now than before the pandemic. Whether they work in an office, at home or a hybrid of both has no impact on that view, or their level of engagement, according to the survey.
There is plenty of evidence that engaged workers are a smart investment for employers. Some studies have found that engaged employees outperform their peers that are not engaged. Overall, companies with high employee engagement are 21 percent more profitable.
The risk of not taking action to engage your employees is losing talent — especially young talent — altogether. Marielle has taken a year-long break from her tech career to travel the world. As she described it: “I’m trying to realign with my purpose after feeling like I lost my agency over my career.” It would seem she is not alone.
By Ted Dhillon, Forbes Councils Member from fore’s.com • February 15, 2023
ESG (environmental, social and governance) is often viewed as a way for the financial markets to measure the social and environmental performance of a business. But it’s a lot more than that. Increasingly, prospective employees are using it as a measuring stick to decide where their next job will be.
ESG represents a set of principles that many prospective employees hold all over the world—the idea that businesses need to operate with sustainability at the forefront, doing as little harm to the environment as possible and promoting social responsibility and community building inside and outside the enterprise.
Generation-Z—the group many companies will draw their fresh talent from in the next two decades—already believes in these principles more than previous generations do.
My company draws talent from all corners, but especially from groups that have either studied or worked in environmental science. That’s because their values already align with our mission. It’s a natural fit for someone who wants to contribute to a climate change solution to gravitate toward companies that empower them to do just that.
But the Great Resignation that started with the pandemic is still taking a toll. Even companies outside the ESG industry that want to recruit and retain top talent don’t have the luxury of ignoring the class of climate change warriors. Enterprise leadership must think carefully about how they can align their values and practices with these prospects. It’s not enough to say you are pro-environment, diverse and inclusive—you have to show it and “pitch it” in the interview process.
Communicate an authentic message.
No one comes through the door supporting an environmental mission for exactly the same reasons, so messaging has to be strategic and, most importantly, can’t be seen as greenwashing. Greenwashing, in this context, means putting forward misleading claims to prospective employees to boost a company’s environmental credentials.
So how do you convince a top recruit that your company takes sustainability seriously? In short, communicate, demonstrate and engage:
1. You can communicate a pledge to sustainability through a clear impact statement on every job posting. It should answer some key questions:
What impact can an individual have at this particular company? How does the individual job role contribute to the positive impact the company wants to have on the environment?
If an employee is choosing between you and another company, the “50-50” decision could come down to how well you answer those questions.
2. You can demonstrate sustainable practices by proactively sharing a fact sheet or webpage with every job candidate, whether they ask for it or not. Using social media channels to amplify those messages especially works well to reach out to ultra-connected Gen-Zers. This signals that ESG concerns are not an afterthought but a priority.
In the interview process, make environmentally friendly benefits—even if they are as small as reimbursements for taking greener modes of transportation to work—a part of the standard benefits run-through.
3. Keep current employees engaged in sustainable practice discussions by initiating employee-led committees that have the power to push new sustainability policies. Mention to prospectives (or better yet, let other employees mention it in conversation) that there are internal structures in place to give them a voice on sustainable practices. Prospects will quickly see that there is no greenwashing going on in that shop.
Consider tracking and reporting.
There’s a panoply of green certifications that companies use for bragging rights (the LEED standard for green buildings might be the best known). But ESG rating systems, those firms that take reported data and create rankings of companies, can be confusing because they all use different methodologies that may not be fully transparent.
There are better ways to demonstrate true ESG impact. Job candidates are looking less for a list of green badges and more for evidence that the company can track its own impacts through clear and transparent ESG reporting. If your company already tracks impacts, which can range from emissions to water usage to social impacts, then package the most recent year (or five years) reporting in an easy-to-understand format for anyone interested in working for the company.
If you are not yet tracking impacts, developing a plan to do so and being transparent about it to prospective employees at least makes a definitive statement about where the company is headed.
Gen-Z Swedish activist Greta Thunberg is famous for calling out older generations who are fumbling the ball on climate change today. “My message is that we’ll be watching you,” she told a U.N. climate summit audience in 2019. She meant that there would be accountability for the world’s most existential problem, and decades from now, business leaders may be judged by what they do today to be part of the solution.
Forward-looking companies will strive to track ESG impacts, form action plans that meet specific emissions (and other) goals and then ask young climate change warriors to jump on board.
Ted Dhillon is the CEO and cofounder of FigBytes, an ESG insight platform.
Our overheating planet needs social change more than it needs to avoid the physical tipping points we’ve come to associate with climate disaster, according to a new study from the University of Hamburg. The researchers note that while progress has been made in numerous arenas — such as citizen action, fossil fuel divestment, and implementation of U.N. and legislative policies to curb emissions — consumption patterns and corporate behavior remain prime barriers in the fight against climate change.
Ultimately, one is likely the product of the other, with consumers reacting to the constant onslaught of advertising and social media influence designed to keep them buying with little regard for the real consequences for the climate.
Nowhere is this more obvious than with the push to replace internal combustion engines (ICE) with electric vehicles (EVs) instead of building a nationwide infrastructure of public transportation — as Curbed’s Alissa Walker detailed in her extensive report last month, “An EV In Every Driveway Is an Environmental Disaster”.
“A green future, the story goes, looks a lot like today — it’s just that the cars on the road make pit stops at charging stations instead of gas stations,” Walker wrote. “But a one-for-one swap like that — an EV to take the place of your gas guzzler — is a disaster of its own making: a resource-intensive, slow crawl toward a future of sustained high traffic deaths, fractured neighborhoods, and infrastructural choices that prioritize roads over virtually everything else.”
Truly, a low-carbon future requires systemic change, with society organized not around the personal passenger vehicle but around community and getting the most out of transportation resources through integrated public transit. Swapping out ICE vehicles for EVs does nothing to curb the overconsumption problem. If anything, it intensifies it — with many consumers under the mistaken impression that prematurely replacing their gas-powered car or truck somehow helps the environment.
If anything, staying the course on cars represents a refusal to allow social change, with governments and automakers working together to keep the industry going strong in spite of the environmental and social costs.
And while consumers are consistently blamed for their desires, there is no denying that many of those wants and needs are manufactured by corporate interests and used to sell everything from shiny new vehicles to fast fashion. Would Americans really be so eager to shell out an average of almost $6,000 annually per household on loan payments and car insurance alone if not for the incessant advertising campaigns convincing us that we’ll find freedom, or love, or whatever else we desire in our next brand new car?
Would young people really care about being seen in the same outfit twice if the fashion world didn’t shove the message down their throats that it’s a bad thing? Would fast fashion — with garments that notoriously fall apart after just a few washes — have much of a market if clothing companies didn’t pay influencers to a model a one and done lifestyle?
Putting the onus of change on consumers, even as corporate interests invest in convincing them to do more of the same, is precisely why social change is not forthcoming at the rate that is needed. Indeed, while Americans say they are willing to alter their lifestyles to curb climate change, those who rely on their overconsumption aren’t going to give up trying to sell them more than they need any time soon.
The study, titled Hamburg Climate Futures Outlook, concurs with the U.N.’s determination that humanity will not be able to keep global temperatures from rising 1.5 degrees Celsius as set out in the Paris Agreement on climate change. The researchers emphasize the need for social change now versus the current focus on individual physical tipping points like melting ice sheets that won’t have much effect on temperatures until 2050.
“The question of what is not just theoretically possible, but also plausible — that is, can realistically be expected — offers us new points of departure,” researcher Anita Engels of the University of Hamberg said in a statement. “If we fail to meet the climate goals, adapting to the impacts will become all the more important.”
Unfortunately, corporate and billionaire interests appear more than willing to force humanity to adapt as they sacrifice the habitability of much of the planet in order to continue business- and consumption-patterns-as-usual.
For companies aiming to become part of the solution on climate change, the Outlook recommends moving beyond the facility level (Scope 1 emissions) to address emissions across the value chain (Scope 3) — particularly how companies influence and interact with their stakeholders. If governments can come together transnationally, and non-government actors like companies take action against climate change within their entire scope of influence, these crucial social tipping points could come closer into reach.
By Andreas von Buchwaldt, Grant Mitchell, Seth Reynolds, and Steve Varley from Harvard Business Review • Reposted: February 10, 2023
CEOs could once focus almost single-mindedly on their businesses and value chains. Now, along with driving a strategy that generates competitive advantage and enhanced value, they face another core task: satisfying a broad base of stakeholders with diverse interests who all demand sustainability policies and practices in different variations.
Delivering on both (often apparently conflicting) fronts is essential. Investors will only support a firm’s long-term strategic initiatives if they yield an above-market return and address the future needs of investors themselves, customers, regulators, and employees.
Like digital before it, sustainability has become an overarching strategic concern today. Judgments about a company’s sustainability performance affect talent acquisition and retention, access to capital, and consumer choices. And new regulations, such as the U.S. Inflation Reduction Act, are translating sustainability imperatives into economic shocks, notably in the energy sector. CEOs also see competitors growing and increasing customer loyalty through sustainability-linked products and services.
As a result, CEOs have largely accepted the need to embed sustainability in their strategies to create competitive advantage. But while existing frameworks describe the elements of a sustainable business, they rarely show how to get there.
At the intersection of sustainability and strategy, many companies adopt an environmental, social, and governance (ESG) strategy. In doing so, they can be strongly influenced by the external focus on third-party ESG metrics, which are framed as a way of measuring a company’s performance in ESG.
ESG strategies, which often aim to improve key metrics in a way that a firm finds acceptable or manageable, have given many businesses a pragmatic start toward becoming more sustainable. However, as a path to a better strategy, they have drawbacks.
Managing to metrics isn’t the best way to deploy sustainability as a driver of competitive advantage and value, or to hasten meaningful improvements in environmental and social outcomes. Being still immature, metrics are far from comparable, rigorous, or transparent. And the evidence for a link between economic value and ESG ratings is modest. Investors support genuine gains in sustainability, but they won’t tolerate strategies that don’t deliver economic value. While stakeholders closely observe ESG metrics, financial performance remains much more important in corporate valuations.
Rather than focusing on ESG metrics, a more effective path to improving both financial value and sustainability performance is to integrate sustainability into the development and implementation of corporate strategy. In doing so, CEOs can ensure their strategy makes the most of the market, technology, customer, and regulatory trends created by sustainability imperatives.
CEOs can unite strategy with sustainability in three ways:
1. Adapt classic, CEO-level strategy questions by viewing them through a sustainability lens: “Is my purpose the best possible fit with competing stakeholder demands?” “As sustainability plays out in my industry, how should I position my strategy and portfolio for maximum advantage?” The collated responses should be tailored for individual business units or portfolio sectors.
2. Ensure strategic choices include sustainability imperatives by applying top-down and bottom-up analysis.
From the top down, ask, “How will increased sustainability modify or create new strategic drivers?” To test existing strategic themes, use such means as moving from climate scenarios that capture climate risk to embedding climate elements in strategy scenarios and tailoring customer research to test hypotheses about critical sustainability issues. Insights gained can indicate how industry ecosystems will evolve as sustainability grows in influence.
From the bottom up, ask, “Which specific sustainability concerns will our strategy need to accommodate?” To identify such concerns, CEOs could consider which issues are most significant for stakeholders—and so, how likely they are to create competitive advantage. Three interrelated qualifiers can help identify these: the future prominence for stakeholders; uniqueness of contribution; and size of business value, net investment. Careful analysis helps rank these issues.
3. Use common methods to assess investments in sustainability and commercial initiatives. Investments with negative value miss the opportunity to increase meaningful impact. While some investments with unclear links to value may be pragmatic to avoid reputational risk, they should phase out over time. Most organizations can do more to use data such as that on stakeholder attitudes and future economic impacts, and connections to estimate the business consequences of investment.
Organizations need to execute sustainability initiatives with the same rigor as traditional strategic activity. They need to anchor these initiatives in the ambition, resourcing plans, and incentives of all key decision makers—not isolate them within a sustainability team. CEOs will need to identify early the new internal business and impact data they need to measure the progress of key sustainability initiatives, as legacy systems may not capture such data.
EY-Parthenon research shows that taking these steps can give meaningful sustainability actions greater prominence in a CEO’s long-term agenda and may lead to better outcomes—helping a business achieve both the financial means and investor support to create a more sustainable future. Read more about how corporate strategy can deliver both growth and sustainability here.
A new survey asked shoppers why they aren’t buying from socially responsible brands anymore. The biggest problems: They can’t name any and think they’re too expensive. By Heath Shacklford from Fast Company • Reposted: February 9, 2023
The number of Americans who believe it is important to support socially responsible brands has risen in the past decade. The percentage of consumers who plan to increase their spending with such brands in the year ahead has never been higher. Yet, when push comes to shove, fewer and fewer consumers report purchasing products and services from socially responsible companies.
These are some of the key takeaways from the 10th annual Conscious Consumer Spending Index, a benchmarking study my agency runs that gauges momentum for conscious consumerism, charitable giving and earth-friendly practices. The Index score is calculated by evaluating the importance consumers place on purchasing from socially responsible companies, actions taken to support such products and services, and future intent to increase the amount they spend with responsible organizations.
With inflation lingering near 40-year highs and one quarter of Americans reporting a decrease in their household income in the past year, more individuals are finding it challenging to support socially responsible brands, which typically cost more than traditional products and services. In fact, almost half of respondents (46%) said the cost of socially responsible goods and services prevented them from buying more from conscious companies.
This decrease in purchasing power resulted in only 57% of respondents reporting they purchased goods for socially responsible brands in 2022, down from 64% in 2021 and 62% from the inaugural index results in 2013.
While the current economic situation is making it harder for consumers to support socially responsible brands, there are also more systemic challenges to the “do good” movement. Specifically, here are three opportunities for improvement as we consider the path forward for conscious consumerism.
HOLDING OUT FOR A HERO
Way back in 2015, TOMS was in the media spotlight as an icon for what do good business was all about. It was a hero brand, a poster child for the movement. As part of the Index that year, we began asking consumers to name one company or organization that is socially responsible. Based on unaided recall, TOMS topped the list of responses, and repeated that performance the following year.
Fast forward to 2022. For the fourth year in a row, Amazon is the most cited brand when consumers are asked this question. Meanwhile, TOMS no longer makes the list at all. It’s a classic case of out of sight, out of mind. There are only so many experiences the average consumer can have with TOMS as a brand, even if they are rabid fans. Meanwhile, they engage with companies like Amazon and Walmart, number two on this year’s list, on a daily or weekly basis.
The TOMS one-for-one business model is no longer a novelty and no longer the focus of frequent media attention. As a result, we have lost our hero brand for socially-responsible business. We have many strong brands who are well-known for doing good: Patagonia and Ben & Jerry’s are among the examples. But no brand has captured our collective attention and imagination like TOMS did during its peak as a media darling.
Ultimately, this movement needs a hero. A brand that emerges as a leader and carries the torch for socially-responsible business practices. A brand that is large enough to demand consistent attention from the news media and the average consumer. A brand who can serve as an example and as a powerful advocate for business as a force for good.
A joint study from McKinsey and NielsenIQ examines sales growth for products that claim to be environmentally and socially responsible. From McKinsey • Reposted: February 9, 2023
Total US consumer spending accounts for over $14 trillion annually and two-thirds of the US GDP. An important subset of this spending goes toward everyday consumer packaged goods (CPG), ranging from foods and beverages to cosmetics and cleaning products. The sheer size of the CPG sector—with millions of employees and trillions of dollars in annual sales—makes it a critical component in efforts to build a more sustainable, inclusive economy.
CPG companies increasingly allocate time, attention, and resources to instill environmental and social responsibility into their business practices. They are also making claims about environmental and social responsibility on their product labels. The results have been evident: walk down the aisle of any grocery or drugstore these days and you’re bound to see products labeled “environmentally sustainable,” “eco-friendly,” “fair trade,” or other designations related to aspects of environmental and social responsibility. Most important is what lies behind these product claims—the actual contribution of such business practices to achieving goals such as reducing carbon emissions across value chains, offering fair wages and working practices to employees, and supporting diversity and inclusion. But understanding how customers respond to social and environmental claims is also important and has not been clear in the past.
When consumers are asked if they care about buying environmentally and ethically sustainable products, they overwhelmingly answer yes: in a 2020 McKinsey US consumer sentiment survey, more than 60 percent of respondents said they’d pay more for a product with sustainable packaging. A recent study by NielsenIQ found that 78 percent of US consumers say that a sustainable lifestyle is important to them. Yet many CPG executives report that one challenge to their companies’ environmental, social, and governance (ESG) initiatives is the inability to generate sufficient consumer demand for these products. There are many stories of companies launching new products incorporating ESG-related claims only to find that sales fell short of expectations.
How can both of these things be true? Do consumers really care whether products incorporate ESG-related claims? Do shoppers follow through and buy these products while standing in front of store shelves or browsing online? Do their real-life buying decisions diverge from their stated preferences? The potential costs—particularly in an inflationary context—of manufacturing and certifying products that make good on ESG-related claims are high. Accurately assessing demand for products that make these claims is vital as companies think about where to make ESG-related investments across their businesses. Companies should therefore be eager to better understand whether and how these types of claims influence consumers’ purchasing decisions. Is a shopper more likely to purchase a product if there’s an ESG-related claim printed on its package? What about multiple claims? Are some kinds of claims more resonant than others? Does a claim matter more if it’s appended to a pricier product? Is it less meaningful if it comes from a big, established brand?
Over the past several months, McKinsey and NielsenIQ undertook an extensive study seeking to answer these and other questions. We looked beyond the self-reported intentions of US consumers and examined their actual spending behavior—tracking dollars instead of sentiment. The result, for CPG companies, is a fact-based case for bringing environmentally and socially responsible products to market as part of overall ESG strategies and commitments. Creating such products turns out to be not just a moral imperative but also a solid business decision.
Products making ESG-related claims averaged 28 percent cumulative growth over the past five-year period, versus 20 percent for products that made no such claims.
To be clear, this is only a first step in understanding the complex question of how consumers value brands and products that incorporate ESG-related claims. This work has significant limitations that merit mention at the outset.
Growth was not uniform across categories (Exhibit 2). For instance, products making ESG-related claims generated outsize growth in 11 out of 15 food categories and in three out of four personal-care categories—but only two out of nine beverage categories. Shopping data alone can’t explain the reasons for such variances. In the children’s formula and nutritional-beverage category, for example, it’s possible that buying decisions reflect advice from doctors and that consumers probably won’t let ESG-related claims outweigh clinical recommendations.
Exhibit 2
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The overall trend, however, was clear: in two-thirds of categories, products that made ESG-related claims grew faster than those that didn’t. Evidence from NielsenIQ’s household panel showed that some demographic groups—such as higher-income households, urban and suburban residents, and households with children—were more likely to buy products that made one or more ESG-related claims. Still, the research shows that a wide range of consumers across incomes, life stages, ages, races, and geographies are buying products bearing ESG-related labels—with an average of plus or minus 15 percent deviation across demographic groups for environmentally and socially conscious buyers compared with the total population. This suggests that the appeal of environmentally and socially responsible products isn’t limited to niche audiences and is making genuine headway with broad swaths of America.
2. Brands of different sizes making ESG-related claims achieved differentiated growth
Large and small brands alike saw growth in products making ESG-related claims. In 59 percent of all categories studied, the smallest brands that made such claims achieved disproportionate growth. But in 50 percent of categories, so did the largest brands that made these claims (Exhibit 3). Some examples of category variance: in sports drinks and hair care, smaller brands grew more quickly, while in fruit juice and sweet snacks, the larger brands did. (The data can’t explain the underperformance of medium-size brands, but it’s possible that they lack the marketing and distribution scale of large brands and the aura of credibility that may benefit smaller brands.)
Exhibit 3
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Brands that garner more than half of their sales from products making ESG-related claims enjoy 32 to 34 percent repeat rates (meaning that buyers purchase products from the brand three or more times annually). By contrast, brands that receive less than 50 percent of their sales from products that make ESG-related claims achieve repeat rates of under 30 percent. This difference does not prove that consumers reward brands because of ESG-related claims, but it does suggest that a deeper engagement with ESG-related issues across a brand’s portfolio might enhance consumer loyalty toward the brand as a whole.
4. Combining claims may convey more authenticity
This study also analyzed the effects on growth when a product package displayed multiple types of ESG-related claims. On average, products with multiple claims across our six ESG classification themes grew more quickly than other products: in nearly 80 percent of the categories, the data showed a positive correlation between the growth rate and the number of distinct types of ESG-related claims a product made. Products making multiple types of claims grew about twice as fast as products that made only one (Exhibit 5).Exhibit 5
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We are not suggesting that companies can simply print more claims and certifications on their products and expect to be rewarded. These claims must of course be backed by genuine actions that have a meaningful ESG impact, and companies should heed the serious warning about greenwashing we presented in our introduction. Nonetheless, this finding does suggest that consumers may be more likely to perceive that a multiplicity of claims (rather than only one) made by a product correlates with authentic ESG-related behavior on the part of the brand. It also indicates that brands might be wise to reflect on their commitment to ESG practices and to ensure that they are thinking holistically across the interconnected social and environmental factors that underpin their products.
What does this mean for consumer companies and retailers?
