Sustainable WNC

Happy New Year to All!

From the WorldWatch Institute, January 10, 2008:

Washington, D.C.— Pioneering entrepreneurs, nongovernmental organizations, and governments around the globe are inventing the Earth’s first sustainable global economy, according to State of the World 2008: Innovations for a Sustainable Economy. In response to climate change and other environmental problems, these leaders are field-testing a remarkable array of economic innovations that offer surprising and hopeful new opportunities for long-term prosperity, finds the new report from the Worldwatch Institute.

“Once regarded as irrelevant to economic activity, environmental problems are drastically rewriting the rules for business, investors, and consumers, affecting over $100 billion in annual capital flows,” say project co-directors Gary Gardner and Thomas Prugh.

The report describes a host of new economic opportunities that are attracting capital. An estimated $52 billion was invested in renewable energy in 2006, up 33 percent from 2005. Preliminary estimates indicate that the figure reached $66 billion in 2007. Carbon trading is growing even more explosively, reaching an estimated $30 billion in 2006, nearly triple the amount traded in 2005.

Some of the most powerful players in today’s economy have announced breakthrough environmental initiatives in the past two years, including Citigroup, Goldman Sachs, Kleiner Perkins Caufield & Byers, McKinsey & Company, and Wal-Mart. And many large companies are putting their political muscle where their investment capital is: 27 major corporations, including Alcoa, Dow Chemical, Duke Energy, General Motors, and Xerox, are actively urging the U.S. Congress to pass legislation regulating greenhouse gas emissions—something that would have been unthinkable two years ago.

Innovative companies are also revolutionizing industrial production to meet environmental challenges, while finding that they’re saving money: the chemical giant DuPont cut its greenhouse gas emissions 72 percent below 1991 levels by 2007, saving $3 billion in the process.

Another sign of dramatic change is the 575 environmental and energy hedge funds now in existence, most of them formed in the last few years. “Clean tech” has rapidly grown to be the third largest recipient of venture capital, trailing only the Internet and biotechnology. And 54 banks, representing 85 percent of global private project finance capacity, have endorsed the Equator Principles, a new international standard of sustainability investment.

State of the World 2008 cites two major economic modeling studies that find that the damage from global climate change could equal as much as 8 percent of global economic output by the end of this century. Citing World Bank data, the report also notes that some 39 countries experienced a decline of 5 percent or more in wealth when accounting measures also included factors such as unsustainable forest harvesting, depletion of non-renewable resources, and damage from carbon emissions. For 10 countries, the decline ranged from 25 to 60 percent.

To avoid economic collapse at the global level, the State of the World authors call for major reforms of government policy to steer investment away from destructive activities such as the extraction of fossil fuels and toward a new generation of environmentally sustainable industries. Specific recommendations include making prices tell the ecological truth by reducing subsidies and adopting environmental taxes.

“We have the tools today to steer the global economy onto a sustainable path,” say project co-directors Gardner and Prugh. “The task now is to bring them together and scale them up so that they become the norm across today’s economies.”

The report urges a full assessment and valuation of the services that nature provides free of charge to the human economy and describes several efforts to create markets to protect biodiversity. The report cites a recent assessment that found green accounting programs in place in at least 50 countries and identified 20 other countries that were planning to initiate such programs.

State of the World 2008 finds growing evidence suggesting that the global economy is now destroying its own ecological base. It quotes former World Bank chief economist Nicholas Stern, author of the acclaimed Stern Review on the economics of climate change, who describes the changes now under way in Earth’s atmosphere as “the greatest and widest-ranging market failure ever seen.”

WNC Readers: This important study offers critical enablers for business success in sustainability - How can the corporate lessons learned be applied for maximum success here in WNC?

Best to All - Steve

ATLANTA, Dec. 10, 2007 - A new study examines the progress of 10 global corporations against a comparative five-stage sustainability framework and suggests a direct correlation between leader mindsets and sustainability success.

Many companies are missing a critical step in their sustainability journey, according to the Avastone Corporate Sustainability Study (ACSS). The ACSS reveals that it is not a lack of tangible systems and activities that comprise the missing component, but rather a scarcity of higher-capacity leaders.

The study findings have been released in a new report, Leadership and the Corporate Sustainability Challenge: Mindsets in Action, issued by Avastone Consulting. (Download here.) Avastone is an international consultancy committed to the vitality and sustainability of client organizations and the larger global community.

Study participants include diverse, global corporations ranging from $1 billion to over $100 billion in revenues. The ACSS finds that all of the companies interviewed are in the process of moving to higher stages of sustainability, yet none have reached the fourth stage (Integrate). In addition, 60 percent do not view as business-relevant the highest fifth stage (Redesign), where expanded mindsets are critical on the path to sustainability.

