Sustainablog

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

13.5.06

Sun names VP for eco-friendly products: Sun plans to focus on environmental friendliness as a competitive differentiator

InfoWorld - Technology Information for Business Intelligence



Sun names VP for eco-friendly products
Sun plans to focus on environmental friendliness as a competitive differentiator


By John Ribeiro, IDG News Service

May 10, 2006

Sun Microsystems has created a new vice presidential post for Eco-Responsibility, reflecting the company's strategy to focus on environmental friendliness as a competitive differentiator. David Douglas will return to Sun to take up the position.

Douglas will assume responsibility for the strategy and execution of environmental initiatives across the company, including enhancements to Sun's products in the areas of energy efficiency, cooling technologies, product recycling and clean manufacturing, the company said. He will report to Greg Papadopoulos, the company's chief technology officer and executive vice president of research and development.

Technology companies including Advanced Micro Devices, Hewlett-Packard, IBM, and Sun set up an environmental project called The Green Grid in April. The project aims to reduce power and cooling requirements in computer data centers. The project is to announce next month a formal metric for measuring energy consumption of servers.

Douglas returns to Sun where he worked previously in a variety of senior engineering and technology management positions in both systems and software, including as vice president of engineering for Sun's Solaris operating system. In 2001, Douglas cofounded ConnecTerra, a startup in RFID middleware technology, and when ConnecTerra was purchased by BEA Systems in 2005 he became BEA's chief architect for WebLogic from October 2005.

Ballard Watching Canada's Support for Fuel Cells




Ballard Watching Canada's Support for Fuel Cells

VANCOUVER, British Columbia - Ballard Power Systems Inc.'s chief executive is looking for a sign that Canada's new Conservative government will continue support for the country's fledgling fuel cell industry.

John Sheridan would like the federal government to join a program to have fuel-cell powered buses on the road for the 2010 Winter Olympics in Vancouver, and consider tax incentives to spur the technology's continued development.

"I think the new government will be a supporter of this area ... but so far, have we seen a focused, substantive contribution? I'd have to say no," Sheridan told reporters Wednesday following Ballard's annual meeting.

The Conservatives, who were elected in January, have come under fire from environmental groups that say the new government plans to back away from Canada's commitment to the Kyoto protocol on climate change.

Fuel cells, which produce electricity from hydrogen using a chemical process, with little if any harmful emissions, are being touted as a potentially important technology in the battle against global warming.

Sheridan, a former Ballard chairman but addressing shareholders for the first time since becoming CEO, said Ballard had become a more focused company over the last year but still had work to do.

The Vancouver-based firm was a darling of investors in the late 1990s, but was forced to reorganize its corporate strategy last year as it struggled to make the alternative technology commercially viable.

Sheridan said he does not expect any major organizational changes, but Ballard will continue working to show it can deliver on the promises it has made for its technology to become viable.

Story Date: 12/5/2006


11.5.06

[Editorial] The anti-CSR lobby - House of straw


The anti-CSR lobby - House of straw
Phillip H Rudolph
4 May 06


Ecomagination: a rational response to market forces


A recent US conference on corporate citizenship revealed the logical holes in the arguments of opponents to the corporate responsibility movement, writes Phillip H Rudolph
Several years ago I represented a company in a difficult investigation. Government lawyers kept asking perceptive questions that had the potential to undermine my client’s position entirely.

We would forward these questions to our high-priced economist, and he would unfailingly respond by snapping: “They’re asking the wrong questions!” He would then posit the questions “they should be asking”, meaning questions he could answer. This proved to be a remarkably ineffective tactic.

I was reminded of this recently during a conference at which many vocal critics of corporate social responsibility were represented.

Throughout the day, I was struck by the degree to which several of these critics attacked corporate social responsibility by mischaracterizing its premises in every imaginable way.

Having thus created a false enemy, they eagerly pummelled a conception of corporate responsibility that few of us would recognise.

There were so many straw men in the room that day that a spark would have set the whole building ablaze.

For free markets


I soon came to realise that the positions espoused by these critics were (and are) completely at odds with the principles they so stridently promote.

My epiphany occurred during a panel in which the “moderator” offered an enthusiastic testimonial to Adam Smith and Milton Friedman, and to the manifest superiority of free markets.

Then, without a hint of irony, he mounted a spirited attack on social investment funds and social investors, calling investments in such funds “moral laziness” and stopping just shy of suggesting their abolition.

This critique struck me as remarkably at odds with his free-market ideals.

Along similar lines, other speakers challenged companies for engaging with stakeholders, publishing non-financial reports, and generally attempting to address the myriad issues and constituencies affected by their business activities.

Keynote speaker Clive Crook – author of last year’s now-legendary Economist piece on corporate responsibility – eagerly embraced these attacks.

He also peremptorily dismissed the significance of activities aimed at “raising profit and social welfare” as simply “good business” and observed that such endeavours were not worthy of special attention or a special label.

This is fine, as far as it goes. Labels are famously weak substitutes for substance. But Crook also sought to score easy rhetorical points by usurping the corporate social responsibility label and affixing it to activities that are manifestly not corporate social responsibility.

By engaging in such sleight of mouth, Crook and others try to distract us from the fact that what he describes (and discards) as “good business” is no different from what most of us think of as true corporate social responsibility.

When I say “most of us” I include business leaders of the countless companies that are increasingly attempting to understand and manage the social, environmental and human rights impacts of the activities of their companies.

The National Review recently acknowledged that 81% of business respondents to a US Chamber of Commerce survey agreed that corporate citizenship needs to be a priority for companies.

Common goals


These business leaders – and their numbers are growing – have not thrown Adam Smith or Milton Friedman off the bus.

To the contrary, they understand quite well that their job is to maximize shareholder value. They are attempting to practise good management. And the free market ultimately will determine whether they have succeeded.

In this context, it is hard to see engagement with non-governmental organisations, socially responsible investment, social reporting, “ecomagination”, hybrid automotive technology, Citigroup’s Sustainability Mining Index, and any of countless other corporate responsibility activities as anything but a reaction by rational, profit-maximizing managers to market forces.