Over the past century, global consumer consumption has been a central driver of economic prosperity and growth. This success, however, also comes with social and planetary impacts that result from producing, transporting, and discarding these consumer products. It should thus carry a moral imperative, for consumers and companies alike, to understand and address these impacts to society and the planet as part of buying decisions and ESG-related actions. Product label claims—if they represent true and meaningful environmental and social action—can be an important part of fulfilling this moral imperative.
For companies at the forefront of manufacturing and selling consumer packaged goods, there is no one formula for investing in environmentally and socially responsible product features and claims. Opportunities exist on multiple fronts. It’s important for consumer companies and retailers, first, to prioritize and invest in ESG-related actions that deliver the greatest advancement of their overall ESG commitments and, second, to inform customers of those actions, including information conveyed through product label claims. Our research points to a few insights that companies might consider as they attempt to advance their ESG commitments while also trying to achieve differentiated growth.
Ensure that ESG product claims support an overall ESG strategy with a meaningful environmental and social impact across the portfolio. This study shows that ESG-related growth can be possible across a broad range of brands—large or small, national or private label, in price tiers both high and low. Companies should define the actions, throughout the enterprise, that have the greatest ESG impact and then publicize those actions, where appropriate, with claims across their product portfolios. Rather than making a single large bet in a particular product or category, companies will probably have a greater ESG impact and a better chance of achieving outsize growth if they incorporate high-impact ESG-related benefits across multiple categories and products.
Develop a product design process that embraces ESG-related claims alongside cost engineering. Investments in product design aim to achieve a growth upside but must also—especially during an inflationary period—consider its cost. To ensure that investments in ESG-related claims have the greatest possible impact, companies can consider building strong product design capabilities that take a holistic look across costs, quality, and ESG-related impact. Using a disciplined design-for-sustainability approach, product designers can maximize the visibility, efficacy, and cost-efficiency of ESG-related product features that will resonate with consumers. Meanwhile, ingredients, materials, and processes that don’t contribute to this goal should be eliminated.
Invest in ESG through both existing brands and innovative new products. A healthy portfolio generally has a balanced mix of new and established products. ESG-related claims can play an important role in both. This study suggests that a flagship, established product fighting for share in a highly competitive environment could potentially create an edge by offering relevant and differentiating ESG-related claims. Given the outsize role of new products in boosting category growth, it’s critical to ensure that environmentally and socially responsible products account for a significant share of a company’s innovation pipeline—both to meet customer demand for such products and to ensure that they help advance the company’s overall ESG strategy.
Understand the ESG-related dynamics specific to each category and brand. Categories differ in significant ways, so it is critically important to study category-specific patterns to learn what has worked best in which contexts. Understanding which high-impact ESG claims are associated with consistently better performance in a given category can help companies focus on the claims that matter most to consumers in those categories. Companies can also benefit from being thoughtful about how specific ESG-related claims might align with the core positioning of each brand or differentiate it from those of competitors.
Embrace the holistic, interconnected nature of ESG by creating products addressing multiple concerns. This study shows that consumers seemingly don’t respond to specific ESG-related claims consistently across all categories. But they do tend to reward products that make multiple ESG-related claims, which may do more to help a product achieve a company’s overall ESG goals while also conveying greater authenticity and commitment to consumers. The incremental growth potential from introducing a second or third ESG-related benefit for a product may be equal to the growth impact of introducing the first one. To achieve stronger growth while delivering enhanced ESG-related benefits, companies could find it helpful to consider undertaking a category- and brand-specific assessment to determine whether and how to implement multifaceted claims.
Companies will probably have a greater ESG impact and a better chance of achieving outsize growth if they incorporate high-impact ESG-related claims across multiple categories and products.
This study does not answer all questions about the impact of investments by consumer companies in environmentally and socially responsible products. It does not assess the veracity of ESG-related claims, the relative environmental or social benefits of different claims, or the incremental cost of producing products that authentically deliver on those claims. It does, however, provide an important fact base revealing consumers’ spending habits with regard to these products, and this may help companies accelerate their ESG journeys. There is strong evidence that consumers’ expressed sentiments about ESG-related product claims translate, on average, into actual spending behavior. And this suggests that companies don’t need to choose between ESG and growth. They can achieve both simultaneously by employing a thoughtful, fact-based, consumer-centric ESG strategy. The overarching result might be not just healthier financial performance but also a healthier planet.
ABOUT THE AUTHOR(S)
Jordan Bar Am is a partner in McKinsey’s New Jersey office, Vinit Doshi is a senior expert in the Stamford office, Anandi Malik is a consultant in the New York office, and Steve Noble is a senior partner in the Minneapolis office. Sherry Frey is vice president of total wellness at NielsenIQ.
The authors wish to thank Oskar Bracho, Nina Engels, Gurvinder Kaur, Akshay Khurana, and Caroline Ling for their contributions to this article. They also thank NielsenIQ for its contributions to the collaborative research conducted for this study.
This report draws on joint research carried out between McKinsey & Company and NielsenIQ. The work reflects the views of the authors and has not been influenced by any business, government, or other institution.
From familywealthreport.com • Reposted: February 9, 2023
Nuveen, the investment manager of TIAA, has recently released its 7th Responsible Investing Survey, tracking US investors’ attitudes and behaviors regarding responsible investing.
A new survey by Nuveen shows that three-quarters of US investors believe that ESG factors should always be part of the investing process.
According to the survey, more than 80 per cent of US investors also think that companies need to be more open in communicating the risks and opportunities that shape their standing as “responsible investments.”
Seventy-three per cent said they are more likely to invest in a company that shares its plans with investors for effectively managing those factors.
Investors’ demand for more ESG-related information from companies is paired with strong agreement that ESG investing now represents a core portfolio approach, the firm continued.
Nearly eight out of 10 respondents see responsible investing as a framework that incorporates material factors not typically accounted for in traditional financial analysis. Four in five agree that investors should view responsible investing as a long-term strategy – and 76 per cent say that factoring in RI risks and opportunities should always be part of the investment process.
Younger investors are particularly in tune with the fundamental value of responsible investing: 92 per cent of Gen Z and Millennial investors agree that related risks and opportunities always belong in the investment process, compared with just 68 per cent of Gen X’ers and Baby Boomers, the firm said.
The survey, which was conducted by The Harris Poll on behalf of Nuveen, covered 1,003 adults aged 21 and over with at least $100,000 in investible assets between July and August 2022. It includes 573 investors who said they currently own funds managed according to principles of responsible investing – also known as ESG investing.
“Although many investors are interested in RI’s positive impact on society, in their minds the process of managing key ESG factors should also focus squarely on mitigating critical impediments to company performance,” said Amy O’Brien, global head of responsible investing.
According to the firm, about seven in 10 investors agree that having RI options in their retirement plan makes them feel good about working for their employer. The sentiment is even stronger among Gen Z and Millennial investors: 95 per cent would feel good, compared with just 56 per cent of Gen X’ers and Baby Boomers.
“Responsible investing options are becoming a ‘must-have’ for corporate retirement plans, driven by strong participant interest in aligning investments with their values while tracking toward long-term financial goals,” said O’Brien.
“Retirement plan sponsors who introduce RI options and offer education about the portfolio advantages clearly have an opportunity to build even greater appreciation and loyalty especially among employees who are early on in their careers,” she continued.
The dairy alternative brand Oatly is using its newly reformulated oat milk yogurt line to introduce U.S. consumers to its climate footprint label — which the company has featured on products in European markets since 2021. Seeing more carbon footprint labels on food products could signal an important shift toward more informed and responsible consumption, as Americans report a willingness to make changes for the sake of the planet.
Such labeling could be a boon for producers with small carbon footprints while perhaps encouraging carbon-heavy producers in sectors like such as beef to find ways to lighten the load. But widespread use and standardization across the food industry will be necessary for it to be effective.
“Transforming the food industry is necessary to meet the current climate challenge, and we believe providing consumers with information to understand the impact of their food choices is one way we as a company can contribute to that effort,” Julie Kunen, director of sustainability for Oatly North America, said in a statement.
There’s good reason to believe that a significant number of consumers will adjust their choices accordingly. A joint study by Johns Hopkins Bloomberg School of Public Health, the University of Michigan and Harvard University found that climate impact labels on food menus did influence respondents to choose a chicken, fish or vegetarian meal over a beef one. Warning labels were more effective in deterring people from choosing beef than low-impact labels were at encouraging people to eat an alternative. While it was a small study with a limited scope, the research does point to the potential for carbon footprint labels to inform people’s diets.
The global food system accounts for between a quarter and a third of annual greenhouse gas emissions, depending on methodology, leaving plenty of room for improvement — and impact.
For its part, Oatly compares its climate footprint labeling — which will list the product’s climate impact from “grower to grocer” in kilograms of carbon dioxide equivalent (CO2e) — to the nutritional information that is already required on packaging. The CO2e measurements include not just carbon emissions, but also other greenhouse gases such as nitrous oxide and methane which have been converted into interchangeable units in order to incorporate them in the total footprint.
However, the brand is clear that carbon footprint labels are neither required nor standardized, and they’re of little recourse to consumers until they become so. Thus the brand is hoping to inspire other producers in the industry to follow suit while encouraging consumers to eat more plant-based and low-carbon alternatives.
“The products we make at Oatly aim to make it easy for people to make the switch to non-dairy alternatives, and great taste is one of the most essential components of driving that conversion,” Leah Hoxie, the brand’s senior vice president of innovation in North America, explained further in a statement.
Taste has been a barrier for the plant-based movement, with major strides made in the latest generation of plant-based meats and dairy products that have hit the market. Indeed, more people are willing to make the leap to eating lower on the food chain as the taste, texture and price of alternatives become more palatable.
Fostering a sense of responsibility for the climate in their business practices and labeling should work in Oatly’s favor, especially among Gen Z.
Consumers have long been burdened with a status quo that makes doing the right thing more difficult, so it’s no wonder we have fallen into a food system that pollutes and destroys ecosystems at a rate far higher than it should. But by providing climate impact information on product packaging, brands can gain consumer trust and demonstrate that they also trust the consumer to make the right choice.
As the balance of information shifts and becomes more equitable, consumers could be empowered not just to lower their own gastronomic impact on the climate, but to expect better from the food industry as well. Naturally this would require a more intricate labeling system — perhaps including warnings on high-impact items — but Oatly is off to a promising start.
Fellow plant-based brand Quorn also includes carbon footprint labels on product packaging, and CPG giant Unilever has committed to roll such labeling out to its entire product portfolio. Other sectors, from beauty to tech, are also looking toward climate labels in a trend that seems to be just heating up.
By Tina Casey from triple pundit.com • Reposted: February 7, 2023
Crusaders against socially responsible investing have been holding forth about the evils of “woke capitalism” in recent years. For all the red-hot rhetoric, though, leading U.S. businesses continue to promote clean power. The latest effort involves GM, Ford, and other leading stakeholders in an effort to grow the market for virtual power plants.
What is a virtual power plant?
Although the idea may seem somewhat exotic, a virtual power plant is simply a networked grid system that enables individual electricity producers to interact with each other and with individual users. The overall aim is to avoid the cost of building new centralized power plants — and especially to avoid building new fossil power plants — while improving reliability and resiliency.
This network-based approach to grid planning is made possible by new smart grid and smart metering technology, along with the proliferation of rooftop solar and other small-scale renewable energy systems. It is a sharp contrast with the traditional strategy of building additional centralized power plants to get communities through periods of peak demand.
In addition, virtual power plants provide electricity users with new opportunities to save or even make money, depending on the incentives offered by their grid operator.
In a blog post last May, the U.S. Department of Energy described how virtual plants have come to include not only individual meters, but also individual appliances that are designed to interact with the grid, as well as electric vehicle charging stations and energy storage facilities.
“Operators gain the flexibility to better reduce peak demand and, as a result, defer investment in additional capacity and infrastructure to serve a peak load that is expected to increase as we electrify the nation’s economy,” explained Jigar Shah, director of the Energy Department’s Loan Programs Office.
Why don’t we all have virtual power plants?
For all their potential benefits, virtual power plants are a relatively new phenomenon, and they still account for a vanishingly small percentage of grid activity in the U.S.
In a followup blog post last October, Shah noted that the market for virtual power plants has only been open since 2020, through an order of the Federal Energy Regulatory Commission. “Nearly two years later, VPPs are just beginning to compete in organized capacity, energy, and ancillary services markets at a meaningful scale at the regional level,” Shah wrote.
In particular, Shah focused on the need for virtual power plants to secure revenue contracts. “To unleash the capital that makes ratepayer and wholesale power cost reductions possible, incumbent financiers need to see lower customer acquisition costs and consistent revenues for the critical services provided,” Shah noted.
Heeding the VPP call
GM and Ford have heeded the call for virtual power plants under the banner of the VP3, the new Virtual Power Plant Partnership hosted by the clean energy organization Rocky Mountain Institute (RMI). Other VP3 founding stakeholders include Google Nest, OhmConnect, Olivine, SPAN, SunPower, Sunrun, SwitchDin and Virtual Peaker.
GM and Google Nest served as seed funders of VP3. RMI also hopes to build on the success of its Renewable Energy Buyers Association partnership, of which GM is also a founding member.
“VP3 is an initiative based at RMI that works to catalyze industry and transform policy to support scaling VPPs in ways that help advance affordable, reliable electric sector decarbonization by overcoming barriers to VPP market growth,” according to a press announcement from the Rocky Mountain Institute.
“Our analysis shows that VPPs can reduce peak power demand and improve grid resilience in a world of increasingly extreme climate events,” added RMI CEO Hon Creyts, in a statement. “A growing VPP market also means revenue opportunities for hardware, software, and energy-service companies in the buildings and automotive industries.”
As a collaborative effort, VP3 will work to raise awareness about the benefits of virtual power plants, develop best practices and standards across the industry, and promote supportive policies.
The electric vehicle connection
Electric vehicles are in a perfect position to contribute to and benefit from virtual power plants, due to their mobility, flexibility and large energy storage capacity. That explains why Ford and GM jumped at the opportunity to get involved with VP3 as founding members.
Mark Bole, GM’s head of V2X and battery solutions division, noted that the V3 collaboration “underscores GM’s commitment to creating a more resilient grid, with EVs and virtual power plants playing a key role in helping to advance our all-electric future.”
In a separate announcement, Bill Crider, head of global charging and energy services at Ford, explained that electric vehicles are “introducing entirely new opportunities for consumers and businesses alike, creating a greater need for sustainable energy solutions to responsibly power our connected lifestyles.”
“Supporting grid stability through the introduction of technologies like Intelligent Backup Power is central to Ford’s strategy, and collaborating to advance virtual power plants will be another important step to ensure a smooth transition to an EV lifestyle,” Crider added.
Who’s next on the virtual power plant bandwagon?
Among the Big Three legacy U.S. automakers, Stellantis has yet to engage with VP3. That could change as the company that now owns Dodge and Chrysler ramps up its interest in virtual power plants.
In 2020, Stellantis began work on a large-scale virtual power plant in Italy based on electric vehicle-to-grid technology. The company, which also counts Fiat and Peugeot among its subsidiaries, may be waiting on the results of that project before committing itself to a policymaking endeavor in the U.S.
Interest in virtual power plants is also growing at Volkswagen and other overseas automakers that have an eye on the U.S. market. In addition, Tesla has embarked on virtual power plant ventures in California and Texas, deploying both its vehicle batteries and its Powerwall home batteries.
It remains to be seen if Tesla will collaborate with VP3 on industry standards, though. Tesla CEO Elon Musk established a well-known reputation for not collaborating in the early days of electric vehicle commercialization. He held out Tesla’s charging system as unique to Tesla, even as other automakers worked to create the standard CCS charging technology for Europe and North America.
Since its introduction in 2011, CCS has been supported by almost all other auto manufacturers in those two markets. Even Tesla itself leans on CCS to some degree, since it provides Tesla owners with an adapter to use at CCS charging stations. (Note: Japan and China continue to use their own charging systems.)
More recently, Musk further cultivated his outsider status in the early days of the COVID-19 lockdown when he criticized the U.S. government’s public safety guidelines and upstaged an inter-industry collaboration to restart U.S. factories. He also spread confusion and misinformation about the virus and the COVID-19 vaccine on social media.
When U.S. President Joe Biden convened a major media event for auto manufacturers in August of 2021, it was no surprise to see Tesla left out in the cold. Last year, the S&P 500 also took Tesla to task for not keeping pace with its peers in the auto industry on corporate ESG (environment, social, governance) issues.
Musks’s use of social media also makes Tesla an outlier among CEOs in the auto industry and elsewhere, in regards to his willingness to amplify and normalize white nationalist rhetoric.
With or without Tesla, though, VP3 is yet another instance in which industry leaders are swatting away the anti-ESG agitators like flies to take advantage of new opportunities to grow their businesses and attract new customers.
By Ashish Prashar from Triplepundit.com • Reposted: February 7, 2023
We in the advertising industry talk a lot about equity and inclusion. We design a lovely showroom that celebrates our apparent commitment to diversity in all its forms. Sadly, this is all superficial. Peel back the curtain and we see … nothing. We continue to ignore blatant racism and injustice and fail to take even the most basic steps that can drive real change.
For all the pledges we saw from agencies in 2020 to finally address systemic racism, over two years later we’ve seen little real action. Even while they complain of a “war for talent,” agencies aren’t doing enough to change how they recruit and promote talent and are struggling to make a meaningful cultural impact.
Racism and exclusion persist in the workplace, with higher turnover rates and lower promotion rates among people of color. For years, we’ve known there’s a clear business case for prioritizing diversity, equity and inclusion at work beyond lip service. A McKinsey study found that the most diverse companies were 36 percent more profitable in 2019 than their least diverse counterparts.
While companies may sometimes have good intentions in coming forward with commitments after a big cultural moment, the impact falls short every time. After George Floyd’s death in 2020, company after company promised to recruit and retain more diverse talent and pledged to put cash toward DEI. But there was little accountability. Companies often don’t report their demographics, and it’s even more rare that they disclose information about spending.
A number of agencies are recruiting more diverse talent, and some are willing to share their data, with varying degrees of detail and frequency, but there is a lot more work to be done — particularly when it comes to instigating change at the top. This is where agencies can move beyond anti-bias and anti-racism training to provide things like committed executive sponsorship and mentorship of young diverse talent.
It can be difficult to hold organizations accountable when it comes to all aspects of DEI, particularly when looking beyond financial commitments and assessing what data is important when considering DEI progress.
We need to think bigger If we’re going to make meaningful change. The best DEI strategies target all parts of companies, and that starts by going beyond recruiting. Recruiting a diverse workforce is one part of DEI, but it should be viewed as a first step, not a comprehensive solution. It takes holding leaders accountable for change, something agencies haven’t seemed willing to take on. This may include difficult decisions around current leadership and has to encompass taking the impact on talent and agency culture into account when filling new leadership roles. Managers who create or enable a workplace environment that makes people of color uncomfortable should never be shoo-ins for new leadership roles.
It also means asking questions about who we work with, the kind of work we want to create, and the stories we want to share with the world. Companies often make the biggest difference when they change something within their spheres of influence. In this industry, our sphere of influence is narrative.
The creative industry has served as an arbiter of ideas and a reflection of a society’s failing or burgeoning health. Creatives have had a powerful hand in building either massive propaganda machines or culture-changing art and movements. The question about which side we’ll fall in this dichotomy can be answered by choosing to be conscious of our resources and of our responsibilities.
It is our responsibility in the creative industry to question what ideas and values we are disseminating, what stereotypes or biases we are introducing, and to whom we are giving platforms through our work. But it’s not enough just to avoid making the mistakes of the past. This industry has a responsibility to create new narratives that help tear down the biases and stereotypes it has previously helped perpetuate.
If agencies really want to make a difference in connecting with people of color, they can start by working on the issues and causes that impact and shape our lives. There is no shortage of partners in need of help addressing issues like justice reform, education and healthcare equity. Find out who you can work with to make an impact, and get to work. Talent (and prospective talent) will notice.
Make 2023 the year that your agency was truly an ally in the fight for diversity.
Hotel companies begin to set ESG goals. From CBRE Group • Reposted: February 6, 2023
The COVID-19 pandemic accelerated the urgency for companies and individuals to act to protect the wellbeing of the planet, their communities, their employees, and in the case of hotels, their guests. As such, environmental, social and governance (ESG) initiatives have accelerated.
The hotel industry’s commitment to ESG initiatives, while somewhat nascent, is increasing. Rising energy costs, which have increased electricity costs by 10% since May 2021, are likely to accelerate the industry’s focus on sustainability, particularly given the shift in traveler preferences toward more sustainable tourism and green accommodations and the growing demand for disclosure around climate risk. Although Russia’s invasion of Ukraine, which has exacerbated energy price hikes, might motivate hotel operators to invest in long-term environmental upgrades, higher interest rates and sharply declining equity prices may offset this positive momentum, at least in the near term.
*COMPANIES HAVE SET A TARGET TO LIMIT GLOBAL WARMING TO 2° OR 1.5° CELSIUS BY A SPECIFIED DATA. SOURCE: COMPANY FILINGS, CARBON DEVELOPMENT PROJECT, SCIENCEBASEDTARGETS.ORG, GLOBALREPORTING.ORG
(E)nvironmental
According to the Sustainable Hospitality Alliance (SHA), to keep pace with the targets outlined in the Paris Agreement, the global hotel industry needs to reduce carbon emissions per room per year by 66% by 2030 and 90% by 2050 (SHA, 2017).
