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


[Energy newsclip] PG&E extends rebate program to storage: The utility company already offers rebates for energy efficient servers and is now offering the same benefits to companies that upgrade to greener storage equipment

PG&E extends rebate program to storage
The utility company already offers rebates for energy efficient servers and is now offering the same benefits to companies that upgrade to greener storage equipment

By Robert Mullins, IDG News Service

April 06, 2007

Pacific Gas & Electric, a California-based energy utility, is extending an energy-savings rebate program, already available for servers, to disk storage equipment.

PG&E provides rebates to companies that replace all or most of their data centers with new, more energy-efficient servers based on the scope of the replacement project and the projected energy savings. Such server vendors as Hewlett-Packard and Sun have had their products certified as eligible for use in the program.

PG&E earlier this year said it was collaborating with other U.S. electric utilities to share best practices on data center rebate programs. The idea is to make them as uniform as possible so a company with data centers in Texas and California, for example, can expect the same kind of rebate, said Mark Bramfitt, principal program manager for energy efficiency at PG&E.

Extending the rebate program to storage is a natural extension of the drive to improve energy efficiency in data centers, Bramfitt said.

Storage arrays could use an energy efficiency makeover. A storage array that includes 100 disk drives keeps all 100 of the disks spinning around the clock so that data can be quickly retrieved when needed, Bramfitt said. A software program called MAID, for massive array of idle disks, can identify which of those disks are little used and which data on those disks is little used. It backs up that data onto a portion of the disk drives and turns them off.

"So out of 100 disk drives, maybe 75 are now idle, so there's clear energy savings there," he said. If one of those idle disks is needed, it may take a little longer to retrieve data on it until it powers up, but if it's little used anyway, the delays won't add up to much.

The incentive program for storage, which will be formally announced later this month, will be similar to the server program, he said. A company will apply to PG&E for the rebates and provide details of the project it is undertaking. PG&E will then calculate the anticipated rebate based on the projected energy savings. Once the project is done, PG&E will inspect the new data center and verify the change was done according to the plan.

"Then we send them a check," Bramfitt said. PG&E calls it an incentive program because it tells the customer up front what their rebate could be as an incentive for them to complete the project.

Sun was the first vendor to have its hardware certified as eligible for PG&E rebates, though HP earned certification soon after. Sun says it is close to identifying a Canadian utility company that will offer a rebate on Sun servers and may announce deals with several other U.S. utilities as well.

But PG&E doesn't offer a rebate simply for buying an energy-efficient server, Bramfitt said. The customer has to do a "rip and replace" project, removing a sizable number of older servers or storage and installing new energy-efficient ones. The incentive program is also not available for brand-new data centers. The point is to replace old servers with new ones to reduce overall energy consumption.

[CSR newsclip] An ambassador of processed foods

An ambassador of processed foods
By Clare Davidson
Business reporter, BBC News, Crawley

The room is spotless.

White-coated lab technicians open large refrigerators and remove substances for testing in vials.

Exactly as one would expect from a laboratory.

But what is unusual is something entirely invisible: an overwhelming, tantalizing fruity smell.

The air is thick with aromatic strawberries - or is it pina colada?

"It's passion fruit and pineapple - a new juice flavour," a cheery blond technician pipes up.

This is no ordinary science lab.

This is Unilever's Innovation Centre: the place where the firm's recipes are refined.

Food movement

As technicians experiment with juices, Unilever chef Simon Boyle gives a tour before a cooking demonstration of a Unilever recipe.

"I hope to head a food movement at the firm."
Simon Boyle, Culinary Ambassador, Unilever

In fact Mr Boyle is not just a chef.

He is - as the embroidered title on his white chef's outfit states - the Anglo-Dutch firm's only "Culinary Ambassador".

The softly-spoken 34-year-old appears the antithesis of the stereotypical hot-headed chef, but no less passionate about food for that.

He is on a bold mission. "I hope to head a food movement at the firm," he says. "I want to bring back chefmanship and the enjoyment of cooking."

Chefs as chefs

One might well ask why a conglomerate such as Unilever should need such a person as an internal food leader.

Chicken Tonight
Ben & Jerry's ice cream

But Mr Boyle says food items, which represent the majority of the firm's portfolio, still need good cooks behind them.

"A food factory is effectively a large kitchen," he says.

"It just goes into a larger cooking pan - but the end result has to be enjoyed by the consumer.

"A lot of businesses have chefs but turn them into technologists. Chefs should be kept as chefs."

'Natural ingredients'

Like a restaurant kitchen, the Innovation Centre has its equivalent of a larder.

But unlike a restaurant, there are no fresh ingredients visible.

Instead, with the solid food all tucked away in freezers or fridges, the main feature is a dizzying array of herbs, spices and flavours freeze-dried and stored in row upon neat row of jars.

As Mr Boyle removes their lids, each is strikingly distinct - from lemon grass or galangal to butter powder.

"It's all totally natural," says Mr Boyle. "Just because it is dehydrated doesn't mean it's no good".

Savoy training

And Mr Boyle would certainly seem to have the credentials to spearhead a food movement.

As the "ambassador" effortlessly dices onions for the first of several sauces, he reveals that his wish desire to be a cook started at the age of 13.

That led to the Academy of Culinary Arts, then four years at London's Savoy Hotel and two stints on cruise ships, one of which on the MV Minerva was as executive chef.

Mr Boyle also has his own enterprise - Beyond Boyle - which provides cooking courses, a venue for meeting with tailored menus and a catering service.

Cooking crisis

Whatever the menu, good ingredients are vital, he says, as he prepares a dish using a Unilever sauce called Chicken Tonight.

While removing the pan-fried chicken from the hob, Mr Boyle says two factors have driven his desire to pioneer food within the company.

There is a crisis. People don't know how to cook from scratch.
Simon Boyle, Culinary Ambassador, Unilever

The first is health, after an alarming rise in obesity in Britain.

Supermarkets, and therefore food firms, are under pressure to offer healthier food.

As part of Unilever's Nutrition Enhancement Programme, the firm has eliminated 15,000 tons of trans-fats, 10,000 tons of saturated fats, 2,000 tons of sodium and 10,000 tons of sugars.

But another issue seems of greater concern to Mr Boyle.

"There is a crisis," he says. "A lot of people don't know how to cook from scratch."

A sauce in a jar might not be ideal, he acknowledges.

"But what is the real alternative?

"Getting a takeaway, eating frozen foods, or buying a ready meal?"

He argues that "semi-scratch cooking" - whereby meat or vegetables can be added to a commercial sauce, such as Chicken Tonight - is a step up.

Unilever's Ragu for Kids helps the "plight of Mums as they try to get children to eat properly".

The firm has also started providing bowls of fresh fruit, as well as nuts, to raise awareness internally about healthy eating.


The proof, of course, is in the pudding - or in this case the Chicken Tonight.

Of the three dishes Mr Boyle has prepared, the one using entirely fresh ingredients before adding freshly-cooked chicken undoubtedly tastes the best.

It presented less contrast with the ready-made version than expected, but the latter still tasted - well - processed.

And the version devoid of salt, pepper, herbs or mushrooms, predictably tasted bland.

Many might say that however good the ready-made options, they are no substitute for learning how to cook.

But getting people back into the kitchen has to be a first step - and Mr Boyle hopes to get them there.

[Energy newsclip] Planning curbs on domestic green energy may be eased

Planning curbs on domestic green energy may be eased

Kelly says local action must match global efforts
Permission may not be needed for many schemes

Tania Branigan, political correspondent
Wednesday April 4, 2007

The Guardian

Green-minded householders will be allowed to put up solar panels and wind turbines without applying for planning permission under plans to be announced today by Ruth Kelly.

The communities secretary hopes the changes will encourage people to generate their own energy supplies and cut carbon emissions, as well as reducing the number of non-controversial applications that clog up the planning system. At present applications can take months to be processed and cost hundreds of pounds.

Article continues

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Ms Kelly will launch a consultation on the proposals, which will cover all kinds of renewable energy technologies, from solar thermal panels to ground source heat pumps.

The proposals were recommended in January by the Commons trade and industry committee and, if approved, will be included in the planning white paper this spring.

However, planning permission will still be needed wherever neighbours could be affected significantly by the installations, and when the technology is unlikely to bring substantial benefits.

Speaking at a meeting of the Green Alliance, Ms Kelly will stress that people should not use the technology as a fashion accessory, a remark that will be read as a passing swipe at the Conservative leader, David Cameron.

Mr Cameron's £3,000 wind turbine was removed from his London home last month after it was fixed in the wrong place. Contractors will have to reinstall the machine in the designated place on his roof to avoid breaching the planning permission. The Tory leader has described the turbine as a first step, though his Kensington house also has other eco-measures including solar thermal panels and improved insulation.

The Department of Communities and Local Government will say: "Local authorities will retain the right to restrict planning permission in exceptional circumstances where the benefit of the technology is clearly questionable and outweighed by its impact on the local environment. For example, this could include a wind turbine in a built-up area with little wind."

The announcement is part of a strategy to encourage councils, businesses and households to take responsibility for tackling climate change. New homes and public buildings will have to be assessed and given a green rating - similar to the efficiency ratings covering electrical appliances - as the government moves towards its pledge to make all new homes zero-carbon by 2016. At present, domestic emissions account for a quarter of the country's total.

Ms Kelly will warn: "We can only succeed if we match local action alongside global agreement. The real action to implement steps to a low-carbon economy and society has to take place at community level. The local planning system should support efforts to tackle climate change rather than acting as a barrier. We need changes to ensure the system is proportionate - whilst retaining clear, commonsense safeguards on noise, siting and size."

There are more than 100,000 microgeneration appliances installed across the UK, but the total is expected to rise to more than 1.3m by 2020.

[CSR newsclip] West African child labour still feeds the world's insatiable hunger for chocolate

West African child labour still feeds the world's insatiable hunger for chocolate
By Humphrey Hawksley in San Pedro, Ivory Coast
Published: 29 March 2007

Children are being forced to work on cocoa farms in west Africa despite a pledge by the chocolate companies more than five years ago to start eradicating child labour.

Travelling deep into the cocoa belt of Ivory Coast - the country that produces half the world's chocolate - children carrying cocoa machetes are a common sight. They are kept out of school and many have untreated wounds on their legs. "I used to go to school," said Marc Yao Kwame, who works with his brother Fabrice on a remote farm. "But my father has no one to work on the farm, so he took me out of school. My mother's a long way from here. I haven't seen her for 10 years - since I was two years old."

In 2001, after an international outcry and a warning from the United States Congress, the global chocolate industry signed an agreement known as the Cocoa protocol. At first they promised to have made serious inroads towards ending the problem by July 2005. But they missed their targets, and Congress gave them three more years.

"That deadline came and went and we were very unhappy," said Eliot Engel, the Democrat congressman who initiated the protocol. "They now need to live up to that agreement. If they don't we'll make a decision in 2008.

"Personally I would be for implementing some sanctions because I think six years is enough."

The Ivory Coast government says the village of Petit Yammousoukro is a model project for taking children off cocoa farms. The village square is arid dirt and at one end is a school building. It is a mud hut, with a gap in the wall for a window, with 50 children inside. All had been farming cocoa.

"We opened this in January," said Georges Atta K Bredou, the village official in charge of the scheme, meaning January this year, five years after the Cocoa protocol was signed. Forty schools were earmarked for this district, but so far only six have been built.

"We haven't seen any of the money," said Thomas Lasme, the general secretary of the Oume Prefecture which is overseeing the pilot projects. "We need everything. Money, training, vehicles to take the children from the plantations, places for the children to stay."

In London, Alison Ward, of the Biscuit Cake, Chocolate and Confectionery Association, said she believed the industry was on target this time to keep its promise.Meanwhile, Marc, Fabrice and thousands of other children continue to work on the cocoa farms - the impoverished end of a business chain that earns billions of pounds a year.

Humphrey Hawksley's report will be broadcast tonight on Newsnight on BBC2 and The World Tonight on Radio 4

[Energy newsclip] CO2 emissions targets at risk from 'the roll to coal'

CO2 emissions targets at risk from 'the roll to coal'
By Michael McCarthy, Environment Editor
Published: 28 March 2007

Soaring greenhouse gas emissions from power stations are seriously threatening Britain's new climate-change targets, launched in a blaze of publicity only two weeks ago, according to a new report.

Emissions of carbon dioxide from the power sector are shooting up because of an increasing switch from burning high-priced gas to cheaper, but more carbon-intensive, coal, says the report, commissioned by the World Wide Fund for Nature (WWF).

They have rocketed by nearly 30 per cent since 1999, with a rise of 6 per cent in 2006 alone - and this raises "serious concerns", the report says, about whether the Government can meet its proposed target under the recently launched Climate Change Bill to cut emissions by 26 per cent to 32 per cent by 2020.

The findings, in the report UK Power Sector Emissions - targets or reality? by consultants IPA Energy + Water, show that in 2006, emissions from power stations shot up to 178 million tonnes of CO2 - an increase of 6 per cent in 2005 - after a sector-wide return to coal use which was driven by high gas prices and increasing electricity demand.

The power sector is the biggest source of Britain's greenhouse gases, accounting for about a third of the total. Its emissions have reached the highest level since 1992, cancelling out all of the gains from the "dash for gas" in the 1990s, when power companies went the other way.

"This is a disgrace for Britain, and shows that for the past decade the Government has talked a good game on climate change while failing dismally to tackle emissions from this highly polluting sector," said Keith Allott, the head of climate change at WWF-UK.

"The 'dash for gas' in the 1990s helped drive down carbon emissions almost by accident - but the power sector is now on a 'roll to coal' with profound environmental implications. If the Government is serious about climate change, the power sector has to be brought to heel - either through incentives or legislation - so that coal burn is dramatically reduced."

Paul King, the director of campaigns at WWF-UK, said: "The UK is seen as taking a lead on climate change internationally, but these findings show that we urgently need to get to grips with our own emissions to give us credibility on the world stage."

The report highlights the fact that policies to put the sector on to a low-carbon path are proving woefully inadequate, largely because they are not implemented strongly enough. The first phase of the EU Emissions Trading Scheme has failed to stop the return to coal - and the price of carbon has crashed because European governments issued far too many pollution permits to their industries.

In Britain, electricity consumption continues to rise, despite government promises of a "step change" in energy efficiency - and although renewables are making welcome progress, they are having to run fast to keep up with rising demand. The Department of Trade and Industry forecasts that on current policies, emissions from the power sector will stay broadly unchanged to 2020. Indeed, the WWF report confirms the Government has actually encouraged high levels of coal burn in future by encouraging, and essentially subsidising, coal stations to fit sulphur scrubbers, so prolonging their operating life.

[Energy newsclip] Financing Clean Energy: A Framework for Public Private Partnerships to Address Climate Change

Financing Clean Energy: A Framework for Public Private Partnerships to Address Climate Change

Speech by Paul Wolfowitz, President of the World Bank, delivered at the at the Financing Clean Energy conference in London, United Kingdom (13 March 2007)

"Whatever solution emerges for reducing carbon emissions, one thing is clear. We will need to generate significant resources to help developing countries grow while reducing the impact on the environment" said Paul Wolfowitz in his remarks on how to meet the rising demand for energy while reducing the carbon footprint.

Good afternoon. Let me begin by thanking the EBRD for hosting this event and for this joint effort undertaken with the World Economic Forum, the World Business Council for Sustainable Development, and the World Bank Group.

We are here today to address an urgent issue on the global development agenda—how to meet the rising demand for energy while reducing the carbon footprint.

In the past week, Europe led the way I welcome Chancellor Merkel's announcement that Europe will reduce carbon emissions 20% by 2020. It is not only a substantive step towards tackling climate change, but it also creates opportunities to draw the private sector into this effort.

Many companies represented here already are investing in renewable energy, improving efficiency and expanding research and development of climate-friendly products.

This trend in the corporate sector has gone global. Earlier this year, a coalition of NGOs as well as major companies—that included DuPont, Caterpillar and General Electric—called for a groundbreaking national policy to tackle climate change.

A few years ago, it would have been difficult to imagine these companies coming together to discuss climate change—today, they are demanding action.

They are part of an emerging global consensus that the international community needs to do something—sooner rather later—to pursue a low carbon path and leave a healthier planet for our children.

Global Energy Demand

The challenge of fighting global poverty is immense: today, 1 billion people worldwide are surviving from one day to the next on less than $1 a day. It's a staggering figure.

Yet, if we look at recent history, we know there is hope. In the last 25 years, some half a billion people have escaped poverty worldwide. Much of this progress has been driven by rapid economic growth in the two big emerging economies of China and India .

That growth would have been impossible without increased energy consumption in these countries. And, there is no question that this growth needs to continue—so that those who are still trapped in poverty have a chance for a better future.

So, energy demand in developing countries will only increase. But, we need to be prepared to respond to this rising demand with a smaller carbon footprint.

Today 1.6 billion people worldwide don't have access to electricity. In rural areas of the developing world, particularly South Asia and Sub-Saharan Africa, as many as 4 out of 5 people live without electricity.

With these statistics in mind, we need to ask ourselves: How do we reduce both poverty and carbon emissions?

Poor countries have argued they should not have to pay the price for fossil fuel dependent growth in the rich countries. And they are right.

Rich countries need to lead by example. Today, OECD countries are moving forward with plans to renovate and replace virtually their entire power plant infrastructure. The decisions made in capitals across Europe and North America today will affect generations to come—so it is essential that they make the right choices and invest in clean technology and move towards low carbon strategies.

Rich countries will also need to lead with direct support to developing nations.

We need to reduce poverty and reduce carbon emissions.

But, instead of viewing emission reductions as a costly activity that simply reduces the burden of climate change, we should also view as an opportunity to generate funds to invest in a different energy path—one that not only makes less use of carbon but which diversifies the world's energy sources, preserves the world's forests, and enables a long term shift away from finite fossil fuels toward greater reliance on renewable energy and on technological innovations.

Roadmap for Investments: Clean Energy Investment Framework

Moving to a low carbon path, however, will require more than investments alone.

It will also require a long-term equitable global regulatory framework to reduce greenhouse emissions:

-a framework in which rich countries show leadership by supporting developing countries in exchange for the global benefit of greener, smarter growth;

-a framework that provides certainty to stimulate research and development in transformational technologies;

-and, a framework that allows carbon markets to thrive and bring financial flows to developing countries to the tune of $100 billion within a few decades.

Emerging Opportunity

Whatever solution emerges for reducing carbon emissions, one thing is clear. We will need to generate significant resources to help developing countries grow while reducing the impact on the environment.