There remains plenty of room for legitimate debate concerning whether market forces alone will deliver a sustainable world or will do so quickly enough. I fear not, but that is another topic entirely.

One way or the other, however, both Adam Smith and Milton Friedman would be hard-pressed to convince me that the evolution of business towards sustainable and responsible conduct represents anything other than the free market at work.

All of which suggests to me that, straw men and heated rhetoric aside, the participants in the debate may not be as far apart as they seem.

Phil Rudolph is vice-president and general counsel of Ethical Leadership Group, an ethics and corporate responsibility consultancy based in the United States.

phil@ethicalleadershipgroup.com
www.ethicalleadershipgroup.com

How business can lobby responsibly


How business can lobby responsibly
Tobias Webb, Editor
10 May 06

Transparency can help remove suspicion of lobbying activities
Transparency can help remove suspicion of lobbying activities


Some experts on ethical lobbying offered some tips at a London conference this week
Allegations of undue corporate influence of government officials are never far from the news these days.

Recently the UK's
Guardian newspaper detailed how mobile operators are aggressively lobbying Brussels over EU plans to limit expensive roaming charges.

Partly in response to greater awareness of business lobbying, one of the City’s biggest investors, F&C asset management, which manages over £110 billion for various clients, sponsored a report last year on responsible lobbying.

Speaking at the Business in the Community annual conference in London on Tuesday, Karina Litvack, head of governance for F&C, said that the US lobbying system is viewed by many as “institutionalised bribery”.

Companies, she said, should start to seek shareholder approval in the US for their overall political contributions, as they do in the UK.

Article continues below this advertisement:
Want to read more articles like this in print each month?

Then
click here and quote "ECT05" to order your free trial subscription to Ethical Corporation magazine.



"Although the French have outlawed corporate political donations, and the US has many rules on lobbying, this does not appear to have stamped out the practice"




David Lascelles, author of the F&C sponsored report “The Ethics of Influence”, published in 2005 by the UK’s Institute of Business Ethics, said that while no-one would deny companies a voice in policy making, much greater business transparency is needed.

Transparency solutions


Describing some areas of lobbying process as “dark and murky”, Lascelles said that there are four things for companies to think about if they want to be responsible lobbyists.

First, he said, they should operate under clear open rules and be transparent about the process.

Secondly, the scale of their lobbying is important, he said, pointing to the EU debate about chemicals registration in the last few years, when some 50,000 companies were mobilised by the industry to protest planned new rules.

Thirdly, he pointed out, companies must think about whether or not their messages to policymakers are properly consistent with their stated values.

Lastly, how their trade associations or narrow-issue campaign groups they might fund represent them as a proxy force.

The UK, compared with other markets, gets the balance relatively right on lobbying, agreed both Lascelles and Litvack.

In the UK companies must ask shareholder permission for their overall political donations budget for the EU (although the law is slightly vague) and public opinion has moved firmly against overt or ultra-aggressive lobbying in recent years. “It’s become unacceptable corporate practice” in the UK, Lascelles told yesterdays conference in London.

Some positive examples


While some firms post detailed position papers on certain issues on the websites, and others, like Anglo American, the mining company, have openly funded large quantities of broke political parties in South Africa in an attempt to support democracy, Lascelles says that generally disclosure is poor in many big businesses.

Outside the UK the situation does appear to be somewhat worse in many other OECD nations, despite recent scandals over “loans for peerages” accusations still dogging the beleaguered Labour government.

Although the French have outlawed corporate political donations, and the US has many rules on lobbying, this does not appear to have stamped out the practice, said Lascelles.

Indeed, the
Jack Abramoff scandal in Washington recently demonstrates just how formalised the paid lobbying system is with US political parties, agreed Karina Litback, saying that it creates a tremendous number of conflicts of interest.

She pointed to state run oil companies in Russia, such as Rosneft or Gazprom, who increasingly wish to do business or list in the UK. These firms have blatant conflicts of interest with regard to their relationships with Russian government officials, she said.

The chairman of Rosneft, said Litvack, is extremely close to Russian president Vladimir Putin. “In whose interests is the company managed?” she asked.

Avoiding donations wherever possible


Litvack’s suggestions for responsibly lobbying include avoiding political donations altogether except where, as in the case of Anglo American, they are intended to support democracy rather than gain influence on a specific issue.

When donations are given, companies should disclose who they went to, how much goes where, and be transparent about their decision making processes and who is responsible.

When it comes to direct or indirect lobbying, “be clear about who is being funded” and about “management of conflicts of interest”, she said.

Litvack concluded that companies should have policies on who they appoint from government and should push their lobby groups to disclose dissenting voices when they publish their position statements, as the Association of British Insurers, rare among lobby groups, already does.

Others may be slower to follow. It might take a high profile pull-out by a big firm to drive real change. When BP pulled out the global climate coalition, a lobby group denying global warming in 1997, it spurred others to do so too.


F&C recomendations for responsible lobbying
. Companies should:

• Publish their overall lobbying policy and objectives: F&C assumes that a company is pursuing its commercial interests on behalf of its shareholders, but expects to see a policy that contains more than a generic statement.

• Develop and publish a code of conduct on lobbying that moves beyond the company’s generic principles and approach to business ethics, to address the specific concerns raised by lobbying.

• Disclose fully and promptly the key and material formal positions they take on policy issues on which they lobby, e.g. all written submissions to regulators and lawmakers; lobbying positions on key industry issues; links or references to previously published materials such as statements in the Annual report.

• Disclose the organisations of which they are members, if these engage in lobbying of regulators and lawmakers; this should at minimum be at headquarters level, and also cover significant organisations1 of which operating subsidiaries are members.

• Ensure that these membership organisations substantially represent their views and uphold standards of conduct consistent with their own.

• Develop and publish clear policies on avoiding conflicts of interest when appointing former or still-active government and regulatory officials to executive or board positions.

