Sustainablog

This blog will cover some news items related to Sustainability: Corporate Social Responsibility, Stewardship, Environmental management, etc.

4.2.06

The economic benefits of California’s planned greenhouse gas (GHG) emission reduction programme will outweigh the cost, according to two new reports.


California to benefit from GHG plan
SACRAMENTO, CA, January 26, 2006 - The economic benefits of California’s planned greenhouse gas (GHG) emission reduction programme will outweigh the cost, according to two new reports.

The studies address Governor Arnold Schwarzenegger’s Executive Order S-3-05, which aims to reduce statewide GHG emissions to 2000 levels by 2010, 1990 levels by 2020 and by 80% below 1990 levels by 2050.

One study, by the Centre for Clean Air Policy (CCAP) and released on 19 January, determined that "the governor’s targets can be achieved at no net cost to consumers, and likely at a net benefit in both 2010 and 2020".

The CCAP estimates that, on average, GHG reduction will cost $5.25/tonne in 2010 and $5.77/t in 2020. Although some steps will cost up to $30/t, most will cost less than $10/t and are offset by measures with net benefits, such as the energy efficiency and GHG vehicle standards programmes already underway in the state.

These programmes could save consumers $762 million in 2010, while other emission reduction measures would cost only $154 million, the study says. In 2020, total savings of $2.8 billion could be achieved, compared with costs of $334 million, it predicts. In 2020, 73% of GHG reduction measures will still cost $10/tonne or less, the CCAP adds.

Another study, released on 23 January by the California Climate Change Centre at the University of California at Berkeley, says many GHG policies reduce energy use, which lowers spending. Channelled elsewhere, that spending can stimulate economic activity and create jobs, it says.

The Berkeley study analysed eight policies and determined that they could achieve half of the governor’s goals by 2020, while increasing gross state product by $60 billion and creating 20,000 new jobs. They are: buildings efficiency, vehicle GHG standards, afforestation, landfill management, HFC reduction, manure management, semiconductor manufacturing improvements and cement production changes.

Cost Effective GHG Measures for California is available b>here.

The Berkeley study is available here

WBCSD learning tool helps companies to adopt, implement and integrate eco-efficiency


WBCSD learning tool helps companies to adopt, implement and integrate eco-efficiency

Geneva, 31 January 2006 - Eco-efficiency is a management philosophy that encourages business to search for environmental improvements that yield parallel economic benefits. The eco-efficiency module is designed to capture interest, to inform and to engage on issues surrounding eco-efficiency at different levels within an organization.

Inside the eco-efficiency module

The eco-efficiency module ( 2 MB) is a compilation of learning materials and exercises, from which the user may pick-and-choose, to raise awareness and foster implementation at different levels within their organization. There is a choice of activities, all of which are flexible enough to suit a wide range of audiences, to be delivered by people from a variety of functions and to be
customized to the needs and concerns of a particular organization.

The module contains a background briefing paper designed to give a comprehensive overview of eco-efficiency and a resources section with case studies, quotes and references. In addition there are three learning units –
understanding, exploring and implementing – with a combination of conceptual and practical tools and methods.

The understanding unit introduces the concept of eco-efficiency through a range of basic exercises around definitions, drivers and trends. In the exploring section, participants can understand eco-efficiency and seek to deepen their skills and knowledge through dilemmas and case exercises, applying different approaches and solutions. Implementing will teach participants how to take stock of current performance and to integrate eco-efficient decisions into an organisation.

About eco-efficiency

Eco-efficiency is a management philosophy that encourages business to search for environmental improvements that yield parallel economic benefits. It focuses on business opportunities and allows companies to become more environmentally responsible and more profitable. It is a key business contribution to sustainable societies.


What is eco-efficiency?

As defined by the World Business Council for Sustainable Development (WBCSD), "eco-efficiency is achieved by the delivery of competitively priced goods and services that satisfy human needs and bring quality of life, while progressively reducing ecological impacts and resource intensity throughout the life-cycle to a level at least in line with the Earth’s estimated carrying capacity." In short, it is concerned with creating more value with less impact.

  • Interface, one of the world’s largest producers of commercial floor covering, saved over $200 million from 1996 to 2002 through its sustainability efforts.
  • HP in California reduced its waste by 95% and saved $870,564 in 1998.
  • STMicroelectronics, a Swiss-based technology manufacturer, saved £38 million in energy and $8 million in water costs, with a total saving over a decade predicted at $900 million.
  • Dupont reduced energy use by one-third at one facility saving over $17 million per year on power while reducing greenhouse gas pollution per pound of product by half. In 2000, it saved almost $400 million due to resource and productivity improvement.
  • In five years, SC Johnson increased production by 50% while waste emissions were cut by half, resulting in annual cost savings of more than $125 million.
  • United Technologies Corporation’s sites eliminated almost 40,000 gallons per year of waste water and saved over US$50,000 per year with a fundamental change in the way it manages its test cells, underground storage tanks and waste streams.


Eco-efficiency in practice

There have been great advances in the application of eco-efficiency principles to the real world. Industry, for example, has had considerable success in reducing pollution and emissions, and eliminating hazardous materials from production processes. In the past, business viewed the environment and sustainable development as problems and risk factors.

Today, they are also seen as opportunities – sources of efficiency improvement and growth. Eco-efficiency is very much a part of this picture. Basically, it is about doing more with less: delivering more value while using fewer resources. If you save energy, for example, you cut your costs while also reducing unwelcome outputs such as emissions.