The UK's Environment Secretary David Milibrand recently suggested carbon trading could generate resource flows in the order of $200 billion a year, half of which will go to the developing world, that is to say about $100 billion per year.

$100 billion is an enormous amount of money and certainly exceeds what is currently spent on Official Development Assistance, but it is dwarfed by what the world spends on fossil fuels. It is only 7 percent of the $1.5 trillion that the world spends each year just on oil alone.

There are better uses for those funds. Instead of importing fossil fuels, we could be investing in innovation that will allow us to meet our energy needs from more diverse resources without damaging the environment.

So clean energy should not be perceived simply as a cost. It should be seen as an opportunity to invest in a different future…an opportunity to diversify our energy sources and expenditures.

Towards a Low-Carbon Path: World Bank Role

At the World Bank Group, we have been doing our part to close the funding gap in the developing world for expanding access to energy.

With Gordon Brown's leadership at the Gleneagles Summit in Scotland two years ago, the G8 Countries asked the World Bank to produce a road map for accelerating investments in clean energy for the developing world, in cooperation with the other international financial institutions.

The Clean Energy Investment Framework (CEIF) identifies the scale of investments needed:

-To increase access to energy, especially in Sub-Saharan Africa;

-To accelerate transition to a low carbon economy and

-To adapt to climate variability and change.

Over the last three years, the World Bank total energy support has been ramped up to $3-4 billion per year—an increase of 40% over the previous three year period. Last year, 37 percent of this lending was directed to low carbon initiatives.

Yet given the huge demands, more needs to be done to leverage private sector financing—both to close the gap and spur innovation.

Let me briefly talk about four areas where we have been actively supporting climate-friendly solutions.

1. Investing in Efficiency and Conservation

First, despite efforts to diversify, it is clear that most developing countries will need to rely heavily on carbon based fuels for the foreseeable future so we are focusing on opportunities to improve efficiency and conservation and the use of fossil fuels.

As large emerging economies like China and India pursue rapid growth, we are working with them to develop strategies and financing plans that reduce their carbon footprints.

For instance, we are partnering with Chinese banks to convince the local private sector of the business case of energy efficiency. For the first time, three key players in the Chinese economy – utilities, suppliers of energy efficiency equipment, and commercial banks – have come together to create a new financing model, a market-based solution, to promote energy efficiency.

Through our analytical work, we are supporting China 's efforts to restructure its district heating sector and are working with the Chinese steel industry to save energy through redesigning current production processes.

We are helping Mexico , Brazil , China and India to pilot more energy efficient modes of urban transport.

We are also promoting Green Investment Schemes, which link emission trading revenues to low carbon investments in Latvia , Ukraine , Bulgaria , and initiating similar work in Russia .

Strong partnership with the private sector is especially important.

To give you one example, as part of the Global Gas Flaring Reduction Partnership, we are helping oil producing countries and companies to increase the use of natural gas, which will otherwise be flared or burned and damage the environment.

This partnership mobilized $1.7 billion in private capital investments for gas flaring reduction projects in Ecuador , Indonesia , Nigeria , and Russia that offset some 6 million tons of CO2 emissions.

This partnership model could be useful for promoting other climate friendly technologies. Given the very large coal reserves in countries like the US, China and India, techniques such as Integrated Gasification Combined Cycle (IGCC) coupled with Carbon Capture and Storage (CCS) can help us make use of a valuable resource for development—but do it in a way that leaves a small carbon footprint.

With research and development, incentives can be created to speed-up the commercialization of both IGCC and CCS. Could a public-private partnership accomplish this? We will look to this conference for insights.

As we scale up our efforts, we will need to look at innovative financial tools, including guarantees and other instruments that can leverage the private sector and respond to the specific needs of our partner countries. Our Carbon Finance work will be an important part of this.

Today, the World Bank is managing nearly $2 billion in nine carbon funds and facilities of which $1.4 billion has already been committed.

These funds are supporting low-carbon investments which range from the destruction of industrial gases to the capture of methane in landfills. The investments are also aimed at improved energy efficiency in steel production, bagasse co-generation, renewable energy (wind, geothermal, hydropower), land use change, and combating deforestation.

And now, in consultation with governments and private sector participants in these funds, the Bank is designing a new carbon finance facility that would purchase emission reductions beyond the regulatory period of the Kyoto Protocol (2008-2012).

2. Investing in Renewable Energy

The second focus of our effort expanding investment and access to renewable energy.

We know that there is no silver bullet. But, here too, we know that the private sector is key to innovation.

Wind, solar, geothermal, hydro, and bio-energy are all part of a diversified energy path. These technologies can reach areas where it is impractical to build and maintain a centralized power grid.

We are promoting geothermal energy in Kenya and small hydropower in rural areas in Uganda . In Nepal , we are supporting a biogas program that replaces firewood for cooking in rural households, thus reducing indoor air pollution.

We are working on the commercialization of fuel cells in Africa . In a number of countries we are supporting advanced biomass power generation.

In India , Kenya and Morocco , we are promoting the use of solar panels for electricity, especially in remote locations.

In Guinea-Bissau , a Bank project underway uses cashew shells to generate electricity. We think this will open the door to an industry where 10 Megawatts of power can be generated from bio-mass, and directly support the cashew industry—which is responsible for two-thirds of the country's GDP.

In 1992, renewable energy accounted for only 0.1 percent of India 's total generation capacity. We supported India by providing $108 million in credits and raising $200 million from the private sector to promote renewable energy and strengthen relevant institutions. By 2002, India 's share of renewable energy increased to 3 percent, while still a small percentage that is a thirty fold increase in just over a decade.

In Brazil , I had the opportunity to visit a sugar ethanol plant outside of Sao Paolo. They are producing ethanol on a large scale and with exceptional efficiency. It is no surprise that bio-fuels are at the top of President Lula's agenda.

There may be countries in Africa with the right combination of climate, land, and water that might make bio-fuel production a real possibility. We know that what is successful in Brazil , may not be successful in other places. Brazil 's remarkable production efficiency and natural conditions cannot be replicated easily, but it is something that should be assessed.

More broadly, second generation technologies hold promise and we look forward to supporting strong R&D programs.

We are ready to provide technical assistance and advice to support adoption of bio-fuels where they are economically and environmentally sustainable.

3. Combating Deforestation

A third focus of our efforts lies in preserving forests. We know that around 20 percent of greenhouse gas emissions result from poor land management, especially deforestation. This not only threatens the environment—it also destroys wildlife and erodes the natural wealth of the poor.

Together with both our official and non-governmental partners, we are developing a pilot Forest Carbon Facility that will help countries combat deforestation and be rewarded with carbon finance.

The proposed pilot fund would set the stage for a future, large-scale carbon market. It would build a country's capacity to harness the future carbon market and pilot performance-based payments to avoid deforestation and improve natural resource management, in particular forest management.

4. Adaptation

Fourth, we are working with our partner countries to help them adapt to some of the negative impacts of climate change.

Developing countries, and particularly the world's poorest people, are hardest hit by changes in climate and extreme weather events such as floods, droughts, heat waves, and rising sea levels. They are often least prepared to cope.

The World Bank was among the leaders in addressing adaptation to climate risk by pioneering insurance work in the Caribbean, in Latin America, and in South Asia . Just last month, we launched a Caribbean Catastrophic Insurance Facility with support from a multi-donor trust fund. The challenge now is to replicate these lessons more widely, especially in Sub-Saharan Africa and the Pacific Islands .

We are also discussing with our partners ways to promote development that is sustainable and resilient to climate variability—we call it 'climate-proofing' our development investments.

Reaching for the Double Dividend

We recognize that we need to walk the talk in our own operations, and we are doing something about it. We have made the World Bank Group Headquarters carbon neutral. We also believe it is time, in coordination with our partners, to develop a system that can estimate the carbon intensity of our projects.

I'm encouraged to see that a number of private companies at this conference are also moving in the same direction.

Today, we are faced with compelling evidence that our consumption of fossil fuels is hurting the environment—and the longer we delay action, the more costly it will be. Business as usual is not an option.

Today, we have the opportunity to move towards a climate-friendly development path and secure a cleaner, more stable future for our children and grandchildren.

If governments, the private sector, and international development institutions work together, we can turn the emerging global consensus on climate change into concrete actions. We can fund innovation and find solutions.

And we can look more confidently toward a very different future—one where we don't have to choose between prosperity and a healthy environment, because both will be within our reach.

Thank you.

[CSR newsclip] The Role of Business in Society: Speech by Antony Burgmans, Chairman of Unilever

The Role of Business in Society

Speech by Antony Burgmans, Chairman of Unilever, delivered at the XXth World Traders’ Tacitus Lecture in London, United Kingdom (22 February 2007)

According to Unilever's Antony Burgmans, "healthy business needs healthy societies and vice versa. This in turn involves understanding how business can contribute to societal progress while at the same time understanding the boundaries of both what society will accept and what business can do."


Master, Wardens, Lord Mayor, Your Excellencies, my Lords, Aldermen, Sheriffs, Chief Commoner, Ladies and Gentlemen,

It is a great honour for me to have been asked to speak to you today, and that is for several reasons.

First of all any speaker would be thrilled to address such a distinguished audience as the Worshipful Company of World Traders.

I am aware a heavy responsibility rests on my shoulders today as I know the Tacitus lecture is your “main annual contribution to the subject of education in world trade”. Can’t afford any mistakes then…

Secondly, the location could not be more splendid than this fabulous Hall. Guild Hall survived the Blitz and at an earlier stage the Great Fire of London, and is the only secular stone structure dating from before 1666 still standing in the City. Who would not feel privileged to speak at such a historic landmark.

The topic I want to address with you today is the role of business in society in the context of globalisation.

A very broad topic on which there is much to say, so I have to limit myself.

Multinational companies and the role they play are in the spotlights of the globalisation – or should I rather say anti-globalisation - debate that we have been witnessing for some years now.

Recently I was flabbergasted by a comment from a leading politician in my country. He was speaking on the globalization process and stated that in his view the development of Africa would never materialize as long as activities of multinationals were not eliminated in these countries.

For me two things are clear: first he is wrong, and second: business should fully engage in the debate on globalisation, and that is one of the reasons why I am here today.

In the past decade I have been travelling up to 200 days and visiting 15-20 countries a year. I have therefore been able to see both the huge benefits of economic growth in many parts of the world, as well as huge inequalities that still exist.

Just to mention the Kibera slum in Nairobi, where 900,000 people live in the space of a few soccer fields in absolute squalor separated a mile away down from gated villas with big gardens and guard dogs. That raises many questions and I would like to address some of them with you.

As I will use various examples from my own Unilever experience, I will first of all make some general remarks about my company and its mission.

Unilever and its Vitality mission

Predicting is difficult especially if it concerns the future.

That was certainly the case when I joined Unilever.

With the benefit of hindsight I can say I made the right choice at the time. The fact that Unilever has been my only employer is proof of that. I worked in various places including Indonesia, Germany and the UK, and have thus been able to experience these nations development leaps and setbacks at close range.

Unilever is not only an economic actor of considerable scale and scope but at the same time has traditionally had a particularly important social role as a result of its product portfolio. Why is that so?

In his magnum opus “The Wealth and Poverty of Nations” Professor David Landes from Harvard University identified three main reasons why life expectancy has increased dramatically in the recent century. These were because of improvements in (1) medicine, (2) hygiene and (3) nutrition. Unilever happens to be active in the latter two sectors.

In that light it may come as no surprise that a couple of years ago we have formally codified Unilever’s Vitality mission.

Unilever “adds vitality to life” so that through our brands people can feel good, look good and get more out of life.

Unilever was formed in 1930. The company was the result of a merger of the Dutch Margarine Unie and the British Lever Bros, and as such an example of a successful Anglo-Dutch partnership.

Both companies were known for their innovation - in their brands and business methods, and for setting up projects to improve the life for their workers.

Just to mention a few of our brands: Knorr, Bertolli, Lipton, Flora and Magnum ice cream in the Foods category and Dove and Persil in Home and Personal care.

Some years ago we decided to scale down the amount of brands from 1600 brands to 400. The idea behind it: more focus and concentration of marketing resources, because in the global marketplace only VERY strong brands will survive. Already today we harvest fruit of this foresight.

Every day about 150 million customers worldwide buy one or more Unilever brands. All these customers are served by us through our 179.000 employees. Our worldwide turnover in 2006 amounted to about 40 Billion Euro.

We have operations in over 100 countries and we sell in over 150. So it is fair to say we operate on a global scale, and as such are an actor in the globalization process.

This I think is a good moment to take a closer look at this phenomenon of globalization

Economic Globalization: Defining its Meaning and Identifying the Drivers

There are many forms of globalisation, ranging from the globalisation of culture and the globalization of terror. As a businessman I will today – perhaps not surprisingly – focus on economic globalisation.

There are many definitions around. So far I have not come across a more concise one than the definition by Martin Wolf – economics editor of the Financial Times who once described economic globalization as follows :

Globalization is the integration of economies through markets across frontiers

In my view the key drivers behind globalisation are twofold:

First of all pro-market policies. The 1989 revolution in Eastern Europe culminating in the fall of the Berlin Wall was a watershed development and seen by many as the definitive victory of both democracy and the free market over authoritarianism and state-driven economies. The intensive debate on globalisation and the so-called “Washington consensus” shows however that the “end of history” cannot be declared. In contrast: the consensus is seriously in discussion, and that is surprising in view of its rewards. Nonetheless, reality is that we are currently engaged in a highly ideological debate on globalisation.

Secondly, there is the technology driver. I don’t think this needs a lot of discussion here, apart from the fact that in this field unlike many other areas the world is truly becoming globalized. We all know technology has shrunk the planet.

Unilever and its Views on the links between Business & Society: General Remarks

Ladies and gentlemen, the societal aspect of doing business is going to be ever more important in the 21st century. In the consumer brands business it is already very important.

Sustaining trust with consumers requires understanding not only of their tastes and expectations about products, but also of taking into account their concerns about the state of the world.

It is not only about helping consumers look good, feel good and get more out life, but also about how we conduct our business. The Unilever mission includes vitality in the community not without reason.

It is Unilever's longstanding operating experience that you cannot have a successful company in a failing society. Healthy business needs healthy societies and vice versa.

This in turn involves understanding how business can contribute to societal progress while at the same time understanding the boundaries of both

(a) What society will accept and

(b) What business can do.

This seemingly broader approach to doing business - that Unilever is engaged in - is no business philanthropy. It is core business activity. It is part of a journey many companies are on. It is all about understanding your customers and the world in which they live. Companies, like markets, are part of society, created by society, and not something separate from it.

The Role of Business: Corporate Sustainable Responsibility

For me the role of business in society can be summarized quite simply as doing business in a sustainable way.

My personal opinion is that CSR stands for Corporate Sustainable Responsibility.

This sustainable responsibility consists of two layers:

First, business has to be sustainable in economic terms. One of the fundamentals of business will always be to ensure profitability in the short and particularly in the long run. Only on that basis can business be economically sustainable and deliver benefits to both its shareholders and stakeholders. For those arguing against I would like to refer to the experiences of many businesses in the “new economy craze” of some years ago. The lessons were clear: business models may change but some fundamentals will always remain.

Second, business activities should be sustainable in a societal and environmental responsible way. I will return to that later.

In sum: How business handles its business, how well, and how carefully, are valid questions, but not why. Of course, this is precisely the angry question from many anti-business/ anti-globalisation activists. It is like asking a cow why it is producing milk. The answer of course is: this is what cows are for.

And as we all know, cows do deliver. So can business. In this context it is interesting to note that this is also acknowledged by some of globalisation’s most prominent critics.

In his latest book Nobel Prize laureate Joseph Stiglitz does concede the following:

“Yet corporations have been at the center of bringing the benefits of globalization to the developing countries, helping to raise standards of living Throughout much of the world They have enabled the goods of developing countries to reach the markets of the advanced industrial countries; modern corporations’ ability to let producers know almost instantly what international consumers want has been of enormous benefits to both. Corporations have been the agents for the transfer of technologies from advanced industrial countries to developing countries, helping to bridge the knowledge gap between the two. The almost $ 200 billion they channel each year in foreign direct investment to developing countries has narrowed the resource gap. Corporations have brought jobs and economic growth to the developing nations, and inexpensive goods of increasingly high quality to the developed ones, lowering the costs of living and so contributing to an era of low inflation and low interest rates.

(Joseph Stiglitz, Making Globalization Work; the next steps to global justice, 2006, p.188)

Ladies and gentlemen: with such critics you don’t even need friends!

But the other question – about how business is doing business – is hugely important, and it is right that business is expected to answer it. It touches upon the heart of corporate governance as well as social and environmental responsibility.

Business Climate Creation: the Crucial Role of Government:

At the same time, governments play the more important role in society in enabling or disabling integration of economies through markets across frontiers.

Governments make the decisions on domestic market reform and public funding of infrastructure, and decide on trade and investment rules and barriers.

As in all areas of life we can differentiate between the good, the bad and the ugly. This is true for businesses as it is valid in the context of governments. There are good governments, incompetent ones, and worse.

The importance of good governance cannot be stressed enough. It is the infrastructural backbone for business success.

The capability of a government to install and maintain a solid legal and fiscal infrastructure - and in particular a fair and transparent system of property rights and tax collection - is an example of a nation’s ability to attract investment, create jobs and develop in a sustainable way.

The present accelerated phase of globalisation owes much to the domestic and international market opening initiatives in the 1980s by political leaders such as Ronald Reagan, Margaret Thatcher, Helmut Kohl, Jacques Delors, Mikhail Gorbachev and Deng Xiaoping.

Between them, they led several decisive contributions to our era of economic integration

- Domestic reform here in the UK (“the Big Bang”) - The opening of China’s internal market followed by its opening to the world - The launch of the Uruguay Round trade talks - The events leading up to the reunification of Germany and the end of the Warsaw Pact economic system - And the Single European Act leading to the Euro

The role of business was of course influential in at least a few of these decisions

– but business was not monolithic on market-opening then, just as it isn’t today.

Calls for protection were not and are not limited to textiles and steel, as those of you from the financial sector know well. Some companies advocated for, and embraced market opening, some others resisted it but adapted, still others resisted change for too long and disappeared.

But the overall model is clear – governments set the parameters, terms and pace of market opening, while business serves and explores markets as they emerge. Business can not be asked to take on the role of governments in the end, but a responsible business does look where it can contribute to improve society, for example through public-private partnerships.

As a contrast let me remind how Ronald Reagan characterised the role of government on the economy: “If it moves, tax it, if it keeps moving, regulate it. If it stops subsidise it.”