Source:
www.fandc.com

Useful links:

www.ibe.org.uk/Ethics_of_Influence_summary.pdf

The UN's "Towards Responsible Lobbying" report:

www.unglobalcompact.org/docs/news_events/8.1/rl_final.pdf

Ethical brands: Scratching a niche -- Resentment towards big business buying in to ethical brands is unwarranted


Ethical brands: Scratching a niche
Mallen Baker
8 May 06

Body Shop: A model business?
Body Shop: A model business?


Resentment towards big business buying in to ethical brands is unwarranted, argues Mallen Baker
There has been a furious reaction to the shock news that HSBC is to take over the UK's Co-operative Bank in its attempt to reach a new ethical market segment.

Or at least there would be, if that particular story was true. The Co-op is one of the last remaining iconic niche ethical brands that hasn't been swallowed up by a mainstream rival.

Every time it happens, whether to the Body Shop, Green & Blacks, or Ben & Jerry's, there is moral outrage from those that see an important symbol of a different way of doing business being corrupted.

The niche brands are given huge profile in the debates around the value of corporate responsibility. Sometimes that can be positive. More often, however, it is not.

On the plus side, these companies can be first movers in identifying best practices that will then go on to influence the rest. Because they have less ambivalence about their own business case, they can take risks, be bold and ultimately set the trends.

On the other hand, they can lead both advocates and critics alike to forget the business case completely.

The ethical niche players encourage us to believe that they will be successful because they are ethical, and that somehow the standard requirements of good management, responsiveness to customers and effective processes are not the key success factors that they are for all other businesses.

Beyond campaigning


The Co-operative Bank has been successful because it has been run as a business aiming to be true to its niche.

The Body Shop has been much more uneven as a business, because it has often been run as a campaign. Anita Roddick is loved and admired by campaigners not because she ran a successful business, but because her anti-corporate language appeals to their loathing of bigness.

That's fine - but when mainstream businesses look at the Body Shop's progress over the last five years, they see a situation where they have less to learn on ethics than they would have to teach on business fundamentals.

And when activists respond with fury to the takeover they positively reinforce the perception that those that want their ethics to be strong want their champions to be small.

Bemoaning Fairtrade


It is the same reaction that attacks the move towards large companies taking up Fairtrade brands. We think these things should be run by friendly, small concerns. Anything else will be insufficiently pure.

Frankly this is about corporate responsibility as recreation. It is not about maximising the positive power of business to make a difference in the world.

And there is a huge lack of realism in what motivates some of these corporate takeovers. Activists seem to believe that big, bad and ugly companies think that buying an ethical brand will give them something to hide their ugliness behind.

The truth of it is that these companies make a commercial decision based on the fact that these ethically branded firms bring with them a market segment that will expand their overall penetration. It's why niche players in all sorts of other contexts get bought up, and it's no different here.

When ethics make sense


Of course, only a badly run corporate would buy up one of these brands and then change the fundamentals that give the brand its strength.

Rather than being afraid of these buyouts, we should be keenly interested as to whether good management, investment in marketing and other aspects, might lead that brand to being a more powerful champion of its kind.

So long as we keep fighting this, we are admitting that we are not ready for the big time.


This article is reproduced with kind permission from the Business Respect email newsletter. For information on how to subscribe and for a website archive of issues, go to:
www.mallenbaker.net/csr/nl/index.html

Write to Mallen Baker at mallen@mallenbaker.net,
or write to the Editor at
editor@ethicalcorp.com.

China: A green energy bonanza?


China: A green energy bonanza?
Tom Miller
10 May 06

Foriegn investment in clean coal technology could cut China's emissions
Foriegn investment in clean coal technology could cut China's emissions


China’s growing focus on energy conservation and clean energy production is likely to prove lucrative for foreign energy companies investing in the world’s second biggest power market
As a growing band of publicly listed, clean technology companies expand into China, portfolio investors also stand to benefit from the nation’s shift towards greener energy production.

One of the key numeric targets of the government’s 11th Five Year Plan is to reduce energy consumption per unit of GDP by around 20% by the end of 2010.

Last year, China consumed the equivalent of 2.2 billion tonnes of coal, and Chinese analysts warn that total energy demand may reach 4 billion standard coal equivalent (SCE) tonnes by 2020 if allowed to continue unchecked.

But this could be kept below 3 billion SCE tonnes, they say, if effective energy-saving measures are put in place.

In February, China’s central government – known as the State Council – released its science and technology strategy document for the period 2006-2020.

Clean coal moves

Emphasising the importance of energy conservation, the report also recommends promoting “clean coal” technology and diversifying into renewable energy sources, notably wind power, solar power and biomass/geothermal energy.

Renewable energy currently accounts for roughly seven percent of China’s total power supplies, and the official aim is to increase this to 15% by 2020.

“Currently,” the report states, “there is an acute imbalance in China’s energy supply and demand, which is unreasonably structured, with poor efficiency in energy utilisation. Coal figures predominantly in primary energy consumption, and massive consumption of fossil energy has caused serious environmental pollution.”

Foreign investment in clean coal technology may be the key to containing the growth of carbon emissions in China, now the world’s second biggest carbon emitter after the US.

Disputed technology


Environmentalists argue that clean coal is a myth: coal remains a dirty fossil fuel, they say, even if it does reduce carbon emissions from conventional burning.

But around 75% of China’s energy needs are currently supplied by coal, which is abundant in China and by far the cheapest energy source. Coal will remain China’s primary energy source for the foreseeable future.

One company bringing clean coal technology to China is South Africa’s Sasol Group, the world’s leading producer of coal-to-liquids and publicly listed in Johannesburg and New York.

Sasol operates the world’s only commercial scale coal liquefaction plant at Secunda in South Africa, where it produces 150,000 barrels of liquid fuel per day (bpd).

Last year, Sasol completed feasibility studies and signed agreements with two Chinese coal companies, Shenhua Group and Ningxia Coal Group, to build two coal-to-liquids plants, each with a capacity of 80,000 bpd at a total cost of US$6 billion.

The two plants will together have an annual capacity of around 8 million tonnes, with per barrel production costs of just US$10. Last, year China imported 22.1 million tonnes of crude and refined oil.

