The ‘S’ in ESG gains currency

February 8, 2021 by  
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The ‘S’ in ESG gains currency Manjit Jus Mon, 02/08/2021 – 01:00 This article originally appeared in the State of Green Business 2021. You can download the entire report here . We have seen a rising emphasis on ESG issues in recent years, as customers, investors and other stakeholders look for more transparency on corporate strategies and their impact on society. Companies are making progress in disclosing their environmental impact and governance standards, but social factors have not been given the same attention — until now. Social factors include how a company manages relationships with its workforce, the communities in which it operates and the geopolitical environment. The COVID-19 pandemic has pushed “S” into the spotlight by highlighting a range of problematic societal issues as millions of people around the world found themselves suddenly out of work with little protection. There are a lot of nuances with data on social issues, such as gender equality, human rights and labor standards. According to the United Nations Principles for Responsible Investment, “The social element of ESG issues can be the most difficult for investors to assess. Unlike environmental and governance issues, which are more easily defined, have an established track record of market data, and are often accompanied by robust regulation, social issues are less tangible, with less mature data to show how they can impact a company’s performance.” Social sustainability factors are material issues for many industries, however, and their management is directly linked to a company’s reputation and brand equity. Companies are showing a growing awareness that good social performance can translate into improved business performance and better relationships with customers and local communities. The S in ESG is definitely gaining currency. Two important areas are gender equality and human rights. Gender diversity enhances corporate governance, talent attraction and human capital development — all important factors driving long-term competitiveness . Corporate policies promoting gender diversity are a reflection of a well-managed company that realizes diversity’s value in stimulating creativity and increasing productivity, in tandem with employee well-being. While progress is being made on diversity, we are not seeing enough equality in the ranks. According to the International Monetary Fund, women earn 63 percent less than men, and the resulting loss of economic output is staggering. It ranges from 10 percent of GDP in advanced economies to more than 30 percent in South Asia and the Middle East and North Africa.  The latest data from S&P Global’s Corporate Sustainability Assessment (CSA) underscores the fact that gender pay gaps are more pronounced in some regions and in some industries, and at different levels of hierarchy within organizations. Companies are showing a growing awareness that good social performance can translate into improved business performance and better relationships with customers and local communities. The CSA is an annual evaluation of companies’ sustainability practices, focusing on criteria that are both industry-specific and financially material. For the CSA, gender equality means not only equal pay for equal work and equal gender ratios, but also equal access and equal treatment for career-advancing opportunities and corporate support systems. This includes flexible work arrangements and parental leave policies that go beyond legal minimum requirements. Companies are asked a number of questions about their gender equality policies and practices in the annual survey. Findings suggest that companies with a more diverse and equal workforce are indeed better positioned to outperform. Additional research by S&P Global Market Intelligence pointed to evidence of the outperformance of female executives relative to their male peers. Results showed that female CEOs drove more value appreciation (defined as a decrease in the book-to-market multiple relative to the sector average) and improved stock price momentum for their firms. In addition, female CFOs drove more value appreciation, defended profitability moats better and delivered excess risk-adjusted returns for their firms. Clearly, an increased focus on both diversity and equality will be needed going forward. The social factor in ESG is also heavily populated with human rights-related elements. Drivers include internationally recognized standards, such as the U.N.’s Guiding Principles on Business and Human Rights (UNGPs), as well as the growing interest of asset owners and managers in the U.N.’s Sustainable Development Goals. As part of their responsibility to implement the UNGPs, companies must have systems and practices in place enabling them to know and show that they respect human rights. Crucially, this includes an ongoing risk-management process to identify, prevent, mitigate and account for how a company addresses any adverse human rights impacts. This human rights due diligence HRDD) includes four key steps: assessing actual and potential human rights impacts; integrating and acting on the findings; tracking responses; and communicating about how impacts are addressed. The CSA extended the human rights criterion by adding a section on HRDD. Since then, results have shown a growing interest by participants in tackling human rights issues, reflected in improved average scores for this criterion across all industries and regions. Based on CSA results over the past several years, companies are expected to continue to report more extensively on their human rights due diligence going forward. Greater transparency in this regard will provide important information for their corporate decision-making. The coronavirus pandemic has caused stakeholders around the world to take a closer look at how businesses handle human capital and related issues. There likely will be growing pressure on companies to consider social factors in their longer-term plans and goals for senior management and to disclose how they are performing year over year. As interest in ESG funds continues to grow, companies will need to be firing on all three cylinders to attract capital: E, G plus S. Pull Quote Companies are showing a growing awareness that good social performance can translate into improved business performance and better relationships with customers and local communities. Topics State of Green Business Report Social Justice ESG Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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The ‘S’ in ESG gains currency