Economic Globalization and its Results

The overall results of the past 25 years of increasing economic integration are also fairly clear:

Since the mid-1980s, when the latest long-term efforts to open and integrate markets across frontiers began in earnest, the world economy has grown by over 3 percent a year. Furthermore, the emerging economies that have joined this process have grown twice as fast as the overall average.

Thirty years ago, China and India, where almost two-fifths of the world’s population live, were among the world’s poorest countries. Since 1990, India’s real GDP per head has more than doubled, and in China it has quadrupled. Meanwhile, Korea and Taiwan have joined the ranks of the advanced economies within two generations.

The impact of growth on extreme poverty is also telling:

- In 1950, around 50 percent of the world’s population lived in extreme poverty (less than $1 a day in real terms). By 2000, it was just under 24 percent.

- In sub-Saharan Africa it remains over 40 percent, while in China it fell from 33 percent in 1990 to under 18 percent in just one decade (1990-2000).

- In the rest of East Asia it fell from 25 percent to 10 percent in the same period.

- In the same time-frames, very dramatic falls in child mortality and increases in adult literacy have also occurred in the developing economies with the fastest growth.

That is not to say that there are no winners and losers. There have always been and there will always be. The question is: are we better of as a whole with or without globalization. I think the figures mentioned say it all. History has shown that allocation of resources is managed most efficiently through market policies. In a competitive market that does mean cutthroat competition.

As my father used to say: “Success” comes before “work” only in the dictionary

And it is exactly that which is sometimes misunderstood in the developed world. Success and high standards of living are almost taken for granted, and that is a serious misconception. Statesmen should educate their people on important developments, and globalisation certainly ranks among those. In contrast, we see many protectionist reflexes.

Let us instead emphasize the positive side of things exemplified by the figures just mentioned. China and India - through hard work - are regaining their traditional position at the world stage. Is this not what we always aspired to?

That these countries are not dependent on development aid but take their destiny in their own hands. I think that is incredibly good news.

Of course we do need a level playing field in the process and fair competition, which was certainly not the case in the story of the cock that went into the henhouse with the egg of an ostrich and then stated:

Look ladies: this is what your colleagues in other countries are producing

While the absolute numbers of people still living in extreme poverty is an affront to our humanity, the trend is clear – market-based growth within the right and effective regulatory frameworks can dramatically reduce extreme poverty.

Despite this progress – or perhaps because of it - there is great anxiety and even opposition to economic globalisation, as we for instance witnessed during the “Battle of Seattle”.

Global Concerns ……

The critics often point out that many important global issues remain unresolved. Most starkly, 2.7 billion people still live on less than $2 a day while another 2 billion are able to meet basic daily needs and perhaps 1 billion are enjoying unprecedented affluence.

This is clearly one of the key sources of anxiety and concern. A few more facts:

  • 20% of the world’s population – 1.2 billion people – lives without adequate food, clean water, sanitation, healthcare or basic education.
  • 1 woman dies every minute in childbirth.
  • 25% of all the people on earth die of AIDS, TB, malaria and infections related to dirty water – principally cholera and diarrhoea.
  • 10 million children die every year of completely preventable childhood diseases.
  • Global warming is leading to climate change.
I fully share these concerns. And I can add many more. Let me mention one.

A couple of years ago I was closely involved in a huge worldwide study under the auspices of the United Nations.

This Millennium Ecosystems Assessment Board (MEAB) study was carried out by 1300 scientists and took over 4 years to complete. It contained some genuinely alarming conclusions: almost two/thirds of the world’s ecosystems, i.e. the services provided by nature to mankind are found to be in decline or are already seriously endangered.

To make matters worse we know that in particular the world’s poorest depend on the services which these ecosystems provide.

What to do?

As regards the way forward, I fully share the line of thought of Kofi Annan that in order to tackle these problems, we need more, not less globalisation.

…… and Unilever Practice

So in this context - what is the role and responsibility of business?

It has limits but that does not mean it is limited. Business, along with all actors in society, has to face up to the scale of the challenges and need for faster and more effective action.

It requires us as a business to identify and focus on core competencies and what we are about – the things we already do best in reaching people via commercial transactions.

Last December Professor Michael Porter together with Mark Kramer wrote an interesting article on “Strategy and Society; The link between competitive advantage and corporate social responsibility” in the Harvard Business Review. They concluded the following:

The more closely tied a social issue is to the company’s business, the greater opportunity to leverage the firm’s resources and capabilities, and benefit society.

The same line of thought guided our strategy when we identified our sustainability initiatives in the areas of fisheries, agriculture and water.

At the same time we have looked at ways to deploy our skills in partnerships with NGOs and governments – the people whose raison d’etre it is to reach people via non-commercial transactions. Let me stress that the skills we bring to the partnership are the basic skills which we use when pursuing our routine business interests.

Let me give you some examples to illustrate what I mean.

1. Understanding the links between international business and poverty reduction

Ladies and Gentlemen, we have always believed that businesses such as ours can make a significant contribution to local economies and wealth creation. However, it wasn’t something we had ever actually measured.

So in 2003 we teamed up with Oxfam and its Dutch arm, Novib. The Financial Times described us as ‘strange bedfellows’. We decided to collaborate on an indepth study on the socio-economic impact of our business in Indonesia - a country where more than half the population lives on less than $2 dollars a day.

Our purpose was to discover whether our operations/activities there were helping or harming the nation’s poor. And we committed to publishing the results. We gave Oxfam access to our internal documents, figures and forecasts. And we let them interview our employees.

Not surprisingly, this involved a steep learning curve and a degree of discomfort on both sides. But the experience of working together and the findings of the report were valuable for both partners.

Most important, perhaps, the study showed that while Unilever in Indonesia employs about five thousand people, our business creates the equivalent of 300,000 full-time jobs − around a third in the supply chain and more than half in the distribution and retail chain.

The report also showed that a significant majority of the total cash value generated by Unilever Indonesia remains in Indonesia. This is in the form of government taxes, payments to primary producers and suppliers, and in incomes generated for distributors and retailers.

Of pre-tax profits, two-thirds remain in Indonesia as corporation tax, local dividends and investments.

The exercise highlighted the extent to which business can indeed have a major positive economic as well as social impact in developing countries.

However, it also brought home to us our limitations in helping to lift people out of poverty.

Often, the most vulnerable are those at the furthest ends of the value chain; for instance, small farmers and shopkeepers. The study showed the importance of other social institutions and resources to be in place, if value chains are to work for poor people. For example: credit and saving schemes, involvement of other relevant players such as local governments and NGO’s, and diversification of income streams.

2. To learn how to grow our fish business in an ecologically sustainable way,

A decade ago we began working with the international conservation organisation WWF on tackling the depletion of the world’s fish stocks. This more or less started with a conversation I had with WWF’s then Director- General Claude Martin, in which we basically said – we each have quite some knowledge and interest in this issue, so let’s put our heads together and see what we can achieve.

For Unilever of course, there was real business self-interest, because as we say :

“No fish, no fish fingers”.

Together we helped to establish a certification programme for sustainable fisheries – known as the Marine Stewardship Council (MSC) in 1996. Today, more than 200 products made by different companies worldwide carry the MSC logo. The logo provides the assurance that the fish comes from sustainable fisheries, independently certified to the MSC Standard.

Back in 1996, we made a long-term commitment to buy all our fish from sustainable sources. We set a milestone to achieve this by 2005. This proved more difficult than expected; by the end of 2005, we were buying 56% of our fish used in Europe (where we processed the largest volumes) from sustainable sources. This includes fish from fisheries certified to the MSC standard and stocks that pass our own assessment.

Today – after a 10 year battle – the MSC is revolutionising the fishing industry.

3. Innovation at the base of the economic pyramid

To quote the wise words of Professor C.K. Prahalad from his book, ‘The Fortune at the Bottom of the Pyramid’:

“The aspiring poor present a prodigious opportunity for the world’s wealthiest companies. But it requires a radical new approach to business strategy.”

He is talking about the four billion people in the world with spending power of less than fifteen hundred dollars a year. Doing business at the base of the pyramid also offers significant scope for positive social impact.

In fact, these consumers have even greater need of quality products precisely because they have so little money to spend. And of course, access to certain types of products can be literally life-saving – think of the impact of antibacterial soap or vitamin-fortified food.

A little bit more about soap. You surely look like a very clean audience. But hygiene is not widespread everywhere. The life saving qualities of soap can not be stressed enough.

Hand washing campaigns for frequent use of anti-bacterial soap can prevent diarrhoeal diseases, and can potentially save one and a half million lives a year.

However, as Professor’s Prahalad’s comment suggests, conventional business wisdom gained in developed markets does not apply in these low income income markets. It can even be counter-productive.

Instead, success will depend on the ability to capitalise on the strengths of the existing environment rather than trying to overcome its weaknesses. To put it at its simplest, we will not change these markets. So we must let them change us. This might mean different price points, redesigned packaging, new types of partners, custom-built solutions, building local capacity. It will certainly mean a fresh approach to consumer affordability.

Instead of the traditional method of determining price by way of “cost plus margin”, you have to begin from a different starting point. What can consumers afford? Then you must find a cost base that supports your margin. Thinking like this has led Unilever to single-use sachets of shampoo, mini deodorant sticks, individual bouillon cubes and single-use tea bags, all of them highly successful social innovations, and good business for us.

But that’s not all: one of the main challenges of operating in many developing areas is to actually reach the consumer with your products. We are talking about “deep distribution” here; the need for near-home delivery.

In Indonesia for example – an archipelago of over 16.000 islands with an infrastructure that is not always exactly state-of-the -art, you can imagine that effective distribution can give rise to a headache.

But for over 70 years we have been able to put in place a distribution-network covering the whole of this beautiful country through which we serve about 600.000 small entrepreneurs on a weekly basis - both in the cities and in rural areas.

In similar fashion, in India we sell our brands through 6.3 million shops in 638.000 villages and 5,545 towns.

At the bottom of the pyramid consumers do not have cars to drive to Superstores 20 miles down the road. You virtually have to deliver the brands at the doorstep of those who belong to the bottom of the pyramid.

4. Empowering women as micro-entrepreneurs

In India, Hindustan Lever’s Shakti project (Shakti means ‘strength’ in Sanskrit) shows what can be done at the point where social responsibility, sustainability and business strategy all meet.

In the more remote parts of India, there are millions of potential consumers but no retail distribution networks, no advertising coverage and poor roads and transport.

Our company provides women from self-help groups with training in selling, commercial knowledge and bookkeeping, teaching them to become microentrepreneurs. The women who are trained can then choose to set up their own business or to become Project Shakti distributors – or Shakti Ammas (‘mothers’) as they have become known.

Each woman who becomes a distributor invests 10,000 – 15,000 rupees (US$220-330) in stock at the outset – usually borrowing from self-help groups or micro-finance banks facilitated by Hindustan Lever.

Each Shakti woman aims to have around 500 customers, mainly drawn from her village’s self-help groups and from nearby smaller villages. The women typically double their income through sales of around 10,000-12,000 rupees a month, netting a monthly profit of 700-1,000 rupees (US$15-22). This is typically the equivalent income to a male agricultural worker.

Today, just four years after the first pilots commenced, there were already over 30,000 Shakti entrepreneurs. By 2008, Project Shakti’s goal is to recruit 100,000 Shakti entrepreneurs covering 400,000 villages and 400 million consumers, and to keep multiplying from there.

More than 300 partners have joined the project, including NGOs, banks and both state and local government departments, helping to ensure its sustainability.

Project Shakti does however raise some important questions. As a result of running a Unilever business, these Shakti-women in India are empowered.

I am sure that all of us gathered here today think that is great, but in a country with different cultural values this may not always land well. Where are the boundaries? How far can, and how far should you go as a business in this respect? Remember: the role of business is not the same as that of government.

This touches upon important questions regarding the cultural dimension of globalisation. The topic certainly deserves a speech in its own right.


Ladies and Gentlemen, I am aware that - being here amidst the Company of World Traders - I am obliged to say some words about the current WTO negotiations.

For your information: I am not tailoring this message according to the occasion, as I virtually always take the opportunity to discuss and emphasize the importance of a successful conclusion of the Doha Development Round.

The name of the Round could not have been chosen more strikingly. This WTO Round is about development.

The OECD has calculated that

  • the gains of full tariff liberalization for industrial and agricultural goods could amount to nearly 100 billion US dollars in terms of increased economic activity and thus prosperity
  • benefits of liberalizing trade in services could even reach 500 billion US dollars
  • A Doha agreement on trade facilitation could contribute another 100 billion US dollars
Projections are that the developing countries would be the beneficiaries of 2/3 of these gains. At the same time that means that they have the most to loose.

Main Conclusions:

Ladies and Gentlemen, to sum up:

1. The evidence that globalisation has lifted hundreds of millions of people out of poverty is irrefutable. However, globalisation has also lifted the awareness of the plight of the billion people who live on less than $1 a day.

2. The world faces a number of issues such as climate change, poverty alleviation, hunger, etc. which are global in nature and require integrated global solutions.

3. Business has become a global force. Its prime purpose is to provide a return for its shareholders and protect the interest of its stakeholders. Business is an integrated force in society and uniquely designed to get the job done. For this, business has created a powerful toolbox in order to create value efficiently.

4. To achieve the Millennium Development Goals, which aim to overcome a number of global issues such as hunger and poverty, the toolbox of business (i.e. skill sets which the company already has acquired in pursuit of its normal commercial goals) can play a decisive role.

5. This requires governments or global institutions to design a multistakeholder approach which fosters partnerships between governments, NGOs, academia, business etc.

6. To rely on taxation and regulation only to coerce business into certain behaviour would be an act of folly.

7. And finally: business thrives best in a light touch regulatory environment, a predictable and fair tax regime and a reliable judiciary. Only then will business have the space to deploy its full set of competencies to alleviate the global issues of our time – but always in partnership with other members of society.

[CSR newsclip] IBM, Indian tech firm devise smart card for poor

IBM, Indian tech firm devise smart card for poor

AFP, 7 March 2007 - US giant IBM and an Indian technology firm said Wednesday they had devised a smart card to help poor entrepreneurs access credit from institutions that lend to the "unbanked."

Small traders who have borrowed from microfinance institutions such as Bangalore-based Janalakshmi Social Services will be able to take part in fruit and vegetable auctions using the card, without having to take loans from greedy moneylenders, the companies said.

A technology platform developed by IBM and Financial Information Network and Operations, a unit of India's second-largest bank ICICI, will hold customer accounts of microfinance companies.

The system would be accessed by customers using a fingerprint-enabled smart card, which will serve as both proof of identity and an electronic passbook, the two companies said in a joint statement in Bangalore.

Financial Information Network said it plans to approach 200 microlenders based in India and abroad with the technology, enabling them to offer the poor not only credit but also investment, remittances and insurance services.

The system will cut costs, reduce paperwork, boost efficiency and create a database of unbanked poor, helping bring them into the mainstream, it said.

"We have a large number of customers with very large transaction volumes and small ticket sizes," said Ramesh Ramanathan, who heads Janalakshmi Social Services.

"Our audit and control systems need to match the volumes, and our transaction costs need to be low enough to enable low-cost delivery," he said. "None of this will be possible without technology."

Microfinance was popularized by Bangladesh's "banker to the poor" Muhammad Yunus and his Grameen Bank who won the Nobel Peace Prize last year for helping millions escape poverty through a system of small-scale loans.

In India, a nation of 1.1 billion people, "the microfinance sector has seen a tremendous upsurge in recent times," said Manish Khera, who heads Financial Information Network.

"There is a huge potential in this domain and we see ourselves branching out to serve many more unbanked geographies," he said.

The country is home to 400 million people who have no access to traditional banking services, according to estimates.

[CSR newsclip] Innovation in Innovating: the Eco-Patent Commons

Innovation in Innovating: the Eco-Patent Commons

Geneva, 23 March 2007 - Since the Italian Renaissance, societies have offered their innovators a deal. In return for publicly describing their invention, they are granted a period of exclusivity. This not only encourages innovators, it gets ideas more quickly out into the open, where others can build upon them.

It is an approach that has served society well over the centuries. Yet recently it has become more controversial. Should life-saving drugs be patented? Should life forms? Should a company get private rights for software without revealing the underlying source code? Does the morass of patents and licenses in the field of biotech actually limit progress?

Amid such arguments, IBM has quietly brought forth a new idea: an "eco-patent commons" (EPC), a process to share intellectual property (IP) related to environmental and ecological technology.

There is a need. The vast majority of patenting happens in the North, whereas the rapidly industrializing South requires all the help it can get in managing environmental impacts (see figure below). The goal is to have the EPC serve as the catalyst for collaboration and innovation in addressing urgent environmental challenges.

If it gets beyond the idea stage, the EPC could include a coalition of global business and academic leaders who are willing to grant royalty-free access to relevant IP. The EPC could provide a collection of patents pledged by companies (and other IP rights holders) for unencumbered use by all, enabling these organizations to more quickly innovate and implement processes that improve and protect the environment.

Depending on participation by others, IBM would contribute a number of appropriate patents and leverage key client and partner relationships for additional contributions.

The WBCSD held an EPC information meeting at the beginning of its New York Council meeting and has been facilitating the discussion of the EPC with member companies. The Council is exploring hosting the EPC to stimulate technology cooperation in support of sustainable development. Participating members and the WBCSD could outline the operating principles and framework, host an EPC-dedicated website, and help manage the collaborations that may result.

The Council has worked over the years on the connections between innovation, technology, sustainability and society, work that has included a stakeholder dialogue on intellectual property rights. IBM has been exploring the same space through its Global Innovation Outlook project and series of meetings, and the company has also been working with "open source" software.

At several international meetings, WBCSD President Bjorn Stigson has found that governments are deeply concerned over the IP controversies, and are looking for new ways forward, hoping that business can help them find them.

IBM and the WBCSD are inviting companies to join a core group and attend a kickoff meeting in early 2007 to start discussing the framework of the Eco-patent Commons.

[CSR newsclip] Business, Water and the World

Business, Water and the World

Geneva, 3 April 2007 - The issues associated with energy, climate change and development have long over-shadowed water in terms of government, business and media attention.

But it is precisely the growing importance of these three topics that has shed a new light on water. The inextricable links between water and energy, the water shortages associated with climate change, and the need for water in development have pushed water toward the top of the international agenda.

However, this attention has done little to sort out the water policy chaos. A few decades ago the delivery of safe water was widely seen as the responsibility of governments alone. More recently "privatization" was a unifying battle cry. Today water actors and activists have no common ideology, and seek new combinations of old approaches and new partnerships.

For 10 years WBCSD members have recognized water as a key factor in sustainable development. They first focused on how companies could better manage the water they used. Then they reported on ways to help communities manage water supplies and delivery "beyond the factory fence". Then they took on the bigger topic of water for the poor.