Others taking an interest


Other companies with clean coal interests that are looking to expand in China include US coal giants Peabody Energy, which is listed in New York and recently opened a representative office in Beijing, and Alliance Resource Partners, listed on the Nasdaq.

Bangkok-listed energy group Banpu Plc, one of Asia’s few large coal producers with clean coal technology, has a minority stake in Asian American Coal Inc, which operates in China.

GE Energy and Shell also have considerable investments in coal gasifiers in China.

A number of foreign companies are betting that carbon trading – whereby foreign companies provide producers in developing countries with environmental technology in exchange for buying their pollution rights – will take off in China.

The market leader in China is UK-based Camco International, which recently listed on London’s AIM stock exchange. Hong Kong’s Noble Group, listed in Singapore, has a growing carbon trading business in China, as well as further interests in clean coal technology and the worldwide ethanol market.

More dams on the way?


Hydropower ranks as China’s major energy source after coal and has received considerable international attention, largely thanks to a number of controversial damming projects – notably the Three Gorges Dam and plans to generate electricity from the upper reaches of the Chinese Mekong.

There is still huge potential for more dams in China’s water-rich, mountainous southwest. Major foreign hydropower players likely to benefit are Norway’s Veidekke (listed in Oslo), which supplied technology for the Three Gorges project, GE Energy and Siemens Power Generation.

According to Tsinghua University energy expert Professor Wang Weichang, however, wind power is on course to supplant hydropower as China’s chief renewable energy source by the middle of the century.

And wind too…


The State Council’s strategy document calls for the development of large-scale wind farms, particularly in China’s remote, underpopulated and agriculturally backward western provinces.

But China currently does not have the technology to produce wind turbines larger than 300 kilowatts, and has to import 95% of its wind technology.

The biggest beneficiary is likely to be Danish wind technology firm Vestas, the world’s largest supplier of wind power systems with 30% of the global market.

Publicly listed in Copenhagen, Vestas currently has 480 wind turbines in China with an output of 279 megawatts. There is clearly huge potential for further investment: Vestas has 2,856 wind turbines in India, producing 1,025 megawatts, and a further 8,176 turbines in the US, producing 2,778 megawatts.

Another winner could be GE Energy, which supplied 23 wind turbines to Hebei province’s Shanyi Manjing wind farm and recently announced it would provide 150 megawatts of turbines for the Rudong wind farm in Jiangsu province, to be completed in 2007.

Both Siemens and Spain’s Gameas, the world’s second largest wind turbine manufacturer and listed on the IBES stockmarket in Spain, may also look to expand in China.

Solar options


Solar power lags behind other renewables in China. But the Chinese government forecasts that the market for photovoltaic products and systems, which stood at just 20 megawatts in 2005, should reach 400 megawatts by 2010 and 10 gigawatts by 2020.

In December last year, BP Solar and China Xinjiang SunOasis Co. signed a contract to form a solar power joint venture with a 25 megawatt energy capacity. Based in the northwestern city of Xi’an, the new company will focus on providing sustainable power to remote rural areas throughout China.

And finally…fuel


As China slowly moves towards a car-owning economy, green transport fuel is also a growing concern.

One small company to watch is the UK’s D1 Oils, which makes biodiesel for the transport industry by using a unique method of crushing Jatropha seeds, a tropical oil seed plant.

Listed on the AIM stock exchange, D1 Oils recently signed a deal with the Chinese Ministry of Agriculture to promote the production of Jetropha biodiesel in southern China, where conditions are suitably warm and wet for cultivating Jetropha plants.

Useful links:

www.sasol.com
www.camco-international.com

Tom Miller is a freelance journalist working in Beijing

10.5.06

The Human Element: Dow's Next Decade of Commitment to Sustainability


The Human Element: Dow's Next Decade of Commitment to Sustainability

Speech by Andrew Liveris, Dow President, CEO and Chairman (3 May 2006)

In an address in Washington, D.C., Andrew Liveris, President, CEO and Chairman of The Dow Chemical Company, announced the company's sustainability goals for the next decade.

Speaking to leaders of the policy, regulatory, business and environmental communities at Washington's Willard Intercontinental Hotel, Liveris outlined an ambitious multi-part program to address some of the most pressing economic, social and environmental concerns facing the global community over the next 10 years.

Good afternoon . . . and thank you Hank and Don.

I will try my best to be worthy of that generous introduction. And one way I plan to be worthy of it is to be brief.I want to be brief because what I have to share with you today is, like most important ideas, something that can be offered in very few words.

I’m here today to introduce you to our company’s renewed commitment to sustainable business strategies and practices.

In most years, for most companies, that is something that might be done by the smart and capable specialist who leads the environmental, health and safety organization ― someone like our own David Graham who is here with us today. The reason I’ve asked David for permission to speak in his place is because I believe our commitment will be new and different in the world of corporate sustainability. And because I feel so strongly about what this means for our company and for all companies that intend to be serious about their relationship with the world.

Ten years ago, we set important goals for improving our environment, health and safety performance.We have met most of those goals, exceeded some, and have come very close in most of the others.

As a result, our workplaces are safer, our facilities are cleaner, our energy use is more efficient and our corporate governance is stronger and more vigilant. Indeed, we have become a recognized world leader in these areas and I am very proud of every Dow employee for his or her contributions toward that achievement.

But, for all the work and dedication that went into progress toward these goals, the goals themselves were, fundamentally, about us, about Dow, about putting our own house in better order.

To be sure, it’s a job that never ends. Sustainability begins at home. And we will always have more work to do to make our company better. It was the right path for us in 1996, and it’s the right path to continue down over the next ten years. But starting today, it’s only part of the path.

I’m a scientist and chemical engineer by training and temperament. And the innovator in me is always inclined to boast a little about the fact that everything in this room -- from the clothes we’re all wearing to the components of my microphone, to the food we are about to enjoy together-- -- everything owes something to the ability of companies like ours to apply science to the improvement of the human condition. I am deeply proud of that. I always will be.