Ocean-based sequestration heats up

February 1, 2021 by  
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Ocean-based sequestration heats up Jim Giles Mon, 02/01/2021 – 00:30 This article originally appeared in the State of Green Business 2021. You can download the entire report here . Over the past few years, as companies have come under steadily increasing pressure to tackle climate change, nature-based solutions have emerged as a particularly exciting method for shrinking corporate carbon footprints. Investing in forests can be a win-win that both sequesters carbon and regenerates nature. That’s why one recent survey recorded almost $160 million spent on forest offsets in 2019. And a newer option, soil carbon, also is generating investment from multiple corporate sectors . Yet another natural sink absorbs about as much carbon dioxide as our planet’s soils and forests combined: the world’s coastal and ocean waters. Until recently, ocean sequestration, also known as blue carbon, attracted little attention outside academic and think-tank circles. We might be at a turning point, however, because a handful of forward-looking corporations, conservation organizations and startups recently have accelerated efforts to store carbon in marine systems. Thanks to their work, companies of all sizes soon may be able invest in ocean sequestration. One pioneer in this area is Shopify, an e-commerce company that has committed to spending $5 million annually on innovative clean technologies. Shopify’s first round of investments , announced in September, includes Running Tide, a company based on the coast of Maine. Running Tide’s core business is oyster farming, but CEO Marty Odlin is planning on a new revenue stream: growing kelp and sinking his crop in the deep ocean.  “Once it goes down below 1,000 meters, it’s not coming back up, because the pressures are so great,” Odlin told Fast Company . “So you can get at least 1,000 years of sequestration. More likely, it will turn into oil or sediment and be sequestered on the geologic timescale — millions of years.” Once it goes down below 1,000 meters, it’s not coming back up, because the pressures are so great. At Running Tide, engineers will use the Shopify investment to build kelp-growing platforms, which they will launch into ocean current systems selected as having the right temperature and nutrients to support kelp growth. The platforms will be kept afloat by buoys designed to biodegrade once they reach the deep ocean, at which point the kelp will fall to the ocean floor, taking its carbon with it. Running Tide will measure the carbon sequestered in the process and sell credits on the carbon markets. Shopify also made a bet on Planetary Hydrogen , a startup that aims to produce “green hydrogen” while simultaneously capturing carbon and healing the ocean. The process begins with a twist on existing green hydrogen technology, in which renewable energy is used to power the production of hydrogen from water, a reaction that produces no carbon. The Planetary Hydrogen team adds a mineral salt to the process, leading to the creation of a waste product — a mineral hydroxide — that binds with atmospheric carbon dioxide. The final step involves adding the bicarbonate compound that results from this reaction to the ocean, where, because the substance is alkaline, it helps counter climate-caused ocean acidification. According to the company’s calculations, the process can capture and store 40 kilograms of carbon dioxide for every kilogram of hydrogen produced. “Our fuel may be the greenest on Earth,” boasted Greg Rau, Planetary Hydrogen’s chief technology officer, at GreenBiz Group’s VERGE Carbon conference last fall.  The catch? Let’s start with costs. Green hydrogen costs two to three times as much as the conventional alternative, and Planetary Hydrogen’s fuel is even more expensive. In most markets that probably would be the end of the story, but the carbon-negative status of Planet Hydrogen’s product means that it could earn credits from schemes such as California’s Low Carbon Fuel Standard — enough credits, Rau believes, to make it a cheaper option than other forms of hydrogen. Before that happens, his team will have to scale up the technology, which it plans to do using Shopify’s investment. A pilot plant should come online in 2022, according to Rau. Another challenge facing both Planetary Hydrogen and Running Tide is the issue of permanence. For a credit to be traded on carbon markets, an established certification body — Verra and Gold Standard are two leading examples — needs to sign off on the process used to store the carbon. Among other things, the certifier would assess how long the carbon is likely to stay sequestered. The biology and chemistry of the deep oceans suggest that kelp and bicarbonate could offer a better guarantee of long-term storage than, say, forests. But collecting the data needed to demonstrate that will be challenging given the vastness of the oceans and the fact that this is a new frontier for certification bodies. “We need to rethink the basis for calculating the carbon benefits of these projects,” Carlos Duarte, an expert in marine ecosystems at the King Abdullah University of Science and Technology in Saudi Arabia, said at VERGE Carbon. Given the uncertainties, many companies will wait before investing in emerging ocean projects. But there are more established blue carbon options that are better understood. In 2018, for instance, Apple announced that it would back a project to protect and restore 27,000 acres of mangrove forest on Colombia’s Caribbean coast. According to Conservation International, one of the NGOs behind the project, mangroves and other coastal wetlands can store up to 10 times more carbon per unit area than terrestrial forests. Apple will purchase carbon credits generated by the project, generating a new income stream for the 12,000 local people whose livelihoods depend on the mangroves. Pull Quote Once it goes down below 1,000 meters, it’s not coming back up, because the pressures are so great. Topics State of Green Business Report Oceans & Fisheries Carbon Removal Nature Based Solutions Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Forests of giant kelp, Macrocystis pyrifera, commonly grow in the cold waters along the coast of California. Photo courtesy of Shutterstock