In 2005 the Water Project published Water Facts and Trends and Collaborative Action for Sustainable Water Management ( 1.9 MB), the latter offering guidance on what companies can actually achieve by working with others. These publications contributed to the growing debate at the international level about the importance of engaging with business to find solutions to the problem of water.

All of these publications inform, but the project members felt that they were not sufficiently engaging their business peers in dealing with the economic and business implications of water. So the Water Project embarked on a scenario process to understand and anticipate the future.

Two years of work ended in New York in October with the formal launch of Business in the World of Water: WBCSD water scenarios to 2025 ( 1 MB). The publication is also meant to help business understand that water is essential, and not just a maze of complex statistics.

The three "H2O" scenario stories each point to a different water challenge for business. The story of "H" (Hydro) is about the challenge of increasing water use efficiency as water becomes scarcer and more expensive, which provokes the business response of innovation.

The story of "2" (Rivers) relates to the challenge of water security and the business need to earn and maintain its social license to access the water it needs. The story of "O" concerns the challenges of interconnectivity and the multifaceted influences and impacts of water, which encourage a business role in water governance.

There is alternative energy, but no "alternative water". As the growing populations make heavier demands on water supplies, and as climate change upsets the world's water resources, water availability and security of supply will become ever-greater issues for everyone, including business.

In that context the WBCSD water scenarios provide the business community with a tool to think about its water practices and strategies, as well as a platform for structured dialogue with its stakeholders.

The challenge now is corporate action. The water project is encouraging such action by developing a water metrics tool to link external data with a company's water inventory, a complement to the water scenarios tool.

Armed with these new insights, the Water Project also intends to play a leading role in the growing topic of water governance. Whether through its own events or external ones such as the World Water Week in Stockholm, the goal of the project is to ensure that the key role of business is recognized and that governments and civil society meaningfully engage with business.

Topics including breaking out of past policy impasses, fair water allocation and privatization all need to be discussed thoroughly and constructively. A governance structure for more holistic water management has yet to be devised. Members of the WBCSD Water Project will lead discussions on this topic and continue to advocate the role of business with key stakeholders in the coming years.

In the meantime it is pleasing to see individual initiatives by WBCSD member companies popping up, such as a recent project by four members to improve water quality and availability through sanitation and other measures in developing nations.

These initiatives recognize that water issues are not just a huge problem but also a huge opportunity for individual companies. This is precisely where engaging in sustainable development, including water, can add value in the world of business.

Further information:

[Energy newsclip] Ethanol Demand driving surge in food prices

Demand driving surge in food prices

Greenwire, 9 April 2007 - The quest for biofuels is causing food prices to rise worldwide, which may cause a cataclysmic series of events that could stunt growth and cause distress in the developing world.

With prices for corn reaching $4 per bushel, the demand for crop-based fuels is creating what could be a long-term case of food-price inflation, putting added pressure on poorer nations like China and India that depend on those crops to feed their swelling populations.

Food-price inflation in Hungary is more than 13 percent per year, compared with just 3 percent in 2005. Prices are also up in developed countries like Germany and the United Kingdom.

Experts warn that the general inflation in food prices will extend beyond those crops used to make biofuels, raising the cost on everything from milk to cereal, forcing shoppers to curb their spending. The inflation could also have secondary effects on interest rates, stifling growth (Patrick Barta, Wall Street Journal [subscription required], April 9).

Foreign carmakers unsure about ethanol

Carmakers in Europe and Asia are not as excited about ethanol as their U.S. counterparts, admitting their development efforts are driven by pressure to embrace biofuels.

"We have not endorsed it as fully as the domestic companies have," said Mike Stanton, president of the Association of International Automobile Manufacturers. The association's members include the three major Japanese carmakers -- Toyota, Honda and Nissan -- as well as Renault of France and several other European manufacturers.

While the United States is throwing its weight behind ethanol and other biofuels as an alternative to oil, carmakers worldwide are putting a greater focus on electric and clean diesel technology.

Although some carmakers are coming out with ethanol-fueled models, Stanton said the initiatives were largely based on a fear that "we've got a train in front of us" (Bernard Simon, Financial Times [subscription required], April 8).

[CSR newsclip] Grasping the Geopolitics of Warming

Grasping the Geopolitics of Warming

IPS, 9 April 2007 - The Central Intelligence Agency, National Security Agency, the Pentagon and the Federal Bureau of Investigation should pool data and offer a comprehensive review of the national security threat posed by global warming, say U.S. Senators Dick Durbin and Chuck Hagel.

Last week, Durbin, an Illinois Democrat, and Hagel, a Republican from Nebraska, introduced bipartisan legislation that would require a National Intelligence Estimate (NIE) to assess the security threats posed by global climate change.

NIE's are the federal government's most authoritative reports on issues concerning national security and contain the coordinated judgments of all U.S. intelligence agencies regarding predictions of future events and contingencies.

"For years, too many of us have viewed global warming as simply an environmental or economic issue. We now need to consider it as a security concern," said Durbin.

"Many of the most severe effects of global warming are expected in regions where fragile governments are least capable of responding to them. Failing to recognise and plan for the geopolitical consequences of global warming would be a serious mistake," he said. "This intelligence assessment will guide policymakers in protecting our national security and averting potential international crises."

Both senators say an NIE is necessary to effectively compare and contrast the information gathered by different intelligence agencies and compile a comprehensive report on the possible geopolitical consequences of climate change.

Durbin and Hagel's bill, the Global Climate Change Security Oversight Act, would authorise the intelligence community to provide an estimate of the risks posed by climate change for countries and regions that are of economic or military interest to the United States, or that are at serious risk of humanitarian suffering.

Situations such as water scarcity, food shortages or flooding may exacerbate conflict along economic, ethnic or sectarian divisions and may lead to large displacements of people and mass migration.

The bill would empower the NIE to examine these issues in the context of the next 30 years, as well as funding additional research by the Department of Defence to examine the impact of climate change on military operations.

"This bipartisan legislation takes on an important emerging policy issue -- the impact of climate change on national security," said General Charles F. Wald, former deputy commander of Headquarters U.S. European Command. "I support its call for a National Intelligence Estimate of the topic and authorising the secretary of defence to conduct further research on the military impact of climate change."

In 2006, Pres. George W. Bush's National Security Strategy acknowledged that environmental issues pose a national and international security challenge.

The United Nations Security Council has also acknowledged the threats posed by global warming and put climate change on its agenda for the first time, warning that global warming could be a catalyst for conflict.

In 2003, Pentagon analysts Peter Schwartz and Doug Randall released a report that explored how an abrupt climate change scenario could potentially destabilise the geopolitical environment, leading to skirmishes, battles and even war due to resource constraints.

The study suggested that as tensions mount around resource shortages, nations with the resources to do so may build virtual fortresses around their countries, preserving their resources while other nations will engage in struggles for access to food, clean water or energy.

"...(T)he way forward is to responsibly address the issue of climate change with a national strategy that incorporates economic, environmental and energy priorities. These issues are inextricably linked and changes to one will affect the other two," said Hagel.

"Risk assessment is essential to putting our national resources in the places where they will be most effective. This is even more important when assessing risk to national security. This legislation will provide information we need to continue to help make our country secure in the years to come."

[CSR newsclip] Deforestation's effect on climate differs in North, South: study

Deforestation's effect on climate differs in North, South: study

AFP, 9 April 2007 - Planting new trees in snow-covered northern regions may actually contribute to global warming as they have the counter-effect of tropical forests, according to a study out Monday.

While rainforests help cool the planet by absorbing carbon dioxide and producing clouds that reflect sunlight, the dark canopy of Canadian, Scandinavian and Siberian forests catches sunrays that would be reflected back to space by the snow, the study said.

The study, published Monday in the online edition of the Proceedings of the National Academy of Sciences, found that reforestation projects in the tropics would help mitigate global warming, but such projects would be "counterproductive" in high latitudes.

In mid-latitude locations like the United States and most of Europe, more trees would only create marginal benefits for climate change, the researchers said.

"Our study shows that only tropical rainforests are strongly beneficial in helping slow down global warming," Govindasamy Bala, who led the research, said in a statement.

"It is a win-win situation in the tropics because trees in the tropics, in addition to absorbing carbon dioxide, promote convective clouds that help to cool the planet," he said.

"In other locations, the warming from the albedo effect (sunlight absorption) either cancels or exceeds the net cooling from the other two effects," said Bala, an atmospheric scientist at the Lawrence Livermore National Laboratory.

Researchers used a three-dimensional computer simulation to study the effects of large-scale deforestation and look at the positive and negative effects of tree cover at different latitudes.

"When it comes to rehabilitating forests to fight global warming, carbon dioxide might be only half of the story; we also have to account for whether they help to reflect sunlight by producing clouds, or help to absorb it by shading snowy tundra," said study co-author Ken Caldeira.

By 2100, forests in temperate and northern countries will make some places 10 degrees Farhenheit warmer that if the trees had not been there, the study said.

However, the authors did not endorse slashing down boreal forests as a measure against global warming.

"Preservation of ecosystems is a primary goal of preventing global warming, and the destruction of ecosystems to prevent global warming would be a counterproductive and perverse strategy," said Caldeira.

"In planning responses to global challenges, it is important to pursue broad goals and avoid narrow criteria that may lead to environmentally harmful consequences," said Caldeira, of the Carnegie Institution.

Bala added: "Forests provide natural habitat to plants and animals, preserve the biodiversity, produce economically valuable timber and firewood, protect watersheds and indirectly prevent ocean acidification."

Researchers from Stanford University in California and Universite Montpellier II in France contribute to the study.

[CSR newsclip] EU CO2 emissions on the rise in 2006

EU CO2 emissions on the rise in 2006, 8 April 2007 - Preliminary data for 2006 show an increase in CO2 emissions from participants in the European Emissions-Trading System (ETS), as the Commission seeks to avoid the over-allocation of pollution allowances which sent carbon prices crashing last year.

The preliminary figures for 2006 show that 93%, or about 9,000-10,000 heavy industrial plants covered by the scheme - now in its second year of operation - recorded a 1%-1.5% overall rise in emissions. However, the amount of carbon emitted was less than the quota of pollution allowances.

The Commission wants to avoid a repitition of last year's crash when lower-than-expected emissions data for the first year of the EU-ETS sent carbon prices crashing (EurActiv 2/05/06). The EU executive has since taken a tougher stance, rejecting the overly-generous limits set out in national allocation plans for the next trading period (2008-2012). Germany and Poland, which count among the EU's three largest polluters, saw their plans tightened by Brussels regulators over the past months (EurActiv 27/03/07EurActiv 12/2/07).

The ETS's credibility relies on creating a scarcity in the market for pollution allowances, which in turn leads to high carbon prices and incentives for companies to cut emissions.

The spot price of a tonne of carbon fell by about a quarter to €1 upon release of the news, however the Commission pointed to a rise in the future price of carbon for 2008 to €17 a tonne.

The Commission also announced on 2 April 2007 that it would accept Austria's national action plan (NAP) as long as it reduced its proposed amount of allowances by 6.4%. Austria is the 18th country to have its plan approved.

Environment Commissioner Stavros Dimas said: "The Commission is assessing all national plans in a consistent way to ensure equal treatment of member states and to create the necessary scarcity in the European carbon market. This is how we have assessed the plan decided today, and the same standards will be applied to all others."

Chris Davies, Liberal Democrat environment spokesman in the European Parliament, said that the rise in emissions is "disappointing, but hardly surprising...the operation of the EU emissions-trading scheme is a success but it will not start to bite until national caps on carbon emissions are firmly in place, and for that we must wait until 2008 at the earliest".

Full verified data for 2006 will not be published until 15 May, according to the Commission.

[CSR newsclip] Report sees 'climate divide' between rich and poor

Report sees 'climate divide' between rich and poor

SciDev.Net, 6 April 2007 - Up to 250 million people across Africa could be facing water shortages by the year 2020 as a result of global warming, and the output of water-fed agriculture could fall by 50 per cent during the same period, according to the latest international assessment of the impact of human-induced climate change.

The warning comes from the UN Intergovernmental Panel on Climate Change (IPCC), which says that developed countries aren't spending enough to limit the effects of climate change on developing countries ― making it harder for poor countries to deal with the impact of global warming.

In a report released on Friday (6 April) the IPCC's Working Group 2, which is responsible for monitoring the impacts of climate change impacts as well as adaptation and vulnerability issues, says that two-thirds of the atmospheric build-up of carbon dioxide comes from the United States and western Europe.

It says that rich nations far from the equator are spending billions of dollars to limit the risks to themselves, investing in new technologies such as wind-powered plants that turn seawater to drinking water, flood barriers, floating homes and genetically modified crops.

At the same time, however, the report points out that only tens of millions of dollars have been provided to vulnerable countries close to the equator, raising concerns of a growing 'climate divide' between wealthy and poor nations.

The IPCC report says that it has become increasingly clear that global precipitation is shifting away from the equator towards the poles. This will increase agricultural production in regions like Canada and Siberia, but leave drought-prone countries such as Malawi even shorter of water then they are at present.

The report cites obsolete meteorological data, a lack of irrigation, excessive dependence on single crops, vanishing forests, and land degradation as major challenges to African countries facing climate change.

Jacob Nkomoki, chief forecast officer at the Zambia Meteorology Department, says that some of the effects of climate change — such as widespread flooding — can only be reduced by equipping African meteorology departments with modern forecasting equipment, and setting up early warning systems.

Saleemul Huq, lead author of the report's chapter on adaptation, says that an increase in hurricanes, heat waves, floods and drought during the last decade of the 20th century provides strong evidence that climate change is occurring.

Climate change will have a particular impact on poor people who live in least developed countries, says Huq, with those living in small island developing states in Asia's vast river deltas and in most African nations being the most vulnerable.

Huq also points out that although a number of funds have been created to support adaptation in the poorer nations, the few hundred million dollars that have been pledged is only a tiny fraction of the tens of billions of dollars that are needed to allow poor countries to adapt adequately.

[CSR newsclip] US climate ruling opens long road to change: lawyers

US climate ruling opens long road to change: lawyers

AFP, 5 April 2007 - The US Supreme Court provided a strong goad in the fight against climate change by forcing the government to regulate greenhouse gases, lawyers said, but this will not change policy overnight.

"What the court did was essentially start a process," said Kevin Healy, a lawyer specializing in environmental issues. "Trust me, it would take 10 years for standards to be set" on harmful emissions, he added.

In a case led by Massachusetts on behalf of several other states and cities, the court ruled Monday that greenhouse gases are pollutants, and the federal Environmental Protection Agency (EPA) was wrong to refuse to regulate such emissions.

"The consequence of this will be to create pressure to get federal legislation that is coherent and comprehensive, and most importantly targeted to the emission of greenhouse gasses and the problems related to climate change," Healy said.

"The court has decided that ... a state has standing to sue at least the federal government on the basis of an action related to climate change."

The decision was welcomed by environmentalists as a milestone in fighting global warming. It dealt a blow to the administration of President George W. Bush, which refuses limits on US industry and gas-guzzling cars, arguing they could hurt the country's economy.

Josh Dorner, spokesman for the Sierra Club environmental group, said on Monday: It "sends a clear signal to the market that the future lies not in dirty, outdated technology of yesterday, but in clean energy solutions."

Democrat lawmakers who hold a majority of seats in Congress have also announced plans for a climate change bill for this summer.

"The potential for exposure to companies on climate change is another thing that is going to lead to pressure" on the federal government from companies to set emissions guidelines, Healy said.

The authorities will be forced to "issue some statutes that will allow companies the comfort of knowing what they should be doing."

Howard Fox, a lawyer for the environmental group Earthjustice, said other lawsuits were pending against EPA for its refusal to regulate emissions from electricity plants, which produce some 40 percent of US carbon dioxide emissions.

He added that the Supreme Court decision would help states such as California which must defend their own measures to fight climate change against challenges in the courts from industrial groups.

Elsewhere, an appeal is pending by eight states in a suit aiming to oblige five companies to reduce carbon dioxide (CO2) emissions from their electricity plants.

The prospect of individual plaintiffs bringing successful cases against companies remains a distant one, however, the observers said.

"That will have to wait another day," said Fox. "It really depends on what type of proof they can come up with."

"It's not at all clear to me that individual companies should bear the responsibility (for) the increase in CO2 that is the result of industrialized society," Healy said.

"I have my doubts as to whether those cases (by individuals) should be successful, but there is no doubt that they will be brought."

[Energy newsclip] Map reveals member states' solar energy potential

Map reveals member states' solar energy potential, 2 April 2007 - An interactive map allowing exact calculation of the solar electricity potential of any given location in Europe and its neighbouring regions will help determine each member state's share of solar power in the EU's overall 20% EU renewables target.

The Commission's in-house scientific service, the Directorate-General Joint Research Centre, has developed an interactive map allowing users to calculate the solar power potential of any location in Europe. The Photovoltaic Geographical Information System (PVGIS) , available online since 30 March 2007 also allows an on-line assessment of the electricity generation from photovoltaic systems in Europe, Africa and South-West Asia.

The PVGIS map shows that "an identical solar system will generate twice as much energy in sunny areas of Europe, such as Malta and Southern Spain, than in areas such as Scotland or Northern Scandinavia." Meanwhile, the first commercial concentrating solar power plant in Europe was inaugurated in Seville, a town in the southern Spain, on 30 March 2007.

In addition, the PVGIS provides up-to-date research information about the development of photovoltaic technology in general and figures on the share which solar energy represents of total national electricity consumption in each member state.

At the 2007 spring summit, European leaders agreed to meet 20% of their energy needs with renewables, such as solar, wind and hydro power, by 2020. According to the council conclusions, "differentiated national overall targets" should be derived from the overall 20% binding EU figure, "taking account of different national starting points and potentials, including the existing level of renewable energies and energy mix".

Major discussions ahead include how the 20% targets on renewable energies will be divided between member states. The PVGIS mapping service will play an important role in discussions determining the share of solar power targets for each member state. An EU directive on renewables is set to be published by the end of 2007.


EU official documents

Business and industry

[Energy newsclip] Solar 'competitive with coal' by 2010

Solar 'competitive with coal' by 2010

Environmental Finance, 5 April 2007 - The cost of the cheapest solar power could be on par with that of electricity from coal plants by 2010, according to Photon Consulting.

The Boston, Massachusetts-based firm predicts that solar electricity will cost $0.18/kWh in Germany, $0.13 in California and $0.12/kWh in Spain by 2010 – while industry leaders will be able to bring that latter price down to $0.10/kWh, equivalent to the retail cost of electricity from a new coal-fired power plant.