I am also well aware that we still have much work to do in raising and extending those living standards to more of the human family. But, in addition to being an innovator, I bring another perspective to the table today.

As you may be able to tell, I’m not from around these parts. I am from a town in Australia called Darwin, which is in the tropics of the Australian north, closer to the archipelago of Indonesia than to Sydney or Melbourne. My grandfather emigrated from Greece early in the 20th century, and when he arrived in Darwin, the town had no electricity, lots of exotic and incurable diseases, and a fair share of the world’s crocodiles.The crocs are still there, but today, Darwin is a modern city of thousands of people who trace their ancestry from all over the world – a genuine global village.

And this second perspective tells me that, for all the precise command of the elements modern chemistry has achieved, a command that has resulted in the bounty of products that fill this room – it’s time to think more carefully about the element, above all others, that helped my grandparents and their neighbors in Darwin collaborate and thrive, sharing each others’ burdens and triumphs, building something good and decent together. And by that I mean The Human Element.

So, with The Human Element as my point of reference, I’m here today to share with you our company’s new commitment to responsible engagement with the places we do business.

And, today, for Dow, that means, quite literally, everywhere.

A summary of our goals is in the booklets at your tables and will be available after today’s meeting on our Website. I encourage each of you to read about, study, comment on and, of course, hold us accountable for the specifics. But in the time I have with you, I’d like to talk about the kind of work that needs to be done, the work that is embodied in those commitments.

First, we will support our immediate family ― the people and communities we touch directly every day. This means even better health and safety performance to protect our employees, a goal we have made great strides toward over the past 10 years.

But it also means strengthening our relationships with our hometown communities. Dow has more than 150 such home towns in 37 countries around the world. Our commitment is to collaborate actively with the communities where we have a major presence, not simply to ensure our facilities are safe, as indeed they must be, but to ensure that we are a good neighbor and partner, working locally to identify and support the priorities that are most important to their well-being and prosperity.

Second, we will pioneer and contribute to new solutions for some of the most serious problems faced by the most vulnerable members of the larger human family. Beyond our 150 hometown communities are hundreds of thousands of others ― large cities and tiny villages ― that face a long list of serious challenges brought on by the sheer size of the world’s population, and the effect of our numbers and our use of resources on our planet.

On behalf of the men and women of Dow, I commit to you today that, by 2015, our company will achieve at least three breakthroughs that will significantly improve the quality of life for those facing:

  • The challenge of sustainable water supplies.
  • The challenge of an adequate food supply.
  • The challenge of decent housing.
  • The challenge of personal health and safety.
In developing these ambitious but, we believe, achievable objectives, we looked to the United Nations Millennium Development Goals for guidance. And we selected goals that were both part of the UN mandate and consistent with the science and technology we do best.

We have identified these four challenges ― water, food, housing and health ― because we are an organization with the resources and technology to make a genuine difference -- and the will to be a leader.

But why be a leader? It’s a fair question. Why do this?

The answer is deceptively simple. If we do not lead, we are vulnerable ourselves. To be a successful, thriving enterprise, we need a healthy environment that meets the needs of people. We need a stable and secure political climate. We need a healthy and optimistic community of potential customers and consumers.

In other words, we are doing our part to set the stage for a future that is as full of promise and opportunity as our past has been.

Finally, beyond the threats facing the most vulnerable, we will confront two challenges to which ALL human families are vulnerable. Specifically, I mean those related to (A) the unsustainable way the people of the world use energy – as countries, as companies and as individuals. And (B), the related problem of greenhouse gas emissions and climate change.

Our industry as a whole is the world’s single most intense consumer of fossil fuels. They are not only our energy source, they are also our raw material. We don’t just burn fuel, we reorganize its chemistry to make things that are essential to modern life. And for the near-term,our industry will continue to depend on oil and natural gas as our primary sources of energy and raw material.

It is now clear that world’s climate is impacted by increases in greenhouse gasses, of which CO2 created by the burning of fossil fuels, is the single largest component.

Some have said our industry’s intense appetite for fossil fuels disqualifies us somehow from being part of the solution. On the contrary, no one in the world is more intensely aware of the need, ultimately, to reinvent our dependency on oil and natural gas than we are. In other words, we will lead the way on energy transformation, because we have to.

And we have taken some important steps already. From 1996 to 2005, we cut our consumption of energy per pound of product by more than 20 percent. And, over the next ten years, we are confident we can improve our energy efficiency by an additional 25 percent. With greater efficiency and a commitment to burning cleaner fuels, we will also reduce the intensity of our greenhouse gas emissions by 2.5% annually between 2006 and 2015.

Because of our scale, that step alone will reduce the equivalent of the CO2 emissions from 3 million automobiles or 6 million homes over this time period. But we cannot be content with focusing on our own energy and greenhouse gas footprint.

Even today, there are Dow products ― such as Styrofoam™ building insulation ― and products on the horizon like low-cost hydrogen fuel cell technology ― that will save more energy than they cost to create.

We must also use our resources, technology, innovation and influence to pioneer these and other new ideas for solving the problem in general. And we will.

In 1962, I heard President Kennedy over a crackling radio say this about the challenge of going to the moon, we commit to do these things “not because they are easy, but because they are hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one that we are willing to accept, one we are unwilling to postpone, and one which we intend to win.”

That challenge, like ours, was a scientific challenge. It was, like ours, a political challenge. It was, like ours, a challenge of fostering and sustaining goodwill and collaboration among people with strong and often different interests and points of view. We will meet those challenges.

I could not let today pass without acknowledging the incredible work of the individuals who have made this day possible and the rich heritage of commitment they have built for our company.

Frank Popoff, our former chairman, who represented our company at the pivotal Earth Summit in Rio in the early 1990s, and who, afterward, literally wrote the book ― along with Livio DeSimone, then CEO of 3M and the World business Council for Sustainable Development ― on corporate sustainability.

That book is called Eco-Efficiency and it has become the bible for large organizations seeking to create a strong, sustainable future. I encourage you to read it if you haven’t.