Eco-efficiency is not limited simply to making incremental efficiency improvements in existing practices and habits. It should stimulate creativity and innovation in the search for new ways of doing things. Nor is eco-efficiency limited to areas within a company’s boundaries, such as in manufacturing and plant management. It is also valid for activities upstream and downstream of a manufacturer’s plant and involves the supply and product value chains. Consequently, it can be a great challenge to development engineers, purchasers, product portfolio managers, marketing specialists and even finance and control.

Companies can use eco-efficiency as an integral cultural element in their policy or mission statements. They can also set eco-efficiency objectives for their environmental or integrated management systems. And it is a useful tool for monitoring and reporting performance, and for helping the firm’s communication and dialogue with its stakeholders.


"This is what eco-efficiency is all about: combining the goals of business excellence and environmental excellence, and creating the link through which corporate behavior can support sustainable development."
Bjorn Stigson, President WBCSD


Eco-efficiency opportunities can emerge at any point in the entire life-cycle of a product. This means employees need to understand what eco-efficiency is, the value it can bring to a company and how to make it happen. This in turn requires building skills and understanding in order to integrate eco-efficiency across business operations, sectors, countries and issues, and allowing space for innovation and creativity.

A panacea?

The concept has moved from preventing pollution in manufacturing industries to becoming a driver for innovation and competitiveness. Companies implement eco-efficiency to optimize their processes, turn their wastes into resources for other industries, and drive innovation that leads to products with new functionalities.

Eco-efficiency is a practical approach but not a panacea. And it will never work as an add-on to a business – it has to be an integral part of a strategy. Such a strategy will have a strong focus on technological and social innovation, accountability and transparency, as well as on cooperation with other parts of society with a view to achieving the set objectives.

Eco-efficiency can help companies develop and successfully implement a business strategy toward sustainability only if it’s in the hearts and minds of employees. Demonstrating the value of an eco-efficient approach will help employees recognize why it is important for the company to implement and motivate towards action.

Eco-efficiency has been demonstrated, through hundreds of case examples, to work for companies of all sizes, in all industrial sectors and in all regions. It is critical to draw on the range of tools, strategies and examples that already exist within the leaders in this field.

Eco-efficiency also requires a range of skills and capabilities from understanding definitions and dilemmas, analyzing stakeholder perspectives to undertaking a life-cycle assessment, integrating thinking across business operations, cooperating and negotiating with external partners, and measuring and evaluating impact.

Eco-efficiency is, in fact, work in progress and will continue to be so because it is in essence a dynamic rather than a static process. The purpose of the module is therefore to help companies advocate and educate the eco-efficiency story so far:

  • the business drivers and value of adopting eco-efficiency
  • the key strategies and tools for implementing eco-efficiency
  • how to integrate eco-efficiency into business decision-making processes.
Eco-efficiency is not sufficient by itself because it integrates only two of sustainability’s three elements, economics and ecology, while leaving the third, social progress, outside its embrace. By advocating and educating eco-efficiency, employees can better understand the impacts of the company and its relationship with society. This will enable business to look beyond eco-efficiency in order to earn its licence to operate, innovate and grow.

Download

Talking point - The ISO 26000 process. Is it a good thing or bad thing to instutionalise CSR standards?


Talking point - The ISO 26000 process
Ian Welsh, Readers' Editor
26 Jan 06

ISO compliance: a big deal in developing countries too
ISO compliance: a big deal in developing countries too


Our coverage of the ISO 26000 standard on social responsibility in December raised a number of fundamental issues regarding ISO and what standards mechanisms should be all about.

Tom Rotherham of IISD and Ethical Corporation’s James Rose – who wrote the original stories – have debated these and their implications for social responsibility matters generally, and their correspondence is reproduced here.

Dear James,

I think that your article (and leader) are unduly pessimistic of the ISO social responsibility (SR) process, which you refer to as a “talkfest”, “immature” and “tortuous”. I do not represent the ISO 26000 working group (WG), but have been involved actively in its discussions so would like to raise three points of clarification.

Comparisons between ISO 26000 and ISO 14001 are misleading


ISO 14001 is an environmental management system standard. The WG has stated often that ISO 26000 will not be a management system standard. So if ISO 14001 is an orange, ISO 26000 will be an apple. Compare at your own risk!

“Metricating” SR in an international standard has political and technical restrictions


The new work item proposal for ISO 26000 states that, “while the objective is improved performance, the guidance will have to address both process and performance”. It notes that there is a “limitation on quantitative assessment of SR issues”. Why? Because of “regional differences relating to legal requirements, customs or cultural differences, physical environmental conditions and economic development”. And because “it is the role of governments and inter-governmental organisations to set social obligations or expectations”. But it is possible to guide quantitative performance without setting performance standards. Doing that is a big part of the WG’s challenge.

Concerned interests can have influence – if they get involved


Anyone who knows ISO can attest to the innovation and flexibility in the ISO SR standardisation process. As one example: all of the working documents are available on-line at www.iso.org/wgsr. And another: a specific Task Group has been formed to help raise funds for under-represented stakeholders. The process is not perfect, but it is misleading to suggest that the ISO 26000 standard-setting process is difficult to engage with.

Kind regards,

Tom Rotherham

International Institute for Sustainable Development representative to ISO Working Group on Social Responsibility
Co-convenor Task Group 3: Operating Procedures


Dear Tom,

My main argument is that the very institutionalisation – the whole construction itself, if you will – of corporate responsibility (CR) is likely to over-shadow wider issues. I’ll come back to that.

First, you made three major points, which I’ll endeavour to address.

1. I admit I have been confused about the nuances between such mechanisms as 14001 and 26000. But, the need to clarify relatively basic points, such as this, tends to underscore my argument that the main thrust and potentials of CR may be lost amid the technicalities of this process.