"These economics could quickly result in a very large market opportunity for solar energy," the company said, estimating that, by 2010, solar electricity will cost less than the retail electricity price for 50% of residential customer in OECD countries.

However, the study – The True Cost of Solar Power – suggests that the makers of solar photovoltaic systems are not likely to pass the full cost reductions through to customers, offering "an excellent opportunity to expand their earnings in the coming years".

"Prices for solar electricity [systems] in 2004 have become disconnected from costs. Because the demand is much greater than the supply, a reduction in cost will not automatically trickle down to the consumer," said Michael Rogol, one of the study's authors.

"This scenario will likely continue for several years, with solar prices remaining strong due to very large demand," he added.

The summary findings of the report can be found be clicking here

[CSR newsclip] Banks Get Ahead by Funding Sustainability Projects

Banks Get Ahead by Funding Sustainability Projects, 28 March 2007 - Banks that integrate environmental, social and governance concerns into their business strategy and seek out those opportunities make their businesses more valuable, according to a new report by the International Finance Corporation.

The IFC, the private sector arm of the World Bank Group, issued "Banking on Sustainability," providing practical examples of 14 financial institutions in 12 countries that have taken concrete steps to integrate sustainability into their policies, practices, products, and services.

"While detailing the evidence of potential benefits for banks in integrating sustainability into their business strategy, the report reveals a dramatic shift in banks' awareness of these benefits," said Rachel Kyte, IFC Director of Environment and Social Development.

In a 2005 IFC survey, 86 percent of 120 financial institutions interviewed reported positive changes as a result of steps they had taken to integrate social and environmental issues in their business.

"There are real opportunities for banks in reaching previously unserved segments of the market, including women entrepreneurs or energy efficiency projects," said Jyrki Koskelo, IFC Director for Global Financial Markets. "The publication provides a tool for banks to recognize these opportunities."

The report shows how 14 financial institutions developed innovative financial products to expand their business into areas related to social and environmental sustainability and how their businesses were positively impacted by doing so.

Some of the examples included in the report are: Ceska Sporitelna, a bank in the Czech Republic that is leading the way in commercial financing for sustainable energy projects; Afriland First Bank, an African bank that is providing loans for environmental improvements in waste collection and treatment as well as microfinance for rural communities and women; and Nedbank, the first African bank to publish a sustainability report and adopt the Equator Principles.

The full report is available for download from the
IFC website .

[CSR newsclip] Offsetting emissions – The carbon con?

Offsetting emissions – The carbon con?

Ethical Corporation, 26 March 2005 - It is now the done thing for climate-conscious companies and consumers, but carbon offsetting is by no means straightforward and its effectiveness is far from certain. A romantic trip to Barbados would probably make most Londoners' Valentine's Day. And now couples can enjoy their visit to the Caribbean with consciences as clean as the water washing tropical beaches. Why? Because just £14 buys something very special – a holiday that promises not to harm the planet.

The company behind this attractive proposition is the UK firm Climate Care, which for relatively small sums enables people to offset the environmental damage of energy-intensive activities by funding clean-energy projects around the world. It prices carbon offsets, or "voluntary emissions reductions", for a single passenger's return flight from Heathrow to Barbados at just £14.16.

This is carbon offsetting. Of all the possible solutions to climate change none is perhaps more desirable, or less well understood.

The confusion is not without good reason. The market for offsets is highly fragmented, with prices ranging wildly from as little as $1 to about $20 per tonne of carbon dioxide. Firms dealing in offsets in the UK, the global centre for trading "carbon credits", have grown in number by 60% a year since 2002. And these firms support a bewildering array of projects, from planting trees in Tanzania to building hydroelectricity plants in Bulgaria.

Price differences are less extreme in the compliance market for carbon offsets, where governments and companies trade carbon credits, or Compulsory Emissions Reductions, to meet emissions reductions targets under the Kyoto Protocol or the European Union's Emissions Trading Scheme. CERs account for the vast majority of offsets purchased worldwide, whose total value was $2.7 billion in 2005 according to World Bank estimates, and the market is growing quickly.

The environmental argument for carbon offsetting is that it makes more sense to cut emissions where it is cheapest and easiest to do so – usually in developing countries. But concerns have been raised over the effectiveness of carbon offsetting as a way of tackling climate change.

For many campaigners, offsetting is flawed in principle since it gives the impression that people in rich countries need not change their lifestyles to halt global warming. A serious objection concerns the effectiveness of the voluntary offsetting market, whose lack of regulation or standards makes it far from clear whether offsets are actually having the desired effect.

The compliance market's governing framework, the Clean Development Mechanism, is considered overly bureaucratic, with emissions reductions outweighed by high transaction costs.

These limits were exposed last year when it was revealed that plans to offset emissions from the 2005 G8 summit backfired. The installation of energy-saving light bulbs and fuel-efficient stoves in properties in Cape Town, South Africa, left the local council £17,000 in debt because of the spiralling costs of auditors employed to monitor the project on behalf of the CDM.

Reasons to be neutral

Despite embarrassments like this, going carbon neutral is fast becoming the environmental fashion for companies. For Kirsty Clough, climate change policy officer at WWF UK, "carbon neutral is the ultimate green claim".

"Zero carbon" companies gain the reputational benefits of being seen to be green. Offsetting also offers them the experience of working with a shadow price for carbon, in preparation for future regulation. But companies should not make these claims lightly, says Clough. "It should really be the responsibility of companies to prove that the offsets they are buying are credible and actually have environmental worth."

Mike Childs, head of campaigns at Friends of the Earth, suspects that carbon offsetting is allowing companies to appear green while providing little incentive to change their, or their consumers', behaviour. "I think it's being used as greenwash," he says. He accuses energy companies and airlines, such as BP and British Airways, of being the loudest advocates of consumer carbon offsetting, as these industries stand to lose most from more environmentally friendly behaviour.

Childs is worried that offsets do not reduce emissions. He compares the planet to a running bath, full almost to the brim with carbon dioxide. To offset carbon dioxide emissions, by analogy, is to say: "I won't turn off my tap. I'll let someone else turn off their tap." The reality, he says, is that we need to turn off both.

Pablo Ceppi, strategy manager at the Carbon Trust, a UK group advising businesses on how to tackle climate change, says: "If a company wants to go carbon neutral they need to first look into their direct emissions, then look into their indirect emissions and then offset."

Francis Sullivan, environment adviser at HSBC, agrees that carbon offsetting should compliment other corporate strategies to reduce emissions, saying: "More and more companies are seeing this as a logical extension of their environmental management systems."

Sullivan says anyone who thinks companies regard offsets as the answer to reducing carbon emissions is mistaken. The reason is simple: offsets are a permanent cost for a business, whereas energy efficiency measures are a permanent saving. HSBC spends ten times more money (about $50 million a year) on energy-efficiency measures than it puts into offsets.

BSkyB exemplifies this structured approach to reducing a carbon footprint. The broadcaster's head of environment, Fiona Ball, stresses that offsetting is just part of the company's broader strategy to reduce emissions.

In May last year BSkyB became the world's first media company to go carbon neutral. But before then the company was already buying 100% green or renewable energy in England and Wales. "We offset what are currently unavoidable emissions," says Ball. Nor does she consider offsetting a long-term solution: "In time we want to reduce our reliance on offsets."

The great unknown

Companies wanting to go carbon neutral are advised to buy good quality offsets. But this is easier said than done. Just as the price of voluntary offsets varies hugely, so does the extent of the environmental improvements they deliver.

Many projects are still not externally verified. Some offsetters have no way of guaranteeing the reductions achieved by a project are in fact additional to energy savings that would have happened without the project taking place. And the selling of a single credit two or three times to different buyers – a process known as double counting – is not uncommon.

Jasmine Hyman, spokesperson for the Gold Standard certification of offsetting projects, says: "The voluntary market is a no-man's land." Companies need to know what they are venturing into.

Very serious doubts surround the pet choice of many carbon offsetters: tree planting. Extremely popular a few years ago, largely for its symbolic rather than environmental value, many offsetters are now moving away from forestry as their primary means of investing in carbon credits.

The Carbon Neutral Company, the UK's largest offsetter, which began as Future Forests, typifies this switch. Forestry accounted for 100% of its portfolio two years ago. Now it makes up just 20%.

Trees act as "carbon sinks", locking in carbon dioxide they absorb from the atmosphere – a process known as sequestration. But trees are also vulnerable to destruction and decay – something the band Coldplay learned recently when most of the trees on a mango plantation in India they were supporting, to offset emissions from their on-tour flights, died.

Jonathan Shopley, chief executive of the Carbon Neutral Company, defends his company's decision to continue investing in forestry. Destruction of ecosystems accounts for about a fifth of carbon dioxide emissions worldwide, he says.

This means "a carbon portfolio that commits about 20% to 25% of its offsets to sequestration is a good balance". He also expects that within two years there will be insurance instruments in the voluntary offset market to guarantee the permanence of forestry sequestration projects.

Proving your worth

An even greater challenge for buyers of offsets, in forestry and other clean energy projects alike, is proving that the project could not have happened without their investment. For credits in clean energy projects to count as offsets, buyers must show energy savings made are additional to those under a "business as usual" scenario – a concept known as "additionality".

But for this seemingly defining feature of carbon offsets there is surprisingly little definition of what additionality actually is. The criteria accepted as a basis for project additionality under the CDM are: it is not required by current regulation; it uses technologies that are not common practice; or it faces economic, technological or investment barriers and therefore needs offset money to start up.

To establish project additionality, developers and offset buyers must set a baseline from which to predict emissions that would occur were the project not to go ahead. To answer this essentially counter-factual question there are 60 approved methodologies for the CDM market alone. The difference between the baseline and the forecasted emissions from the proposed clean energy project will, in theory, establish the additional emissions reductions it will make.

A lack of standardised methodologies afflicts all aspects of the offset market. Many offsetting firms work to their own proprietary standards, most but not all of which are verified by a third party. An emerging favourite of campaigners is the Gold Standard, a Swiss certification scheme devised by 43 environmental NGOs and launched in 2003.

There are currently 60 projects in the Gold Standard pipeline, which admits only energy reduction or energy efficiency projects and requires high levels of community engagement from project developers to promote sustainable development.

Hyman says the Gold Standard is "like an organic label in a supermarket". Its premium is increasingly popular in the voluntary market, where clients are beginning to demand greater assurance their offsets are of a good quality.

Room to manoeuvre

The UK government's decision to introduce a code of practice for voluntary offsetters, announced in January by environment secretary David Miliband, responds to concerns over the sector's lack of transparency. The voluntary code, which is the first of its kind in the world, will ask offsetters to provide clients with clear information and transparent prices for offsets.

These principles are welcome for campaigners and offset firms. But both are worried the new standards, if based on the terms of certified carbon credits under the CDM, may threaten the flexibility of the current voluntary market. Voluntary offsets, they argue, have a precious record of channelling money into small projects the compliance market fails to reach.

Voluntary offsets typically go towards small-scale, local community-based renewable energy projects, says Shopley. These are exactly the sorts of projects the high transaction costs of compliance with the CDM would rule out. CDM projects can also only take place in countries where "designated official entities" (DOEs) have been established to monitor energy reduction projects. India, China and Brazil all have DOEs. But many other less developed countries such as Thailand, and the majority of sub-Saharan Africa, do not.

WWF's Kirsty Clough explains: "At the moment the CDM is very much dominated by projects in Asia, particularly in China because they have the infrastructure in place to do so." She is concerned that the preference on the compliance market is for gas-abatement projects, such as the destruction of HFC 23, which are flooding the market with cheap carbon credits. "They might undermine the renewable energy or energy efficiency projects that are more expensive but in the long term move us down a more low-carbon trajectory," she says.

Mike Mason, founder of Climate Care, says voluntary offsets can succeed where the CDM currently fails. He believes the voluntary offsets market needs to be regulated because "it is too difficult for consumers to work out what's what".

But this should be done in a way that does not discourage risk-taking of the sort impossible for projects funded through the CDM. "We have to reach the parts that CDM doesn't reach. We have to be pioneers," says Mason. He adds: "We should be able to take well-intentioned risks, and occasionally get it wrong."

Getting it wrong appears to be all too easy when it comes to carbon offsetting. But as the offset market continues to mature, and its standards become more established, the quality of offsets available should increase. Yet, ultimately, the process of offsetting is not foolproof. Nor is it the answer to climate change, which can be more effectively tackled by companies and individuals first changing their behaviour.

In years ahead, funding for renewable energy projects should come increasingly from mainstream investment funds, not offsets. But for individual consumers, the idea of flying to a place in the sun without damaging the planet is unlikely to lose its appeal.

Useful links:

Carbon calculating – it all adds up

A tonne of CO2 is emitted when you:
· fly 2,000 miles in an aeroplane.
· drive 1,300 miles in a large SUV.
· drive 1,900 miles in a mid-sized car.
· drive 6,000 miles in a hybrid car.
· run an average US household for 60 days.
· run your computer for 10,600 hours.
· graze a Ugandan dairy cow for eight months.

Average CO2 emissions per year:
· 4.5 tonnes for the average US car.
· 4.5 tonnes for the average global citizen.
· 6.2 tonnes for electricity use of the average US household.
· 21 tonnes for the average US resident.
· 1.5 million tonnes for a 500MW gas power plant.
· 8.3 million tonnes for an older 1,000MW coal power plant.
· 6 billion tonnes for the US as a whole.
· >25 billion tonnes for the planet as a whole.

Source: A Consumer's Guide to Retail Carbon Offset Providers, Clean Air-Cool Planet, 2006

CDM explained

The Clean Development Mechanism is one of three "flexible mechanisms" to reduce carbon dioxide emissions established under the Kyoto Protocol, the others being Joint Implementation and Emissions Trading.

Under the convention, so-called Annex 1 countries (most of the nations of Europe) have agreed to reduce carbon dioxide emissions to an overall 5% below 1990 levels between 2008 and 2012. Clean energy projects meeting the terms of the CDM are issued carbon credits, or "Certified Emissions Reductions", which Annex 1 governments and companies can buy to meet their emission reductions targets under the protocol. These can then be traded on the carbon futures market, or under the European Union's emissions trading scheme.

The Kyoto Protocol now covers 169 countries and 55% of global greenhouse gas emissions, although critics argue the failure of the US to ratify its terms has left the convention hamstrung.

Carbon market forecast: trade is booming

One way for companies to reduce their carbon dioxide emissions is to join voluntary emissions trading schemes such as the Chicago Climate Exchange (CCX).

DuPont, Ford and Motorola are among 210 CCX members committed to offset 6% of their total emissions by 2010. This means the CCX represents a significant volume of global trade in carbon.

Its independent European sister company, the European Climate Exchange (ECX), provides futures contracts and options contracts to companies trading carbon under the European Union's Emissions Trading Scheme.

Benefits of neutrality

In May 2006 BSkyB became the world's first media company to go carbon neutral. The company offsets its annual carbon dioxide emissions of 41,000 tonnes by funding a New Zealand wind farm and Bulgarian hydroelectric project – for a combined cost of just £350,000. Both offsets are made through The Carbon Neutral Company.

Now BSkyB is taking the message to consumers. It is currently running trials giving 6,000 customers energy-efficient light bulbs to offset emissions from set-top boxes.
All set to offset

Companies in energy-intensive industries are leading the way on encouraging consumers to reduce their carbon footprints. Last year BP launched targetneutral – a website where drivers can calculate then pay to offset their emissions from driving. This followed a similar initiative from Ford who launched Greener Miles, an online consumer carbon calculator and offsetting facility with US offsetting firm TerraPass.

Meanwhile, British Airways last year started giving customers the option to offset carbon emissions from their flights via UK offsetting firm Climate Care. Yet campaigners have criticised the wisdom of a plan that has registered interest from just 0.5% of passengers.

Virgin Atlantic is set to follow BA's example as soon as this month. It is rumoured the scheme could be "opt-out", as opposed to "opt-in", to improve uptake of customers purchasing offsets

[CSR newsclip] Climate change set to worsen health burden: draft UN report

Climate change set to worsen health burden: draft UN report

AFP, 2 April 2007 - Malaria, cholera, malnutrition, heatstroke and pollen allergies are just a few of the health problems set to worsen because of global warming, according to a report prepared by UN climate experts meeting here.

Climate change has already extended the range of mosquitoes and ticks, helped spread diarrhoeal disease, boosted the length and location of pollen seasons and pumped up the intensity of dangerous heatwaves, says the report.

In the coming decades, such problems are likely to amplify and for many people, hunger and poor nutrition will be added to the mix, it says.

"Adverse health impacts will be greatest in low-income countries," says the report. "Those at greater risk include, in all countries, the urban poor, the elderly and children, traditional societies, subsistence farmers and coastal population."

The 1,400-page document is due to be issued on Friday by the Intergovernmental Panel on Climate Change (IPCC), the top UN scientific authority on global warming and its impacts.

It is part of the fourth assessment report by the IPCC since it was founded in 1988 to inform policymakers about man-made climate change. The previous report was in 2001.

A final draft of the report points out that human health can be affected in subtle and sometimes poorly perceptible ways by climate change.

For instance, if food production is hit by drought or flooding, that in turn affects nutrition -- or may prompt a rural exodus that boosts the population of shanty towns, where overcrowding and communicable disease can be rife.

A study of the heatwave that struck Western Europe in 2003 found that nearly a third of Switzerland's excess mortality came from ground-level ozone -- the pollution caused by a reaction between sunlight and traffic exhausts, which can be dangerous for people with respiratory or cardiac problems.

In some cases, says the report, climate change may be positive. In northerly latitudes, winters will become shorter and milder, easing the risk to poor and elderly people of cold waves.

But overall, the outcome will be "overwhelmingly negative", hitting most of all poor tropical countries with water stress, poor sanitation and shaky medical infrastructure.

One study cited in the report projects that the number of people at risk of hunger in the Sahel country of Mali will roughly double, from 34 percent today to between 64-72 percent in the 2050s, if nothing is done to help the population adapt to the threat.

The report puts the spotlight on populations in these areas:

-- COASTAL AND LOW-LYING AREAS: A quarter of the world's six billion people lives within 100 kilometres (62 miles) distance and 100 metres (325 feet) elevation of the coastline.

Depending on the levels of carbon pollution in the atmosphere, these areas are at risk from rising sea levels, more powerful storms, coastal flooding, damage to fisheries and saltwater intrusion into freshwater resources.

According to one estimate, nearly five percent of the population of Bangladesh could face inundation if temperatures rise 2 C (3.8 F), the sea level increases 30 centimetres (12 inches) and monsoon rainfall rises 18 percent, which are middle-of-the-range estimates.