Sustainability progress is being made, yet there remains a significant gap.

The report explores the nature of leader mindsets and discusses how these mindsets impact sustainability. “While leading companies have become sophisticated in their approach to sustainability and committed to making progress, few focus on the influence of patterns of the mind and how these shape our understanding of the world,” said John Schmidt, CEO of Avastone Consulting. “Certain mindsets allow organizations to navigate the complexity of sustainability and proactively work with other key players toward sustainability at the scale needed.”

The report details variations in leader mindset development and capacity, which explains the diverse views of sustainability and why some leaders possess ability to support fifth stage sustainability efforts, while others do not. The report suggests that, without engagement of higher-capacity leader mindsets, organizations will find it difficult to attain the upper stages of corporate sustainability.

The comparative framework used in the study to assess company progress on their sustainability journey includes five stages or “gears,” based upon SustainAbility’s “Corporate Responsibility Gearbox.”

1.0 Comply Gear — companies commonly focus their sustainability efforts on compliance and philanthropy.

2.0 Volunteer Gear — they put in place impact reduction and eco-efficiency programs.

3.0 Partner Gear — companies begin to manage risk more proactively while building their brand and reputations.

4.0 Integrate Gear — sustainability becomes strategic, and companies embed sustainability within the business and across the value chain.

5.0 Redesign Gear — at this most elusive stage, expanded mindsets and the impact of previous gear activity creates large-scale systems changes that recast markets, redesign financial systems, and root out drivers of non-sustainability.

“The 21st-century global landscape calls for leaders with mindsets that view all five gears of sustainability as relevant to the business, not simply the gears that are obviously required to move the business forward,” said Cynthia McEwen, Principal, Sustainability & Leadership at Avastone Consulting and co-author of the report. “The ACSS identifies an intricate relationship between leader mindset and achievement of complex sustainability outcomes. In other words, it states that sustainability is as much about the mindset through which the world is seen as it is about the activities taken in support of it.”

The report further details the success factors critical to the 10 surveyed companies’ sustainability progress. ACSS findings demonstrate that, while technical and business systems may be necessary, they are not sufficient by themselves as drivers of sustainability success; subjective aspects like culture, shared values, and guiding principles are just as important. The report offers practical ways to accelerate progress based on the findings.

Hello - All: How can you translate these ideas into personal actions?

(From ‘Environmental Leader’)
November 16, 2007

Experts and research companies are predicting that green holiday shopping will be hot this year.

PriceGrabber.com says that 71 percent of those responding to its recent holiday survey say it is important to them to purchase eco-friendly products this holiday season, says Ron LaPierre, president of the Los Angeles-based company, MediaPost reports.

“Even though green gifts and green products are hot right now, the flame of consumer interest burns out very quickly,” says Robbie Blinkoff, a consumer anthropologist and managing director of Context-Based Research Group in Baltimore. “Right now, with all the interest in global warming, there’s a lot of energy. Smart marketers need to be not righteous, but ‘lefteous’,” he says, “and recognize that consumers want to be taken to the next level.”For retailers, he says, that means having a whole portfolio of green products, not just one or two.

Nearly half of Americans (48 percent) will try to buy fewer gifts or holiday products this season because they are concerned about the effect their consumption may have on the environment, according to research from Cone.

The environment is also impacting the purchases Americans plan to make. Almost six in ten (59 percent) say they are more likely to buy “green” products this year than in the past. Interestingly, more than half of Americans surveyed (52 percent) say the motivation for green shopping is to alleviate the guilt associated with holiday consumption.

More than half of Americans (54 percent) say they would be willing to pay more for a holiday gift or product if it is environmentally responsible, and an equally motivated number (55 percent) say they proactively seek opportunities to buy green gifts and products around the holidays.

Americans’ environmentally sensitive behavior extends beyond gifts, as well. They are purchasing gift wrap made from recycled paper (42 percent) or decorating with energy efficient holiday lighting (32 percent). Other consumer choices include:

• Products made by companies that are environmentally responsible – 29%
• Shopping with retailers that have environmentally responsible practices – 27%
• Energy-efficient gifts – 27%
• Gifts with recycled content – 26%
• Organic/locally produced food for holiday meals or gifts – 23%
• Apparel made with environmentally responsible materials – 20%
• Making a donation to an environmental cause as a gift in someone’s name – 15%
• Purchasing carbon credits to offset holiday travel and/or shopping – 3%

First Solar Dazzles Wall Street
Source: GreenBiz.com

PHOENIX, Ariz., Nov. 9, 2007 — First Solar shares sold for $20 during its initial public offering a year ago.

The same shares soared past the $200 mark Thursday following this week’s earnings report showing quarterly sales increased nearly 300 percent over the same period last year.