2. You seem to be admitting the ISO process can only go so far. I would whole-heartedly agree. It depends how far people take it, however. That is, ISO 26000 may become a de facto “that’s it” solution for CR. That would be a danger.

3. I would also agree broadly that the ISO process is fairly open to wide debate. In fact, I tried to make the point that such a debate was highly significant and valuable. In some ways, this debate may be of more historic value than the actual standard.

My main concern is that ISO and the 26000 process may lead to mis-representations of CR to the extent that they are given institutional form, but lack a personal dimension. Essentially, CR is founded in humanist ethics. While there is much debate over the definitions of ethics, the best ones I think are those that require us all to consider our actions in the light of our own values and those of our communities.

CR needn’t be more complicated than that and thus may not necessarily require the elaborations and embellishments it has been obliged to endure for it to successfully take root in organisational culture.

It is this personal dimension of CR that I think ISO, by seeking to institutionalise and package the concept, may be in danger of overwhelming.

Yours

James Rose

Asia-Pacific Editor, Ethical Corporation


Dear James,

I agree that SR cannot be reduced to a distinct set of requirements or criteria (although I believe that there are some universal principles and expectations). SR is better seen as a lens to help gain insights into opportunities and risks that arise from changing societal expectations. It is often more of a “how” or “why”, not a “what”.

I also agree with you that using the SR lens is not particularly complicated. But your analogy of personal values breaks down at the implementation stage: people can pursue their values even to the point of self-destruction (eg Indian anti-dam protesters; Korean rice-farmers).

Organisations are run by people with other responsibilities – to their boards, their investors, their employees, to laws … – and so are more constrained in their pursuit of an ethical vision.

This is why implementing a humanistic, ethical vision can be so complicated for organisations. They need to:

decide what changes (in policies, strategies, business plans) are needed to capitalise on the new insights;

decide which issues (and which stakeholders) to prioritise;

figure out how to link an SR policy to the core organisational interests;

drive the necessary changes through all parts of the organisation; and

communicate (internally and externally) their message in a clear, credible and consistent manner.

In the September 2005 issue, Paul Hohnen and I argued that the right vision for ISO 26000 is a “SR for Dummies” guide. An enormous amount of extra value has been squeezed from Windows because of a simple, how-to guide. The same is possible for SR. It takes experts to write such a guide, but the audience is non-expert users.

In your article you implied that an ISO SR standard would have to quantify the unquantifiable. My point was that the drafters of the standard are well aware that SR cannot be boiled down to a distinct list of requirements or criteria, particularly in an international standard. The implication, which I hope is clearer now, is that it might therefore be worth considering what else they have in mind for ISO 26000.

Best regards,

Tom



Dear Tom,

I fundamentally do not agree that the international organisational models that predominate today can adapt as much as you seem to believe.

Today’s multinational organisations, be they for-profit or not-for-profit, tend to adopt cultures which are mono-cultural, hierarchical and goal oriented. Operating across many borders tends to establish a need for such an approach.

Broadly speaking, this approach works well if all you’re looking for is basic economic growth and increased investor and/or consumer opportunities.

But, when it comes to issues of ethics and responsibility, there is a fatal gap between these more quantitative goals and the qualitative ones that CR envisages.

Essentially, there is a paradox at the centre of the modern international organisation. That is: they are run by individuals but they retain the cultural mechanisms of an institution. Individuals running institutions today are probably more institutionalised (or corporatised, managerial) than they have tended to be in the past.

I believe this paradox is the foundation of the grievances aired by the Korean farmers and the Indian anti-dam protestors you mentioned in your last letter. Such groups essentially wish to preserve a better balance between the individual and the community/institution. They are concerned about the breakdown of that system and the effects it will have/is having on them.

The balance between personal and institutional values is clearly at a dysfunctional point. The institution is winning at the cost of personal empowerment, values, and space.

So, for ISO to introduce what is clearly an attempt to further institutionalise CR is, I think, not helpful in the wider context of this imbalance.

While I do not wish to discredit ISO or others who have waded into the waters of CR standardisation, my ultimate raison d’être is to ensure caution, lest the depth of those waters drowns the protagonists. Or worse, that their struggles prompt a walkway to be built over them so no-one gets wet at all.

Yours,

James



Join the debate: email your views on the ISO process or any points raised above to
editor@ethicalcorp.com for publication!

Business bribery - C’est la vie: Just when Thales thought it had escaped prosecution, the company finds itself embroiled in a court battle.


usiness bribery - C’est la vie
Poulomi Mrinal Saha in London
17 Jan 06

Jacob Zuma: man of the people, and of the courts
Jacob Zuma: man of the people, and of the courts


French companies’ performance on corruption issues still has a long way to go
Just when Thales thought it had escaped prosecution, the company finds itself embroiled in a court battle.

In November, two subsidiaries of the French defence company were indicted on bribery charges by South Africa’s National Prosecuting Authority. It is alleged that Thales subsidiaries promised to pay the country’s former deputy president, Jacob Zuma, 500,000 rand (£44,000) a year to protect the companies from corruption investigations.

The controversy initially erupted in 2001 when it was alleged by a South African parliamentary member, Patricia de Lille, that senior members of the Africa National Congress had received kickbacks in a major arms deal. Government investigations resulted in the dismissal of the defence department’s chief of acquisitions, Chippy Shaikh.

It was said that Shaikh “did not recuse himself properly” from the negotiations that resulted in a $70 million weapons contract for a joint venture between Shaikh’s brother, Schabir, and the South African arm of Thales.