And also, David Buzzelli, our former board member and former CEO of Dow Canada, whose unwavering commitment to sustainability has been one of the most important influences on the culture of our organization over the past quarter century.

The members of our Corporate Environmental Advisory Council , two of whom you met today, who have been so passionate and so effective at helping us steer a course that has led us to this announcement today.

And the thousands of men and women of The Dow Chemical Company, who have lived and breathed our commitment to transparent public reporting and the “Triple Bottom Line,” a commitment to measuring success, not just in terms of profitability, but also sustainability and social responsibility.

My message to you today is simply this: As we strive to achieve the goals I’ve outlined for you today, we will reach beyond the fences of our company.

Sustainability may begin at home, but its destiny is to engage the problems of the world. I’m here today to tell you we will engage them.

We will engage them by raising the bar for ourselves and by being a role model for other organizations to follow. We will build on our company’s rich legacy of leadership in solving the world’s most pressing problems with a spirit of fearless accountability, not just for our own footprint on the planet, but the collective footprint we make because we are part of the human family.

In some cases, we know pretty well what needs to be done and how to do it. In others, we have a roadmap, but it’s a road whose twists and turns will surely be unpredictable. For still others, we have to invent the roadmap itself. And we will.

And we will make it happen by keeping faith with The Human Element.

It goes without saying that The Human Element is not--like carbon or nitrogen or iron- -an element to be shaped to our will. It is, rather, the element that shapes each of us who is a member of the human family, defines us, and will weigh whether, during our time as stewards of the bounty around us, we did more than create value, we were true to our values. We did more than build our net worth, we were worthy.

Download

9.5.06

[Most of] Business Respect - CSR Dispatches No#94 - 7 May 2006: Intel invests $1bn in low cost PCs for developing countries, and other stories



* Intel invests $1bn in low cost PCs for developing countries

 Intel, the world's largest manufacturer of computer chips, has
 launched a new personal computer designed to provide low cost but good
 quality machines for developing countries.

 The machines, currently labelled 'eduwise' will have wireless
 networking capabilities and will be able to run either the Microsoft
 Windows or the Linux operating system.

 The company said that the move was part of a $1bn investment by the
 company in promoting the use of computers in developing countries.
 "No-one wants to cross the digital divide with yesterday's technology"
 said a spokesman.

 Intel has already agreed a deal with Mexico to provide low cost PCs to
 300,000 teachers over the next year.


* Child labour figures fall for the first time

 According to the International Labour Organisation (ILO), the number
 of children working has gone down by 11 percent to 218 million. This
 is the first time the figures have declined, and the ILO hailed the
 news by suggesting that many types of child labour could be eradicated
 in a decade.

 Latin America saw the steepest decline. Brazil, for instance, saw
 numbers of very small children in work decline by 60 percent. However,
 there was no real decline in Africa, and declines have been greater in
 hazardous industries, with a 26 percent reduction. Asia remains the
 region where the most child labour continues.

 The shift has been attributed to campaigns and new laws, with a number
 of countries beginning to focus on the problem with much greater
 seriousness.


* US: Fizzy drinks companies to pull out of schools

 Coca Cola, PepsiCo and Cadbury Schweppes have said that they are to
 pull most fizzy drinks from US schools, selling only water, juice and
 low calorie drinks. The deal was brokered by former President Bill
 Clinton and the American Heart Association.

 The move is the latest development in a world-wide response to growing
 problems of childhood obesity and increasing criticism of the role of
 the food and drink companies. The change will influence around 35m
 American school children, around 16 percent of whom are considered to
 be overweight.

 In the face of the controversy, a number of district and state
 legislatures have been considering a total ban on vending machines in
 schools - the voluntary move by the companies may mean that they are
 still able to maintain a presence. A number of schools say they
 benefit from the income from such arrangements.

 Bill Clinton said that he had suffered his own struggles with weight,
 high cholesterol and other health problems because of a diet with too
 much fast food.


* EU: Chemicals cartel fined 388m euros

 Seven chemicals companies have been fined 388m euros for running a
 cartel that exchanged commercially important information and fixed
 prices of hydrogen peroxide and perborate.

 The companies concerned are Solvay, Arkema, Akzo Nobel, Kemira, FMC
 Foret and Snia and Edison. Two other companies had been involved but
 escaped fines, which were Degussa and Air Liquide.

 The EU Competition Commissioner Neelie Kroes said that the size of the
 fines were intended to reflect the seriousness of the offence,
 especially since some of the companies were repeat offenders.


* Ford invites customers to offset carbon emissions

 Ford Motor Company has announced a 'Greener Miles' programme that
 invites Ford owners to purchase carbon offsets to cover their vehicle
 usage.

 The drivers are asked to visit the website of the company's partner in
 the scheme, TerraPass, and to calculate the amount of CO2 emissions
 they generate in a year. They can then support the production of
 renewable energy programmes to the equivalent amount.

 Ford has said that the scheme is designed to help people in the short
 term to address the growing concern over climate change. It is not
 intended to become an alternative to work to improve the energy
 efficiency of vehicles, work which has proven difficult over the last
 few years.


* South Korea: Hyundai chairman charged with embezzlement

 Chung Mong-Koo, the chairman of Hyundai Motor Group, has been arrested
 on embezzlement charges. The move follows accusations that he and the
 company paid politicians and officials for business advantage.

 The arrest is the latest development in an investigation into the
 company that has been running over the last two months.

 Mr Chung denies the charges. His place at the company will now be
 taken by the vice chairman and chief executive Kim Dong-jin.


* UN Principles for Responsible Investment launched by Kofi Annan

 Kofi Annan has signalled the launch of the new Principles for
 Responsible Investment by sounding the opening bell and the New York
 stock exchange, flanked by pension funds worth more than $2,000bn.

 The Principles represent the first global charter that places
 environmental, social and governance standards at the heart of
 investment strategy. The six principles for responsible investment aim
 to show how the long term value of assets is supported by sustainable
 practices.