Companies like Accor, Hilton, Hyatt, IHG and Host Hotels have aligned themselves with science-based target initiatives (SBTi), which manage emissions reductions and net-zero commitments. Many hotel companies have made commitments to reduce their impact on the environment by setting climate-based targets. In many cases, they have adopted near-term targets on the path to achieving net zero. For example, Hilton pledged to reduce scope 1 and 2 emissions by 61% by 2030. Marriott is committed to setting SBTi targets under the 1.5-degree scenario and targets a 30% reduction in carbon intensity by 2030.
Investors are interested in understanding exposure to these climate risks. In the hotel industry, corporations have started to recognize the importance of reporting and disclosing standards and the need to set targets to mitigate climate risks early. Benchmarking has historically been difficult because of the lack of transparency. Ten years ago, IHG created its own system, called Green Engage, for measuring the environmental friendliness of its hotels. However, the industry has moved to standardized measurement systems such as Energy Star and LEED certification for U.S. buildings including hotels. As regulations, disclosure requirements and policies in the U.S. come into focus, companies that take steps to implement and invest in disclosure and goal setting will be ahead of the game.
SOURCE: AMERICAN HOTEL AND LODGING ASSOCIATION (AHLA)/CASTELL PROJECT.
(S)ocial
Developing a workforce, franchisee base and supplier network representing diverse populations and assuring equity and inclusion of all stakeholders has become a priority for many hotel companies. Social concerns also encompass issues related to guest and employee wellness and labor practices, as well as training programs that prevent human trafficking and human rights violations.
Companies create and support training programs to help at-risk youth and underserved populations by developing hospitality skills and a career path in the hospitality industry. In addition, companies look for ways to give back through monetary donations and volunteer hours.
Organizations like the National Association of Black Hotel Owners, Operators and Developers (NABHOOD), Asian American Hotel Owners Association (AAHOA), American Hotel and Lodging Association (AHLA)/Castell Project, National Society of Minorities in Hospitality (NSMH), She Has A Deal (SHAD), and Latino Hotel Association (LHA) advocate and support growth in women- and minority-owned, developed and operated hotels within the industry. According to AAHOA, Asian Americans represent more than 20,000 hoteliers owning 60% of hotels in the U.S. Black ownership remains below 2%, but this figure is growing, according to NABHOOD.
SOURCE: AMERICAN HOTEL AND LODGING ASSOCIATION (AHLA)/CASTELL PROJECT.
Operator hiring practices are focused on ensuring diversity among staff and upper management. While the industry has made some progress in increasing the representation of women and Black employees in executive roles, trends among C-suite executives have held steady. According to the American Hotel and Lodging Association (AHLA)/Castell Project, 6% of hotel company CEOs are women, while less than 1% are Black. The hotel industry slightly lags the market where 8% of Fortune 500 CEOs are women and 1% of CEOs are Black. Marriott and Hilton have gender parity targets, and Wyndham aims for 100% gender pay equity by 2025. Host Hotels aims to include at least two women and two people of color in the candidate pool for all externally sourced executive positions.
While representation in high-level management has stayed roughly the same over the past several years, there has been an increase at the senior vice president, vice president and director levels, hopefully leading to a more diverse pool of potential candidates for higher-level positions in the future.
Many companies make supplier choices based on alignment with ESG priorities. For example, one of Hilton’s inclusivity-related goals is to double the spending on sourcing from local, small and medium-sized businesses and minority-owned suppliers. Choice Hotels’ supplier diversity program develops opportunities for diverse suppliers, educates associates and fosters an inclusionary procurement process among suppliers. Several hotel companies, including Choice, Hilton, Marriott and Wyndham, are members of the National Minority Supplier Development Council, whose mission is to serve as a growth engine for minority-owned business enterprises (MBE).
Operators are focused on making hotels a more integral part of the larger community with efforts to increase charitable giving and volunteering. Marriott, Hilton, Hyatt and Wyndham have set goals for employee volunteer hours and targets for annual corporate giving.
(G)overnance
Governance issues include board diversity, company ethics, transparent reporting on the environmental and social goals, and clear executive compensation guidelines.
Proxy advisory firms create policy guidelines each year to help institutional investors assess how to vote on various proxy items that might arise during the year. The most recent Glass Lewis policy updates for 2022 included voting provisions on board diversity and composition, oversight for ESG risks, Special Purpose Acquisition Companies (SPACs), Say on Climate, and Say on Pay proposals. The last two topics allow shareholders to comment on a company’s climate and compensation strategies.
Best governance practices include having independent directors, separating the role of CEO and Chairman, staggering board terms, and eliminating poison pill provisions. Many public hotel companies and REITs follow some of these best practices already. Most hotel companies allow employees to anonymously report financial and ethical misconduct to promote ethical company culture. Hotel companies have also released statements regarding policies on human rights and condemning human trafficking.
SOURCE: GOOGLE TRENDS KEYWORDS: ECO-HOTEL, ENVIRONMENTAL HOTEL, GREEN HOTEL.
Why is ESG important?
Increasingly, travelers are expressing an interest in patronizing eco-friendly and socially responsible companies. The need to reduce carbon emissions from transportation could necessitate changes in business and leisure travel, a risk that could arise for hotel owners.
According to Google Insights, more than 50% of travelers surveyed say that environmental and sustainable considerations are essential when planning travel. As reported in the New York Times, according to a Booking.com survey, 71% of guests planned to travel “greener” and more than half indicated that they are determined to make more environmentally conscious travel choices in the next year.
Guests can quickly assess the environmental friendliness of a hotel by using rating systems like Tripadvisor’s GreenLeaders, Green Key Global, Green Seal, Green Tourism Active, Audubon Green Lodging Program, Travelife, or Earth Check, and LEED or Energy Star Certification provide information about the sustainability of a property. Since February 2021, the amount of searches on terms such as environmental hotel, green hotel and eco-hotel have remained above 2019.
The search for environmentally friendly accommodations is most common among luxury hotels guests who often seek vacations at resorts in environmentally sensitive areas like beaches and mountains. According to Virtuoso, a network of luxury travel agencies, in April 2021, 82% of travelers said the pandemic has made them want to travel more responsibly in the future. Half said it was important to choose a company that had a strong sustainability policy. While there is some evidence that guests are willing to pay a premium for environmentally sustainable accommodations, because of inflation and uncertainty in the market, the premium they are willing to pay remains unclear.
Hotel operators focus their environmental efforts on four key areas: water conservation, energy efficiency, carbon emissions and waste reduction. Unlike other real estate sectors, hotel buildings operate 24/7 so investment in technology to help manage the systems within the buildings provides savings over more hours of the day.
WATER
Water scarcity is a global problem. Many popular tourist destinations are in water-stressed areas. Hotels use eight times the amount of water the local community uses (SHA, 2017). As a result, how hotels manage water usage and consumption will substantially impact water-stressed communities. Water conservation efforts can include minimizing water use in bathrooms, laundry, landscaping and pools and installing water management systems. Offsite projects aimed at protecting and preserving local watersheds can also be created.
WASTE
Waste reduction efforts focus on cutting food waste and upcycling materials. 18% of food purchased by hospitality and food services goes to waste (SHA, 2017). Many hotel companies have set targets to reduce the amount of food waste generated by their operations by 2030. Further, many have started implementing procedures to reuse and repurpose non-food waste. Several companies have eliminated straws and single-use plastics. Others participate in programs that recycle discarded soaps and amenities.
ENERGY
Most hotel companies are installing energy-efficient lighting and solar panels, sourcing clean electricity and purchasing energy-efficient appliances. Many are using predictive monitoring systems to optimize and manage energy use. New properties are often planned and built with energy efficiency in mind. With margins under pressure because of rising costs, investments in energy efficiency could pay off in the long run. In 2021, utility costs decreased to slightly more than 4% as a percentage of revenue and rose to slightly less than $2,000 per available room, which is still below the high of $2,087 in 2009. However, given increasing occupancies and higher utility costs in the wake of the pandemic and the steep pullback in hotel occupancies but not room rates, we expect utility costs to reach a record $3,214 per available room in 2022, up 67% year-over-year.
CARBON EMISSIONS
1% of global carbon emissions come from the hotel industry (SHA, 2017). Many hotel companies measure and report the greenhouse gas (GHG) emissions from their owned and headquarter properties. In 2021, Hilton achieved a 50% reduction in carbon emission intensity in managed hotels and a 43% reduction for all hotels across their portfolio as measured against a 2008 baseline. Like Hyatt and Wyndham, many have set targets to reduce the GHG emissions generated from activities at these locations. A company’s value chain emits GHG through, for example, the actions of suppliers, business travelers and franchisees. Since most hotel c-corporations do not directly own most of their hotel properties, creating a carbon minimization strategy for their entire portfolio of owned, managed and franchised hotels may be more complicated.
Meeting planners and corporate and government travelers may request environmental impact information before making travel plans. Measurement and tracking are becoming a necessity. Uniform System of Accounts for the Lodging Industry (USALI) and other organizations are preparing to adopt standards and guidelines to help operators track waste, energy and water to make it easier to report on the environmental impacts of operations.
*FOR ACCOR AND IHG, TOTAL OWNED, MANAGED, OR FRANCHISED HOTELS REPRESENT HOTELS IN THE AMERICAS NOT JUST US HOTELS. SOURCE: ENERGY STAR.GOV, US GREEN BUSINESS COUNCIL, COMPANY FILINGS.
What Guests Can Expect
Guests should expect hotels to focus on wellness and placemaking including meals that include sustainably and locally-sourced food. Farm-to-table and farm-to-spa concepts are on the rise.
Companies support employee and guest wellness with added fitness facilities like a Peleton room, additional outdoor space, improved air quality systems and healthier locally inspired food options. In addition, guests may start to see décor that reflects local artisans and relies on upcycled materials. Improved hygiene and safety standards reflect expectations from the pandemic and are likely to remain as the pandemic recedes. Eco-friendly bedding and optional room cleaning for more than one-night stays are available in most hotels. The pandemic led to reduced housekeeping, and labor shortages and cost concerns have pushed chains to offer housekeeping upon request. However, union campaigns to bring back daily housekeeping to preserve jobs could jeopardize these efforts.
Financing Transactions and Development
As interest in environmental sustainability increases, companies turn to green bonds or sustainability bonds to finance many environmental projects.
The global green bond market hit $1 trillion in 2021. In the U.S., sustainable fund assets surpassed $300 billion. In 2020, Park Hotel Group in Singapore issued $176 million in green bonds to refinance the Grand Park City Hotel. In 2021, Host Hotels issued $450 million in green bonds to finance green projects, including increasing the number of LEED-certified buildings in the portfolio. Accor issued €700 million in sustainability bonds in November 2021 to refinance debt. These bonds are tied to the company’s sustainable development goals.
According to the LEED certification website database, there are more than 1,000 hotels associated with the LEED certification process in the U.S., excluding confidentially listed properties. Nearly 30% have achieved Platinum, Gold or Silver certification. An additional 154 hotels are LEED-certified. However, LEED-certified hotel properties represent less than 1% of hotel and motel properties in the U.S. Hotel REITs have a higher percentage of LEED- or Energy Star-certified portfolios among public companies, with Host boasting 23% of their portfolio certified to these standards. Marriott has nearly 9% of its owned, managed and franchised properties LEED- or Energy Star-certified, according to information gathered from LEED and Energy Star. Marriott set a goal to have 100% of their owned, managed and franchised hotels globally certified to a recognized sustainability standard, including, for example, Green Key and Green Globe.
SOURCE: COMPANY FILINGS AND REPORTS.
Conclusion
The hotel industry is in the early stages of achieving meaningful changes to environmental practices. Guest preferences and government mandates that include financial penalties and/or incentives will greatly influence the speed at which companies move toward their stated targets.
As the U.S. works to create a federal environmental policy, state and local governments will continue to set the agenda. Green projects will be facilitated by lowering the costs related to the projects and increasing the incentives to build and develop green projects. While current geopolitical and economic factors may have taken center stage, ESG goals will likely remain prevalent as countries prepare for the UN’s climate change conference, Conference of Parties (COP26), in November 2022.
By Edward Palmieri via triple pundit.com Reposted: February 4, 2023
In 2020, Meta achieved net zero greenhouse gas emissions for our global operations and today, we are supported by 100 percent renewable energy. These are good first steps, but we have so, so much work still to do to become a fully sustainable company.
That was my thought as I arrived in Sharm El-Sheikh, Egypt, for the 27th annual U.N. climate conference, or COP27. Held in November 2022 and dubbed theClimate Implementation Summit, the event gathered leaders from the public, nonprofit and private sectors — the global sustainability community — to debate, celebrate and negotiate global climate action.
Going in, “implement” was the word top of mind as leaders were expected to follow up on ambitious goals set the year before in Glasgow, Scotland. By day eight, however, the word on my mind was “mired.” As in: Are we, collectively, moving fast enough?
This year’s event had its high points —President Joe Biden’s address to world leaders, in which he affirmed the United States’ commitment to a low-carbon future, was certainly one. But COP27 missed the mark in some key ways, such as creating financing for developing countriesstruggling under the financial burden of climate change and creating mechanisms to help more countries reduce emissions. It is also clear we can all do more to measure and report on yearly progress.
Edward Palmieri, director of global sustainability at Meta, speaks on a panel with other business leaders at COP27. Submitted Photo.
At Meta, we believe the private sector has a critical role to play in our global ambitions to mitigate and adapt to the impacts of climate change. During a challenging period for the company, focusing on the “true north” of measurable climate action and building climate resilience remains essential to our future and our bottom line.
Year-over-year, our net zero goal remains fixed even as we grow — both in terms of our users today and our plans for the metaverse tomorrow. And along with our net zero ambition, we are progressing related goals, including our aim to restore more water than we consume in our global operations.
Bringing all of this back to COP27, it’s clear that we can’t do it alone. No one can and, in fact, this is one of my favorite things about working in sustainability: collaboration. As we embark on a new year, Meta remains committed to collaborating with those committed to climate change and continues to expand our network of global partners. Most recently, we’ve:
Helped launch theAsian Clean Energy Coalition to advance renewable energy procurement in Asia with the World Resources Institute and other technology companies.
Announced a new partnership with Stripe, Alphabet, Shopify and McKinsey Sustainability to launch Frontier, an advanced market commitment to help scale emerging carbon removal technologies that are crucial to tackling climate change.
Embraced an Emissions First accounting framework that moves beyond the current approach of megawatt-hour matching and focuses on emissions impact.
And during COP27 itself, were honored to supportThe Resilience Hub, an inclusively-built virtual and physical space that served as the home to the Race to Resilience campaign. Representing more than 1,500 non-state actors taking action on resilience around the world, the hub hosted more than 60 sessions each with incredible speakers offering their expertise and perspectives as well as live performances, art and culture.
Importantly, too, Meta is supporting and amplifying changemakers on the front lines of the climate fight. After our largest-ever global survey about climate change this past spring painted a picture of deep concern among respondents, we’re already seeing meaningful change happen when communities come together. More than 40 million people around the world are part of at least one of the 24,000 Facebook Groups dedicated to the discovery, protection, and appreciation of the earth and our environment.
In the meantime, Meta Sustainability continues to report on its work across our enterprise. As theU.N. High-Level Expert Group report clearly states, integrity matters, which is why our net zero commitments are not only public but are relentlesslytracked and reported each year.
But as the U.N. report notes, a net zero pledge “must contain steppingstone targets for every five years” in line with Intergovernmental Panel on Climate Change (IPCC) or International Energy Agency (IEA) pathways as well as “prioritize urgent and deep reduction of emissions across their value chain.”
We agree. That’s why I look forward to sharing our own specific decarbonization plans in early 2023. And while I look forward to seeing my sustainability peers at COP28 next November as well, I encourage those in the private sector — companies big,small and every size in between— to join us in the climate fight.
Time is literally running out — and we need all of you, and all of your solutions, to make this work.
The Little Sable Lighthouse on Lake Michigan. Many of the legal diversions of water tap Lake Michigan. Photo: MI PR
From Michigan Radio | By Lester Graham • Published February 2, 2023
This week a nationwide Associated Press story looked at the possibility of pumping water from the Mississippi River to the drought-stricken West. That might sound familiar. For years, people in the Great Lakes region have been wary of those dry states looking at diverting water from the Great Lakes.
The cost to pump water that far would be enormous, as Michigan Radio’s Mark Brush reported in 2015. It would require hundreds of miles of large pipes. Since much of the distance would be uphill — across at least one mountain range — many new power plants would be needed to power the pumping stations along the way. In the past, it was believed the cost of that water would astronomical.
With years-long droughts in Western states, some areas are desperate for water. And when you’re desperate you might be tempted to spend astronomical amounts. The thinking is pretty simple: If the Great Lakes have so much water and we have so little, doesn’t it make sense to give us access?
“I think that’s very intuitive to people,” said University of Michigan professor Richard Rood. He studies climate change and its effects.
But the Great Lakes states have an agreement that bans diverting water from the lakes. The Great Lakes Compact was approved partly because they were concerned about diversions closer to home. Towns straddling or just outside the basin wanted access to the water. The Great Lakes Compact bans water diversions in most cases. And even if a diversion is approved, it takes a unanimous vote from all eight Great Lakes states.
Climate change and its effects are challenging all our notions about controlling water. Economic and political pressures are building.
“I believe that once those stresses get high enough, that really all treaties, all things that have been done by humans will be up for negotiation,” Rood said.
Climate change effects are happening sooner and causing challenges that are catching policymakers unprepared.
The water levels of the Great Lakes is a good example. The lakes have always had a cycle of high levels and then low levels. But the much quicker water-level changes, along with higher highs and lower lows, are new.
When water levels get extremely high as they have been in recent years, there aren’t a lot of mechanisms to lower the level. There’s no pressure valve.
“I feel as if one of the most important things to do to anticipate climate change for this region is to start to seriously think about water and water management associated with the Great Lakes,” Rood said.
He did not specifically say that the excess water could or should be pumped elsewhere. But all the tools and all the rules regarding the Great Lakes could be subject to unprecedented economic and political pressure if officials are not prepared.
Rood says they need to start looking at things anew.
“I think all of those compacts, all the agreements, any engineering assets that are currently available were designed for an old climate. And when they were considering the new climate, I don’t think that they actually considered how quickly the climate is changing.”
A colorized image of the 1963 civil rights March on Washington, where an estimated 250,000 people gathered to demand equal access to jobs, housing and education — and hear Martin Luther King Jr.’s now famous “I Have a Dream” speech.
By Mary Mazzoni from triple pundit.com • Reposted: February 3, 2023
Corporate efforts to observe Black History Month are often cringe-worthy at best and offensive at worst. If you’re planning to add a kente avatar on social media or pen a generic letter to employees, please do us all a favor and stop now. Business leaders can — and should — do better. Here’s some advice to get you started, from the Black thought leaders who have been telling us for years.
Don’t: Pander to your employees and customers this Black History Month
In the Year of Our Lord 2023, we should really all be past the platitudinous “Happy Black History Month” email to employees — or worse, the dreaded product drop. Think back to when TriplePundit asked workplace inclusion expert Kim Crowder about corporate cash-grabs around Juneteenth: “This is a repeat of why Juneteenth was needed,” she reminded business leaders. “It is basically commodifying the Black American experience by those who do not share those experiences and who have benefitted from the enslavement of people.”
The same holds true for brands that seek to capitalize on Black History Month while doing little to honor Black history or benefit Black communities. Just ask Ernest Owens, editor at large for Philadelphia magazine, who has never been shy with his opinions about how brands observe the holiday.
“Just like Pride Month, Black History Month has become a routine time of year when corporations say the absolute most while doing the least for marginalized communities,” he wrote in a 2021 op/ed for the Washington Post.
Do: Look inwardly — and act accordingly
Rather than looking to commodify the holiday or pat your company on the back for its great work on racial equity, turn your mind to the work ahead of you — and communicate frankly and thoughtfully with your employees and stakeholders about what comes up.
“Organizations should be looking beyond one day and focusing on areas such as pay equity, promotion rates, the ability for Black team members’ work to be seen and acknowledged, and partnering with Black businesses regularly — including paying them well for their work,” Crowder told us. “The goal is to work toward Black liberation every day.”
Don’t: Expect praise for pennies
In December polling commissioned by TriplePundit, less than 20 percent of over 3,000 U.S. consumers said they’d be impressed by a billion-dollar company donating $5 million to a social cause like racial equity, with the majority agreeing that “business should do more.”
Findings like these indicate that people are growing more wary of brands appearing to “check the box” by donating to a nonprofit. They want to see what changes you’re making, and they want to hear about the outcomes of that change.
“The key here is authentic leadership — in other words, walking the walk, not just talking the talk,” Gary Cunningham, president and CEO of Prosperity Now, told TriplePundit back in 2021. “It’s easy to say that you’re anti-racist without changing anything about how your organization operates.”
Do: Champion your partners
Of course, there’s absolutely nothing wrong with donating to nonprofits or establishing new programs that look to address racial equity, nor is it intrinsically wrong to communicate these programs during Black History Month. But if you do, do so thoughtfully.