Schabir Shaikh was Jacob Zuma’s financial adviser and a friend from his anti-apartheid days. The links caused suspicion resulting in a trial. In June last year, Schabir Shaikh was sentenced to 15 years in prison over a “generally corrupt relationship with Mr Zuma”. Zuma was not indicted in this case.

Thales was granted immunity from prosecution in return for supplying an “encrypted fax” detailing payments for Zuma in the arms bribery investigations.

The company is now in trouble again. Zuma was indicted in November for his part in the case, which he vehemently denies. Thales, its subsidiaries now accused of bribery, also denies all charges.

Pierre Moynot, Thales’s South African director, says the company is a victim of a political clash between Zuma and president Thabo Mbeki that has caused a rift in the ANC. “Mr Zuma never asked for anything at all from Thales and we have never paid him anything at all,” he says.

Wider scandals


But the trial that is to begin in July this year is not Thales’s only concern. The company is also at the centre of judicial investigations by the French government into allegations of bribes acquired from Taiwanese officials for the supply of frigates to Taiwan’s navy in 1991. Taiwan has asked the French government to return $600 million allegedly taken as kickbacks by French government officials.

These recent cases come on the back of the biggest corruption trial in France’s history. In 2003, two senior executives at French oil company Elf (now a part of Total) were sentenced to prison for using company funds to acquire contracts in South America, Africa, Russia, Spain and Germany between 1989 and 1993, when the company was state-owned. The case took eight years to conclude and resulted in an eight-month trial that rocked France.

Apparently, however, the lessons learnt from the Elf scandal haven’t been taken much on board by other firms. Corruption remains rampant in French business, according to anti-corruption watchdog Transparency International. TI studied the levels of protection against corruption among the biggest companies in France during 2005. Of the 80 companies that received the survey, only 17 responded and the results made for depressing reading, says TI. Very few companies had both policies and systems in place to monitor and detect fraud or corruption.

In a similar study into oil revenue transparency by the UK-based campaigners’ coalition, Publish What You Pay, French oil giant, Total ranked a near-bottom 21st out of the 25 companies researched. “They [Total] talk a lot about transparency but it’s a lot of window-dressing,” says Michel Roy, co-ordinator of the French arm of Publish What You Pay, referring to Total’s commitment to the Extractive Industries Transparency Initiative principles in 2003.

Total, which has operations in Angola, Azerbaijan, Indonesia and Nigeria, refuses to publish payments to governments, says Roy, because the company believes host governments would be more comfortable co-operating with companies if assured of confidentiality.

Elodie Biarnés, analyst at the French research group Centre for Information on Companies, notes that public market reforms between 1998 and 1999 have introduced more transparency within France, leading to a recession in corruption. But the same does not stand true for these companies’ performance overseas.

Lacking impetus


Anti-corruption campaigners blame the absence of pressure. While some non-governmental organisations and media organisations highlight breaches in corporate codes of conduct, they have not been able to effect major changes in attitudes to bribery. The investing community, too, has been reticent in expressing non-tolerance of lax attitudes in addressing potential corporate graft issues. The absence of big institutional investors in the country also makes it harder to press for change as a collective force.

Government support has not been especially forthcoming. Biarnés says France’s ratification of the OECD Convention on Corruption in 2000 provided a breakthrough but much of the action against corruption-related matters has been driven by foreign legislations, such as the US Sarbanes-Oxley Act.

Publish What You Pay has been engaged in talks with the government on its mandatory regulations for disclosure among extractive companies. However, the response has been lukewarm. The government cites a decrease in businesses’ competitive advantage against extractive industries in countries where such disclosure is not required by law.

But optimism lives on among some campaigners. Many believe there have been signs of improvement and that, with the right sort of pressure, things could improve. This optimism, however, jars with rumours that the French government may put diplomatic pressure on South Africa to get Thales off the hook, a view compounded by the government’s slow pace in investigating the Taiwanese frigates scandal.

Useful links:

www.thalesgroup.com
www.total.com
www.transparency.org

3.2.06

[SolarAustin] Chinese PV production booming



"... On the basis of the ambitions presented by several new Chinese
players, it is anticipated that in 5 years' time Chinese PV
manufacturers will be dominating the world market with their
products..."

The overall goal of the Chinese government is to have 450 MW of
cumulative PV power installed in China by 2010. This is in
comparison to the estimated 75 MW which was current in 2005.

Enormous Growth of Chinese PV Industry

By: Edwin Koot, Director of www.solarplaza.com

China is a country of big numbers. And it seems the growth virus has
infected the Chinese PV industry as well. Growth over the past few
years has been impressive and shows even more ambition. In the 30
major companies involved at present, total available production
capacity for cell and module production already exceeds 20% of the
world's total. 5 years ago, it was less than 1%. China is now the
world's third country in terms of solar cell production capacity,
and this industry is still growing at more than 50% per annum. Based
on the ambitions of the 20 cell manufacturers already active in this
market, production capacity is expected to grow to 820 MW per annum
in 2006. Several new cell and module manufacturers have started
production over the past 4 years and are now growing towards the top-
ten ranking of the world's largest manufacturers. Currently, over
90% of all PV products produced (cells, modules) are being exported
to Western countries, such as Germany, as well as to Japan and the
rest of the world.

Feedstock shortages….