This could increase to 57 percent of the population in a computer model of a high-range 4 C (7.2 F) temperature increase, a 100-cm (40-inch) rise in sea level and a 33 percent increase in monsoon precipitation.

-- MOUNTAIN REGIONS: Glaciers are in rapid retreat in the Himalayas, Greenland, the European Alps, the Andes and East Africa, causing for some populations the future risk of water insecurity. Nearly a quarter of China's population, for instance, lives in western regions where glacial melt provides the main water source in the dry season.

A warmer climate will enable mosquitoes to live at altitudes that previously were too cold, while more extreme rainfall will boost the number of floods and landslides.

-- POLAR REGIONS: Indigenous peoples who comprise roughly 10 percent of the circumpolar population are "particularly vulnerable" to climate change, both in threats to their habitat and their lifestyle. Warmer temperatures will increase the range of disease-bearing wildlife and badly affect traditional nutrition because of changes in animal migration and distribution.

[CSR newsclip] Can Green Consumers Make a Difference?

Can Green Consumers Make a Difference?

GLOBE-Net, 28 March 2007 - Can the actions of the individual consumer, multiplied many times over, change how the goods we use in our everyday lives are produced? An increasing number of people are choosing to buy products and services that have positive environmental and social impacts, and their purchases are feeding a growing green marketplace. How much of an impact will green purchasing have on tomorrow's consumer marketplace? EPIC, The recent "Sustainable Living Expo" produced by the GLOBE Foundation, provided some insights to that question.

EPIC was a first in Canada, bringing together consumers and suppliers of green products and services spanning a wide array of lifestyle sectors, including food, fashion, home design, personal transportation, travel, investing, recycling and communications, all designed to leave a softer footprint on the earth. Live presentations on sustainable living, eco-fashion shows, and the slideshow from "An Inconvenient Truth", drew large crowds to the EPIC Main Stage throughout the event.

While EPIC was a celebration of environmentally friendly products and services that could allow shoppers to feel good about their purchases, a more fundamental level of concern motivated the 12,000 visitors participants.

Environmental issues are in the public spotlight as never before seen. Concern over climate change, the degradation of our ecosystems, and rising levels of pollution is at an all time high. In response, many are advocating government policy changes, tighter regulatory controls and more environmentally friendly products and production processes. The number of people becoming more active in promoting change is also on the rise.

But another less obvious, but potentially more powerful level of activism, arises from people that simply exercise the power of choice in terms of the products and services they buy. By using their purchasing power to support sustainability, consumers are bringing about positive environmental and social changes in the marketplace.

Even simple choices such as buying recycled paper products, selecting biodegradable dishwashing soap, or purchasing organic food and clothing, can make a difference. It can extend to purchasing renewable energy for your home, buying a fuel-efficient car, or extensive renovations or upgrades to your home, such as installing heat pumps or solar panels.

Today's green consumer movement is part of a trend that gained traction during the early 1990s, when the term 'sustainable development' was coined. The number of products made from recycled or recyclable content began to rise and 'organic' or 'natural' became buzzwords in local supermarkets.

Since then there has been an expansion in the products and services that identify themselves as 'sustainable' and the choices available for recycled, organic, or environmentally sensitive goods has become wider and easier to make. In the past few years the market for 'green' products has leapt forward once again, galvanized by increased public awareness and concern about the environment.

Green consumers exist, and they are growing in numbers, and their purchasing preferences have led to a host of companies developing sustainable product lines. No longer distinguished by a lack of style or a literally 'green' appearance, environmentally and socially friendly products now boast the same desirable features as conventional goods, with the added bonus of being ethically attractive.

Cotton Ginny, Patagonia, Mountain Equipment Co-op, and LUSH are just some of the many leading brands that have launched sustainable product lines, and there are many more small companies that are basing their identity on providing environmental and social benefits with their business.

Influencing change in the marketplace

The question remains - can those simple choices, such as buying an organic cotton t-shirt or using energy efficient compact fluorescent light bulbs, have a long term environmental and social impact? Is buying environmentally and socially friendly products really going to save the planet?

Perhaps not single-handedly, but as a component of an overall shift towards a more sustainable society, the power of green spending is considerable. Individual purchasing decisions are strengthened by numbers, and in turn influence the marketplace. As Pierre Millette of Toyota Canada noted in his presentation at the EPIC Main Stage, lasting environmental change will require "Technology plus lifestyle choices."

Take paper, for instance. Recycled paper uses 55% less water and up to 70% less energy to produce than paper from virgin pulp. Each pack of paper a person buys for use with their home computer carries an environmental and social price, and each individual choice to buy recycled can have a huge cumulative impact. On average, every ton of post-consumer paper waste recycled leaves 17 trees standing and conserves 7,000 gallons of water.

Energy-efficient and water-saving devices for the home are other areas where consumer actions can have a huge impact. For example, compact fluorescent light bulbs use 80% less energy than incandescent bulbs and last up to ten times as long. Front-loading clothes washers use less energy and 40% less water than top-loading machines, while efficient dishwashers use less energy and around half as much water per cycle as others.

Peter Robinson, CEO of Mountain Equipment Co-op (MEC), made the case for organic and sustainable clothing during his presentation. "25% of chemicals produced worldwide are used for textiles," he said, adding that finishing of textiles generates high quantities of waste water while consuming large amounts of energy.

In response, partly due to customer interest and advocacy, MEC has developed organic products, polyester recycling programs, and is constantly seeking product innovation that both improves design and enhances environmental sustainability.

In today's highly competitive marketplace, companies listen to their customers. They are constantly surveying, tracking buying habits, and trying to determine what customers want. And if the people speak, not just with their words but with their actions and with their dollars, companies will react.

If a company's line of recycled paper products outsells its conventional product line, it will shift towards more recycled fibre. If organic cotton shirts start flying off the shelves, more retailers will seek out these products

Already such products are increasing in availability, but they still represent a small niche of the overall market. Organic foods, for example, represent around 2.5% of the entire food market- a relatively small component, but one that is growing fast.

The true test of the power of the green consumer will come over the next decade, as the movement for sustainable products and services moves more completely into the mainstream marketplace and extends to a wider array of products and services.

If consumers make sustainable choices consistently, the nature of some products may change forever. For example, all computer paper used in North America could be feasibly supplied by recycled paper or alternative fibres such as flax. If people maintain a commitment to buy recycled whenever possible, that could become a reality.

But making such changes will not be easy for everyone. It involves making positive purchasing choices, selecting environmentally and socially friendly options of many every day goods.

In the short term, it may also mean screening out goods that are environmentally negative. If a store doesn't carry biodegradable soap or recycled paper towels, perhaps the best choice is to delay that purchase until sustainable choices can be found – or better yet, ask the store manager why they don't provide those options.

In the long term, if enough people make that simple choice consistently, there will be environmentally friendly options in every store, for virtually any type of good. Many green products are already cost-competitive with conventional goods, and those that are more expensive will begin to come down in price as they become more popular.

This will encourage sustainable purchasing even among those that are not committed environmentalists. Some consumers are willing to sacrifice for their beliefs, but for others, green products will only become successful when they match conventional goods for quality and features. As Toyota's Pierre Millette noted, "Our market research tells us people are willing to buy an environmentally friendly vehicle…but only if all other factors are equal!"

Companies are responding to this, and savvy consumers can save money, protect the environment, and own products that are both stylish and ethically sound.

Many would point out that consumption of material goods and energy is a major cause of the pressures we exert on the natural world, and that we can't 'buy our way out of it'. It can be argued that the best response for the environment is to reduce consumption.

While reduced consumption may be desirable, we must face the fact that in our society the lifestyles we enjoy require large inputs of natural resources and raw materials. Given this, the exercise of positive consumer choices in favour of those goods which have the lightest environmental footprint becomes important not only for continued quality of life and improved health, but also for the lasting preservation of the natural world.

Certainly there are other aspects to the environmental challenges facing the planet. Government policies and scientific innovation will be required to make the changes necessary to make our society sustainable. But individual consumers, by exercising choice and making simple commitments to buying environmentally friendly goods, can help drive these changes, reduce their own environmental impact, and more tightly link economic and environmental prosperity.

They literally can help save the planet, one purchase at a time.

EPIC: The Sustainable Living Expo, held its first show this March 16-18 in Vancouver, Canada, bringing over 12,000 people together to learn about and purchase sustainable products.

If you missed EPIC, take a look at the hundreds of exhibitors and new products, featured presentations and sustainable inspiration that took place at our 2007 event at .

[CSR newsclip] European Union officials devising a new strategy on helping poor countries boost their share of world trade have warned that it must contain concrete measures for reducing poverty.

'Trade Must Cut Poverty'

IPS, 23 March 2007 - European Union officials devising a new strategy on helping poor countries boost their share of world trade have warned that it must contain concrete measures for reducing poverty.

In October last year, EU governments decided to prepare plans for spending 2 billion euros (2.6 billion dollars) a year in 'aid for trade' by 2010. The aid is intended to address the marginalisation of the world's poorest countries, who have seen the proportion of international trade that they hold fall from two percent to one percent over the past four decades.

The officials tasked with drawing up the EU's strategy have complained that key international recommendations on aid for trade have paid little attention to the need for poverty alleviation. A World Trade Organisation report on the subject last year was "relatively quiet" on linking such aid with poverty, the officials noted.

The officials' comments are contained in an internal paper for the EU's executive arm, the European Commission.

It is essential, they say, that a "deeper reflection" on using trade-related assistance to reduce poverty is undertaken by the Commission and the Union's governments. Special attention should be paid to addressing gender inequality, to improving working conditions and to promoting voluntary 'fair trade' initiatives.

The Organisation for Economic Cooperation and Development (OECD, a grouping of 30 rich countries) recently called into question the effectiveness of aid for trade.

Experience has shown that this aid can rely too much on advice from external consultants, without enough input from people actually living in poor countries, the OECD said. As a result, there is "relatively little thinking" about the underlying reasons why poor countries have a tiny share of international trade and how financial assistance can help remedy the situation.

Paul Goodison from the European Research Office, which monitors the EU's activities in developing countries, said that the aid for trade schemes funded by the Commission in Southern Africa do not inspire confidence.

"The projects put in place have been a disaster," he told IPS. "This has a lot to do with the way big contracting companies are recruited for the projects and how the EU's people are not in any way connected with what's going on."

After the EU signed a free trade agreement with South Africa in 1999, it decided to help a number of schemes in Botswana, Lesotho, Namibia and Swaziland. As these four countries belonged to a customs union with South Africa, the free trade agreement effectively applied to them, too.

Case studies by the European Research Office have found that many of the aid for trade projects concerned have suffered from lengthy delays.

In 2002, the Commission committed itself to a 5.6 million euro (7.5 million dollars) fiscal restructuring programme in Swaziland.

One of the main objectives of this project was to reduce the Swazi economy's heavy reliance on custom receipts, as these were predicted to decrease substantially. Yet when the project was completed in June last year, the level of dependence on customs had risen from 54 percent of government revenue in 2004-05 to 62 percent in 2006.

Meanwhile, a system for collecting value added taxes intended to be formed by this year was found to be off target and is not expected to be set up until 2009.

"Most trade adjustments need to be implemented quickly," said Goodison. "But the EU's timeframe for delivering support can be far too long."

EU governments have stated that African, Caribbean and Pacific (ACP) countries will be among the main recipients of aid for trade. Seventy-five ACP countries are negotiating free trade deals known as Economic Partnership Agreements (EPAs) with the Commission.

But some assessments conclude that the amounts being considered by the EU will fall far short of needs.

The Commonwealth Secretariat has estimated that the cost of compensating ACP countries for the agreements will come to more than 9 billion euros (12 billion dollars). These costs will arise from falling receipts for tariffs imposed on imports and the adverse affects on employment and production from market liberalisation.

Some campaigners have asked for assurances that aid for trade will not be at the expense of other forms of development assistance, and should not be used as a tool to pressure ACP countries into signing accords that may run counter to their own interests.

"The European Commission has said that a significant proportion of aid for trade will be directed to African, Caribbean and Pacific countries, which -- if it's really new money -- will be welcomed," said Sophie Powell, trade policy adviser with the organisation Traidcraft.

"However, the benefits would be seriously undermined if the Commission shackles its generosity with conditions such as making the ACP sign the highly controversial Economic Partnership Agreements. Using the promise of additional money as leverage to force some of the world's poorest countries to open their markets to EU goods and companies is cynical in the extreme."

The EU's only directly elected institution, the European Parliament, is urging that increased aid for trade should be given to the ACP countries, regardless of whether they sign the accords.

In a new report for the Parliament's international trade committee, the British Socialist MEP David Martin calls on the Commission and the Union's governments to specify how much aid for trade will be available to ACP states before the EPA talks conclude.

Greater clarity is necessary, he contends, to allow the ACP negotiators anticipate how much they will receive to cushion the blow from trade liberalisation and to allay suspicions that the EU is keener to promote its own interests than those of the poor.

"This would help to bring the development dimension of EPAs, which has been hitherto conspicuous by its absence, back to the fore," he said.

[CSR newsclip] Save forests to fight global warming: Stern

Save forests to fight global warming: Stern

AFP, 23 March 2007 - The world should invest 10 billion dollars annually to halve deforestation in the fight against global warming, Nicholas Stern, the author of a key climate change report, said Friday.

Forest clearance for farming or urban development released large amounts of the greenhouses gases blamed for climate change, he told reporters at a meeting in Indonesia's capital, Jakarta.

"The world has to work together to provide a strong fund to cut deforestation in Indonesia, Brazil and other countries," he said.

In a landmark report commissioned by the British government, Stern warned last year that climate change could bring economic disaster on the scale of the world wars and the 1930s' Great Depression unless urgent action was taken.

"The cost of action, strong and urgent action, will be very much less than the cost of inaction," he said in Jakarta.

"If we do nothing, if we go on with business as usual, we will eventually derail growth and development."

Rich nations had a powerful interest in helping to preserve forest cover because they would also be affected by global warming, he said.

"The money is not charity -- it's investing in a future of which they will be the big beneficiaries," said Stern, who is due to visit Indonesia's Sumatra island to see the problem of deforestation close up.

Experts say Indonesia has about two percent of the world's forest area but is losing large amounts of it annually, which releases carbon dioxide and makes the country one of the world's largest greenhouse gases polluters.

The 10 billion dollar global fund could be used to provide compensation to discourage forest clearance, Mike Harrison, an expert from Britain's Department for International Development, told AFP.

The money could also be given to national parks to conserve forests and some could be used to fund forest concessions, he said.

The UN Food and Agriculture Organisation said this month that forests were expanding in several regions of the world, but that each day saw a net loss equivalent to an area twice the size of Paris.

Global forest covers about 30 percent of the world's land area. From 1990 to 2005, the world lost three percent of its total forest area, according to the organisation.

Ten countries account for 80 percent of the world's primary forests, of which Indonesia, Mexico, Papua New Guinea and Brazil saw the highest losses in the five years from 2000 to 2005, it said.

The IPCC, the United Nations' paramount scientific authority on global warming, has predicted the Earth's surface temperatures will rise between 1.8 and 4.0 degrees Celsius (3.2 and 7.2 degrees Fahrenheit) by 2100.

[CSR newsclip] 'Base of the Pyramid' Holds Key to $5 Trillion Market

'Base of the Pyramid' Holds Key to $5 Trillion Market, 23 March 2007 - Four billion people who live in relative poverty represent a $5 trillion market, according to a new report released by the International Finance Corporation and World Resources Institute.

The report, "
The Next 4 Billion: Market Size and Business Strategy at the Base of the Pyramid," offers a first-of-its-kind measure of the size of markets at the base of the economic pyramid using income and expenditure data from household surveys. Coupled with the survey information is an overview of business strategies that have succeeded for companies working in these markets.

In its geographic analysis, The Next 4 Billion finds the following global BOP numbers:

  • The Asian BOP market (including the Middle East) is by far the largest, with 2.86 billion people and a total income of $3.47 trillion, constituting 83 percent of the region's total population and 42 percent of the its aggregate purchasing power.
  • Eastern Europe's $458 billion BOP market includes 254 million people, 64 percent of the region's population, with 36 percent of aggregate purchasing power.
  • In Latin America the BOP market of $509 billion includes 360 million people, representing 70 percent of the region's population but only 28 percent of aggregate purchasing power, a smaller share than in other developing regions.
  • In Africa, the BOP market is $429 billion, but it represents 71 percent of aggregate purchasing power in this region. The African BOP includes 486 million people -- 95 percent of the region's surveyed population.
In studying the economic situations of the world's population, the authors found that base of the pyramid markets are often rural, underserved, and dominated by the informal economy, and as a result are relatively inefficient and uncompetitive. And these BOP markets, made up of people who on average earn less than US$3,000 per year, often run into a "Bottom of the Pyramid Penalty." Poorer people often have access only to goods that are more expensive than they can afford, or are very low-quality goods. The report seeks to help businesses think more creatively about new business models that meet the needs of these markets, and suggests the mobile phone industry is one that has shown how profitable these markets can become.

Professor C.K. Prahalad, who originated the "base of the pyramid" concept, said the mobile phone industry succeeded in "cracking the BOP code." Over 2.5 billion people now have access to the phones because of industry innovations like pre-paid phone cards, which gives them access to the service regardless of income.

Prahalad believes these examples are just the beginning. He told the
WorldWatch Institute , "There is an opportunity here, but it's not yet fully understood.... This is all about imagining the world differently. If we can not imagine a different world, we cannot create it."

"The report backs up the calls for broader business engagement with the base of the pyramid, stressing the need for the private sector to play a greater role in development," said IFC Chief Economist Michael Klein. "The report also highlights the need for governments to pick up the pace of reforms to the operating and regulatory environment, so that it becomes easier to do business," he added.

The empirical profile of the base of the pyramid in the analysis substantially extends previous analyses by C.K. Prahalad, Stuart Hart and other experts by offering a detailed economic portrait of BOP markets, broken down by income segment, urban/rural location, economic sector, country and region.

Some striking patterns emerge from the data. More than half of BOP health care spending, for example, is for pharmaceuticals. As incomes rise, the share of household spending for food declines, while the share of spending for transportation and for phone and Internet access rises sharply. Access to electricity is universal in Eastern Europe and high for most BOP households in Asia and the Latin America region, but quite low for Africa. For all regions except Eastern Europe, firewood is the dominant cooking fuel for the lower-income segments in the BOP, while propane or other modern fuels dominate higher BOP income segments and urban areas.