 The Principles were developed during a nearly year-long process
 convened by the UN Secretary-General and coordinated by the UN
 Environment Programme Finance Initiative (UNEP FI) and the UN Global
 Compact.

 UN Secretary General Kofi Annan said: "These Principles grew out of
 the understanding that while finance fuels the global economy,
 investment decision-making does not sufficiently reflect
 environmental, social and corporate governance considerations – or put
 another way, the tenets of sustainable development".

 Environmental campaign groups have expressed scepticism about the
 Principles, arguing that voluntary frameworks make little difference
 to decisions actually made on the ground. But other commentators have
 noted that the new initiative begins with a greater degree of
 commitment than previous initiatives.



* Philip Morris apologises for Maori 'mistake'

 Louis Camilleri, the chief executive of Altria, parent group of Philip
 Morris, has apologised for launching a brand of cigarettes in Israel
 called 'Maori Mix' that used imagery from the Maori people and a map
 of New Zealand.

 The public acknowledgement of error was prompted by the complaint made
 at the company's AGM by anti-smoking activist Shane Bradbrook, who
 accused the firm of abusing the Maori's culture and traditions.
 Smoking is prevalent amongst Maoris - it is the leading cause of
 death.

 The Maori have gone to great lengths in the past in preserving their
 imagery, creating a trademark called Toi Iho that provides a process
 for the development of products using Maori imagery and culture.


* Chad: World Bank and government reach interim deal over oil

 The World Bank has announced that it has reached an interim agreement
 with the government of Chad to unfreeze some of the blocked oil
 profits and to resume lending following the recent dispute over how
 money was to be used.

 The Bank is to resume lending and to release funds from an escrow
 account in recognition of new guarantees about how these resources
 will help to meet needs in education, health, community development
 and other social causes.

 Chad had torn up a previous deal whereby World Bank support for oil
 development was achieved through guaranteeing that revenues would go
 to the support of the poor, as well as into a fund for future
 generations. The government had said that it needed resource to
 support its security in the face of insurgency threats. In response,
 the World Bank had frozen funds. Under the new deal, spending on
 security will not come from the released funds.

 The World Bank has said that the interim deal will provide time to
 work on a further, more permanent agreement.


* Chevron CEO confronted by rainforest activists

 Two rainforest leaders called upon Chevron CEO David O'Reilly at the
 company's AGM to face its responsibilities for pollution in the
 Ecuadorian Amazon.

 Emergildo Criollo, of the Cofan people travelled to the AGM and argued
 that Chevron activity had put the survival of his tribe's culture at
 risk.

 O'Reilly acknowledged that there were issues in the former concession
 where Texaco, bought by Chevron in 2001, operated an oil field in
 partnership with the government of Ecuador. But he insisted that it
 was the government and the Ecuador national oil company that bore the
 responsibility for what he described as 'reprehensible behaviour'.

 As the argument at the AGM proceeded, one shareholder apparently not
 involved in the dispute called upon the company to help the situation
 regardless of whether it was actually liable.

 Atossa Soltani, Executive Director, of Amazon Watch, criticised Mr
 O'Reilly's position: "He is either being lied to by his local counsel
 or he chooses to be blind to the mountain of evidence being produced
 at trial."


* Indonesia: Freeport faces official audit

 Indonesia's Supreme Audit Agency (BPK) is to audit Freeport Indonesia
 to establish whether the company's reports provide an accurate
 reflection of how its profits are distributed.

 The move follows accusations that the company's activities are
 arranged to benefit foreign investors disproportionately compared to
 the poor communities where it operates. In particular, the company had
 been accused of showing a different figure in its reports to those
 recorded by the government's own revenue records.

 The head of the BPK, Anwar Nasution, said that the audit was important
 to remove suspicions and unrest around Freeport's activity.

 Freeport has said that it has nothing to hide, and it has no objection
 to the audit.


==============================

* Scratching a niche

 Article by Mallen Baker

 There has been a furious reaction to the shock news that HSBC is to
 take over the UK's Co-operative Bank in its attempt to reach a new
 ethical market segment.

 Or at least there would be, if that particular story was true. The
 Co-op is one of the last remaining iconic niche ethical brands that
 hasn't been swallowed up by a mainstream rival. Every time it happens,
 whether to the Body Shop, Green & Blacks, or Ben & Jerry's, there is
 moral outrage from those that see an important symbol of a different
 way of doing business being corrupted.

 The niche brands are given huge profile in the debates around the
 value of corporate responsibility. Sometimes that can be positive.
 More often, however, it is not.

 On the plus side, these companies can be first movers in identifying
 best practices that will then go on to influence the rest. Because
 they have less ambivalence about their own business case, they can
 take risks, be bold and ultimately set the trends.

 On the other hand, they can lead both advocates and critics alike to
 forget the business case completely. The ethical niche players
 encourage us to believe that they will be successful because they are
 ethical, and that somehow the standard requirements of good
 management, responsiveness to customers and effective processes are
 not the key success factors that they are for all other businesses.

 The Co-operative Bank has been successful because it has been run as a
 business aiming to be true to its niche. The Body Shop has been much
 more uneven as a business, because it has often been run as a
 campaign. Anita Roddick is loved and admired by campaigners not
 because she ran a successful business, but because her anti-corporate
 language appeals to their loathing of bigness. That's fine - but when
 mainstream businesses look at the Body Shop's progress over the last
 five years, they see a situation where they have less to learn on
 ethics than they would have to teach on business fundamentals.

 And when activists respond with fury to the takeover they positively
 reinforce the perception that those that want their ethics to be
 strong want their champions to be small. It is the same reaction that
 attacks the move towards large companies taking up Fairtrade brands.
 We think these things should be run by friendly, small concerns.
 Anything else will be insufficiently pure.

 Frankly this is about corporate responsibility as recreation. It is
 not about maximising the positive power of business to make a
 difference in the world.

 And there is a huge lack of realism in what motivates some of these
 corporate takeovers. Activists seem to believe that big, bad and ugly
 companies think that buying an ethical brand will give them something
 to hide their ugliness behind. The truth of it is that these companies
 make a commercial decision based on the fact that these ethically
 branded firms bring with them a market segment that will expand their
 overall penetration. It's why niche players in all sorts of other
 contexts get bought up, and it's no different here.