The growth in production capacity seems unstoppable; however, actual
production is limited by the availability of solar grade silicon
(SGS) and wafers on the world market. Since things move and grow
fast in China, these international shortages have inspired several
new Chinese companies and have resulted in new initiatives for
silicon and wafer production. One of them is LDK Solar (located in
Xinyu City, Jiangxi Province). The company has set itself the goal
of as much as a 13,000-ton production capacity for 2010 - a figure
not far removed from current world production, which is over 16,000
tons. In 2006, the company will be making an investment of € 58
million to get started with a production capacity of 75 MW for multi-
crystalline wafer production. Typically, the manufacturing equipment
will come from a company outside of China: the American company GT
Equipment Technologies.

Despite these new silicon manufacturers and a production capacity
covering about 20% of the world's production of solar ingots and
wafers, China's PV industry is still heavily dependent on the import
of solar feedstock. And yet, as a result of worldwide shortages and
attractive market prices, part of China's current production of
silicon and cells is being exported. Taking into consideration the
ambitions of the companies known at present to be involved in the
production of solar grade silicon (SGS), wafers, cells and modules,
it is anticipated that even by 2010 China will still need to import
feedstock to maximise its production of cells and modules.

Opportunities for Western-Asian joint ventures

With everything growing at high speed in China, there is room for
collaboration with western companies. Most Chinese PV companies use
production processes based on manufacturing equipment and technology
purchased from the West. More and more joint ventures and
partnerships are being started with Western PV companies, such as
the recent joint ventures of Spanish Isofoton with the Himin Group
and BP Solar with SunOasis. Other Western companies, such as Sharp
and SolarWorld, have (part of) their modules produced in China by
OEM manufacturers. Chinese manufacturers are doing good business and
have applied for product certificates to sell their modules in the
European and American markets. Increasing numbers of them are
starting to brand and sell their own products in Western markets.
Venture and investment capital no longer set a limit on further
growth. China's market leader Suntech Power recently collected over
$ 396 million on the occasion of the firm's debut last December on
the New York Stock Exchange - a record for the global solar
industry. Market capitalisation increased the company's value by
more than € 2.5 billion, and all this for a company established less
than 5 years ago… Its stock exchange listing made its founder and
present CEO, Zhengrong Shi, the first solar PV billionaire…

On the basis of the ambitions presented by several new Chinese
players, it is anticipated that in 5 years' time Chinese PV
manufacturers will be dominating the world market with their
products. To fulfil their ambitions, cell and module manufacturers
will have to grow by 400% in 5 years.

Rural PV application in the Chinese PV market

China's domestic PV market is still in its relative infancy, but it
is growing and has the potential and ambition to become one of the
world's most important PV markets. The market is controlled by
central government, and incentives and (international) support still
require Beijing's approval. China offers solar radiation conditions
for PV applications that range from good to excellent, and it has an
infinite availability of space. The main market segment in China is
rural electrification (some 7 million people have no access to
electricity, mainly in the North and West). Central government has
initiated the Village Electrification Programme ("Song Dian Dao
Cun"), which aims to electrify a further 20,000 villages with PV
power in China's off-grid western region between 2005 and 2010.

Government target: 450 MW of PV power installed by 2010

The overall goal of the Chinese government is to have 450 MW of
cumulative PV power installed in China by 2010. This is in
comparison to the estimated 75 MW which was current in 2005. Average
sales growth of 40% per annum until 2010 is needed to achieve this.
For the next decade, a target has even been set for 8,000 MW by
2020, when PV might already be cost competitive. For the coming
years, rural electrification will remain the dominant segment.

Grid-connected market: youthful and with potential

The new Renewable Energy Law (REL), which comes into force in
January 2006 and includes a feed-in tariff, could boost growth
further in the market segment of grid-connected systems.
This "market" is still fragmented, small and dependent on individual
initiatives. The related sales level is 2-3 MW per annum (2005) and
is likely to grow by more than 75% per annum. Initiatives such as
the Shanghai 100,000 PV roof programme will get underway in the near
future and could result in the cumulative installation of grid-
connected PV at 70 MW by 2010. Any additional major growth of this
segment will depend on the details of the proposed feed-in tariff as
part of the new REL, which provides guidelines for grid connection
and local initiatives. In the past, China and Chinese companies have
been shown to be highly effective in executing the goals and targets
they set. If, in the next decade, PV application becomes financially
competitive compared to other energy sources, China will not only
offer a gigantic market, but will also have the industrial
infrastructure and power to supply it.

International PV trade mission to China

SolarPlaza, the global PV marketplace, recently published a report
entitled "The Chinese PV market and industry", which provides
additional market information, forecasts and listings of the major
PV companies. Following this report and the success of the trade
mission to Spain, SolarPlaza will be organising the "PV Business
Tour of China" in April 2006. The programme will include visits to
major manufacturers, a brokerage event and a symposium for meeting
with other major Chinese PV companies. The central goal of this
international mission is to meet with China's PV Industry, producers
of SGS, solar wafers, cells and modules and to experience
opportunities for collaboration.

More information about the report and the international trade
mission to China can be found on www.solarplaza.com.

2.2.06

California's economy to benefit from GHG plan– reports


California's economy to benefit from GHG plan – reports

Environmental Finance, 26 January 2006 - The economic benefits of California's planned greenhouse gas (GHG) emission reduction programme will outweigh the cost, according to two new reports.

The studies address Governor Arnold Schwarzenegger's Executive Order S-3-05, which aims to reduce statewide GHG emissions to 2000 levels by 2010, 1990 levels by 2020 and by 80% below 1990 levels by 2050.

One study, by the Centre for Clean Air Policy (CCAP) and released on 19 January, determined that "the governor's targets can be achieved at no net cost to consumers, and likely at a net benefit in both 2010 and 2020".