First Solar and other solar companies enjoyed a brisk day on Wall Street Thursday at a time when the dollar is getting battered and the Federal Reserve chief is warning that the economy is poised for a slowdown.

First Solar shares finished at $224.43 Thursday, a 34 percent increase over the day before. Evergreen Solar rose 17 percent to close Thursday at $15.99 while Sunpower rose sharply before falling 2 percent to $141.93.

First Solar drew a standing-only crowd Thursday in San Francisco during the Pacific Growth Equities clean tech conference, according to Dow Jones. The news wire service reported that First Solar CFO Jens Meyerhoff described the company’s plan to mass-produce solar energy cells that are competitive with residential electricity rates without subsidies within the next five years.

Company sales are focused on France, Germany and Spain; it has yet to penetrate the U.S. market. The estate of John Walton, from the founding family of Wal-Mart, owns a controlling stake in the company.

Energy Efficiency Good First Step for Businesses to Fight Climate Change: Survey
By ClimateBiz.com

SAN FRANCISCO, Oct. 17, 2007 - - Energy efficiency is the most effective company-wide first steps CEOs can take to launch a climate change program, according to a team of environmental scientists and climate researchers.

The panel, which includes 54 fellows of the Switzer Foundation, an environmental non-profit, participated in a survey titled, “What the Scientists Know: How Business Leadership can Help Solve Climate Change.” The survey was inspired by members of the Committee of 200, a group of women business leaders.

“The survey is designed to spark a dialogue between scientists and business leaders,” said Jessica Switzer, Partner of Blue Practice Inc., which performed the survey. “We hoped to give a voice to leading U.S. scientists’ concerns and create something useful that business leaders can use to develop solutions to a very large problem facing our world economy and social situation. We couldn’t have a better audience to preview this than the Committee of 200.”

To best leverage a CEOs leadership, the scientists top rankings included: improving energy efficiency of existing operations, converting to clean and renewable energy, engaging in climate change policy discussions, consideration of climate risk in asset management and buying carbon offsets.

Carbon offsets wasn’t listed as a top priority for companies. The panel also pegged the purchase of renewable energy credits as the last corporate priority; the most popular write-in suggestion for top priority was reducing energy consumption.

Interface Inc., a modular carpet and upholstery fabric manufacturer was named as a company doing a good job of addressing greenhouse gas emissions.

“In the long term, the economy and the environment are the same thing. If it’s unenvironmental it is uneconomical. That is the rule of nature.”~ Mollie Beattie

Among the amazing developments that have been ocurring as market forces embrace the Green Revolution is the “Supply Chain Reaction”. The systemic change is further evidence that ‘business as usual’ with a bit of greenwash won’t cut it in the market anymore…a very good thing, indeed.

(From GreenBuzz.com, Monday, October 15, 2007)

The greening of suppliers is back in the news. Last week, several large companies, including Nestlé, Procter & Gamble, and Unilever, announced that they would soon embark on a campaign to press suppliers to report greenhouse-gas emissions. The initiative, called the Supply Chain Leadership Coalition, would press suppliers to release data about carbon emissions and climate-change-mitigation strategies.

Not long before, Wal-Mart announced that it would measure the energy use and emissions of the entire supply chain of seven product categories, and find ways to increase their energy efficiency. Over time, the initiative is expected to spread to many other, if not all, products carried by the company.

What’s going on here? For years, companies have been trying to push the responsibility for environmental problems upstream. If suppliers don’t send products, parts, and materials that are overpackaged, or that contain toxic or nonrecyclable ingredients, then their customers could reduce their costs and liability in having to dispose of these things.

The pace has quickened recently, and moved to the more visible realm of consumer products and services. (For more stories on the topic, visit our supply chain resource center.) Moreover, big customers like those named above are asking their suppliers not just to be greener, but to disclose their strategies, programs, and performance.

But it’s more than that. The previous efforts dealt directly with the packaging and ingredients that ended up on their customers’ loading docks. The new push for climate disclosure deals with an impact that the customer never sees.

It’s an interesting development. To do business today, you have to do more than deliver a superior product, priced fairly, packaged economically, and containing no environmental no-nos. You have to be an efficient and responsible company overall.

Suddenly, carbon management and energy efficiency have become table stakes — the minimum commitments companies must make to play with the world’s biggest companies.

(From “Environmental Leader” On-Line Post)

Ninety-five percent of companies that consider climate change to present a commercial risk have implemented a GHG reduction program with a specific target and timeline, according to The Carbon Disclosure Project’s 5th annual global report which looks at the 500 companies ranked by the Financial Times newspaper as the world’s largest by market capitalization. The report is a collaboration of over 315 institutional investors with assets under management of more than $41 trillion.