Sector markets from the report range from those that are relatively small, such as water ($20 billion) and information and communication technologies ($51 billion), to medium-scale markets such as health ($158 billion), transportation ($179 billion), housing ($332 billion), and energy ($433 billion), to truly large markets, such as food ($2,895 billion).

"This report shows how critical it is to focus on the BOP in all its dimensions," said Jonathan Lash, president of the World Resources Institute. "The BOP wins when brought into the formal economy. Businesses win when they pay attention to the needs of the BOP markets. The world wins when environmental sustainability, transparency, and equity are as deeply embedded in BOP growth strategies as the drive for profits. This report lights the path to sustainable business engagement with the BOP."

[CSR newsclip] Uphill Effort for Eco-Friendly Housing

Uphill Effort for Eco-Friendly Housing

IPS, 3 April 2007 - The buildings in which we live and work account for a large part of the climate changing gases that are of great concern to citizens and scientists alike. What we do in our homes and offices translates into polluting emissions, wastewater and garbage.

In North America, 11 to 30 percent of greenhouse-effect gases, which lead to global warming, come from buildings, which use a large part of the available electricity, water and raw materials, including precious lumber -- often from illegally logged forests -- and plastic composites like polyvinyl chloride (PVC), which can be harmful to health.

Just in the United States, producer of nearly one-third of greenhouse gases globally, buildings use around 65 percent of all electricity, 40 percent of raw materials and 12 percent of the water consumed nationwide.

In Mexico, responsible for two percent of the world's greenhouse gases, buildings use 20 percent of the nation's electricity, 80 percent of which is generated by burning fossil fuels.

The North American Commission for Environmental Cooperation (CEC), which partners Canada, Mexico and the United States, seeks to curb the sector's contributions to climate change, which most of the scientific community agree is caused by the accumulation in the Earth's atmosphere of gases that come mostly from the burning of carbon-based fuels.

Experts from the three countries have been studying the matter since the beginning of the year and in September will issue a broad-ranging report that is to include recommendations for government action.

The goal is to limit polluting construction practices and give a boost to sustainable building, which can be integrated better into the environment, consumes less electricity and, ideally, processes its own wastewater and garbage, as well as providing comfort and shelter to its inhabitants.

But it is an uphill fight. "The development of 'green building' is new, and the governments have no core policy in this area," said David Morillón, an expert with the Autonomous National University of Mexico (UNAM) and who will be one of the authors of the CEC's report.

Nevertheless, there are already some plans under way, and dozens of architects, engineers and researchers across North and South America who exchange information and expertise through virtual networks, and through regular seminars on "green building".

In the past six years, Canada and the United States have developed new environmental standards for construction, private companies have set up certification systems for contractors who build sustainable buildings, and there is a "green" mortgage business emerging that takes environmental considerations into loan decisions.

Even so, the percentage of eco-buildings in those countries is no more than 10 percent of the total.

In Mexico, the government is sponsoring a sustainable construction plan for low-income residents. The initiative, managed by the private sector, is near completion on some 5,000 housing units, most of which are between 40 and 70 square metres.

For a country where housing demand surpasses one million units a year -- although in the last six years only 500,000 have been built annually -- the project is just a tiny step.

The eco-housing in Mexico aims especially to reduce consumption of electricity and water, but does not include solar energy or systems for treating wastewater, which would be ideal for this type of construction.

"This is an experimental step" and is geared towards generating information and verifiable data so that it is the market "that finally imposes the need to head towards sustainable construction," said Evangelina Hirata, director of the government's housing development commission, CONAFOVI.

But there is no promise that in six years Mexico will build all housing under sustainability standards, "which doesn't occur in any part of the world," she added.

On Mar. 29 in Spain, the Technical Code for Building entered into force, requiring inclusion of renewable energy sources for supplying hot water and electricity in all buildings that begin construction or renovation as of that date.

According to the new rules, there will be limits on energy consumption based on the building's characteristics, greater efficiency of heat and lighting systems will be promoted, and there will be a required percentage of clean energy sources: direct solar energy and solar panels.

Meanwhile, in Mexico, the sustainability seed is just being planted. "I hope that within a year the Mexican financial system begins to offer green mortgages," after seeing that in the long term any sustainable construction will be cheaper and more beneficial for the user and the community, said Hirata.

According to UNAM expert Morillón, building sustainable housing can cost three to 20 percent more than conventional housing. But he is confident that the market will see prices fall once it becomes more widespread.

However, that could take years, and time is of the essence, he added.

Conventional construction in Mexico lasts 30 to 40 years, but in 10 to 12 years, the country could run out of petroleum, meaning there would be little electricity available for those buildings.

The clock is also ticking for the world's response to climate change. If fossil fuel consumption and environmental degradation continue at today's pace, by the end of the century the planet's average temperatures could increase 1.8 to 6.4 degrees Celsius and sea levels could rise 18 to 59 centimetres, according to the recently released Fourth Assessment Report by the Intergovernmental Panel on Climate Change.

(*This story is part of a series of features on sustainable development by IPS-Inter Press Service and IFEJ - International Federation of Environmental Journalists.)

This article is reproduced with the kind permission of the
Inter Press Service News Agency (IPS).
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[CSR newsclip] Canadian SRI Assets Leap to More Than CAN$500 Billion

Canadian SRI Assets Leap to More Than CAN$500 Billion, 3 April 2007 - A biannual survey released late last month by the Social Investment Organization (SIO) reported that Canadian SRI assets have grown to more than CAN$500 billion. This marks a substantial leap from SIO's last survey which estimated 2004 SRI assets at CAN$65.5 billion. The credit for this increase can be pinned on growing institutional interest in SRI practices and the inclusion of Broad SRI strategies in 2006's asset total.

"Many people involved in SRI in Canada have mentioned to me lately that they feel that 2007 is going to be a real breakthrough year for our industry," Eugene Ellmen, SIO's Executive Director, told "The issue of climate change is one of the major factors driving the investment industry to look more closely at SRI. A recent federal report on corporate social responsibility and the mining industry is also bringing some attention to the role of Canadian companies in the developing world."

"These kinds of issues are not going to go away, and pension funds and mutual funds are going to have to pay more attention to them in selecting and managing their investments, for both fiduciary and ethical reasons," Ellmen added.

SIO's study, "
Canadian Socially Responsible Investment Review," is based on a survey of money managers and community investment providers, with data gathered between September 2006 and January 2007. The study has been produced every two years since 2000. The study's final asset estimates also include publicly available data on mutual and pension funds, and trusts.

The report breaks down the investments into Core and Broad SRI investments following the format of the groundbreaking 2006 European Social Investment Forum's (
EuroSIF) "European SRI Study." However, SIO changed some of EuroSIF's categories to fit a Canadian context. For example, EuroSIF put simple exclusions under Broad SRI while SIO placed simple exclusions under Core SRI. SIO also included community investing, which was not part of EuroSIF's study, under Core SRI.

The survey finds CAN$57.4 billion in assets that use Core SRI strategies such as screening (combining traditional risk and return analysis with values-based criteria to select investments), community investment, and socially responsible lending.

Broad SRI strategies include CAN$446.2 billion in assets that use three main approaches: the evaluation of a company's ESG performance to determine its relative under-weighting or over-weighting in a portfolio, corporate engagement and proxy voting on ESG issues; and sustainable venture capital.

SIO reports that as recently as 2004 there were very few assets invested according to Broad SRI strategies. Broad SRI assets include assets from the pension fund sector that are mainly composed of public pension funds.

"The increase in SRI assets in Canada is due mainly in the area of ESG corporate engagement and proxy voting. In the last two years a number of very large, public pension funds in Canada have adopted SRI policies," said Ellman. "They have signed on to the UN Principles for Responsible Investment, and as part of their commitment under UN PRI, have committed to engage and vote their proxies on ESG factors."

SIO is currently urging pension funds to publicly disclose their engagement activities, as well as their proxy voting.

One of the pension funds SIO points to for adopting ESG engagement strategies is
Caisse de dépôt et placement du Québec, one of Canada's largest institutional fund managers based in Montreal, Quebec. Ginette Depelteau, Senior Vice-President, Policies and Compliance for Caisse told "Caisse de dépôt et placement du Québec considers ESG issues in its activities mainly for two reasons: the risks ESG issues represent in investments and the pursuit of sustainable economic development."

Baitrente, headquartered in Montreal, Quebec, is a labor-sponsored Canadian pension fund that adopted a responsible investment policy in January 2005, outlining ESG risks they would like the companies in their portfolios to avoid.

"We do think that engaging companies is an excellent way to promote good governance and sound environmental and social practices" said Laetitia Tankwe, Extra Financial Risks Manager. "In addition to this 'bottom up' strategy, we are very involved in 'top down' strategies such as the Enhanced Analytics Initiative (
EAI) and the Principles for Responsible Investment. We think that those kinds of initiatives send a clear signal that things are changing and that ESG is no longer a matter of SRI and ethics, but a new mainstream way of doing business for everybody's long term interest."

The conclusion of SIO's report asked if the inclusion of Broad SRI strategies in the total assets of SRI asset represents a real increase in the SRI market. The report concludes that it is not fair to compare Core and Broad SRI strategies. However, the authors believe that the huge growth in Broad SRI is a "breakthrough in the understanding of environmental, social and governance issues by the investment community."

Acuity Funds Ltd., Alterna Savings, Desjardins Trust, Meritas Mutual Funds and The Ethical Funds Company sponsored the study. The non-profit SIO is the nationwide association for the Canadian SRI industry, representing more than 400 members that include mutual funds, financial institutions, investment advisors, managers and consultants, and NGOs and others interested in SRI.

This article is reproduced with kind permission of
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[CSR newsclip] WBCSD plots carbon path to 2050

WBCSD plots carbon path to 2050

Environmental Finance, 29 March 2007 - The World Business Council for Sustainable Development (WBCSD) has called for "decisive, concerted and sustained actions between governments, businesses and consumers" to tackle climate change.

The call comes in a report, Policy Directions to 2050, from the WBCSD, a business organisation of some 190 multinational companies. The report "identifies policy options to sustain economic growth while transforming the ways we access, produce and consume energy".

WBCSD president Björn Stigson said: "Governments must start building the future policy frameworks, and it is necessary for us in business to begin to respond to those policies in time to meet the future emission reduction targets. We can not continue the 'you first' mentality. We need leadership and action by both governments and business."

The report calls for the development and deployment of low-carbon technologies through partnerships and incentives and an approach to mitigate long-term market risk and deliver secure benefits for large-scale, low-carbon projects. It suggests four policy priorities:

1. A quantifiable, long-term (50 year), global greenhouse gas (GHG) emissions pathway, to be decided by 2010;

2. Ensuring continuity in carbon targets and markets after 2012, when the Kyoto Protocol expires, using the existing international framework as a basis, and modifying it to build up from local, national, sector or regional programmes;

3. Building robust national programmes, in support of the international pathway, including on energy efficiency, increasing the use of alternative transport fuels, boosting consumer awareness and incentives for low-carbon products, services and lifestyles; and

4. Developing and commercialising a number of low- and zero-GHG technologies. These will require supporting policies and programmes to address technical and cost challenges.

The November 2006 issue of Environmental Finance magazine carried an article by Adam Kirkman of the WBCSD and David Hone of Shell International, based on an early draft of the report.

This article is reproduced with kind permission of Environmental Finance magazine.
For more news and articles visit or
to Environmental Finance.

[CSR newsclip] Commission launches debate on 'green' tax reform

Commission launches debate on 'green' tax reform, 30 March 2007 - Shifting tax burdens from labour to environmentally damaging activities is one of the main options of a new Green Paper launched on 28 March by Commissioners Dimas and Kovacs.


With climate change and energy security issues high on the EU's agenda, the Commission wants to begin a broad consultation on the use of market-based instruments to stimulate sustainable consumption and production.

Taxes, charges, subsidies and tradable permits can help realise environmental and energy objectives by taking into account the hidden costs of unsustainable behaviour and production.


The Green Paper on the use of market-based instruments to support energy and environment objectives was launched by Environment Commissioner Dimas and Taxation Commissioner Kovacs on 28 March 2007. The Commission believes that increased use of these instruments could be a more cost-effective way of achieving the targets formulated during the Spring European Summit than direct legislation.

The Green Paper looks at potential areas and options for further use, highlighting also some of the following challenges:

  • Can these market instruments be used without undermining EU-industry competitiveness and without putting extra tax burdens on consumers?
  • Can the EU promote a shift from labour taxes to environmental taxes at national level?
  • Would a 'Market-Based instruments Forum' be useful to stimulate best practices?
  • How can the EU get rid of environmentally harmful subsidies?
  • How can the current Energy Taxation Directive be reviewed and streamlined with new energy and environmental objectives?
  • How can the use of market-based instruments be combined with the EU emissions-trading scheme?
The discussion paper also recognises that EU unanimity rules on taxation limit the potential influence of the Union on member states.


The European Environmental Bureau called the Green Paper "too timid". It had hoped that the Commission would take stronger leadership and suggested that member states be urged to agree "on a 10% shift in tax income in ten years, from labour to energy and environment, and agree on a minimum level of co-ordination on how to achieve it".

Latest & next steps


EU official documents

EU actors positions

[CSR newsclip] A New Breed of Leaders Tackles World's Big Problems

A New Breed of Leaders Tackles World's Big Problems, 29 March 2007 - Renewable energy, affordable and effective health care, and fighting climate change are just three of the major global problems currently being addressed by a new model of entrepreneurship, according to a new report by SustainAbility, an independent think-tank and consultancy.

Drawing on the results of a survey of more than 100 'social entrepreneurs' -- leaders of organizations whose goals prioritize improving the quality of life for marginalized populations -- the report, "Growing Opportunity: Entrepreneurial Solutions to Insoluble Problems," finds that these organizations have already penetrated deep into industries and markets that large corporations have barely scratched the surface of.

"Individuals from Bonn to Bangalore are seizing the chance to turn challenge into opportunity, in the process pioneering new markets," according to Paul Achleitner, CFO of the financial services company Allianz, which was a major sponsor of the report. "Microfinance, as an example, is now a $9 billion market that is increasingly empowering citizens to realize their full potential in society. Our hope is that collaborating with creative thinkers will help our people realize their full potential -- and to better serve the needs of present and future customers."

Microfinance is an especially fitting example, as Muhammad Yunus, a luminary of the field, was awarded the Nobel Peace Prize this year for his work at
Grameen Bank over the last 30 years. The wide success of these small community-based finance projects shows the potential of social entrepreneurship across sectors, according to the report.

The findings from the survey show that although social entrepreneurship is growing quickly, it is still a small field, receiving only an estimated $200 million in financing globally, compared with $200 billion in philanthropic investments each year in the U.S. alone. This lack of access to funding was cited as the primary challenge faced by 72 percent of the survey's respondents, followed by promoting and marketing their organizations.

Social entrepreneurship is fundamentally different from previous, similar enterprises because they are not reliant on funding by governments or foundations to do their work. "NGOs get hooked on a sense of getting when they rely on foundation or non-sustainable funding sources," Keerti Pradhan of Aravind Eye Hospitals told the report's authors. "As a result, people don't apply their brains to different ways to break that barrier of dependency on foundations.... NGOs have huge potential, but huge knowledge gaps exist about how to access market-rate funding sources that could help support non-profit work."

The organizations profiled by SustainAbility differ from most NGOs by their interest in working with businesses to achieve their goals. And the time is right for these kinds of partnerships: the growing global concern about environmental crises is leading to a fundamental shift in how businesses operate.

"Growing Opportunity" describes three phases of business operations with regard to sustainability: an early engagement, often driven by the need to comply with regulations, which the report calls Mindset 1.0; followed by a shift in focus to corporate citizenship (Mindset 2.0); and Mindset 3.0, the coming business trend, ties the growth and success of a business to sustainable operations.

The report's authors identify several reasons why social entrepreneurship is important for businesses to engage. "The world is changing — and with it markets," the authors write. "Social and environmental entrepreneurs do not have all the answers, but they do see the world and markets differently, and the more innovative are experimenting with new business models that could potentially break out of their niches and help transform key elements of the global economy."

This new "Mindset 3.0" has the ability to, and even at times the express goal of, rebooting entire economic and political systems, replacing inefficient or corrupt practices in exchange for community-tested, market-driven solutions. "Growing Opportunity" looks in-depth at two industries -- health care and energy -- that have already benefitted from an upheaval of social entrepreneurship.

"Social entrepreneurs ... are set to have a profound impact on the world's most complex societal and environmental challenges," said John Elkington, founder and Chief Entrepreneur of SustainAbility. "Their impact may be limited by their current scale, but could be limitless with the right business partners."

The full report, "Growing Opportunity: Entrepreneurial Solutions to Insoluble Problems," is available for download from
GreenBiz , and more information is posted at .


The difficult politics of saving the planet: Bangladesh, for example, is densely populated and at risk; while New Yorkers suffer little more than sweatier armpits on the subway. How much will New Yorkers wish to pay to save Bangladesh?

The difficult politics of saving the planet

Published: April 10 2007 03:00 | Last updated: April 10 2007 03:00

Producing a sensible response to climate change is a marathon effort, but the world took another plod forward this weekend with the publication of one more scientific report. Important as this latest contribution is, the ball and chain around our ankles is the result of politics, not scientific uncertainty. It is worth thinking now about how to unlock the shackles.

The UN-appointed scientists put their fingers on one of the obstacles: the likely impact of climate change on different countries is very uneven. For some areas - Siberia, Canada, Scotland - some warming may be helpful. For many other areas the consequences are likely to be far less welcome, ranging from water shortages to hurricanes and floods.

Bangladesh, for example, is densely populated and at risk from more erratic rainfall, fiercer cyclones and salt seeping into farmland from the sea. Damage wrought by climate change could look biblical in Bangladesh, while New Yorkers suffer little more than sweatier armpits on the subway. How much New Yorkers wish to pay to save -Bangladesh is one of the questions that will underpin international negotiations, even if nobody is blunt enough to ask it out loud.

If Sir Nicholas Stern is right that the costs of doing nothing about climate change are higher than the costs of doing something, there is scope for a cost-sharing arrangement between nations that leaves everybody better off. It would take a dreamy idealist to believe that such an agreement will be easy to reach.

Yet the political will to act is evidently growing. The UN Security Council is likely to discuss climate change - as well it might, given that famines can provoke the wars and mass movements of people that are all-too-familiar viewing on the evening news. The next US administration will surely be more enlightened on this issue than the current one; it could hardly be worse in any case. European politicians are falling over each other to portray themselves as green.

So there is some hope for a workable successor to the Kyoto agreement. It will have to include India, China and the United States. And it would be politically helpful if it were more -forward-looking, focused on eventually limiting the atmospheric concentration of carbon dioxide, rather than looking backwards at historical emissions benchmarks.