The CCAP estimates that, on average, GHG reduction will cost $5.25/tonne in 2010 and $5.77/t in 2020. Although some steps will cost up to $30/t, most will cost less than $10/t and are offset by measures with net benefits, such as the energy efficiency and GHG vehicle standards programmes already underway in the state.

These programmes could save consumers $762 million in 2010, while other emission reduction measures would cost only $154 million, the study says. In 2020, total savings of $2.8 billion could be achieved, compared with costs of $334 million, it predicts. In 2020, 73% of GHG reduction measures will still cost $10/tonne or less, the CCAP adds.

Another study, released on 23 January by the California Climate Change Centre at the University of California at Berkeley, says many GHG policies reduce energy use, which lowers spending. Channelled elsewhere, that spending can stimulate economic activity and create jobs, it says.

The Berkeley study analysed eight policies and determined that they could achieve half of the governor's goals by 2020, while increasing gross state product by $60 billion and creating 20,000 new jobs. They are: buildings efficiency, vehicle GHG standards, afforestation, landfill management, HFC reduction, manure management, semiconductor manufacturing improvements and cement production changes.

** Cost Effective GHG Measures for California is available at www.ccap.org.

* The Berkeley study is available at http://calclimate.berkeley.edu/

Red Hat officially commits to MIT's $100 laptop: becomes founding corporate member of the One Laptop Per Child organization


        Red Hat officially commits to MIT's $100 laptop
Red Hat becomes founding corporate member of the One Laptop Per Child organization


By China Martens, IDG News Service

January 31, 2006

Linux software vendor Red Hat plans to publicly confirm on Tuesday that it has become a founding corporate member of the One Laptop Per Child (OLPC) organization.

The non-profit OLPC was established a year ago to spearhead development of the Massachusetts Institute of Technology (MIT) Media Laboratories' project to build $100 laptops for schoolchildren worldwide, particularly students in emerging and developing countries.

The ruggedized lime-green 500MHz laptop, which is in prototype phase, will run a slimmed-down version of the Linux operating system and be powered by either an AC adapter or a wind-up crank. Each laptop will act as a node in a mesh peer-to-peer ad hoc network, meaning that if one laptop is directly accessing the Internet, when other machines power on, they can share that single online connection.

The idea is to provide children with a free laptop to improve their education in the classroom and outside. Governments would pay for the laptops.

Red Hat formally committed to the initiative last month, according to Mike Evans, Red Hat's vice president of corporate development. The vendor joins Advanced Micro Devices (AMD), Brightstar, Google, News Corp., and Nortel Networks, which also are helping to develop the laptop. Red Hat had been in talks with OLPC for almost a year.

Evans wouldn't comment on the amount of money or resources Red Hat is giving to OLPC. However, a recent United Nations press release stated that all six of the technology companies have already donated $2 million each to the laptop project. Last week, OLPC and the United Nations Development Programme (UNDP) signed a memorandum of understanding at the World Economic Forum in Davos, Switzerland to work together to deliver the laptop and other learning resources to schools in what they termed "least developed countries."

Red Hat's commitment to the laptop project doesn't mean the company's software will be the de facto operating system for the device, according to Evans. "The laptop is a very open platform, similar to a PC; any OS can run on it." The Red Hat operating system for the laptop will be fully tested and validated with both the laptop hardware and the open-source educational applications due to run on top of the operating system, he added.

When Nicholas Negroponte, showed a working prototype of the laptop at the World Summit on the Information Society in Tunis, Tunisia, in November, the device ran a variant of Red Hat's Fedora operating system, according to Evans. Negroponte is the founding chairman of MIT Media Labs and the chairman of OLPC.

Red Hat has staff onsite at MIT working with OLPC, Evans said, as well as Red Hat staffers around the world. He's also counting on a large amount of participation from the open-source community to address the challenges of putting Linux onto the $100 laptop.

The challenges include making the operating system function within the laptop's power constraints, developing new technology to interact with the mesh networking and determining how best the operating system would work with applications running on top of it. "Open-source participation is strong in some countries and very weak in others," Evans said. "This [the laptop project] could be potentially unifying" as developers in Nigeria talk to their counterparts in countries including Thailand, Argentina, Egypt and India.

Looking into the future, should the project be a success and tens of millions of schoolchildren grow up using open-source software, the ramifications for the global open-source community are powerful, according to Evans. "It is pretty bold," Evans said of the project. However, he feels the timing for such an initiative is right, because many governments are keen to invest in technology for their populations.

Even should the project ultimately fail, raising the topic of how to bridge the digital divide and "making a dent in it" would mean success, according to Evans. He added that MIT Media Labs appears to have learnt from its previous failures with trying to create Media Labs in Europe and Asia. "What I always say to people is that anyone really trying to change the world will be doubted or ridiculed," Evans added.

Specifics on when the laptop will appear keep shifting, but last week's UN press release states that manufacturing begin when a minimum of five million machines have been ordered and paid for in advance by governments. OLPC would then aim to have the first units ready to ship by early 2007.

MIT's Negroponte is due to speak at the Red Hat Summit user conference on June 2 in Nashville, Tennessee, according to Evans.

Management strategy - Responsible leadership required: Five major changes are required of firms that seek to embrace corporate global responsibility


Management strategy - Responsible leadership required
EC Newsdesk
23 Jan 06

Craig Smith
Craig Smith


Corporate global responsibility requires fundamental change in business. Five major changes are required of firms that seek to embrace corporate global responsibility, writes Craig Smith
A recent report, Globally Responsible Leadership, asserts that globalisation has brought to the fore a new and much broader definition of business purpose: to create economic and societal progress in a globally responsible and sustainable way.