Find clear alignment between your company, your teams and the nonprofits you support. Communicate with your stakeholders about the great work your partners do and why you trust them. For example, did someone from your team recommend this organization? Does it work in your community? Is it particularly positioned to address the issues your teams and stakeholders care about most? Remember, this is an opportunity to educate your stakeholders about the issues — and highlight the perspective of your community partners that know these issues best.
“So often I’ve witnessed corporations and business leaders act as if because they are very smart and can solve problems that they can understand and know how to solve the complex problems of racial and ethnic inequality,” Cunningham told us. “Trust the guidance of people who can help you learn, help you bring your work into the community, and help you understand the depth of the issues that you’re trying to contain.”
Don’t: Task your Black employees with more unpaid work
As companies pushed to demonstrate their commitment to racial equity in 2020, it wasn’t long before they looked toward their Black employees to do the hard work for them.
Asking Black employees to speak on panels, lead new employee resource groups, or consult on strategies for diversity, equity and inclusion (DEI) — all for no added compensation — is not only unfair, but it also plainly illustrates the very inequities these companies claim to oppose. Over half of Black women in particular told the consultancy Every Level Leadership they feel singled out as the sole resource to educate their colleagues about DEI.
Think of your team’s well-being, and don’t repeat the ugly cycle this Black History Month. As Najoh Tita-Reid, chief marketing officer for Logitech, observed in Fortune back in June 2020: “Black people did not create these problems, so please do not expect us to resolve them alone.”
Do: Take responsibility for educating yourself
It’s past time for non-Black people to take personal responsibility for educating themselves about racial justice issues, rather than leaning on their friends and colleagues. If you’re an executive, read more, watch more and generally consume more media about the topic. Encourage everyone in your organization to do the same, and give them opportunities to discuss it, if and when they choose.
“Take responsibility for your own education on racial issues,” Tita-Reid suggested in Fortune. “Create companywide forums and Q&A sessions to educate large groups. Bring in experts, if needed, to provide actionable plans that systematically implement racial equity. Identify those of us who are open to speak, and respect those of us who do not want to talk about the situation.”
When it comes to your formal DEI strategy work: Resource it, and pay your teams accordingly. “Do not shortchange race equity work,” Andrea J. Rogers and Tiloma Jayasinghe of Community Resource Exchange recommend in Nonprofit Quarterly. “And if you feel like doing that, ask yourself why, and take this opportunity to unpack biases around what is valued, who is valued, and what impact means for your organization.”
As soda consumption has dropped in the West, companies are making an effort to woo new customers in other places. This Coke bottle ad is in Mozambique. Photo: Thomas Trutschel/Photothek via Getty Images
That’s a question Coca-Cola and other soda makers are wrestling with as soda drinking has waned in U.S. and European markets.
In the 2010s, Coke made a big push into rural parts of lower income countries to sell more soda. So they made smaller, more durable bottles – a 1-cup serving size that could be sold more cheaply and last longer on the shelves.
They built solar-powered coolers that allowed sellers to keep Coke bottles cold in places off the electrical grid – and offer mobile phone-charging to their customers.
And they launched “splash bars” – small businesses run by women that sold shots of Coke, Fanta and other Coca-Cola products for as low as 7 U.S. cents a serving to make the beverage affordable to everyone.
Eduardo J. Gómez is the author of the new book Junk Food Politics: How Beverage and Fast Food Industries Are Reshaping Emerging Economies. Photo: Eduardo J. Gómez
The company presented this strategy as a win-win – they benefited because their product was becoming more available in remote areas and female entrepreneurs had a new way to earn a living.
That’s a story that Eduardo J. Gómez tells in his new book. As he points out, Coke’s characterization of a win-win isn’t universally embraced.
Gómez, director of the Institute of Health Policy and Politics at Lehigh University, says Coca-Cola is one of many junk food companies – fast-food giants like McDonald’s and KFC – who are targeting “emerging economies” – countries where income is on the rise along with trade with wealthier nations.
In these countries, many people see the ability to buy so-called junk food – not just soda but packaged chips and candies and fast food from chains – as a sign they’re made it. And the junk food manufacturers try to put a positive face on their campaignsto expand their audience. They forge partnerships with local governments to fight hunger and poverty – even as the rising consumption of junk food leads to soaring rates of obesity and diabetes.
In his new book, Junk Food Politics: How Beverage and Fast Food Industries Are Reshaping Emerging Economies, Gómez describes a two-way street, where industry and political leaders work together to launch well-meaning social programs – but also skirt regulations that would harm industry’s profits. The result, Gómez says, is that junk food industries thrive in low resource countries at the expense of children and the poor, who develop long-term health problems from consuming sugar-laden, ultra-processed foods.
NPR spoke with Gómez about junk food barges, soda taxes and why healthy eating campaigns aren’t cutting it against ads for candy and fried chicken. The conversation has been edited for length and clarity:
Let’s start with an easy question. What is junk food?
Johns Hopkins University Press
I define junk food as highly ultra-processed fast foods, from KFC to burgers, candies, confectionery, ice cream. Junk food is also Coca-Cola, Pepsi, Mountain Dew – high-sugar, carbonated soda drinks.
What role does junk food play in lower- and middle-income countries?
There’s a proliferation of these junk foods now, not only in cities but in rural communities in India, in Mexico, even into the Brazilian Amazon.
In the emerging economies, these foods that were not [previously] accessible suddenly became very accessible in the 1990s or early 2000s.
We’re seeing [a vast and rapid] infiltration of these foods because of what I call “fear and opportunity.” “Fear” that industries have of losing market [share] in Western nations, and “opportunity” because there’s a [growing] middle class in these emerging economies that are eager to purchase them.
What is junk food politics?
Junk food politics is a two-way street. It’s when [junk food] industries influence politics and society so they can avoid regulations that will impact their profitability, such as taxes on junk foods and regulations on marketing and sales.
We often think industry is to blame. But governments are also to blame [because political leaders partner with industry on their own political agendas – which gives industry clout to undermine policies that would cut their profits].
What’s a good example of junk food politics in action?
In Brazil, for example, you have the rise of industry groups, [like the Brazilian Food Industry Association] that were very, very influential in lobbying the congress and infiltrating national agencies that are working on regulations [like advertising restrictions for junk food]. They’re engaging in partnerships [with governments and communities where] they can be perceived as a solution to the problems [of obesity and diabetes] by, for instance, helping to improve the [sharing] of nutritional information. They’re building legitimacy and avoiding costly regulations.
At the same time, [Brazil’s] President Lula [in his prior term] had a famous anti-hunger campaign. And Lula worked with Nestlé to strengthen this program and went as far as creating an office within his presidential palace to partner with industries that wanted to contribute to this anti-hunger program. And so that was a strategic, two-way partnership that benefited industry and benefited the government.
Of course, President Lula’s intentions were admirable in alleviating hunger. But perhaps it wasn’t a good idea to partner with companies that produce a lot of these ultra-processed foods, because it indirectly legitimizes the company. It amplifies the popularity of their products and their harmful consequences to health.
As low-resource countries rise in wealth, rates of obesity and diabetes also tend to rise. What is the scope of the problem? Why does it happen?
The incidence of childhood obesity is growing much faster in developing countries [than in the West]. [Rates of] type 2 diabetes among adolescents are extremely high in India and China and Mexico.
The rural poor are also becoming obese and getting diabetes. This is something we don’t normally assume. In India, for example, in the 1990s and early 2000s, obesity was seen as a “disease of luxury.” It was perceived that only people with status and money that could go to fast food establishments were having this problem. For many years the government didn’t do anything because they perceived [growing rates of diabetes and obesity]as affecting a small minority of the population.
But now, it’s become a general issue because of the increased access to junk foods.
How has access increased? How did junk foods go from being concentrated in cities to being common food items in rural places?
[Junk food distribution]started in cities, and over time they [expand] out to other areas of the country. In Brazil, for a while, Nestlé had these large blue Nestlé boats that traveled throughout the Amazon and distributed candy and cookies throughout the Amazon. [The “junk food barges,” as critics called them, have stopped]. In rural India, there are shops where people pay for one small shot of Coca-Cola while getting their phones charged.
In every country, junk food is something that’s voluntarily bought. It’s voluntarily eaten. So why are programs that encourage healthy eating and daily exercise and nutrition labeling not enough to convince people to avoid it?
Of course we want people to have nutritional information – we want people to know more, and we want them to know what they’re eating. And there’s growing commitment and success on better food labels. Chile, for example, has introduced more effective food labels – on products high in salt, sugar and fat, they have adopted these black octagon images that are on the food products – that have rippled out through the Americas.
But people are always flooded with marketing and access [to processed foods]. Even when you have this knowledge, there are incentives for you to eat these products that are readily available and less healthy.
What I hear you saying is that healthy eating and exercise campaigns focus on the individual, but poor health and nutrition are rooted in bigger, systemic problems.
Yes, absolutely. Nutritional information is very important, but it’s insufficient. We need to address socioeconomic factors, marketing factors, all these things that play into [making junk foods an easy, accessible choice].
You say governments in low-resource countries have made some progress on taxing junk foods and improving the labeling. What else do you think needs to happen?
Noneof these governments have committed to restricting advertising. [Countries have, instead, relied on voluntary pledges from companies to refrain from marketing unhealthy foods to children.] In a lot of these countries, there are no firm laws on what can be sold in schools. And even when they have laws or rules that prohibit the sale of junk foods in schools, they are not effectively being enforced.
There’s a paradox: While countries [such as Mexico, Brazil, India and Indonesia] have done a great job of increasing nutritional awareness, obesity and diabetes is still skyrocketing. And that’s because governments are doing a little bit on the fringes but not really getting to the heart of the problem. They’re not taking on these industries through regulations to sales and advertising.
What does junk food politics cost society?
There’s an extremely high cost to society, mainly from the health consequences. If you develop type 2 diabetes as a consequence of high sugar intake, it has a tremendous impact on your quality of life. Argentina, for example, has seen a crisis in the affordability of insulin. In the context of global universal health care, we don’t pay enough attention to ensuring that the poor do not go broke in getting the medicines that they need to address their high blood pressure, their [blood] sugar.
What’s the solution? What can cut into the influence that junk food politics has on public health?
The solution is having a government that is committed to ensuring the health of all of society. One that provides activists and communities with a voice that is equal to, or exceeds, the voice of industries within government. One that has no fear of taking on the powerful industries and creating regulations that protect vulnerable populations – especially children and the poor – over the interests of major corporations.
And the solution, too, is our work in communities as researchers and as community members, to raise the awareness about the importance of good nutrition and exercise, and to increase awareness about the need for access to healthier foods.
And just wondering if climate change will play any role?
That’s the topic of my next book – climate change and malnutrition.
And your thesis is that with the changing climate …
… the availability of healthy foods becomes increasingly scarce.
Solar panels gleam in the late-afternoon light at the Sylvan solar project just west of Brainerd on Dec. 7. Minnesota Power recently built the 15.2-megawatt project and two others in Hoyt Lakes and Duluth as part of its effort to increase its solar capacity. Photo: Kirsti Marohn | MPR News
By Kirsti Marohn from Minnesota Public Radio News • February 2, 2023
A bill that would require Minnesota’s electricity to be carbon-free by 2040 is speeding through the Legislature.
The House has already passed the measure, and the Senate is set to vote on it Thursday. Here’s a closer look at the bill, and what it will mean for electric utilities and their customers.
In Minnesota, burning fossil fuels like coal and natural gas to produce electricity is one of the biggest sources of carbon and other greenhouse gasses that contribute to climate change.
What’s prompting state lawmakers to push this through now?
It’s being driven mainly by concerns about climate change.
It’s no longer the biggest culprit, as utilities have moved toward cleaner energy sources such as solar and wind. Transportation and agriculture are now the largest contributors of greenhouse gasses in Minnesota.
However, Gov. Tim Walz, DFL lawmakers and environmental groups want to see utilities make the transition to cleaner electricity more quickly. The carbon-free electricity measure is part of an action plan to combat climate change the Walz administration released last fall.
The proposal has been debated for a couple of years. Now that the DFL Party controls both the House and Senate, it has a real chance of passage.
What would the bill do?
It includes two separate standards for renewable and carbon-free energy.
A 2007 Minnesota law already requires utilities to get at least 25 percent of their electricity from renewable sources. The state achieved that goal early, in 2017. This bill would bump that amount up to 55 percent renewable by 2035.
It also creates a new carbon-free standard. It requires utilities that do business in Minnesota to get a percentage of their electricity from carbon-free sources — starting with 80 percent by 2030, 90 percent by 2035 and finally, 100 percent by 2040.
What’s the difference between renewable and carbon-free energy?
The bill defines renewable energy as solar, wind, hydropower, hydrogen and biomass, such as a plant that burns garbage or wood to produce electricity.
There is one exception in the bill — the Hennepin Energy Recovery Center, or HERC, which burns trash for energy in downtown Minneapolis. It’s been a source of environmental justice concerns over the years because of the air pollution it emits.
The HERC stacks are 215 feet tall. MPCA models show pollution disperses mostly to the north and south of the plant, with heaviest deposition between Broadway Street and Loring Park. Photo: Stephanie Hemphill | MPR
The bill’s authors say that facility should not be considered in the same category as other renewable energy sources such as solar or wind.
Another change: Previously, only energy from small hydropower projects under 100 megawatts qualified as renewable. The bill lifts that restriction, so large, existing hydropower projects would now qualify.
That’s significant, because it would now include electricity that Minnesota Power gets from a large hydro facility on the Manitoba River in Canada, which has been controversial among some environmental and tribal groups.
What qualifies as carbon-free energy?
Carbon–free energy sources are those that don’t release any carbon dioxide, such as solar, wind, hydropower or nuclear. Under the bill, nuclear power is not considered a renewable energy source, but it is carbon free.
Minnesota has two nuclear plants, at Prairie Island and Monticello, owned by Xcel Energy. Xcel has said it plans to continue to operate those plants at least for the next couple of decades to help its carbon-free goals.
Minnesota law currently bans building new nuclear plants in the state. Some Republican lawmakers have argued that the ban should be lifted to allow new nuclear energy production, especially smaller modular technology.
Xcel Energy’s Prairie Island Nuclear Generating Plant is seen through a gate from Wakonade Drive in Prairie Island Indian Community in Welch, Minn. The plant began operating in 1973 and is located adjacent to Prairie Island Indian Community. On-site storage of nuclear waste has proven controversial, as Prairie Island is among the closest communities to a nuclear power plant in the U.S. Photo: Tom Baker for MPR News
Are utilities saying whether they will be able to meet these new standards?
The state’s largest utilities, including Minneapolis-based Xcel Energy and Duluth-based Minnesota Power, have been cautiously supportive. They already have goals of being carbon-free by 2050, so this would move up that date by a decade.
“We’re actually excited about being pushed to go faster,” said Chris Clark, Xcel’s president in Minnesota, North and South Dakota, in an interview. “We also recognize, though, that it’s a challenge.”
A big reason why major utilities aren’t opposing the bill is because it includes exemptions and ways they can meet the standard without ditching fossil fuels altogether.
For example, a utility could buy renewable energy credits to offset electricity generated by a natural gas plant.
Also, the bill contains so-called “off ramps.” The state Public Utilities Commission could allow a utility to delay meeting the standard if doing so would have big impacts on electric rates or create reliability issues.
“It is an offset mechanism to add flexibility, and address that there is some uncertainty about how to reach a fully carbon-free electric system top to bottom,” said Allen Gleckner, clean electricity director for the nonprofit Fresh Energy. But he thinks utilities will be able to meet the standard by adding more solar and wind and adopting new technologies, such as battery storage.
Another exemption gives utilities leeway for what’s called “beneficial electrification” — for example, if a utility needs more capacity to switch people using natural gas to heat their homes to electricity.
What’s been the response of member-owned cooperatives to the bill?
Some co-ops have voiced concerns about whether they’ll be able to meet these standards while keeping their costs in check. They tend to be smaller, and often have contracts to buy power from fossil fuel plants.
As a compromise, the bill was amended to give co-ops and municipal power agencies a little more time to make the transition.
They would need to be 60 percent carbon free by 2030, instead of 80 percent like the investor-owned utilities. But all utilities would need to reach the 100 percent standard by 2040.
Why is North Dakota involved in the debate?
North Dakota produces a lot of power from coal and gas. Top officials in that state have threatened a lawsuit over Minnesota’s bill, saying it would illegally restrict interstate commerce and hinder their ability to develop technology to capture carbon.
This isn’t the first legal spat the two states have had over the issue.
North Dakota officials sued Minnesota over its 2007 law that essentially banned the state from importing power from new coal plants outside of the state. A federal court sided with North Dakota.
If the bill passes the Senate, what’s the next step?
The Senate will consider the same bill that passed the House. If it passes, it will go to Walz, who has said he will sign it.
By Peter de Menocal, Director, Woods Hole Oceanographic Institution via The Conversation • February 1, 2023
Deep below the ocean surface, the light fades into a twilight zone where whales and fish migrate and dead algae and zooplankton rain down from above. This is the heart of the ocean’s carbon pump, part of the natural ocean processes that capture about a third of all human-produced carbon dioxide and sink it into the deep sea, where it remains for hundreds of years.
There may be ways to enhance these processes so the ocean pulls more carbon out of the atmosphere to help slow climate change. Yet little is known about the consequences.
Peter de Menocal, a marine paleoclimatologist and director of Woods Hole Oceanographic Institution, discussed ocean carbon dioxide removal at a recent TEDxBoston:Planetary Stewardship event. In this interview, he dives deeper into the risks and benefits of human intervention and describes an ambitious plan to build a vast monitoring network of autonomous sensors in the ocean to help humanity understand the impact.
First, what is ocean carbon dioxide removal, and how does it work in nature?
The ocean is like a big carbonated beverage. Although it doesn’t fizz, it has about 50 times more carbon than the atmosphere. So, for taking carbon out of the atmosphere and storing it someplace where it won’t continue to warm the planet, the ocean is the single biggest place it can go.
Ocean carbon dioxide removal, or ocean CDR, uses the ocean’s natural ability to take up carbon on a large scale and amplifies it.
Carbon gets into the ocean from the atmosphere in two ways.
In the first, air dissolves into the ocean surface. Winds and crashing waves mix it into the upper half-mile or so, and because seawater is slightly alkaline, the carbon dioxide is absorbed into the ocean.
The second involves the biologic pump. The ocean is a living medium – it has algae and fish and whales, and when that organic material is eaten or dies, it gets recycled. It rains down through the ocean and makes its way to the ocean twilight zone, a level around 650 to 3300 feet (roughly 200 to 1,000 meters) deep.
The years indicate how long deposited carbon is expected to remain before the water cycles to the surface. Graphic: Woods Hole Oceanographic Institution
The ocean twilight zone sustains biologic activity in the oceans. It is the “soil” of the ocean where organic carbon and nutrients accumulate and are recycled by microbes. It is also home to the largest animal migration on the planet. Each day trillions of fish and other organisms migrate from the depths to the surface to feed on plankton and one another, and go back down, acting like a large carbon pump that captures carbon from the surface and shunts it down into the deep oceans where it is stored away from the atmosphere.
Why is ocean CDR drawing so much attention right now?
The single most shocking sentence I have read in my career was in the Intergovernmental Panel on Climate Change’s Sixth Assessment Report, released in 2021. It said that we have delayed action on climate change for so long that removing carbon dioxide from the atmosphere is now necessary for all pathways to keep global warming under 1.5 degrees Celsius (2.7 F). Beyond that, climate change’s impacts become increasingly dangerous and unpredictable.
Because of its volume and carbon storage potential, the ocean is really the only arrow in our quiver that has the ability to take up and store carbon at the scale and urgency required.Peter de Menocal at TEDxBoston: Planetary Stewardship.
A 2022 report by the national academies outlined a research strategy for ocean carbon dioxide removal. The three most promising methods all explore ways to enhance the ocean’s natural ability to take up more carbon.
The first is ocean alkalinity enhancement. The oceans are salty – they’re naturally alkaline, with a pH of about 8.1. Increasing alkalinity by dissolving certain powdered rocks and minerals makes the ocean a chemical sponge for atmospheric CO2.
A second method adds micronutrients to the surface ocean, particularly soluble iron. Very small amounts of soluble iron can stimulate greater productivity, or algae growth, which drives a more vigorous biologic pump. Over a dozen of these experiments have been done, so we know it works.
Third is perhaps the easiest to understand – grow kelp in the ocean, which captures carbon at the surface through photosynthesis, then bale it and sink it to the deep ocean.
But all of these methods have drawbacks for large-scale use, including cost and unanticipated consequences.
I’m not advocating for any one of these, or for ocean CDR more generally. But I do believe accelerating research to understand the impacts of these methods is essential. The ocean is essential for everything humans depend on – food, water, shelter, crops, climate stability. It’s the lungs of the planet. So we need to know if these ocean-based technologies to reduce carbon dioxide and climate risk are viable, safe and scalable.
You’ve talked about building an ‘internet of the ocean’ to monitor changes there. What would that involve?