Such benchmarks were perhaps the only option when the Kyoto agreement was drafted, but have penalised both economies that were efficient in 1990 and those that have grown quickly, such as the US. The atmosphere does not care who receives emissions permits - since they are supposed to be traded anyway - but arguments over their distribution may prove a serious stumbling block. Looking at emissions in 1990 will not help construct a deal that leaves everybody smiling when they leave the negotiating table.

Politicians will have to learn how to sell any deal, too. Many countries are responding to climate change by rewarding favoured lobby groups rather than spreading the costs fairly. Analysis published today by economists at Oxford University shows that the European Emissions Trading scheme provided a massive windfall for polluting industries; they enjoyed an unnecessarily generous handout of valuable permits, ultimately at the taxpayer's expense.

We should be able to do better than that. A stable, predictable price for carbon - whether through an auction of emissions permits or a carbon tax - would promote the best ways of reducing emissions while providing substantial government revenues. Those revenues can be used to buy domestic political support by cutting other taxes and to provide the money necessary to ensure that developing countries are happy to sign up to a Kyoto successor.

All the scientific and economic reports in the world will not resolve uncertainties about either the effects of climate change or the costs of reducing emissions. Yet a measured response now would begin to reveal just how expensive it will be to move to a low-carbon economy, as well as promoting innovation and energy efficiency sooner rather than later. Whether the costs turn out to be high or low, it is time we took the trouble to find out.

World Bank review could see shift away from social projects

World Bank review could see shift away from social projects

By Krishna Guha in Washington

Published: April 7 2007 03:00 | Last updated: April 7 2007 03:00

The World Bank is carrying out a review that will lead to the aid agency cutting back or even abandoning some activities to focus resources where they can be most effective, Paul Wolfowitz told the Financial Times.

The World Bank president said he had charged François Bour-guignon, the bank's chief economist, with drawing up the new strategy for the world's biggest multilateral aid agency.

While Mr Wolfowitz refuses to prejudge the review, many bank officials want to move its focus away from health, education and other social projects back towards promoting economic growth. Mr Wolfowitz said the review team would consult widely but would not shy away from tough choices.

The review will be welcomed by the bank's shareholder governments, which have pressed Mr Wolfowitz to provide more clarity and detail on his plans for the aid agency. But it will unleash a storm of lobbying from non-governmental organisations anxious that the bank should continue to support their own favoured areas of operation.

The review comes at a time when Mr Wolfowitz is mired in renewed internal controversy, this time over terms extended to Shaha Riza, his partner, when she was seconded from the bank to the US State Department.

This row escalated yesterday when a spokesman for the then chairman of the bank's ethics committee told the FT that it did not approve Ms Riza's package, which included a promotion.

Disclosing details of the strategy review, Mr Wolfowitz told the FT it was time to ask "what have we learned" since the bank's current strategy was set in place by James Wolfensohn, his predecessor, in 2000. "What interventions are most effective for promoting development?" he asked. "Where can the bank be most effective?"

One of the biggest changes since 2000 is the proliferation of different organisations in the aid world, with private foundations such as the Gates Foundation and specialist vertical funds growing in importance.

Mr Wolfowitz said: "The question is - what is our comparative advantage and where can we contribute?"

The bank president played down the prospect of radical change, saying: "I do not think there is urgent change of direction needed."

But he added: "I do think some greater clarity about trade-offs is in order.

"The strategy is going to have to say these are the things that it is important to do more of - which inevitably means there are some things we have to stop doing or do less of."

Under Mr Wolfensohn, the bank expanded into a wide range of largely social sectors.


[CSR newsclip] The Future of the Global Compact: Does the new UN Secretary General have the commitment—and corporate experience—to drive the compact?

The Future of the Global Compact
Submitted by Danielle on Wed, 2007-02-14 21:03. International | Politics & Legislation | Social Responsibility

Does the new UN Secretary General have the commitment—and corporate experience—to drive the compact?

By Andrew Savitz and Moses Choi

When the CEO of Novartis met with the Secretary General of the United Nations in the summer of 2000, neither suspected that the result would be to reinvent the very way the Swiss pharmaceutical giant does business. Kofi Annan was merely trying to entice Dr. Daniel Vasella and other corporate leaders to join his new Global Compact.

Since then, more than 3,000 CEOs have signed the Compact, making it the world's largest voluntary corporate citizenship initiative. Annan's objective was to bring companies together with labor, civil society and UN agencies "to unite the power of the market with the authority of universal ideals."

Half the companies have reported changing their policies to harmonize with the Compact's 10 principles for corporate behavior, which address human rights, labor standards, environment and corruption. And many have made efforts to address the underlying problems that impede a more inclusive global economy: poverty, disease, the lack of safe drinking water and sanitation, substandard, unsafe or inhumane working conditions and the bribery and extortion that undermine the rule of law and sap economic vitality.

That progress, however, will be jeopardized unless Annan's successor—sworn in at the end of 2006—shows an equivalent commitment to the Compact. And the signs so far are not encouraging.

Secretary General Ban Ki-moon is a career diplomat who was selected because he is, in the words of one UN-watcher, "more Secretary than General." He is said to be uncomfortable banging the bully pulpit, which was Annan's primary modus operandi. Ban has no business background or training, and no experience with issues of corporate citizenship. And in his native South Korea, only 12 firms have signed the Compact even as corruption remains a huge challenge.

In a recent speech to leaders of the New York business community, the Secretary General appeared to reverse the logic of the Compact, saying that the UN can create an "enabling environment in which business can thrive." But Compact signatories intend to create the conditions in which the UN can succeed, which in turn, will help business. The Compact thus calls for direct corporate action on human and worker rights, the environment and corruption—a call that is nowhere to be found in the Secretary General's speech.

Does any of this matter to the wider world?
Absolutely, judging from the last six years of experience with the Compact. The Compact is the first formal corporate citizenship initiative for many companies. It has triggered hundreds of multi-sector projects such as Norway's Statoil and the International Federation of Chemical, Energy, Mine and General Workers' Unions collaborative effort to extend Norwegian health, safety and labor standards to the company's world-wide operations.

And it has inspired comp­anies to take significant unilateral action.

After his meeting with Kofi Annan, Dr. Vasella signed the Compact and began to take action to transform Novartis. The company issued a Corporat Citizenship policy and a new code of conduct that incorporated the Compact's principles, directing each division to build them into its planning and operations. Corporate citizenship achievements were made a formal part of senior managers' annual reviews. The Board of Directors also created the Novartis Foundation for Sustainable Development, which is working with the World Health Organization to eliminate leprosy by the end of the decade; more than 4 million patients have already been cured as a result. The foundation recently concluded an analysis to ensure that all Novartis employees, working in more than 140 countries, are being paid a living wage which, under the Compact, is considered a human right.

Despite six years of solid progress, the Compact is at an important juncture. Only 5 percent of multinational corporations have joined and some are not actively engaged. The UN's Compact office recently de-listed 345 companies for failing to report on their progress in implementing the principles, one of the few requirements of membership.

Some observers believe that the Compact is now a fact of corporate life, with its own internal momentum, while others suspect that without the active and visible support of the incoming Secretary General, it will quickly become yesterday's initiative. While it is possible that CEOs will continue to push it forward without him, Ban's personal involvement in recruiting new CEOs, inspiring participants and promoting the Compact's successes will be critical.

Secretary General Ban brings a wealth of diplomatic experience and respect from UN insiders. He takes the reins of the organization at a time when business, government and civil society are finding new ways to work together for the common good. The UN Global Compact is a critical initiative, both for the progress it can inspire, and because it shows how the UN can reinvent itself from within and find new ways of leveraging its resources and its moral authority. We urge Mr. Ban and CEOs around the world to lift the Compact even higher.

Andrew Savitz, a former lead partner at PwC, has more than 20 years of experience in sustainability and environmental performance and is author of "The Triple Bottom Line" (Wiley 2006). Moses Choi is currently a master's degree candidate at the Fletcher School of Law and Diplomacy.

[CSR newsclip] Apple, Motorola in the RED?

Apple, Motorola in the RED?
Submitted by Danielle on Tue, 2007-03-27 20:36. Social Responsibility

High expense and low returns bring attention to RED's new philanthropic model.

By Danielle Lee

The RED campaign, launched last year with the fanfare of celebrity endorsement and the involvement of Apple, Motorola and Gap to benefit the Global Fund to Fight AIDS, Tuberculosis and Malaria, has come under attack following an AdAge article reporting that the involved companies spent $100 million on marketing and have raised only $18 million worldwide. The figures have drawn criticism from nonprofit and consumer watchdogs, along with a response from RED CEO Bobby Shriver.

Defending RED as a "new fundraising model" in his letter to AdAge Editor Jonah Bloom, Shriver wrote, "this marketing would have been spent anyway, on other product lines. It never would have been (nor will it ever be) given to the Global Fund. We were able to divert existing marketing dollars for RED."

The RED campaign, created by Shriver, Chairman of Debt AIDS Trade Africa (DATA) and Bono, built partnerships with several companies to produce branded products and donates a percentage of those product sales to the Global Fund. While Shriver and executives at the Global Fund have defended the promotion as raising a valuable level of awareness in addition to "five times the amount given to the Global Fund by the private sector in four years," some critics bemoan the focus on consumption—and the high price of it—as a method of charity.

Mya Frazier, writer of the AdAge article, wrote, "It threatens to spur a backlash, not just against the RED campaign—which ambitiously set out to change the cause-marketing model by allowing partners to profit from charity—but also for the brands involved."

WSJ: Get ready for US CO2 emissions trading system


WSJ: How an Open Market Might Save the Planet
March 28, 2007; Page A11

By Alan Murray
A tip for the big auto companies: Do what Al Gore does.
The chief executives of General Motors, Ford and Chrysler group have been dragged to Washington twice in the past two weeks as politicians compete in a sudden stampede to stop the warming of the planet. The chiefs were grilled about their plans to burn biofuels, build hybrid cars and develop hydrogen cells.
There may be an easier way. Just ask the former vice president, who once was a loner in the Capitol but now has rock-star status. Mr. Gore is a prodigious consumer of energy. The Associated Press reported last month that his 10,000-square-foot Nashville, Tenn., home used 191,000 kilowatt hours last year -- more than 10 times the Nashville average. But he made up for that by buying carbon "offsets" -- credits sold by companies that plant trees, invest in wind farms or take other action to counter carbon emissions.
[go to forum]1
Do "carbon offsets" really work? And if not now, could they work in the future? Share your views in this week's forum.2
As a result, Mr. Gore says, he is "carbon neutral."
Why shouldn't the auto companies do the same? At Terrapass.com3, one of the more popular offset Web sites, anyone can buy carbon credits to make up for the average annual use of a Chrysler PT Cruiser at a cost of less than $50. That's a lot better than, say, some of the simplest hybrid cars, which cost an extra $2,500 to build and achieve only a 12% to 15% improvement in fuel efficiency.
Buy every customer a Terrapass, and the Big Three could instantly be carbon-neutral.
I recommend this, of course, with tongue in cheek. Terrapass and the other carbon-offset markets in the U.S. are still works in progress. And their limited demand depends largely on do-gooders like Mr. Gore, or Google billionaire Sergey Brin, who travels the world in a Boeing 767 and buys offsets to counter its effects. It's unlikely the system could handle an order from GM for four million vehicles.

[go to video]4
Alan Murray discusses5 how environmentally concerned figures like Al Gore are paying for renewable projects to offset the effect of their carbon emissions.
Still, these crude carbon marketplaces hold the secret ingredient that has led many big companies -- including the auto makers -- to come out favoring regulation of greenhouse-gas emissions in recent months.
The auto makers hate the current U.S. regulatory regime -- Corporate Average Fuel Economy standards, or CAFE -- which singles them out for regulation, and makes limited sense. If oil companies flood the market with cheap fuel, and consumers opt for ever bigger cars or trucks, the best efforts to boost fuel efficiency will have little effect.
But a carbon cap -- the current rage in Washington -- would cover other industries as well as autos, and give companies flexibility to find the cheapest solutions to their emissions problems. Moreover, if they can't find cheap solutions, it lets them buy the right to continue polluting. Companies that exceed their caps could buy carbon credits in the marketplace, while those that fall below their caps could sell emissions credits.
That gets to the really big battle that has Washington lobbyists' bank accounts swelling these days. While corporate leaders are lining up behind a national carbon "cap and trade" law, they are also preparing for one of the biggest intrabusiness knife fights since the Telecom Act of 1996 or the Tax Reform Act of 1986. At issue: how to set the carbon caps.
One approach would be to give every auto company or utility company a flat carbon quota per unit of output. That would be great news for Toyota and Honda, which already make fairly fuel-efficient vehicles, but bad news for GM and Ford. It would be good for utilities that rely heavily on clean hydropower, but bad for those that rely on coal.
Another approach would be to set caps based on some recent baseline year's emissions. That would turn the tables upside down. It would be good news for companies that produce less fuel-efficient cars or rely heavily on coal, since they would get the larger quotas and find it easier to make cuts. And it would be bad news for more fuel-efficient producers and hydropowered utilities, which would have less room to cut.
In between those two approaches, there are a thousand variations, with big money at stake in each. The challenge for businesses in this game is to make sure someone at the negotiating table is tending their interests. U.S. auto makers are putting their hopes in Michigan Rep. John Dingell, the chairman of the important Committee on Energy and Commerce and husband of longtime GM lobbyist Debbie Dingell. (And if you wonder why auto makers are suddenly eager for rapid legislative action, you might consider the fact that Mr. Dingell celebrated his 80th birthday last year.)
So get ready for a real national carbon-emissions trading system. It's coming, and soon. But before it does, there'll be some blood shed in Washington.
Write to Alan Murray at Alan.Murray@wsj.com6

Helping cellphone towers help themselves

Helping cellphone towers help themselves
Home » blogs » Kyle Spector
Fri, 03/09/2007 - 10:00am.

Mobile phones are the lifeblood of economic and social networks in developing countries precisely because they don't require the vast infrastructure of wires, cables and stations that traditional landline phones need to operate. They do, however, require cellular towers, which run on electricity—a scarce commodity in the more rural areas of developing nations.


To compensate, at least two countries have developed novel, eco-friendly alternatives to a standard power grid for their cellular networks. In Namibia, a cell phone service provider is experimenting with hybrid wind/solar power cellular base stations to roll out service where a power grid doesn't exist. While the effort won't save any money, the key aim of cell companies is to beat the roll-out of traditional power grids by one to two years. It helps that, once they are set up, the stations run themselves:

In Namibia the turbine and solar panels will also be running the base station with traffic on it, the peripheral communications, vsat (satellite transmitter/receiver) and even the protective fencing around the site." 

An experimental program in India, where the number of mobile subscribers is exploding but power is scarce, uses an interesting choice of feedstock for biofuel production instead of the wind/solar combination:

The scheme in India will use oil derived from plants such as cotton, a mahogany-like tree called neem and jatropha. Jatropha trees are already widely grown across India, specifically as a biofuel crop. The seeds of the plant are a traditional remedy for constipation.

And a parallel program is already underway in Lagos, Nigeria. But does all this work toward creating reliable mobile networks in the rural villages of Africa and South Asia really have an impact? Just ask the health workers in Rwanda—mobile networks there reduced the average response time between patient and health care worker from one month to a matter of seconds.

The problem with offsets: Just a few thousand dollars can convert you from an atmosphere-despoiling narcissist to a fern-fondling flower child without you having to change your lifestyle in the least.

[This is a funny piece, but there is a message there, if you care to look for it


Ugly? Stupid? A Jerk? Relax, Your Worries Are Over
03.28.07 | 2:00 AM

You've heard of carbon offsets, right? The idea here is that you can keep your air conditioner running constantly from April through September, and your heater the rest of the year, and run a load of laundry just to wash a bow tie and a pair of Speedos, and you and your spouse can drive two separate SUVs two blocks to purchase a coal-powered water heater, and it's all ecologically copacetic because you gave some money to some company that's trying to save the world from people like you. Just a few thousand dollars can convert you from an atmosphere-despoiling narcissist to a fern-fondling flower child without you having to change your lifestyle in the least.

Clearly, there are no issues or problems with this system whatsoever, which is why I'm launching a number of corporations designed to help you improve every aspect of your life through the power of giving people money. With enough income, you can be the person you always wanted to be!

Ugly Offsets: Say, for the sake of argument, that you're a grotesque clod with the sexual appeal of a dump truck's undercarriage. I'm not saying you are, but I'm not saying you're not, either. Sure, you could get a better haircut or undergo painful, unconvincing plastic surgery, but why not just buy ugly offsets?

Send us some cash and we'll spend it on beauty college scholarships and research into moisturizing creams -- after taking our cut, of course -- thereby making you, economically speaking, so damn sexy. Just explain to the hotties at the bar that you've completely offset your ugliness and they'll throw you into the sack with such speed and vigor that you won't get your breath back until you've had three orgasms.

Stupid Offsets: Look, you already know that getting smarter costs money. It's criminal that you pay thousands of dollars to attend a university and then you have to do the work anyway. Books, training videos, ancient and wise Zen masters, any way you hack it, smarts are a real hassle.

When you get down to it, the simplest way to get smarter is to send us money, which we'll spend on scholarships and trivia quizzes. We'll send you a card with your offset IQ -- at current rates only $5,000 will bring you up to Hawking level -- and a free membership in Mensa.

Jerk Offsets: You know what's stressful? Being nice. Studies show that every time you choose not to yell at a waitress for bringing you water with ice when you asked for water without ice, it takes six months off your lifespan. If only there was some way to berate and abuse everyone around you and still be considered a nice guy ... well, you see where we're going with this.

Fork over the bills and we'll go out and perform random acts of market-driven kindness. Then the next time a pedestrian tries to cross the street right in front of your Beemer, you can yell at them, make up new sex acts for them to try out on pets and family members, throw your half-empty Starbucks cup right at their head, and then explain that you've fully offset your antisocial acts and, in the big picture, you've basically just bought them an ice cream cone and knitted them a hat.

They'll thank you, unless they've bought jerk offsets as well, in which case they don't need to thank you.

So there you go. Once I've set up these corporations, you'll be able to transmogrify yourself from an ugly, ignorant vulgarian into a stunningly attractive, worldly peach of a person. Some might say that this is all just my cynical attempt to make money off of other people's lethargy, but that's just fine. I've purchased cynicism offsets.

Born helpless, nude and unable to provide for himself, Lore Sjöberg eventually overcame these handicaps to become an ecologist, an economist and an egotist.