As business increasingly operates on a global basis, the complexity and scale of social and environmental demands on firms have grown many fold. Consider, for example, the current debate around the role of business in poverty reduction, developing country access to medicines, oil companies and the environment, global supply chains and sweatshop labour.

Often the response by business to these challenges in the past has been to say that they are not its problem and, even where it is to blame, it is the job of government to address them via regulation. However, while globalisation continues apace, global regulation has fallen well behind.

The answer for many firms lies in a fundamentally different approach to their business: globalisation has made corporate global responsibility an imperative and business practice will need to be transformed accordingly. Five major changes are required of firms that seek to embrace corporate global responsibility.

Tune into the environment


At minimum, corporate global responsibility requires a much richer understanding of the business context, and from a global perspective. This includes stakeholder engagement but also attending to weak signals from distant groups – a scanning of the environment to detect emerging social, cultural, technological and political trends and demands. This might mean, for example, drawing on research from fields far removed from business, such as anthropology or sociology.

Develop stakeholder engagement skills


“Engage with stakeholders” is easy to say but much more difficult to do. Managers do not necessarily have the appropriate skills and may have markedly different attitudes and beliefs to people in some stakeholder groups (e.g. non-governmental organisations). Often, stakeholder groups have different interests and priorities and thus may be in conflict with each other. Managers need training to be able to manage potentially hostile groups, to foster dialogue, to conduct multi-stakeholder meetings, to listen carefully and to interpret correctly.

In some cases, they will need to go beyond engagement and forge partnerships with stakeholders, as some pharmaceutical companies have done to improve HIV/Aids education and access to medicines in developing countries. This calls for deep relationship-building skills.

Cultivate globally responsible mindsets


Developing globally responsible business leaders is much more than skills training. Changes in understanding, in values and attitudes, require managers engaging with heart as well as mind on issues of corporate responsibility.

A changed mindset will start with understanding of potential adverse consequences from failure to consider corporate responsibility (such as loss of “license to operate”) and extend to a greater capacity to deal with dilemmas and ambiguity, an openness to the views of others and a capacity to work with internal contradictions and value conflicts – distinctly not, “business as usual”. To effect this type of change in employee mindsets in the first instance may call for an individual to champion new ways of thinking and working, perhaps around a focal issue that represents a “burning platform” for change.

Institutionalising change


For many firms, realising broader and permanent change will require a cultural shift. This might mean, for example, broader acceptance of a principles-driven view of societal obligations – doing the right thing because it is the right thing to do as well referring to a business case. Institutionalising processes such as corporate responsibility audits, may help, but far more important will be the tone from the top and the example set by key management decision-makers.

Measure and reward


Corporate responsibility is more likely to happen if it’s measured and rewarded. Firms need to establish specific goals and performance measures related to corporate global responsibility.

This is evident, for example, in measures of emissions by leading practitioners in the oil industry. Some responsibility issues, however, are less readily quantified and measures must be more subjective (e.g. human rights). As well as measuring firm performance, individual managers need to be evaluated against corporate responsibility criteria, not just on whether they make their numbers, but how? Some firms are starting to incorporate these measures into balanced scorecard approaches.

Most fundamentally, corporate global responsibility calls for the development of a new generation of globally responsible business leaders, at all levels of the organisation, with the knowledge, skills, attitudes and values to better analyse and address the firm’s responsibilities.

They will lead with the heart as well as the head and give greater attention to issues of corporate responsibility in their organisations because they know it is in the best interests of the firm and society as well as the morally right thing to do. If this is the case, corporate global responsibility had better be “mainstreamed” not only in business but in business schools too.

Craig Smith is senior fellow in marketing and ethics and senior associate dean for the full-time MBA programme at London Business School.
NCSmith@london.edu

*Globally Responsible Leadership: A Call for Engagement available at:
www.globallyresponsibleleaders.net.

1.2.06

The purpose of the corporation: The purpose of capitalism is to harness private interests in service to the public interest.


The purpose of the corporation
Mark Goyder
16 Jan 06

John Ruskin: no fan of insolent futility
John Ruskin: no fan of insolent futility


Mark Goyder delves once more into what companies are for
Not long ago I was invited to take part in a debate at Chatham House in London. It was entitled “The purpose of the corporation: Adam Smith Revisited”. That man Smith again!

On the agenda were six propositions from Allen White, co-founder of Corporation 2020, an organisation formed in the United States to “rethink corporate purpose, rights and obligations”.

The first proposition was: “The purpose of the corporation is to harness private interests in service to the public interest.”

The others referred to “fair returns” for shareholders, operating sustainably, equitable wealth distribution, participatory and ethical governance, and the need for companies not to infringe on universal human rights.

For many of us, especially in the UK, these questions were not new.

Fifteen years ago this month, an Englishman called Charles Handy gave a lecture entitled “What is a company for?” Did it exist for society or for shareholders?

In terms quite similar to White’s, Handy asked: “Is the pursuit of self-interest bound to be for the common good or do we need to recognise that Adam Smith lived in a simpler world, at a time when, for instance, you loved both yourself and neighbours because you knew them and could not ignore them? Do we need new rules for a new and more complicated world?”

Looking around my bookshelves, I can find others asking the same question. Here is George Goyder, the inventor of the social audit, writing in 1987: “The challenge we face is to discover a philosophy of company law which is socially and morally acceptable and at the same time encourages efficiency. We need to apply the principle of trusteeship, which is an expression of the natural law.”