The ocean is changing rapidly, and it is the single biggest cog in Earth’s climate engine, yet we have almost no observations of the subsurface ocean to understand how these changes are affecting the things we care about. We’re basically flying blind at a time when we most need observations. Moreover, if we were to try any of these carbon removal technologies at any scale right now, we wouldn’t be able to measure or verify their effectiveness or assess impacts on ocean health and ecosystems.
So, we are leading an initiative at Woods Hole Oceanographic Institution to build the world’s first internet for the ocean, called the Ocean Vital Signs Network. It’s a large network of moorings and sensors that provides 4D eyes on the oceans – the fourth dimension being time – that are always on, always connected to monitor these carbon cycling processes and ocean health.
Right now, there is about one ocean sensor in the global Argo program for every patch of ocean the size of Texas. These go up and down like pogo sticks, mostly measuring temperature and salinity.
We envision a central hub in the middle of an ocean basin where a dense network of intelligent gliders and autonomous vehicles measure ocean properties including carbon and other vital signs of ocean and planetary health. These vehicles can dock, repower, upload data they’ve collected and go out to collect more. The vehicles would be sharing information and making intelligent sampling decisions as they measure the chemistry, biology and environmental DNA for a volume of the ocean that’s really representative of how the ocean works.
Having that kind of network of autonomous vehicles, able to come back in and power up in the middle of the ocean from wave or solar or wind energy at the mooring site and send data to a satellite, could launch a new era of ocean observing and discovery.
Does the technology needed for this level of monitoring exist?
We’re already doing much of this engineering and technology development. What we haven’t done yet is stitch it all together.
For example, we have a team that works with blue light lasers for communicating in the ocean. Underwater, you can’t use electromagnetic radiation as cellphones do, because seawater is conductive. Instead, you have to use sound or light to communicate underwater.
We also have an acoustics communications group that works on swarming technologies and communications between nearby vehicles. Another group works on how to dock vehicles into moorings in the middle of the ocean. Another specializes in mooring design. Another is building chemical sensors and physical sensors that measure ocean properties and environmental DNA. A tour of sea life in the ocean twilight zone.
This summer, 2023, an experiment in the North Atlantic called the Ocean Twilight Zone Project will image the larger functioning of the ocean over a big piece of real estate at the scale at which ocean processes actually work.
We’ll have acoustic transceivers that can create a 4D image over time of these dark, hidden regions, along with gliders, new sensors we call “minions” that will be looking at ocean carbon flow, nutrients and oxygen changes. “Minions” are basically sensors the size of a soda bottle that go down to a fixed depth, say 1,000 meters (0.6 miles), and use essentially an iPhone camera pointing up to take pictures of all the material floating down through the water column. That lets us quantify how much organic carbon is making its way into this old, cold deep water, where it can remain for centuries.
For the first time we’ll be able to see just how patchy productivity is in the ocean, how carbon gets into the ocean and if we can quantify those carbon flows.
That’s a game-changer. The results can help establish the effectiveness and ground rules for using CDR. It’s a Wild West out there – nobody is watching the oceans or paying attention. This network makes observation possible for making decisions that will affect future generations.
Do you believe ocean CDR is the right answer?
Humanity doesn’t have a lot of time to reduce carbon emissions and to lower carbon dioxide concentrations in the atmosphere.
The reason scientists are working so diligently on this is not because we’re big fans of CDR, but because we know the oceans may be able to help. With an ocean internet of sensors, we can really understand how the ocean works including the risks and benefits of ocean CDR.
The late comic George Carlin once said, “You don’t need a formal conspiracy when interests converge.”
A recent assessment of the educational background of world leaders underscores Carlin’s quip, and it provides at least one explanation for global leaders’ consistent inaction regarding climate change: They all went to the same schools.
The new project by youth campaign group Mock COP found that the 30 top universities in the world have not fostered the leadership skills and civic engagement necessary for our world leaders to navigate the impending ecological crisis.
Entitled “1.5 Degrees,” referencing the solemn recommendation from climate scientists that the planet must not warm beyond 1.5 degrees Celsius to prevent catastrophe, the project demonstrates that current world leaders are birds of a feather — an idle feather at that.
Just as Carlin said, the converging interests of world leaders — who share common backgrounds, educations, worldviews, priorities and goals — has resulted in an informal conspiracy of inertia.
Top universities failed leaders, and leaders fail us
“The people with the privilege to study at the so-called ‘top’ universities, and go on to become key decision-makers across society, are being educated at institutions that do not act in the public good and do not ensure their graduates are prepared to lead a more just and sustainable future,” the 1.5 Degrees website reads.
The project includes a ranking that grades the world’s top universities on how their engineering, law, economics, politics and health courses, which are traditionally chosen by decision-makers, align with the actions needed to tackle the climate crisis.
The ranking of top universities includes Yale, Cambridge, Oxford and Stanford Universities, as well as the Massachusetts Institute of Technology and Imperial College London. No institution received a favorable grade. MIT, as well as Beijing’s Tsinghua and Peking Universities, scored the worst at preparing their graduates for a low-carbon future.
The team of young activists at Mock COP ultimately concluded that the most educated among us are often the worst enablers of climate destruction. They further found that critical courses pertaining to environmental citizenship are “influenced by large corporates working against the advice of the world’s leading climate scientists.”
By and large, leaders around the world are consistent in their approach to climate change — they don’t approach it at all. This can’t come as a surprise, though, once the common education factor is acknowledged. For example, Mock COP found that 20 current heads of state attended Harvard University. These schools shape their students’ worldviews, so if world leaders all went to the same few top universities, it is no wonder that they are acting in lockstep.
“World leaders consistently let us down at conferences like Davos, where they have the opportunity to create real, lasting change,” said Josh Tregale, a mechanical engineering student and Mock COP campaign coordinator, in a statement — referring to the World Economic Forum’s annual meeting earlier this month. “Had our leading decision makers undertaken university courses which effectively taught the facts of the climate crisis and instilled sustainable thinking, then they would understand the urgency and act accordingly. Instead they are uneducated on the facts and unprepared for climate leadership.”
This all adds up to world leaders are well-meaning and inept at best — and ill-intentioned and adept at worst. Neither is very reassuring, but now that the issue has been identified, Mock COP hopes to influence change.
Youth organizers at Mock COP push for curriculum reform to tackle climate change
Mock COP hopes this project will serve to influence curriculum reform and create more of an emphasis on civic duty and environmental engagement at these top universities. If the most exclusive and accomplished institutions begin to prioritize this sort of education, the rest of academia should follow suit.
The team expects this information to help climate-minded young people decide where to study, as many students may think twice about attending these top institutions after Mock COP’s report.
The planet is not dying from ignorant people making mistakes. It is dying from self-interested, highly educated people making deliberate decisions that prioritize profits over planet. It is time to start teaching the people who have the power to save the planet that saving the planet is not only in their best interest — it’s in their job description.
New offerings spur rapid growth. From Installnet • February 1, 2023
With a growing roster of Fortune 1000 clients, commercial furniture solutions company Installnet today announces its brand refresh to better reflect its purpose and mission demonstrated through the company’s new offerings and development.
The company’s new wordmark reflects its modern and flexible approach to finding solutions that simplify the creation of inspired workspaces. Installnet’s self-serve platform of 350 commercial furniture installation companies, previously known as the Office Furniture Installation Alliance (OFIA), has been rebranded as Installhub.
The purpose of Installnet, founded more than 25 years ago, is to create opportunities for people and communities to thrive. The company provides a range of services, from premium project management to Ecoserv, an award-winning circular decommission program.
“Our mission is to deliver industry-leading solutions that help employees, business and communities prosper,” said Dale Ewing, founder of Installnet. “That includes zero waste to landfill through our Ecoserv program, which provides a much-needed, credible solution to companies serious about meeting their sustainability goals. Getting zero done is an audacious, but achievable goal.”
Over the last year, Installnet has served more than 50 Fortune 1000 companies. Its award-winning Ecoserv program has diverted more than 30 million pounds of waste from landfills since its founding in 2012 and served more than 1600 community groups, providing much-needed furniture, fixtures and equipment.
In 2022, Ecoserv diverted 92% more waste from landfill than the year before and donations to community groups rose 35%. Installnet and Ewing were both honored with 2022 SEAL Sustainability Awards for Ecoserv. The SEAL Sustainability Award honorees range from global brands to high-growth start-ups and scale-ups. This is the second consecutive year Installnet has received the award.
In 2022 the company completed more than 11,000 installation projects in the U.S. and Canada, helping customers create inspired workspaces. With a robust installation partner network and a proprietary web-based software, the company expects to grow 20% in 2023.
There’s good news on the viability of President Joe Biden’s climate agenda, with a new report detailing how the U.S. could potentially come within reach of his 2030 objective to power 80 percent of the nation’s electrical grid with clean energy. Doing so would also meet U.S. targets to halve carbon emissions by 2030, using a 2005 baseline, and further reduce them to 77 percent below 2005 levels by 2035, according to the report from the Natural Resources Defense Council (NRDC) and Evergreen Action.
Time is of the essence, however. And not just because of any impending climate tipping points. The current administration isn’t guaranteed a second term. And, as the Washington Post’s Maxine Joselow pointed out last week, an incoming Republican president would likely reverse any last-minute changes. Ironically, rushing the conversion may also be the best way to end partisanship over the issue as long-term savings become apparent to businesses and consumers alike.
“President Biden committed to the most ambitious set of climate goals in American history,” Charles Harper, power sector policy lead at Evergreen Action, said in a statement. “Important progress has been made, but President Biden must take bold action this year in order to deliver on those commitments. By ramping up its work to transition the U.S. economy toward 100 percent clean energy, the Biden administration and state leaders can reduce toxic pollution, cut energy costs, create good jobs, and advance environmental justice. Let’s get to work.”
The report lists necessary measures which, based on modeling, could result in meeting the climate goals set out in the president’s Inflation Reduction Act (IRA) if they are implemented immediately. Researchers say setting new and stringent rules through the Environmental Protection Agency and the Clean Air Act, as well as the Federal Energy Regulatory Commission (FERC), will be paramount. Other necessary courses of action include making the most of the IRA’s grant programs and tax credits, and promoting stronger state standards on emissions to match federal targets.
“We don’t need magic bullets or new technologies,” Manish Bapna, NRDC president and CEO, explained in a statement. “We already have the tools — and now we have a roadmap. If the Biden administration, Congress, and state leaders follow it, we will build the better future we all deserve. There is no time for half measures or delay.”
The report does not call for an end to new power plants that generate electricity from fossil fuels, but it does recommend that rule changes and emission standards be applied to existing gas and coal facilities as well. The transition away from fossil fuels is thus presented as more of a carrot than a stick situation — with funds from the IRA needed to encourage the expansion of renewables, as opposed to attempting to eliminate the construction of new fossil fuel-based plants.
The increasing availability and cheaper cost of renewable energy benefits not just consumers, but also the U.S. manufacturers and businesses that rely on all possible savings to remain competitive. The more that can be done to encourage the grid transition to renewables, the cheaper power will be for everyone. In time, then, partisan opposition to renewable energy should wane.
However, it’s important to remember that no type of consumption comes without consequences. Resources must still be extracted to build batteries, solar panels, wind turbines, etcetera in order to power the clean energy revolution. As such, we must be more careful not to create a whole new environmental disaster in the process of slowing the climate crisis.
People in the U.S. use four times as much energy as the worldwide average. Cheaper power runs the risk of increasing total consumption, as seen with the connection between gasoline prices and driving habits. With the impending robotization of multiple industries, increased power usage could be dramatically compounded and raise emissions above current modeling. Therefore, it is imperative that people in the U.S. look to reduce their consumption, in addition to cleaning up the grid.
Many Americans are already willing to adjust their lifestyles to combat climate change, but they need the tools to successfully lower their carbon footprints. Clean power is a big part of this, but so is a public transportation infrastructure that moves us away from the personal passenger vehicle — electric or not — as the primary mode of transportation.
Likewise, the backlash against remote work doesn’t just dismiss employee needs, but it also ignores the environmental benefits of fewer commutes and climate-controlled office buildings. By looking at the bigger picture, perhaps we will begin to understand that our planet does not have unlimited resources. No matter how we power things, we cannot do so from a thought process of ever expanding abundance with zero consequences.
Many younger workers in the U.K. are rejecting employers that lag in ESG. Image via Shutterstock/Prostock-studio.
By Stuart Stone from businessgreen.com • Reposted: January 30, 2023
A third of 18- to 24-year-olds have rejected a job offer based on the prospective employers’ environmental, social and governance (ESG) performance in favor of more environmentally friendly roles — fueling a growing trend dubbed “climate quitting” by KPMG.
The consultancy giant published the results of a survey of 6,000 U.K. adult office workers, students, apprentices and those who have left higher education in the past six months, which found that almost half — 46 percent — of those quizzed want the company they work for to demonstrate green credentials.
KMPG found that “climate quitting” is being driven by millennial and Gen Z job seekers who are attaching increased weight to the environmental performance of potential employers when considering new roles.
Overall, one-in five-respondents to the survey revealed they had turned down an offer from a firm whose ESG commitments were not consistent with their values, but the share of those rejecting jobs from companies with weak ESG credentials rose to one-in-three for 18- to 24-year-olds.
However, the survey revealed significant numbers of employees are assessing employers’ ESG performance when considering new roles, regardless of age.
It is the younger generations that will see the greater impacts if we fail to reach [global climate] targets, so it is unsurprising that this, and other interrelated ESG considerations, are front of mind for many.
Over half of 18- to 24-year-olds and 25- to 34-year-olds said they valued ESG commitments from their employer, while 48 percent of 35- to 44-year-olds said the same.
Moreover, 30 percent of respondents said they had researched a company’s ESG credentials when job hunting, rising to 45 percent among 18- to 24-year-olds.
A company’s environmental impact and living wage policies were key areas researched by over 45 percent of job seekers. Younger workers tended to be most interested in fair pay commitments, while those ages 35 to 44 were more likely to be interested in the environmental impact of a potential employer.
John McCalla-Leacy, head of ESG at KPMG, said it was little surprise that younger workers were prioritizing firms’ climate credentials.
“It is the younger generations that will see the greater impacts if we fail to reach [global climate] targets, so it is unsurprising that this, and other interrelated ESG considerations, are front of mind for many when choosing who they will work for,” he said.
“For businesses the direction of travel is clear. By 2025, 75 percent of the working population will be millennials, meaning they will need to have credible plans to address ESG if they want to continue to attract and retain this growing pool of talent.”
The results are likely to be welcomed by green businesses, which are facing significant recruitment challenges as they look to hire more people with sustainability and clean tech skills to support the delivery of their net zero targets.
The recent Salary and Recruiting Trends guide from recruitment consultancy firm Hays found that almost two-thirds of young jobseekers are on the hunt for roles in a sustainability sector that is crying out for new talent.
Grocery chains under pressure to switch from HFCs to natural refrigerants to curb climate change
Supermarket fridges and freezers leak powerful greenhouse gases called HFCs. Switching to ‘natural refrigerants’ such as CO2 could make a difference in cutting emissions. Photo: Terry Chea/AP
By Emily Chung · CBC News · Posted: January 29, 2023
Climate-conscious shoppers may buy local food and try to cut packaging waste, but those efforts could be negated by potent greenhouse gases leaking from supermarket fridges.
Refrigerants called hydrofluorocarbons or HFCs are widely used to keep food cold or frozen at grocery stores and during transport. (They’re also used for other refrigeration applications, like ice rinks and air conditioners).
They were originally brought in to replace ozone-depleting refrigerants called chlorofluorocarbons (CFCs), which were banned in a landmark 1987 agreement called the Montreal Protocol, in order to save the Earth’s protective ozone layer.
But HFCs are themselves powerful greenhouse gases.
Typically, each tonne of HFCs can trap as much heat in the atmosphere as 1,400 to 4,000 tonnes of carbon dioxide over 100 years, depending on the type of HFC.
Here’s a look at why that’s happening, what the solutions are, and how ordinary shoppers could make a difference.
How do HFCs get from supermarkets into the atmosphere?
Supermarket fridges aren’t like your fridge at home, which typically contains less than 200 grams of refrigerant. And it’s in a sealed unit that’s unlikely to leak, says Morgan Smith, spokesperson for the North American Sustainable Refrigeration Council.
Her non-profit group has partnered with industry to help enable the transition from HFCs to more climate-friendly refrigerants because the complexity of their systems make them prone to leaking significant amounts of HFCs.
Beneath and behind the cases of vegetables, dairy and frozen foods at a typical supermarket are kilometres of piping with thousands of valves, containing literally a tonne of refrigerant.
“It’s so large and so complex, with so many different points of connection that those systems are inherently leaky, and so they leak about 25 per cent of their refrigerant charge every year,” said Smith.
That’s something another non-profit group called the Environmental Investigation Agency has captured on video using infrared cameras and HFC detectors in U.S. grocery stores. It also measured levels of HFCs in the store using chemical detectors.
Three chemical detectors show readings of HFCs at a Gristedes grocery store in New York during a survey by the Environmental Investigation Agency and 350NYC in 2022. Photo: Environmental Investigation Agency
It detected leaks at 55 per cent of the dozens of U.S. stores where it took measurements. On average,it found a single supermarket emits 875 pounds (400 kilograms) of HFCs a year, equivalent to carbon emissions from 300 cars. In the U.S. alone, it calculated supermarket HFC leaks cause as much global warming as burning 22 million tonnes of coal.
How big a deal are these emissions really?
HFCs are such a big problem for climate change that Canada and 196 other countries have signed an international agreement, the Kigali Amendment to the Montreal Protocol, to reduce HFC consumption 85 per cent by 2036, relative to 2011 to 2013.
Shelie Miller, a professor who studies the environmental impact of the food system at the University of Michigan, says emissions from refrigerants may be relatively small compared to the food system emissions overall and major categories such as food waste.
“But that’s also just because the food system has such a big impact,” she said.
On the other hand, targeting HFCs in supermarkets can be very effective at curbing emissions.
“You can make fairly small changes and have a relatively large impact just because the chemicals themselves that we’re using right now have such large global warming potentials,” Miller said.
While potent, HFCs are short-lived greenhouse gases, said Miller, lasting no more than 30 years in the atmosphere, compared to hundreds of years for CO2. Since a typical refrigeration system lasts about 30 years, decisions made now about what refrigerant to use can affect global emissions for decades.
“We need to be thinking about the sources and the hubs of where emissions are happening. And so our grocery stores are a great way to target our overall food system and reduce emissions.”
What can be used for refrigeration in place of HFCs?
The main alternatives are called “natural” refrigerants because they are all chemicals found in nature. They include:
CO2.
Ammonia.
Propane.
While CO2 is a greenhouse gas, its global warming potential is so much lower than that of HFCs. And propane, while it’s a fossil fuel, is not burned when used in refrigeration. In fact, all three of these chemicals are considered refrigerants with ultra-low global warming potential.
How are Canadian supermarkets progressing at switching away from HFCs?
According to Shecco, a market research firm focused on sustainable technologies, there were 340 commercial CO2 refrigeration installations in Canada as of May 2020. That was far fewer than Japan, with 6,500 and Europe with 29,000, and growing more slowly than every other region in the world listed, including the U.S., Australia and New Zealand.
However, Jeffrey Gingras, president of Evapco LMP, a Laval, Que.-based company that makes CO2 refrigeration systems, said he’s seen an exponential growth in installations in the past three years, and did a record 125 installations in supermarkets, about half of them in Canada, in 2022.
The Environmental Investigation Agency has been building a global map of refrigerants used in supermarkets since it launched its Climate-Friendly Supermarkets project in 2019.
Two Canadian community groups, Drawdown Toronto and Drawdown B.C., have helped coordinate submissions to the map in their regions, and have added about 250 stores to the map. (Note: I volunteered for Drawdown Toronto while on leave from CBC News and added one store. You can read more about that in our What On Earth newsletter.)
This is a refrigerator label from the inside of a supermarket fridge, showing the type of refrigerant used. In this case, it’s an HFC called R404A, with a global warming potential close to 4,000 times that of CO2. Image: Emily Chung/CBC News
That was enough for the EIA to issue its first ever scorecard on Canadian supermarkets last fall. It reported on the five largest food retailers in Canada: Costco, Loblaws, Metro, Sobeys and Walmart.
The best-performing was Sobeys, which had the highest percentageof stores using ultra-low global warming potential refrigerants (nine per cent), was the only listed company that publicly reports its refrigerant leak rate (seven per cent) and has committed to transition to climate-friendly refrigerants for all new stores and renovation projects starting in 2024.
Some stores have also reported taking their own actions on HFCs, including Loblaws, which ranked third in the report and told CBC News that it has cut its greenhouse gas emissions by 30 per cent “in a large part” because of its strategy to reduce refrigerant leaks: using less refrigerant, detecting leaks early and reducing the emissions intensity of the refrigerants it uses.
Walmart Canada, which came fourth in the report, told CBC News in an email that it is installing natural refrigerants in all new stores and during major remodels with new grocery departments, and will switch all stores running on HFC refrigerants to more environmentally friendly options. It did not give a timeline, but said its global operations are aiming for zero emissions by 2040.
The other companies did not respond to CBC’s requests for comment.