 Of course, only a badly run corporate would buy up one of these brands
 and then change the fundamentals that give the brand its strength.
 Rather than being afraid of these buyouts, we should be keenly
 interested as to whether good management, investment in marketing and
 other aspects, might lead that brand to being a more powerful champion
 of its kind.

 So long as we keep fighting this, we are admitting that we are not
 ready for the big time.




=================================

You are subscribed as csr@barsoum.ca

All content may be quoted with appropriate acknowledgement by any
non-profit or non-commercial organisations. Others please contact
mallen@mallenbaker.net. No guarantees are made to the accuracy of any
articles. This electronic publication is independently produced, and
should not be taken as representing the views of any organisation.

For information on how to subscribe and for a website archive of
issues, go to http://www.mallenbaker.net/csr/nl/index.html

Send comments and editorial contributions to mallen@mallenbaker.net

To unsubscribe go to http://www.mallenbaker.net/csr/nl/unsubscribe.php


Energy efficiency certificates take step forward in US


Energy efficiency certificates take step forward in US

Environmental Finance, 4 May 2006 - A new environmental market is taking shape in the US that aims to encourage energy conservation. The initiative, which is being developed at the state rather than the federal level, will see tradable energy efficiency certificates (EECs) or 'White Tags' being issued to participating organisations or companies in exchange for each MWh of energy savings they achieve below an agreed baseline.

Connecticut is expected to be the first state to introduce such a market next year as part of a mandatory energy efficiency programme. Pennsylvania and Nevada have also passed legislation paving the way for EEC trading. Up to 20 other states that have already introduced targets for renewable energy generation are likely to follow suit, says Mel Jones, president of Sterling Power, a retailer of renewable electricity. Similar schemes are being introduced in Italy and France, he says.

> At this week's Green T Forum in New York, Sterling unveiled a dedicated software programme for this new market to help with the measurement, verification and certification of energy savings eligible for White Tags.

It claims several Fortune 500 companies have expressed interest in using the system. Industrial combined heat and power plants could each generate EECs worth some $2-3 million/year, Jones estimates.

Companies generating EECs could sell them to others that find it more difficult to make efficiency savings internally or, says Jones, they could also be held and used against future targets for reducing greenhouse gas emissions.

However, this may be easier said than done, some speakers at the conference warned. Already there is considerable confusion about the double counting of environmental attributes in the US patchwork of renewable energy certificate (REC) programmes and the various voluntary GHG emission reduction initiatives,

One climate change specialist - Mark Trexler, president of Trexler Climate & Energy Services - said he was not convinced the REC programmes were having any impact in stimulating new renewable capacity and, furthermore, he said they risk undermining the GHG market in the US.

Benefits of climate change policies assessed:Strict policies on climate could also boost technological development


Benefits of climate change policies assessed

Environment DAILY, 5 May 2006 - Tough policies to combat climate change can simultaneously improve air pollution, energy security and competitiveness in the EU, says a report published this week by the Netherlands environmental assessment agency. The monetary benefits of reduced air pollution alone are estimated to offset the costs incurred by such policies.

Member states will have to spend around 1.7% of GDP on climate policies by 2030 – alongside “broad international participation” – for there to be a 50% chance of limiting global temperature increases to 2 degrees, the authors say. Costs are expected to rise thereafter to peak in 2050.

The study forecasts that such stringent climate policies could reduce European oil and gas imports by 30% and 10%, respectively, strengthening security of supply. Changes in energy supply are in turn expected to cut particulate matter emissions by 35%, enough to meet the 2030 targets set out in the EU thematic strategy on air pollution.

Strict policies on climate could also boost technological development, the study says. The authors emphasise the value of long-term standard setting rather than short-term market instruments to drive innovation.

The report also details the likely impact on policy objectives of a range of individual energy technology options.

* In a related development, EU advisory body the economic and social committee discussed energy issues at a hearing in Brussels on Tuesday. Conflicting views emerged on the competing merits of shifting to renewable energy, investing more in nuclear power or aiming first and foremost to improve energy efficiency. Ulla Sirkeinen, who is to draft an opinion on energy for the EESC, concluded that the EU should set a strategic goal of a diversified energy mix.

Follow-up: See Netherlands environmental assessment agency, tel: +31 30 274 274 5, plus a summary or the full report. See also EESC press release.

Green Building Survey Shows 20% Growth in 2005, 30% in 2006


Green Building Survey Shows 20% Growth in 2005, 30% in 2006

GreenBiz.com, 4 May 2006 - Preliminary results of a McGraw-Hill Construction/National Association of Home Builders (NAHB) survey indicated that there was a 20% increase in 2005 among those in the home building community who are focusing their attention on green, environmentally- responsible building, which is expected to increase by another 30% this year.

The research findings will be issued May 15 in the Residential Green Building edition of McGraw-Hill Construction's series of SmartMarket Reports.

After several years of slow but steady growth across the country, the green home building movement -- which applies innovative and environmentally sensitive construction techniques and products to reduce energy and water consumption and improve residential comfort and safety -- is rapidly moving into the mainstream. By 2010, residential green building is expected to grow to $19 - $38 billion.

"Green home building is at a tipping point among the builder population," said Harvey Bernstein, vice president of Industry Analytics and Alliances for McGraw-Hill Construction. "The data we recently collected indicates 2006 to 2007 is the time frame from which the builder population moves from a majority less involved to more involved with green building."

To serve the growing green building market, Bernstein also noted that McGraw-Hill Construction in May will publish its first issue of GreenSource, a new magazine dedicated to the growing market for environmentally-responsible green buildings. GreenSource, with content developed in collaboration with BuildingGreen, Inc., will present news, features, case studies of important projects, and green product information to more than 40,000 architects, interior designers, building owners, and members of the U.S. Green Building Council.

A new Web site dedicated to the green building industry has already been launched, at http://www.greensource.construction.com/