In addition, 76 percent of responding companies (77 percent of corporations within the sample responded to the CDP questionnaire this year, compared with 71 percent last year) reported implementing a GHG emissions reduction initiative compared to 48 percent in last year’s CDP4 report. Eighty percent of respondents see climate change as presenting risks and opportunities to their business.

The S&P500 report finds that many leading U.S. companies are also assessing climate change and developing response strategies, but as a group are not as far along as the more international FT500 sample. More of the U.S. survey sample sees climate change as presenting commercial risks than opportunities. Only 29 percent of those survey respondents have implemented greenhouse gas reduction programs with specific targets and timelines.

However, the CDP5 response rate (56 percent of the S&P500 responded to the CDP questionnaire) increased in all 10 industry sectors of the S&P500, with 9 of the 10 having a response rate greater than 50 percent, suggesting to the CDP that U.S. industry has reached a tipping point in addressing the issue.

“Increasingly, investors view good carbon management as a sign of good corporate management,” said Paul Dickinson, CEO of CDP. “Our investors are using the quality of the disclosure as a very useful tool to assess how seriously a company is taking the issues of climate change. As CDP data plays an increasingly important role in informing investors on a company’s approach to climate change, the pressure is increasing on companies to respond. And by moving CDP data collection into company supply chain management, CDP’s reach will grow enormously.”

The CDP also launched a Climate Disclosure Leadership Index that CDP says is comprised of 68 FT500 companies that show distinction in their responses to the CDP survey based on their reporting of greenhouse gas emissions and assessment of climate change strategies.

Companies with leading disclosure practise highlighted in the CDLI include Hewlett Packard, Citigroup, Coca Cola, Wal-Mart Stores, Inc., Royal Bank of Scotland, Allianz and Unilever. The S&P500 report rates companies under the Climate Governance Index on disclosure, emissions reductions and strategy, with leaders including DuPont, General Motors, Consolidated Edison, Alcoa, United Technologies and 3M.

(From an Important Grant Thornton Report)
Sept. 11, 2007
[This is not a trend. We have the opportunity and responsibility to help our regional corporations follow suit.]

Company executives believe that corporate responsibility programs can positively impact their business and help achieve strategic goals, according to a survey of more than 500 business executives conducted by Grant Thornton LLP.While conventional wisdom might suggest that these initiatives will drain the corporate coffers, only a quarter of survey respondents agreed that profits needed to be sacrificed, while three quarters believed corporate responsibility could enhance profitability. As a result, 77 percent said they expected corporate responsibility initiatives to have a major impact on their business strategies over the next several years.

Seventy-seven percent of companies anticipate more spending on environmental programs, 50 percent expect greater allocation to social responsibility programs and 45 percent say economic/governance initiatives will see more funding. Respondents felt that tax incentives, customer support, and innovative technologies were most likely to prompt companies to invest more heavily in environmental initiatives.

Other findings in the survey include:

* Sixty-four percent believe that the human resources department should take on social programs, 50 percent say operations should be in charge of environmental initiatives and 57 percent say finance should be responsible for economic responsibility programs.

Sustainability Buzz Up 169%
Sep 04 2007 (From “Environmental Leader”)

(Note from Steve: The following article looks at national trends. By what percentage do you think the “Buzz” about sustainability has increased here in WNC?)

The term “sustainability” peaked on blogs, boards and discussion groups after the February 25 telecast of The Oscars as Al Gore’s “Inconvenient Truth” took home the Oscar for Documentary Feature. Nonetheless, “sustainability” has remained a persistent issue in the blogosphere, with buzz levels on this term up 169 percent in July 2007 versus one year ago, Nielsen BuzzMetrics reports.

“Fueled by Al Gore, growing media attention, and other factors, these higher, lasting buzz levels suggest sustainability is further becoming a deep-rooted priority in consumers’ lives,” said Greg Thornhill, VP and Practice Lead, CPG, Nielsen BuzzMetrics. “For marketers, this new era of sustainability means they must prepare for rising consumer awareness and scrutiny in everything they do and how it relates to the future good of the planet.”

The top brands consumers associate with “sustainability” in natural online conversations tend to be nimble and independent newcomers, Thornhill added. For example, in the consumer-packaged goods (CPG) category, some of the most popular brands currently discussed in connection with sustainability include: Seventh Generation, Shaklee, Method, Ecover, M.O.P., gDiapers and Greening the Cleaning.

In May, BuzzMetrics reported that Wal-Mart was the corporation most linked with blog posts that mention “sustainability.” Wal-Mart was mentioned in 1.77 percent of the 356,403 messages about sustainability measured between 3/15/06 and 3/15/07.

In a related environmental issue, online buzz about bottled water spiked 520% percent on July 27, following recent bottled-water bans in San Francisco and Ann Arbor, and disclosures that two major bottled water brands included only tap water.