EIA’s global map does show very few green dots in Canada compared to the U.S. and Europe. Avipsa Mahapatra, the group’s climate campaign lead, said that may be because no Canadian supermarket chains have not submitted their own data, unlike in other countries, and there isn’t much information.
“I actually have a hunch that Canada is not very far behind,” she said.
Ordinary shoppers can add local grocery stores to the Environmental Investigation Agency’s map of supermarket refrigerants. (Environmental Investigation Agency)
Why aren’t HFCs getting ditched faster?
Morgan Smith of the North American Sustainable Refrigeration Council said making the switch to natural refrigerants isn’t easy. They may require different training and equipment: ammonia is toxic, propane is flammable, and CO2 operates under very high pressures.
Smith said CO2 tends to be the natural refrigerant of choice for most supermarkets because it’s non-toxic and its systems work a lot like HFC systems.The high pressures mean it does need different piping and different valves, so a system can take months to build, and can’t just be swapped out overnight like parts of the existing system when it needs repairs.
It’s easiest if you have the space to build a new system alongside while the old system is still running, Smith said. Otherwise, you might have to shut down the store during the retrofit, which is difficult for both customers and the store operator.
For smaller stores, one option is to switch to individual fridges similar to your home fridge, with propane refrigerant in a sealed unit, Smith said.
Experts say it’s not easy to convert an existing HFC refrigeration system to natural refrigerants, as they often require different equipment such as valves and piping. Photo: CBC / Radio-Canada
Michael Zabaneh of the Retail Council of Canada said refrigerant projects are quite expensive for supermarkets.
“They can be challenging and that’s probably the biggest barrier, the need to pay for higher capital costs to either upgrade the equipment so that it can handle natural refrigerants, or buy new equipment.”
However, he said most large grocery chains are aware of the problems with HFCs and customer and investor pressure to reduce greenhouse gas emissions, and are taking action.
The Environmental Investigation Agency’s Mahapatra acknowledged that retrofitting older stores is expensive and challenging. However, she says grocery chains should be making all new stores use natural refrigerants.
“There is no excuse for any supermarket today to build a new store that still contains HFCs. That is just simply foolish,” she said, noting that international agreements to phase out HFCs will eventually force companies to change the systems anyway.
What is the government doing about this?
The federal government will start to offer carbon offset credits for projects that cut refrigerant emissions, including those in supermarkets. Environment and Climate Change Canada told CBC News in an email that they’ll go into effect “in the next few months.” Once that happens, companies will be able to apply to get credits for projects that started as far back as January 1, 2017.
Federal regulations have also been brought in to comply with the Kigali Amendment, the international agreement on HFCs that went into effect in 2018, with reduction targets starting in 2019.
The regulations will start to ban the manufacture and import of certain equipment containing HFCs with a global warming potential above a specific limit.
Gingras said the Quebec government did offer incentives for a period of time starting 2014 that made natural refrigerant systems competitive with HFCs, and those did lead to a widespread conversion of supermarkets in the province. However, he hasn’t heard of anything similar in other provinces.
Is there a role for ordinary shoppers?
Avipsa Mahapatra says grocery store customers can make a difference by adding their local stores to the climate-friendly supermarket map, being more aware and putting pressure on grocery store chains, especially when it comes to new supermarkets.
“So if it’s a new store that is being built in your community, it is our job as … residents of that community, to make sure that it is not an HFC store.”
Morgan Smith at the North American Sustainable Refrigeration Council also thinks the public can make a difference: “The more people that are aware of this top
By Mary Riddle from Triple Pundit • Reposted: January 28, 2023
Over 90 percent of business leaders are prioritizing long-term decarbonization — and 89 percent believe carbon markets will play a key role, according to a recent survey of 500 sustainability managers conducted by Conservation International and the We Mean Business Coalition.
A third of the business leaders surveyed are already investing in a voluntary carbon market, while over half are considering carbon credits as an option for the future.
Carbon markets come under criticism…
Carbon markets allow carbon-emitting companies and individuals to offset their greenhouse gas emissions through the purchase of carbon credits. These credits are meant to be tied to certified emissions reductions from projects designed to reduce, or in some cases remove, greenhouse gases from the atmosphere. Credits are often from renewable energy projects, such as wind and solar installations, and nature-based solutions like reforestation and land restoration.
Carbon markets and credits have come under intense scrutiny in recent years due to lack of oversight and regulation. Companies and governments have been accused of greenwashing, as certain entities created fraudulent carbon credit programs that accepted payment, but never implemented carbon reduction projects. Other critics maintain that the carbon market allows companies to continue emitting greenhouse gases instead of finding methods to avoid emissions in the first place.
A recent investigation from the Guardian, Die Zeit and SourceMaterial found that more than 90 percent of rainforest carbon offset credits from a leading provider are likely to be “phantom credits” that do not represent actual greenhouse gas reductions, adding more fuel to the skepticism.
… But business leaders seem to still believe
Net-zero targets represent more than 90 percent of global GDP, and the vast majority of business leaders believe that carbon credits are a critical piece in the global decarbonization puzzle.
Over 80 percent of the business leaders surveyed by Conservation International and We Mean Business say they would like to accelerate their decarbonization plans beyond credits or offsets. They claimed to face barriers such as budgetary constraints, technological limitations, lack of collaboration, concerns about greenwashing, lack of transparency and regulation in the carbon market, and the quality of carbon credits available, which held them back.
To overcome some of the roadblocks and confusion around carbon credits, businesses are increasingly relying on carbon credit ratings agencies such as the Integrity Council for the Voluntary Carbon Market and the Voluntary Carbon Market Initiative. Carbon ratings agencies help ensure the integrity of the carbon market through robust oversight, as well as stewarding a consistent taxonomy for businesses making carbon reduction claims.
“Without a transparent, high-integrity voluntary carbon market that functions at scale, we won’t stay within 1.5 degrees [Celsius],” Annette Nazareth, chair of the Integrity Council for the Voluntary Carbon Market, said in a statement. “Companies’ priority must be to decarbonize their own value chains. High-integrity carbon credits allow them to go further, accelerating climate mitigation beyond their value chain by providing finance to critical climate mitigation activities that do not otherwise meet the risk and return expectations of investors. We need to find a way to make it easy for investors to recognize and price a high-integrity carbon credit no matter which program issued it, what kind of credit it is, whether it is based on a removal or reduction, a nature-based solution, or an emerging technology.”
Tackling challenges in the carbon market is urgent to the activation of climate finance. Another recent report from the We Mean Business Coalition found that if the world’s top 1,700 emitting companies purchased carbon credits for just 10 percent of their emissions, more than $1 trillion would be activated for climate finance by 2030.
“Climate change is the greatest test of collective action in human history, and a crisis of that scale demands an all-hands-on-deck, all-of-the- above strategy,” Dr. M. Sanjayan, CEO of Conservation International, added in a statement. “Carbon credits are [a] proven tool for immediately reducing emissions, while also pursuing longer-term decarbonization ambitions. And though it isn’t always reflected in the headlines, this study affirms that private-sector buyers are indeed gravitating toward high-quality credits, placing a premium on transparency and accountability.”
The challenges to decarbonization are myriad, and the carbon marketplace is not yet ideal. However, many business leaders still feel a functional, scalable carbon credit system could accelerate the reduction of carbon emissions, perhaps just in time.
By Mary Riddle from Triple Pundit. Posted: January 27, 2023
Investors, insurers, and financial institutions in the EU have a new method for assessing the sustainability of their investments. Last week, the Observatory Against Greenwashing launched its independent Science-Based Taxonomy, in direct response to the EU Taxonomy system that some say is ineffective.
The EU Taxonomy is a classification system that claims to give investors, businesses, and financial institutions a common language for identifying the degree to which a specific investment, financial product, or economic activity can be considered sustainable.
However, critics have said the draft guidance is not sufficiently science-based and certain aspects, such as classifying gas-fired power, tree-burning, logging and nuclear energy as sustainable, could do more harm than good.
To create a more sustainable system for classifying investments, a coalition of experts and NGOs including WWF, BirdLife International, and Transport and Environment, formed the Observatory Against Greenwashing (OAG). The group aims to improve on the EU Taxonomy and provide investors with better, science-based guidance on the sustainability of their investments.
What is the independent Science-Based Taxonomy?
The independent Science-Based Taxonomy is based on the EU Taxonomy, but it only keeps the portions of the text that researchers found to be environmentally sound. It also makes more robust criteria for the parts of the EU Taxonomy that the OAG deemed unscientific or harmful to the environment.
“The EU Taxonomy was originally designed to eliminate greenwashing but instead has become another tool to deceive consumers,” Vedran Kordić, EU Taxonomy coordinator from WWF Adria, said in a statement. “The science-based Taxonomy wants to succeed where the original Taxonomy failed: It will create rigorous criteria which financial institutions can use to properly assess what is green and what is not.” According to the OAG, 1 in 3 activities deemed sustainable in the EU Taxonomy actually cause planetary harm.
The EU Taxonomy was established in 2018 with a mission to inject capital into projects that would help the EU meet objectives laid out in its Green New Deal, including carbon neutrality by 2050. But critics argue the EU Taxonomy is disingenuous and fundamentally flawed due to the inclusion of natural gas and nuclear energy sources on its list of sustainable investment options.
“This isn’t good enough. We need a better taxonomy, one based on science,” said Luca Bonaccorsi, sustainable finance director at Transport and Environment, a coalition of European NGOs working on transportation issues, in a statement. “Now the investor community has it.”
ESG regulations are expanding in the EU and beyond
While controversy continues to surround ESG regulation for financial products in the EU Taxonomy, the EU Commission is calling for an increase in regulation of other consumer goods and services in an attempt to respond to claims of bogus greenwashing. The EU has drafted a legal proposal that would require companies to provide scientific evidence to justify sustainability claims such as “carbon neutral” or “contains recycled materials.” The draft rule also calls on EU countries to develop systems for evaluating the environmental claims of companies, including issuing penalties for businesses that do not comply.
The expansion of ESG (environmental, social and governance) regulation is not limited to Europe. In the United States, the Inflation Reduction Act is expected to channel over $400 billion into clean tech companies over the next 10 years. Additionally, the U.S. Securities and Exchange Commission is expected to finally issue its climate disclosure regulations in April, several months later than planned. The new SEC rules, if issued, would require companies to make disclosures surrounding their climate-related risks, as well as their greenhouse gas emissions and those of their supply chains.
In a landmark research report published by Sustainable Life Media, Maddie Kulkarni of PepsiCo reports on the response to Purpose Driven Marketing by groups who self-identify as Democrats, Republican or Independent Voters.
In the report, Kulkarni writes:
“As a marketer, given the high drama of the US midterm elections this November, and the recent criticism of “woke marketing” by some activists and politicians, I wanted to investigate how consumers felt about brands engaging in purpose-driven marketing. Purpose-driven marketing — also known as “sustainability marketing” or “social impact marketing” — speaks to a brand’s attempt to engage its consumers on a social or environmental issue. I wondered: Does identifying with a certain political party influence whether consumers think more highly or more disapprovingly of a brand taking on a cause?
To find out, I turned to data gathered from consumers’ reactions to about 50 purpose-driven advertising campaigns tested with over 25,000 consumers in the last two years through the Sustainable Brands®’ (SB) Ad Sustainability Awareness Platform (ASAP) insights tool. Developed in 2020 when several global brands came together under the SB Brands for Good initiative, the ASAP tool was designed to create a way to measure (across industries and with a standardized set of metrics) how effective purpose-driven advertising campaigns were in driving consumer behavior change around environmental and social issues.”
The key findings in the report included the following:
• Democrats have a significantly more favorable opinion of a brand after seeing its sustainability campaign, over Republicans and Independents.
• There are similarities and differences in the sustainability issues Democrats and Republicans most care about.
• US women like seeing brands that support women.
• Sustainability campaigns are currently most resonating with Millennials.
• Targeted cohorts appreciate a brand’s effort to reach them; though with the Hispanic cohort, there is room to improve ad effectiveness.
• Environmentally focused ads score higher on Effectiveness than socially focused ads.
In summarizing key insights that effective marketers approach to communication, Kulkarni reports the following conclusions:
What are the implications from this research for the marketing industry?
We can use the insights of this research to create strategic media plans that are responsible and take on a social impact lens. At a minimum, our ads need to be accurate, honest and respectful — this is a basic requirement. But by understanding our target consumers, we can not only create content that resonates with them and helps them feel seen; we can also leverage media’s targeting abilities to deliver our content to an audience that normally would not be exposed to it. This would be an effort to develop understanding across people of different backgrounds and help a broader audience “see another side.” Note this strategy might come with some risk if the “other side” does not agree with your point of view; it is best to prepare for this possibility.
To drive creative ad effectiveness around sustainability storytelling, we should continue to focus on Influence, Credibility, Actionability and Talkability metrics. Demonstrating Influence and garnering Credibility with a campaign comes from research, engaging with partners, and spending meaningful time and resources on a cause. Creating an Actionable campaign comes from being clear on how consumers can use our productsto lead more sustainable lifestyles. And Talkability, the notion that people want to share and talk about the campaign, comes from campaigns having a creative spark that surprises and delights the consumer.
Given that our creative ad effectiveness scores are generally lower on socially focused behaviors than on environmentally focused behaviors, we should study how we can improve storytelling when it comes to the former.
We can study how different generational cohorts connect with sustainability issues, so we can develop content that resonates with each group’s unique life stage.
By Luciana Echazú, Associate Dean of Undergraduate Education; Associate Professor of Economics, University of New Hampshire and Diego C. Nocetti, Dean, School of Business; Professor of Economics and Financial Studies, Clarkson University
Environmental, social and governance business standards and principles, often referred to as ESG, are becoming both more commonplace and controversial. But what does “ESG” really mean?
It’s shorthand for the way that many corporations operate in accordance with the belief that their long-term survival and their ability to generate profits require accounting for the impact their decisions and actions have on the environment, society as a whole and their own workforce.
These practices grew out of long-standing efforts to make businesses more socially and environmentally responsible. ESG investing, sometimes called sustainable investment, also takes these considerations into account.
Zeroing in on the E, S and G
ESG priorities vary widely, but there are some common themes.
These priorities usually emphasize environmental sustainability – the E in ESG – with a focus on contributing to efforts to slow the pace of climate change.
There’s also an effort to uphold high ethical standards through corporate operations. These social concerns – the S – can include, for example, ensuring that a company doesn’t buy goods and services from exploitative suppliers, or treats its employees well. Or it might entail taking care to hire and retain a diverse workforce and taking steps to reduce social injustices in the communities where a corporation operates.
Companies embracing ESG principles should also have high-quality governance– the G. Governance includes oversight, handled by a competent and qualified board of directors, regarding the hiring and firing of top corporate leaders, executive compensation and any dividends paid to shareholders.
Governance also pertains to whether a company’s leadership operates fairly and responsibly, with transparency and accountability.
Why ESG matters
By 2026, the total amount invested globally according to these principles will nearly double to US$34 trillion from $18.4 trillion in 2021, the accounting firm PwC estimates. However, increasing scrutiny of which investments really qualify as ESG could mean it takes longer to reach that volume.
This corporate concept is becoming a political touchstone in the U.S. because some states, like Florida and Kentucky, arguing that these practices divert from the focus on maximizing profits and can be detrimental to investors by making other considerations a priority, have barred their pension funds from using ESG principles as part of their investment considerations. Some very large asset managers, including BlackRock, aren’t allowed to work with those pension funds anymore.
Many of the arguments against embracing these principles hold that they reduce profits by taking other factors into account. But how do ESG practices affect financial performance?
A team of New York University scholars looked at the results of 1,000 different studies that had sought to answer this question. It found mixed results: Some of the studies found that ESG principles increased returns, others found that they weakened performance, and a third group determined that these principles made no difference at all.
It’s possible that the disparities among results could be due largely to the lack of clarity regarding what counts and does not count as ESG, which has been a long-standing discussion and makes it hard to assess how ESG investments perform.
The NYU scholars also found two consistent results regarding ESG strategies. First, they help protect investors against risks such as losses resulting from the failure of a supply chain due to environmental or geopolitical issues, and they can protect companies from volatility during periods of economic instability and downturns. Second, investors and companies benefit more from ESG strategies in the long term than in the short term.
Executives view climate change as both a short- and long-term threat, but most are failing to address it proactively, PwC CEO Survey shows. By Mary Mazzoni from Triplepundit.com • Reposted: January 21, 2023
We’ve heard it for years — “business-as-usual isn’t working” — and the annual PwC CEO Survey indicates executives are well aware. Nearly 40 percent of more than 4,000 responding global CEOs think their companies will no longer be economically viable in a decade if they continue down their current path.
That’s a pretty big deal. Yet while one would think such a grim consensus would spur an immediate push for change, many executives told PwC they don’t have nearly enough time to think and talk about the future. Maintaining current operating performance consumed the biggest share of CEOs’ time last year, according to the survey, and executives admitted they’d rather spend more time evolving their companies’ strategies to meet future demands.
Findings like these reflect the “dual imperative” facing CEOs around the world as they look to reinvent their businesses for the future while navigating a laundry list of daunting challenges in the present day, the PwC CEO Survey found. “If organizations are not only to thrive but survive the next few years, they must carefully balance the dual imperative of mitigating short-term risks and operational demands with long-term outcomes — as businesses that don’t transform, won’t be viable,” Bob Moritz, global chairman of PwC, said in a statement.
So, will business leaders act to save themselves, or will they be too busy with next quarter’s P&L? Let’s take a closer look inside the survey to see what executives are saying — and what it could mean for the future.
Executives view climate change as both a short- and long-term threat, but most are failing to address it proactively, PwC CEO Survey shows
While managing climate risk is a long-term challenge that continues to vex executives, the PwC CEO Survey indicates many are also concerned about the effects of climate change in the here and now.
Most of the CEOs surveyed expect their businesses to feel some degree of impact from climate change within the next 12 months. About half predict the effects of climate change will have a “moderate,” “large” or “very large” impact on their cost profiles. More than 40 percent anticipate impacts to their supply chains, while around a quarter are worried about climate-related damage to their physical assets.
Their concerns are warranted: The 10 most significant climate-related disasters to strike the world last year caused more than $3 billion worth of damage each, according to the World Economic Forum.
Still, the way they respond could use some work. “Deeper statistical analysis of the survey shows that the CEOs who feel most exposed to climate change are more likely to take action to address it,” PwC researchers observed.
“This kind of reactive approach is understandable — when your house is in the path of a forest fire, you reach for the hose — but it creates risks of its own,” they continued. “Combating climate change requires a coordinated, long-term plan. It won’t be solved if the only companies working on it are those that face immediate financial impact.”
Beyond issues with reactivity, the researchers underscore that they “don’t know how much” the actions most often taken by businesses — such as decarbonization initiatives and moves to innovate more climate-friendly products and services — “will move the needle, particularly in the near-term, which, in light of emissions already in the atmosphere, promises continued warming under virtually every scenario.”
While it remains murky if business actions will do anything to curb their climate risk in the short term, the researchers warn that many long-term corporate climate strategies are also incomplete or less effective than they could be — setting the stage for even more serious risk in the years to come.
More than half of all CEOs surveyed, including 70 percent of those at U.S. companies, say their teams have no plans to apply an internal carbon price to decision-making, “even though doing so could help them account for considerations like taxes and incentives, and clarify strategic trade-offs,” the researchers found. Many are also dropping the ball on reporting, as another recent PwC survey found that 87 percent of global investors think corporate reporting contains unsubstantiated sustainability claims, often referred to as “greenwashing.”
CEOs predict declining global economic growth, but is that really a bad thing?
Nearly three-quarters (73 percent) of CEOs believe global economic growth will decline over the next 12 months. This is a marked departure from recent years, as more than 75 percent of respondents to the 2020 and 2021 iterations of the PwC CEO Survey said they thought economic growth would improve. It’s also the most pessimistic CEOs have been regarding global economic growth since the PwC CEO Survey began asking this question 12 years ago.
This comes as no major shock, as other recent polling indicates CEOs around the world are bracing for a recession in 2023. Still, it begs a few questions: Is a slowdown in economic growth inevitable, and is it even a bad thing?
In the decades since economist Milton Friedman declared that the social responsibility of business is to increase profits for shareholders, conventional reason has dictated that the ultimate marker of business health is to grow bigger and bigger every year, with solid shareholder returns that climb on a quarterly basis.
Yet study after study indicates that the never-ending pursuit of more consumption, more profit and more money does not equate to better quality of life across the economy — and the spoils of rugged capitalism are not shared equally. In the U.S., for example, CEO pay has grown by a staggering 1,460 percent since 1978, while median worker pay has not even kept pace with inflation, increasing by a mere 18 percent over the same period. U.S. CEOs were paid 399 times as much as a typical worker in 2021.
So, if the dogged pursuit of “more, more, more” does not increase quality of life for the many, and workers by and large find themselves more wage-poor than their parents were, who really benefits from eternal economic growth as a marker of success? Even businesses stand to lose out as CEOs cash their bloated paychecks while predicting their companies will be belly-up within a decade.
Against a backdrop like this, it makes sense that conversations around degrowth are having a major moment in mainstream business circles. As the name implies, degrowth calls for intentional reductions in production and consumption to stay within the boundaries of a resource-constrained world — particularly in rich countries, allowing developing countries to have a greater share of the economic pie (and the global carbon budget).