Hark back to Ruskin


In 1862, in “Unto this Last”, we find John Ruskin writing about the difference between political and mercantile economy. He says: “The idea that directions can be given for the gaining of wealth, irrespectively of the consideration of its moral sources … is perhaps the most insolently futile of all that ever beguiled men throughout their vices.”

Since the industrial revolution, each generation has searched for a better balance between making money and meeting the needs of society. Today’s generation needs answers on a global scale.

But is there any single answer to Handy’s question? My answer, and that of Tomorrow’s Company over the past 15 years is a firm “no”.

All over the world, people are starting businesses for all kinds of reasons: to climb out of poverty, to gain independence, to earn a living, to prove a point, to get rich, to express themselves, to have fun, to beat the hell out of the competition, to put someone they hate or fear out of business.

It is untrue to human experience to claim, as the first Corporation 2020 principle does, that the purpose of every corporation is to harness private interest in service to the public interest. This first principle is, however, a good description of the purpose of capitalism.

It then remains for each company, like each human being, to work out its purpose and its own way of squaring the circle linking the claims of society, shareholders, employees and other stakeholders – and for society to create a framework of such powerful transparency that those companies and their leaders are held truly accountable. We cannot expect to like all the answers we hear: but we can at least ask of companies that they say what they mean.

It is unrealistic to imagine that you can retain the competitive dynamics of capitalism while asking companies to look after social equity. If they want to say they are in business to get rich – fine. Let companies tell us. We know where they stand. Equally, if they want to put the needs of the planet into their purpose, then let us hold them to that.

That is why I suggested that Corporation 2020’s first principle needed a profound one-word change:

The purpose of capitalism is to harness private interests in service to the public interest.

The remaining principles can be reduced by one:

Companies exist to meet human need, but shareholders, customers, employees, the community and future generations all embody different aspects of that need.

Within the law each company can – and should – adopt its own purpose. Diversity of purpose is part of the richness of a market economy.

Directors are elected by shareholders to fulfil that purpose; they are accountable to shareholders but should see their duty as being to the company.

All companies, but especially large ones, have a duty that goes beyond legal obligations to manage and explain their impact on human rights, social well-being, the natural environment and future generations.

mark@tomorrowscompany.com

Useful links:

www.tomorrowscompany.com
http://forums.seib.org/corporation2020
www.c4cr.org

30.1.06

Bush to Promote Alternative Energy Initiatives at State of the Union


Bush to Promote Alternative Energy Initiatives at State of the Union
Monday, January 30, 2006


WASHINGTON — Trying to calm anxieties about soaring energy costs, President Bush is using his State of the Union address this week to focus on a package of energy of proposals aimed at bringing fuel-saving technologies out of the lab and into use.

In Bush's vision, drivers will stop at hydrogen stations and fill their fuel-cell cars with the pollution-free fuel. Or they would power their engines with ethanol made from trash or corn. More Americans would run their lights at home on solar power.

Bush has been talking about these ideas since his first year in office. Proposals aimed at spreading the use of ethanol, hydrogen and renewable fuels all were part of the energy bill that he signed into law in August, but that hasn't eased Americans' worries about high fuel prices.

Americans were hit with the biggest jump in energy prices in 15 years in 2005, and worries about the cost of gas and heating oil have damped spirits about the economy despite other recent encouraging signs.

Add in the unrest in the Middle East, and energy becomes a major problem for the president to address Tuesday night.

"I agree with Americans who understand being hooked on foreign oil as an economic problem and a national security problem," Bush said in a recent interview with CBS.

Eight in 10 Americans surveyed earlier this month by the Pew Research Center for the People & the Press said gasoline prices were a big problem.

Home heating fuel and health care were the other major economic concerns. It's not a coincidence that Bush will spend much of his State of the Union reassuring Americans that he has a plan to address energy and medical costs.

House Democrats sought to take the luster off Bush's speech with a television commercial that accuses the president and Republicans of tilting their policies toward the pharmaceutical, oil and investment industries. It shows lawmakers cheering Bush's words from three previous State of the Union addresses, and asks: "What Special Interest Will the Republican Congress Rubberstamp This Time?"

Officials said the commercial would air only once, on Fox, in the run-up to Bush's speech, making it more like a guerilla-style attack on the GOP than an attempt to mold public opinion.

Bush told CBS that he does not support a big raise in the gas tax, as others have proposed. Instead, he is looking for tax breaks that encourage new technologies, which is popular with farmers, with industry and with consumers of those products.

"We have got to wean ourselves off hydrocarbons, oil," Bush explained. "And the best way, in my judgment, to do it is to promote and actively advance new technologies so that we can drive — have different driving habits."

For example, he said, the federal government could push more widespread use of corn-based ethanol and spur production from other sources.

Almost all ethanol produced now comes from corn. Although non-corn ethanol from sources like grasses, wood chips and even garbage is widely talked about, a practical and cost-effective process for producing it appears years away.

Bush noted to CBS that about 4.6 million cars on the road in the United States can run on ethanol. The fuel works in more than 30 models, including General Motor's Yukon, Chevrolet's Silverado and Ford's Taurus. However, almost all drivers of those vehicles outside the Corn Belt fill up with gasoline.

Automakers and environmentalists are also excited about the prospect of fuel cells, which would run on hydrogen that would only emit water instead of gas fumes. But fuel cell vehicles are extremely expensive to produce and lack an infrastructure of fueling stations to make them viable. The government has said it hopes hydrogen fuel cell vehicles will be available in car showrooms by 2020.

When it comes to alternative ways to power homes and businesses, very little U.S. electricity now comes from renewables such as wind, solar, geothermal, wood and waste. But that share is expected to increase as the price of fossil fuel rises.