While respondents to the PwC CEO Survey stop far short of advocating for strategic degrowth, they don’t plan to cope with the impending recession in the way many might expect. While over half of responding CEOs say they are moving to cut operating costs and raise prices, the majority (60 percent) say they do not plan to reduce the size of their workforce in the next 12 months, and 80 percent say they have no plans to reduce compensation.
Still, it makes sense that predictions about the worst recession in a century would be preoccupying for executives, but as Moritz of PwC observed, those that don’t keep the future in mind are destined for failure. This type of push and pull between long-term longevity and short-term profit is one that has defined conversations around stakeholder capitalism and corporate responsibility for as long as they’ve existed. Parsing through these survey responses, it could be that Mother Nature — and the markets — will finally force executives’ hands, pushing into fruition something that for decades was simply words.
By joining the World Economic Forum’s Global Health Equity Network the company will help drive progress. From Medtronics • Posted: January 20, 2023
From closing health gaps in Kenya with Medtronic LABS, to helping health systems in the U.S. advance access to quality care for underserved patients, Medtronic is committed to advancing health equity. Addressing health equity is critical because more than half the world’s population lacks access to essential healthcare. And the most challenging health issues disproportionately impact marginalized populations. But we recognize that no one solution or organization can achieve health equity alone; strategic partnerships are essential to accelerating this critical work.
To maximize its commitment to health equity, Medtronic is joining the Global Health Equity Network (GHEN). GHEN is a World Economic Forum initiative that brings the private and public sectors together to drive change in health equity – mobilizing CEOs and business leaders to prioritize action in organizational strategy and purpose.
As part of the GHEN agenda, Medtronic has signed the Zero Health Gaps Pledge, which provides 10 areas where committed organizations agree to help drive progress within health equity across their workforce, their companies, and in their communities by 2050.
“At Medtronic, we know implementing people-first technology through access-enabling partnerships can be a profound equalizer, helping expand quality care and advance health equity. Leveraging the unique power and assets of our GHEN colleagues, we’ll maximize our health equity efforts and collaborate to bring quality healthcare to more people,” said Medtronic CEO and Chairman Geoff Martha.
Here are excerpts from three areas within the Zero Health Gaps Pledge, and how Medtronic is bringing them to life:
Pledge: Continually seek to understand how our organization can help address the root causes of health inequities and create a positive health equity impact.
Medtronic LABS develops community-based, tech-enabled solutions with and for underserved patients, reaching over 1M patients to date. An independent nonprofit organization funded by Medtronic, LABS drives system-level transformation to enable scalable, sustainable, last-mile healthcare delivery.
Pledge: Collaborate with communities to identify key health equity needs and identify potential solutions, and to measure impact.
By partnering with local health systems, governments, and NGOs, together we identify gaps in care to build health equity programs. For example, Medtronic established the Health Equity Assistance Program for colon cancer screening to provide GI Genius™ modules to communities with low screening rates or where access to the technology is not currently available.
Pledge: Consistently seek to understand health equity needs across our workforce, consumer base, communities, and ecosystem to make strategic decisions, inclusive of investments, and use insights to inform our organization’s choices from strategy to execution.
Financial stability and wealth are inextricably linked to better health outcomes. Medtronic drives economic opportunity by working with small and diverse-owned suppliers, making $2.7 billion in purchases from small and diverse-owned businesses in FY23. And in partnership with the Medtronic Foundation, the company has established several multi-year, multi-million dollar efforts with groups like Thurgood Marshall Fund and Society for Hispanic Professional Engineers to ensure diverse talent has access and opportunity.
By Melissa Daniels from Modern Retail • Reposted: January 18, 2022
In September 2022, Macy’s rolled out its first-ever wood-sourcing policy for its furniture sales after more than 150 years in business.
It requires the use of responsibly sourced wood or recycled or reclaimed materials. And it also prohibits the use of timber that has been harvested illegally or from threatened areas, among other restrictions. At the outset, the policy covers wood-based products in Macy’s private labels, while buyers will use the policy as a guide for onboarding new suppliers and brands.
“We’re really thinking about this policy first from the products that we own and buy, and where we can continue to expand it across our assortment,” said Keelin Evans, vice president of sustainability at Macy’s.
But Macy’s is far from alone among furniture companies paying close attention to sourcing amid heightened consumer awareness against “fast furniture.” Wayfair, in October 2022, launched a new section to showcase products that meet sustainability certifications. And Crate and Barrel, in August 2022, put out a new sustainability policy that includes ensuring 60% of textiles are Certified Preferred Fibers by 2025.
Macy’s also doubled its score from 9 to 18 on the Sustainable Furnishings Council and National Wildlife Federation’s 2022 Wood Furniture Scorecard — it was among 37% of companies on the list that scored higher than they did the year before.
Part of what’s motivating brands is increasing recognition from shoppers about the environmental impact of production: the eco-friendly furniture market hit $43.26 billion in 2022 with an expected CAGR of 8.6% through 2030, per a recent Grand View Research report.
“Rising awareness among consumers towards sustainable production of furniture products has largely influenced the adoption of eco-friendly furniture in residential spaces,” the report said.
From a retailer’s perspective, though, getting more responsibly sourced materials can be an uphill battle. For example, Evans said that it took about two years to develop the wood policy. And it will take time to implement it across the brands’ product assortment.
“Furniture has long lead times. And sustainability is not about changing things necessarily overnight, but really working with your partners and your suppliers so that this can start to show up more and more,” Evans said.
Gaining access
Conor Coghlan, co-founder and CEO of Hoek Home, launched the DTC brand with the goal of creating easy-to-assemble furniture while minimizing the use of plastic waste. Products include side tables, desks, benches and chairs and Coghlan said the brand aims to keep the prices affordable as possible — a flat desk goes for $495, with a bundle that includes additional shelves for $795.
Some parts of its products use high density poly ethylene, which comes from recycled milk jugs. It also uses sustainably sourced plywood that’s Forest Stewardship Council-certified, indicating responsible sourcing.
One of the challenges with these materials, though, is reliable sourcing. When the brand launched as a Kickstarter in late 2020, there were a plethora of options, Coghlan said. But when supply chain issues kicked in during 2021, suppliers served larger clients first.
“For small companies who are ordering $8,000 or $10,000 worth of postconsumer [materials] instead of $800,000, they just weren’t answering our emails. So it got more difficult,” Coghlan said.
Hoek also aims to source as locally as possible, relying more on U.S-based manufacturers rather than foreign birch or materials. But that can put added cost on the product — and drive the price point higher for consumers.
Still, it’s a balance that Coghlan is willing to try to find in light of widespread concerns about climate change and environmental protection.
“I think it’s important, as we kind of grow up as businesses, that we just seem to be responsible and care for the environment and make the right, sustainable choices,” he said.
Manufacturing monitoring
With much production happening overseas, many furniture brands rely on third parties to monitor manufacturers and facilities.
Evans from Macy’s said the wood and cotton sourcing policies build on top of existing protocols. The brand regularly monitors its global supply chain with social compliance teams located throughout Asia.
It also relies on third-party auditors that visit factories every 18 months to ensure that suppliers and factories are adhering with the brand’s code of conduct, Evans said, particularly with regard to how workers are treated.
“When we actually identify issues with partners, we’re really all about remediation plans, corrective action plans, continuous improvement and working together,” she said. “So if we identify anything, we can make improvements and actually ensure that they’re having a better working experience and they’re being cared for.”
Barbora Samieian, co-founder of the Canadian DTC furniture brand Sundays, said the brand relies on site visits and quality control teams on the ground with its factories in China, Vietnam, India and Eastern Europe. Working with manufacturers that are using responsibly sourced products, though, typically means a higher price point for the end product. Sundays makes living, dining and bedroom furniture priced in the mid-range; its best-selling white oak Field dining table going for $2,190 while a four-piece sectional ranges from $4,670 to $5,180.
Sometimes, having a sustainability-first mind, it means there might be a product that doesn’t pass muster: for example, a recent stool design out of Europe was left out of a new collection because it did not meet California’s Proposition 65 environmental guidelines.
But sustainability at Sundays also means paying close attention the longevity of pieces, with a focus on designs that can fit with many aesthetics and are built with long-lasting materials like solid wood.
“We’d rather our customers have a fewer number of pieces that are sort of workhorse items in their homes that can be multipurpose, rather than expanding to huge numbers of SKUs,” she said.
But Sundays is wary of greenwashing, Samieian said. Much of the wood used in Sundays products is certified by the Forest Stewardship Council, which is a third-party nonprofit designation that ensures timber comes from responsibly managed forests. For it rugs, it relies on certifications from GoodWeave, which verifies products were made without child labor. Still, the brand is careful not to make too many claims for the purpose of marketing or wooing customers who are in the market for an eco-friendly product.
“We’re working really hard behind the scenes and with our partners and making strides and making progress,” she said. “We believe we have to do the right things first, then start talking about it.”
It also means being in a higher price bracket, Samieian said.
“We’ve really focused on solid wood and that’s more expensive and that means we have to play in a certain price point,” she said.
A logjam of Southwest 737s on December 27, 2022 at Santa Barbara Municipal Airport. On a typical day, there are six Southwest arrivals and 6 departures at Santa Barbara, and rarely more than one of the airline’s 737 at the airport at the same time. Photo: Glenn Beltz
Southwest is attempting to appease holiday travelers who were stranded in the airline’s latest fiasco with frequent flier miles and a mediocre, excuse-laden apology — but its pilots’ union (Southwest Airlines Pilots Association, SWAPA) is having none of it. They’ve called leadership out — referring to executive management as a cult in a letter that lists the ways their failures have led to the brand’s persistent problems. Instead of investing in much-needed technological upgrades and staffing, the letter accuses the airline of “maximizing shareholder return” at their expense. Like all corporate entities, Southwest has a duty to its employees and customers first. The airline’s massive disruptions will likely continue until it recognizes the need for corporate responsibility and purpose beyond enriching shareholders and stock buybacks.
Extreme winter weather caused a wave of cancellations across airlines this holiday season — although none weathered it quite as badly as Southwest. Over 15,000 flights were scratched by the transportation giant from December 22nd through the 30th. But it wasn’t just the ice and snow that did them in. As NPR and other news outlets reported, the raging “tripledemic” had many workers out sick — then to top it off Southwest’s ancient staff scheduling software just couldn’t handle the crisis.
What’s worse, though, is that none of this is a surprise to anyone at the airline. Union pilots have been begging leadership to upgrade their technology for years. “I fear that we are one thunderstorm, one ATC event, one router brownout from a complete meltdown. Whether that’s Thanksgiving, or Christmas, or New Year, that’s the precarious situation we are in,” Casey Murray, SWAPA President, is quoted as saying in November, not long before the meltdown.
In fact, this isn’t Southwest’s first self-inflicted disaster. An issue with air traffic control in Jacksonville was felt around the country in October 2021 when the incident had 29 percent of the airline’s flights canceled or temporarily grounded in cities nationwide. Additionally, 2,300 flights were canceled in July 2016 when the airline’s routers went out and issues in 2014 caused 130 flights to be canceled out of Chicago during the month of January. “Systemwide meltdowns at Southwest Airlines have been increasing in frequency and magnitude over the past 15 years,” according to the letter — which was signed by SWAPA’s 2nd Vice President Captain Tom Nekouei.
Nekouei’s main point throughout the letter is that a cultural shift happened at Southwest when Garry Kelly assumed the top position, noting that during that time the company rewarded shareholders with roughly $12 billion and Kelly’s compensation package went up 700 percent. Although he is no longer CEO, Nekouei asserts that Kelly’s influence still dominates the airline’s corporate culture.
Of the lack of investment in technological upgrades needed to keep flights running, Nekouei wrote: “Share buybacks that were once illegal, that provide no benefit for the Company itself while artificially inflating share prices (thus inflating stock-based executive compensation) and sent the clear message that the Company has excess cash on hand but that the CEO thinks there is no better place for investment of capital within his Company.”
Nekouei further noted that while nothing tangible has been done to fix the structural and technological problems, “we continue to receive saccharine corporate-communications- department-written and legal-counsel reviewed ‘we’re sorry’ and ‘I love you’ meaningless and generic messages from SWA corporate executives.” And, while these apologies ring hollow right along with the measly 25,000 frequent flier points Southwest has offered those travelers who were caught in the worst of the mess, Nekouei offered a solution — a return to the values and purpose the airline was founded on:
“You put your employees first. If you truly treat your employees that way, they will treat your customers well, your customers will come back, and that’s what makes your shareholders happy. So there’s no constituency at war with any other constituency. Ultimately, it’s shareholder value that you’re producing.” — Herb Kelleher
Dentsu and Kantar’s Sustainable Transformation Practice launch flagship study into the role APAC marketers play in achieving corporate sustainability ambitions.
SUBMITTED BY DENTSU INTERNATIONAL• Reposted January 17, 2023
DENTSU AND KANTAR’S SPECIAL REPORT ON CORPORATE SUSTAINABILITY HAS REVEALED THAT MARKETING AND INSIGHTS DEPARTMENTS LAG BEHIND OTHER BUSINESS DIVISIONS WHEN IT COMES TO EXECUTING AND MEASURING PROGRESS ON THEIR SUSTAINABILITY OBJECTIVES.
Marketing a Better Future is Asia-Pacific’s first study into marketers’ role in sustainability.
The newly identified organisational intention-action gap is as big a challenge as the consumer intention-action gap to achieve 2030 Sustainable Development Goals (SDGs.)
Radically reimagining the role of marketing to make sustainable transformation its organising principle could help achieve 40-70% reductions in greenhouse gasses.
SINGAPORE, January 11, 2023 /CSRwire/ -Dentsu and Kantar today launch Marketing a Better Future, a flagship study exploring the role APAC marketers play in achieving corporate sustainability ambitions and SDGs.
With the exponential growth of Asian economies, spending power is moving East with the region shaping global consumption trends. This gives Asian consumers and companies a new and unique responsibility, especially as the region is expected to bear the brunt of climate-related catastrophes. Consumer behaviour urgently needs to shift to more sustainable habits and lifestyles. According to Kantar’s latest Global Issues Barometer, climate issues are a key concern with nearly 60% of consumers globally saying they experience eco-anxiety which is driving increased consciousness and desire for action. In tandem, system-level changes are needed to reach global sustainability targets and ensure the planet’s future. There is no doubt that businesses, brands and their agency partners are at a nexus of need and opportunity. As the bridge between brands and consumers, marketers have a unique opportunity, and therefore the responsibility, to be generational agents of change influencing consumer behaviour, as well as driving customer-informed innovation.
Marketers are failing, however, to grasp the opportunity. Dentsu and Kantar’s inaugural study of over 70 brand marketers in 12 markets across Asia-Pacific found that only one in three (34%) marketing and insights teams are ‘executing against their sustainability plans and measuring progress’. This compares unfavourably to 46% in supply chain, and 51% in corporate strategy. The new study identified two significant intention-action gaps, the consumer intention-action gap and the organisational intention-action gap, where marketers’ challenges are rooted.
In order to achieve deep, needle-moving advancement in sustainability, the study found marketing functions need a philosophical revamp: to be given a mandate to drive innovation beyond short-term sales KPIs, to create growth that is good for society and the planet as well as business. Corporate sustainability transformation and sustainable consumption need to become the organising principle around which marketing functions. The study predicts that by making this radical change, brands will be able to drive the behaviour and lifestyle shifts required to achieve the 40% – 70% reductions in greenhouse gas emissions that the sixth IPCC assessment report estimates as achievable.
Dominic Powers, Chief Growth Officer, dentsu Asia Pacific, said, “Meaningful progress in sustainability requires an ecosystem level effort where businesses, consumers and civic society, policy makers, regulators and capital providers work in harmony. Marketers must not only be empowered by businesses to drive innovation that can fuel deep change, but they must also revamp the entire philosophy behind the way the function is designed, which is predicated on selling more. At dentsu we design the ‘what’s next’ for brands. It is clear that sustainable consumption has to be the organising principle of marketing teams, who must now instead focus on inspiring people everywhere to a new way of sustainable living. To do this, brands and marketers must reframe their constituents to include ecosystem partners that co-own the sector’s value chain and its carbon footprint. By positioning themselves as the change agent between the larger ecosystem, customers and their company, marketing teams will be uniquely positioned to drive relevant, resonant, step-change innovation that will help ensure a sustainable future for us all.”
Trezelene Chan, Head, Sustainability Practice, Kantar APAC added, “We already know that the consumer intention-action gap is a problem for marketers, with 56% identifying it as a major challenge. Only 17% of Asian consumers actively change their behaviour to be more sustainable, despite 98% of Asians saying they will. Our study reveals, however, that the organizational intention-action gap is an equally important challenge to be addressed. Although 73% of marketers believe sustainability is important for business continuity and value growth, the study uncovered tactical and fundamental barriers that hinder marketers from taking on meaningful sustainable leadership. These include focus on short-term sales growth targets above all other KPIs, lack of clarity within the marketing function around metrics of success in relation to sustainability goals, and lack of adequate resources or capability building for sustainability within the marketing function. Innovation, collaboration and ownership across the different business functions against a clear set of sustainability goals will be required. Sustainability initiatives by the brand need to address consumers’ and the planet’s needs holistically and simultaneously. This means a whole new mindset for marketers and their corporate leaders.”
By Ekaterina Hardin and Lia Brussock from NASDAQ • Reposted January 16, 2022
What is Climate Resilience? Climate resilience is the ability to anticipate, prepare for, and withstand hazardous events, shifting consumer trends and behaviors, or business disturbances related to climate change.
Improving climate resilience involves (1) assessing how climate change will create new, or alter current, climate-related risks, and (2) taking steps to better cope with these risks.
Since 2020, the world has seen multiple major events – a global pandemic, a supply chain crisis, a geopolitical conflict and an overall economic volatility. These events have challenged businesses and their ability to remain resilient and to manage a range of external constraints.
During the pandemic, labor shortages created clogged marine ports and made companies rely on air freight for logistics and transportation, increasing overall expenses and emissions. Corporates are looking for ways to cut their emissions that spiked during the supply chain crisis.
The geopolitical crisis spiked energy and fuel costs. In absence of energy independence, the situation was worsened by the lowered production levels in the Middle East. Then recent diesel shortage added more fuel into the fire.
The economic volatility felt by many in the most recent months made businesses look deep into their operations for ways to improve efficiency and cut expenses.
All these challenges are linked to transitional climate risks through fuel, energy and emissions. Setting climate impacts aside, not being able to access resources at low cost also has a direct financial impact. Being able to manage these risks in 2023 and beyond will help companies demonstrate climate resilience and provide access to capital in the long term.
Large Corporates Influence Their Supply Chain to Build Resilience
Climate resilience is crucial for all market participants up and down the value chain. To improve their transitional risk resilience, large corporations who have committed to net zero targets are now engaging with their critical suppliers. Large corporate clients are asking their suppliers to provide their GHG inventories, and in some cases, requiring them to set climate-related targets of their own. In this effort to pass down climate targets, these corporations are working to mitigate their own climate-related risks and improve climate resilience throughout their value chain. According to Nasdaq research, currently 58% of S&P 500 companies have a climate-related goal in their 2022 Proxy Statement. In addition, over 4000 companies of all sizes are taking action to reduce their emissions by setting science-based targets through the Science Based Targets Initiative. Almost half of the 4000+ have already set Science Based targets and almost 1500 companies have made Net Zero commitments (Figure 1A). Scope 3 emission targets (indirect value chain emissions) are a significant portion of these commitments.
Large cap companies are not the only ones committing to science-based emissions reduction targets. Small-to-Medium Enterprises (SMEs) make up almost 20 percent (18.6%) of the total companies listed by SBTi (Figure 1B). A total of 747 SMEs have set targets as of November 2022, in comparison to just 29 two years ago. GHG emissions reduction targets are emerging across market caps and organization types, and in many cases the influence of large corporations on their value chain is clear.
We at Nasdaq ESG Advisory hear about these cascade impacts from our clients: their large corporate customers expect them to measure and to reduce their own Scope 1 and Scope 2 footprints, otherwise they risk losing their shared business. This is a significant challenge that smaller and mid-size companies can anticipate in 2023 and beyond. The tide of climate action is rising, and smaller and mid-size companies now face challenges beyond responding to investor pressures and regulatory requirements. They must also address hindered ability to conduct business with large corporate customers. By not having a climate-related target in place, supply chain participants are exposing themselves to climate-related risks that will directly impact their financial health.
Global Transition to Low Carbon Economy and Geopolitical Crisis
Climate resilience has also been challenged this year by the global energy crisis. The 2022 energy crisis, associated with the geopolitical conflict in Ukraine, made energy costs soar. Consequently, high prices on crude oil and natural gas increased the cost of manufacturing and spiked transportation and distribution costs. Lower production levels in the middle east that followed fuel cost increase in the US, only made the situation worse. Additionally, most recently transition to low carbon economy has been under the microscope due to diesel shortages and associated surging diesel cost.
Back in 2020-2021, when marine transportation industry was clogged because of labor shortages, air freight was the only option to deliver goods to customers. Not only is air freight more carbon intensive, but it is also more costly. As a result, we saw increased emissions and narrower margins. Furthermore, in 2022 businesses that rely on fossil-based fuels for energy to produce and transport their goods saw additionally significant operational expense increases. The geopolitical crisis driving energy cost up, combined with a challenging economic environment emphasized the importance of climate resilience. While trying to stop the short-term value bleed, companies need to think about long-term resilience and build-in mitigation strategies such as self-generated energy and increased share of renewables and alternative fuels, so they can climb out of these challenging times ahead of their peers.
Current Economy and Climate Resilience
It is crucial for executives to set up their businesses for resilience in the long term, especially when markets are very volatile. In 2022, decreasing revenue growth rates and shrinking margins have been a focus for investors. Recession and inflation concerns have curbed investor appetite [Scenario Planning and Explaining Your Resilience – Nasdaq’s Advice on Appealing to Investors in Challenging Times]. To build trust with external stakeholders during these times, it is important for companies to explain their resilience to macro concerns like fuel shortage, energy, and raw materials cost. Additionally, understanding the industry trends and setting differentiators from peers will build confidence in management and will help companies to secure capital needed to navigate through the challenging times. Demonstrating financial resilience and climate risks resilience go hand in hand. Companies that are highly exposed to climate-related financial risks, such as energy cost and security, cost of raw materials, cost of transportation and logistics, can prove their financial resilience by demonstrating how they manage these climate-related risks.
Companies in varying sectors have different climate risk profiles, therefore, the way they demonstrate climate resilience would also be different. We encourage each company to access their business specific short-, mid- and long- term climate-related risks and put resilience strategies in place for those risks that companies cannot afford to tolerate in these downturn conditions. related risks and put resilience strategies in place for those risks that companies cannot afford to tolerate in these downturn conditions.
Understanding Your Business Resilience
In times of economic downturn and high volatility, demonstrating to stakeholders that you are an attractive investment, if revenues are down, is a challenge. Companies need to demonstrate how they are planning to capture future opportunities and curb financial risks in current economic conditions. Climate crisis often acts as a risk multiplier. It multiplies all financial risks – operational risk, credit risk, liquidity, underwriting. Being climate resilient company means being financially resilient company. It means capturing climate-related opportunities and mitigating climate-related financial risks better than your peers and competitors.
Knowing what risks your company is exposed to and how they can impact the financial condition and operations of your business across several time horizons and climate futures, will help executives put appropriate resilience strategies in place and build trust with investors.
Understanding industry risks and company specific resilience starts with understanding your risk exposure, risk vulnerability and your risk tolerance and how those might change in the future. For those risks that you cannot tolerate, management strategies must be put in place. At times when it is hard to justify R&D spend on new technologies, products, or services, optimizing efficiencies to reduce operational costs might be the best way to capture climate opportunities and demonstrate climate resilience. By conducting a peer assessment, understanding industry trends and how to achieve a competitive advantage at lowest cost possible, companies can make a business case for themselves and demonstrate to stakeholders that they are an attractive long-term investment.
The Challenges Nasdaq Sees & How We Can Help
Lack of climate expertise coupled with time and resources constraints are the most common pain points for corporates. Companies that are laser-focused on delivering business outcomes during challenging economic times need high efficiency and low-cost solutions. When time is money and when time needs to be spent on delivering products to the market, conducting labor- and time-intensive tasks such as peer benchmarking and assessment is a challenge for resource constrained companies. Staying on top of all the recent regulatory developments and tracking which direction political winds blow is also very time consuming and disrupting.
Climate risk is a systemic risk – meaning it is a risk you cannot diversify from. However, the way it impacts each industry and company varies. Each company’s path along the climate journey is unique. Businesses operate in different geographies, different sectors, have different supply chains and different stakeholders with different short- and long-term priorities. Nasdaq understands that each company has its own set of considerations, and we prepared to partner at each stage of their journey towards climate and financial resilience. Our goal at Nasdaq is to help our community build resilience and trust. We drive impact through cost-effective resources, tools, and guidance around climate data collection, risk identification, and disclosure, ultimately enabling our community to build competitive differentiation. To start your climate resilience journey, contact Nasdaq ESG Advisory here.
About the Authors
Ekaterina Hardin
Ekaterina Hardin is a Lead ESG Advisor focused on Climate at Nasdaq ESG Advisory Practice within our ESG Solutions Business. Ekaterina was previously with the Sustainability Accounting Standards Board (SASB) where she was the Extractives & Mineral Processing Sector Lead Analyst. Ekaterina was also SASB’s climate research lead and Net Zero working group owner. Prior to SASB, Ekaterina was an oil & gas geophysicist for over a decade with an M.S. in Geophysics from University of Moscow, Russia. Later in her career Ekaterina earned an M.S. in Environmental Engineering from UC Irvine, where she focused on Climate Change and Sustainability in the Energy sector.
Lia Brussock
Lia Brussock is a Senior ESG analyst within Nasdaq’s ESG Advisory team. She joins the team with ESG, climate and corporate sustainability expertise. Her prior experience includes environmental footprint management at a global chemical and consumer goods company, where she led engagements with manufacturing facilities to advance progress towards global footprint targets. She is also well-versed in ESG strategy, reporting and benchmarking. Lia holds a M.S. in Sustainability Management from Columbia University and a B.A. in Global Environmental Change & Sustainability with a minor in Economics from Johns Hopkins University.
By Anne Field from Forbes.com • Reposted January 16, 2023
Ten years after it was launched, an annual index measuring U.S. consumers’ socially responsible attitudes and behaviors shows mixed progress.
The Conscious Consumer Spending index resultsGOOD.MUST.GROW
On the one hand, after coming in at a record low of 39 in 2020, the index rose to an all-time high of 51 the next year. In 2022, there was a slight decrease to 48.
On the other, the 2022 result was the second highest since the survey began.
That’s according to the Conscious Consumer Spending Index (CCSIndex), which gauges the extent to which consumers are—or aren’t—embracing conscious consumerism, charitable giving and environmentally-oriented practices.
“After those results in 2021, we expected to see at least a slight decline this year,” says Heath Shackleford, CEO of Good.Must.Grow, a socially responsible marketing consulting firm that administers the research. “But the vast majority of consumers continue to feel purpose is important when they shop.”
The CCSIndex is calculated by assessing such matters as the importance consumers place on buying from socially responsible companies, how they’re supporting those products and services and intent to increase their patronage of such companies. For this year’s research, 1,005 Americans were surveyed. According to Good.Must.Grow, thanks to the design of the index’s design, even a one-point change indicates a meaningful shift in consumer sentiment.
Higher Prices
Shackleford points to inflation as the main culprit for this year’s decrease. That’s because socially responsible products tend to be more expensive—or at least, are perceived as carrying a higher price tag—than their non-responsible counterparts, he says. Only 57% reported buying goods from socially responsible brands in 2022 compared to 64% in 2021. In 2013, the year of the inaugural index, it was 62%.
Teenager shopping at a summer market. Photo: GETTY
The research shows that, says Shackleford, “A hard core of Americans will support purposeful brands no matter what.” But most of the country, even if they believe such purchases are important, feel they can’t afford to buy them during a time when their purchasing power is down.
At the same time, “A vast majority of consumers feels purpose is important when they shop,” he says. In addition, in 2013, 25% reported boycotting brands that weren’t socially responsible compared to 32% in 2022.
The lesson for companies is: They have to meet consumer expectations for factors like price, in addition to their mission, according to Shackleford.
Other Findings
Additional noteworthy results include:
A growing pessimism among Americans. Respondents indicated a growing sense that the world is getting worse. In 2019, 36% agreed with that statement, increasing to 42% in 2020 and 44% in 2021. In 2022, it was 45%. Also, while those who say the world is getting worse have a lower index score than people who say it’s getting better, the lowest score was for respondents who feel things are pretty much the same.
Decline in charitable giving. The portion of people who made financial contributions to a nonprofits declined by 20% from 2013 to 2022. Those volunteering also decreased.
Votes for the most socially responsible enterprise. For the eighth year, the poll asked respondents for the company or organization they first think of when they think of socially responsible enterprises. The top five: Amazon, Google, the Salvation Army, Apple and Walmart. Amazon, which has topped the list for four years in a row, received twice as many votes as Google in 2022. For the first time, TOMS, an iconic social enterprise, fell off the list. It was the top brand for the first two years of the poll.
Effective ESG practices provide companies with an opportunity to demonstrate their commitment to environmental sustainability, community and equity by integrating these tenets into everyday business processes and company culture.
By Jess Welser – Director of B:CIVIC and CSR, Denver Metro Chamber Leadership Foundation • Reposted: January 16, 2023
As I look back on the stories shared in this year’s Good Works Colorado content hub, I’m thrilled to see how our state’s leaders have enthusiastically implemented environmental, social and governance policies (ESG) and invested in corporate social responsibility (CSR) efforts.
ESG and CSR are constantly evolving. ESG is a framework for measuring and managing risks and opportunities around a company’s commitment to environmental, social and corporate governance. CSR is a reflection of what a company believes, expressed by how it impacts its stakeholders internally and externally. We like to think of it as how a company aligns its social and environmental activities with its business purpose and values. Or elevating business for good. More and more, ESG and CSR are recognized as an essential component of a smart, viable business strategy for Colorado companies.
This was one of our founding goals at B:CIVIC, an affiliate of the Denver Metro Chamber Leadership Foundation. Alongside business and community leaders, B:CIVIC is increasing the amount of impact and collective good for the Colorado community. After eight years of doing this work, there are a few lessons we want to share with business leaders who are on their ESG and CSR journey.
1. Now’s the time for ESG.
As our community faces unprecedented social, economic and environmental challenges, local corporations are taking ownership of their impact through ESG. Effective ESG practices provide companies with an opportunity to demonstrate their commitment to environmental sustainability, community and equity by integrating these tenets into everyday business processes and company culture.
As ESG practices advance in Colorado and across the globe, it’s important that business leaders continue to develop and enhance their ESG strategy. Like the ever-changing world around us, these strategies must remain nimble to meet the moment — whatever that moment has in store.
2. It pays to invest in CSR.
As we head into what may be a recession, many companies are preparing for economic downturn by downsizing budgets, instituting travel freezes and more. Though the immediate future remains uncertain, we know CSR programs and personnel are an important investment for a company’s long-term success.
To ensure continued engagement, we are encouraging CSR leaders to double down. The economic downturn will impact industries differently, but we can anticipate that employee giving and engagement will experience a decline. Further, economic hardship causes increased stress among employees. To encourage connection, focus on promoting skills-based volunteering and employee well-being programs that boost morale and build community. As we continue through these uncertain times, we challenge CSR leaders to get creative with their CSR strategies. It pays to invest in the community and your people, especially in times of economic hardship.
3. Colorado is a good place to do business.
Did you know Colorado is one of the best places to do business? In a 2022 CNBC ranking, Colorado came in at No. 4 in America’s Top States for Business list. The state also ranked No. 12 in the category of life, health and inclusion. These rankings are in large part due to the social impact commitments of our business community — commitments that are continuing to grow alongside our economy.
The secret’s out: People, organizations and businesses are making the move to Colorado to join in on the great benefits this state has to offer. As the business community grows, the resources available for CSR and ESG will grow with it. The future is full of possibilities for CSR and ESG impact.
4. Create the infrastructure today to meet the challenges of tomorrow.
When business leaders invest in a company’s CSR infrastructure today, they are better prepared to speak out and advocate for the issues that matter to their community and stakeholders. In a recent report released by the Edelman Trust Barometer — a metric that studies trust in business, government, NGOs and the media — it was found that employees care about how their leadership demonstrates commitment to the community.
According to the Trust Barometer, when considering a job, 60% of employees stated that they want their CEO to speak out on controversial issues they care about. Eighty percent of the general population want CEOs to be personally visible when discussing public policy with external stakeholders or work their company has done to benefit society. Further, 60% of people surveyed will choose a place to work based on their beliefs and values.
It’s clear the workforce wants business leaders to stand up for the issues that matter to them. Implementing ESG and CSR practices is a great way to demonstrate your company’s commitment to the community.
As your team is planning for next year, we hope that you consider the above guidance to maximize the impact of your CSR and ESG practices. Want to keep the conversation going? Reach out to our team at B:CIVIC. Together, we can increase the impact and collective good of the community.
In recent years, and especially with the rise in popularity of “ESG” (environment, social and corporate governance) focused investing, “corporate responsibility” has become a phrase many companies are happy to use in their advertising. There is no set definition but generally it is used as shorthand for “Our company is not a soulless machine designed to do absolutely anything–no matter how destructive, reckless or dishonest–in pursuit of a buck.” In any given case, it can be hard to tell whether such a statement means a corporation really tries to treat its customers, employees and planet decently or is just public relations blather. Talking the talk is easy, but walking the walk is hard.
To highlight those corporations that are actually serious about trying to be good guys, Newsweek has partnered with global research and data firm Statista for our fourth annual list of America’s Most Responsible Companies. This year our list includes 500 of the U.S’s largest public corporations. They vary dramatically by size and by industry. We found the largest number of responsible companies (55) in the materials and chemicals business; the fewest (12) in hotels, dining and leisure. Our overall number one this year is the computer hardware giant HP.
We are proud to present this year’s ranking and to honor companies that actually mean it when they say they are serious about being good corporate citizens.
THE RANKING AMERICA’S MOST RESPONSIBLE Companies 2023 focuses on a holistic view of corporate responsibility that considers all three pillars of ESG: environment, social and corporate governance. In total, 500 companies were identified as America’s Most Responsible Companies.The initial analysis focused on the top 2000 public companies by revenue and banks and insurance companies with total assets exceeding $50 billion.
The analysis is based on two metrics: 1. Quantitative data from KPI (key performance indicator) research: More than 30 KPIs from the three areas of CSR (corporate social responsibility) were considered for the ranking. 2. The CSR reputation of each company from an extensive survey of 13,000 U.S. residents: Respondents were asked to select companies familiar to them and then to evaluate the company’s CSR performance in general and in the three sub-dimensions: social, environmental and governance.
he selection of the companies and the definition of the evaluation criteria were carried out according to independent journalistic criteria of Newsweek and Statista. The evaluation was carried out by the statistics and market research company Statista. Newsweek and Statista make no claim to the completeness of the companies examined. The ranking is composed exclusively of U.S. companies that are eligible regarding the criteria described here. A position in the ranking is a positive recognition based on research of publicly available data sources at the time, the information provided in the validation survey and an extensive survey of U.S. residents. The ranking is the result of an elaborate process which, due to the interval of data-collection and analysis, is a reflection of official ESG data from 2020 or 2021. Furthermore, events following November 3, 2022 were not a subject of this survey. As such, the results of this ranking should not be used as the sole source of information for future deliberations. The information provided in this ranking should be considered in conjunction with other available information. The quality of companies that are not included in the ranking is not disputed. For a complete methodology see newsweek.com/amrc-2023
ewsweek and Statista make no claim to the completeness of the companies examined. The ranking is composed exclusively of U.S. companies that are eligible regarding the criteria described here. A position in the ranking is a positive recognition based on research of publicly available data sources at the time, the information provided in the validation survey and an extensive survey of U.S. residents. The ranking is the result of an elaborate process which, due to the interval of data-collection and analysis, is a reflection of official ESG data from 2020 or 2021. Furthermore, events following November 3, 2022 were not a subject of this survey. As such, the results of this ranking should not be used as the sole source of information for future deliberations. The information provided in this ranking should be considered in conjunction with other available information. The quality of companies that are not included in the ranking is not disputed. For a complete methodology see newsweek.com/amrc-2023
U.S. universities now have over 3,000 sustainability programs. Photo: Andy DeLisle/ASU
By Christopher Boone, Professor of Sustainability, Arizona State University and Karen C. Seto, Professor of Geography and Urbanization Science, Yale University from The Conversation. Re-posted: January 15, 2022
To meet today’s global sustainability challenges, the corporate world needs more than a few chief sustainability officers – it needs an army of employees, in all areas of business, thinking about sustainability in their decisions every day.
That means product designers, supply managers, economists, scientists, architects and many others with the knowledge to both recognize unsustainable practices and find ways to improve sustainability for the overall health of their companies and the planet.
Employers are increasingly looking for those skills. We analyzed job ads from a global database and found a tenfold increase in the number of jobs with “sustainability” in the title over the last decade, reaching 177,000 in 2021.
What’s troubling is that there are not enough skilled workers to meet the rapid growth in green and sustainability jobs available.
While the number of “green jobs” grew globally at a rate of 8% per year over the last five years, the number of people listing green skills in their profiles only grew by 6% per year, according to a LinkedIn analysis of its nearly 800 million users.
When employees are trained to think about sustainable materials and processes, they can improve corporate innovation and the bottom line. Photo: Sona Srinarayana/ASU
As professors who train future workers in sustainability principles and techniques, we see several effective ways for people at all stages of their careers to gain those skills and increase those numbers.
But green jobs go well beyond solar panel installation and wind turbine maintenance.
Sustainable fashion is one of the fastest-growing green jobs sectors, averaging a 90% growth rate annually between 2016 and 2020.
The rapid expansion of ESG investing – environment, social and governance – and portfolio management is opening up new jobs in sustainable finance. In 2021, the accounting firm PwC announced that it would invest US$12 billion and create 100,000 new jobs in ESG investing by 2026.
In 2013, when the Rockefeller Foundation launched 100 Resilient Cities, a network to help cities become more sustainable, few cities had a resilience or sustainability officer. Today, more than 250 communities and 1,000 local government professionals are part of the Urban Sustainability Directors Network.
Most sustainability and green jobs require creative problem-solving, synthesizing and technical skills. Some of those skills can be learned on the job, but boosting the number of qualified job applicants will require more effective and accessible training opportunities that target employers’ needs. Here are a some training sources to consider.
University programs: Sustainability is increasingly being incorporated into a wide range of university programs. Fifteen years ago, sustainability training was mostly ad hoc – a product designer or economist might have taken a class in sustainability approaches from the environmental science department. Today, U.S. universities have about 3,000 programs with a “sustainability” label, up from 13 in 2008.
A National Academies report recommends looking for a competency-based approach to sustainability learning that blends content with skills and links knowledge to action to solve problems and develop solutions.
Micro-credentials: For mid-career employees who don’t have the time to reinvest in full-fledged degrees, short courses and micro-credentials offered by universities, colleges or professional groups offer one way to develop sustainability skills.
U.S. architect Michael Reynolds holds four-week, hands-on training sessions, primarily for architects, in sustainable design principles, construction methods and philosophy. Participation can count toward Western Colorado University’s Master in Environmental Management graduate degree. Photo: Pablo Porciuncula/AFP via Getty Images
Short courses and micro credentials take up less time and are much less expensive than college degree programs. That may also help lower-income individuals train for sustainability jobs and diversify the field.
Specializations: A similar option is jobs-focused online certificate programs with a sustainability specialization.
For example, Google teamed up with universities to provide online courses for project managers, and Arizona State University is offering a sustainability specialization to accompany it. Project management is an area where the U.S. Department of Labor expects to see fast job growth, with 100,000 job openings in the next decade.
Sustainable packaging design that reduces costs and reuses materials is an area ripe for innovation in many companies as consumer shipping increases.Justin Sullivan/Getty Images
Integrating sustainability across all functions of companies will require some level of sustainability training and understanding for most if not all employees. Companies like Starbucks, HSBC, Salesforce and Microsoft have created internal training programs to spread sustainability knowledge and practice throughout their companies, not just for employees who have sustainability in their titles.
Closing the gap
A recent survey by Microsoft and BCG of major companies found that only 43% of sustainability professionals in businesses had sustainability-related degrees, and 68% of sustainability leaders were hired internally.
It’s clear that on-the-job sustainability training and up-skilling will be necessary to fill the growing number of roles inside of companies.
To meet the sustainability skills gap, we believe more training will be required – at colleges and universities, by professional organizations and from employers. Achieving global sustainability and meeting climate change challenges will become more likely as legions of people commit their working hours to sustainability solutions.
Three-quarters (76%) of Millennials consider a company’s social and environmental commitments when deciding where to work and nearly two-thirds (64%) won’t take a job if a potential employer doesn’t have strong corporate social responsibility (CSR) practices, according to the 2016 Cone Communications Millennial Employee Engagement Study.
The study reveals that meaningful engagement around CSR is a business – and bottom line – imperative, impacting a company’s ability to appeal to, retain and inspire Millennial talent. More than any other generation, Millennials see a company’s commitment to responsible business practices as a key factor to their employment decisions:
75% say they would take a pay cut to work for a responsible company (vs. 55% U.S. average)
83% would be more loyal to a company that helps them contribute to social and environmental issues (vs. 70% U.S. average)
88% say their job is more ful lling when they are provided opportunities to make a positive impact on social and environmental issues (vs. 74% U.S. average)
76% consider a company’s social and environmental commitments when deciding where to work (vs. 58% U.S. average)
64% won’t take a job from a company that doesn’t have strong CSR practices (vs. 51% U.S. average)“Millennials will soon make up 50 percent of the workforce and companies will have to radically evolve their value proposition to attract and retain this socially conscious group,” says Alison DaSilva, executive vice president, CSR Research & Insights, Cone Communications. “Integrating a deeper sense of purpose and responsibility into the work experience will have a clear bottom line return for companies.”
Cone will allow you to download the report here if you register.
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