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Ocean-based sequestration heats up

Fighting deforestation should be a top priority for 2021, and here’s how it can be

January 11, 2021 by  
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Fighting deforestation should be a top priority for 2021, and here’s how it can be Heather Clancy Mon, 01/11/2021 – 02:00 One of the biggest stories of 2020 was the rise of the corporate tree-planting movement, with dozens of multinational businesses from virtually every industry pledging millions of dollars to one of nature’s most effective carbon sequestration solutions.  Now, NGOs and investors are urging consumer goods and food companies and financial institutions to devote more resources to addressing the root cause of shrinking forests, deforestation.  Many companies have promised to address deforestation related to their business activities for years, but few have fully delivered on those plans — and an astonishingly high number of companies don’t have an explicit commitment to ending deforestation.  A confluence of factors as we move deeper into the “Decade of Action” is raising the stakes: deepening global concerns over the loss of species habitat and biodiversity; an environmental justice awakening that has more of us attuned to systemic human rights issues, including encroachment of Indigenous communities, as well as child and slave labor; and a heightened awareness among the investment community about the long-term ecosystem and financial risks associated with deforestation. As 2021 begins, more companies are seeing their strategies for addressing deforestation deep down into their supply chains scrutinized.  “We need companies to make commitments that are specific to how they are addressing their supply chains,” says Jessye Waxman, shareholder advocate with Green Century Capital Management, which has so far engaged dozens of businesses encouraging them to improve their “no deforestation” policies and practices. Among those it has targeted: food service operator Aramark, meat company Tyson Foods and consumer products maker Procter & Gamble.  Green Century’s latest shareholder proposals related to deforestation were filed in late December with two of the world’s largest grain traders, The Archer-Daniels Midland Company and Bunge . Both companies already have commitments to eliminate deforestation, but the investment firm would like to see them become even more aggressive with members of their soy supply chains. “There is definitely increasing urgency around this issue,” Waxman says. Palm oil plantation at the edge of a rainforest. Many promises, limited followthrough Here’s what we’re up against. More than 1 million acres of forests have been lost since 1990, leaving the global stock at near 10 million acres, according to a July report by the United Nations Food and Agriculture Organization (FAO). While the rate of annual deforestation slowed to about 25 million acres between 2015 and 2020, the trendlines in several regions — especially countries in Africa and South America — aren’t moving in the right direction. Brazil, for example, recently recorded its highest rate of deforestation since 2008 during the period from August 2019 to July, an increase of 9.5 percent.  The vast majority of that destruction (up to 80 percent) is linked to commodities such as palm oil, soy, beef, leather, timber, and pulp and paper. Cattle-rearing practices in Brazil are of particular concern among multiple NGOs. Yet, many companies hugely reliant on these resources aren’t actively fighting deforestation , according to data from research organizations including CDP and Global Canopy.  What’s more, of the companies that have made commitments, many have failed to deliver or to set deadlines — with some continuously pushing dates into the future or changing the rules by which they judge progress, according to both organizations. CDP’s recent ” Zeroing In on Deforestation Report ” urged consumer products and food companies to devote more energy to this issue. It found, for example, that the supply chains for cattle and soy are particularly opaque — the largest meat processor in the world, JBS, fares “very poorly.” Food and consumer products companies that buy meat from organizations such as these need to become far more engaged in tracing the regional origins of the product they’re buying, says Ling Sin Fai Lam, lead analyst on the report. “CPG companies are going to find it harder to meet their own goals if they don’t seek collaboration from people closer to the ground,” she says.  While new forest strategies have been declared in recent months — Tyson Foods published its forest protection standard in November after a lengthy assessment by nonprofit Proforest — the dialogue around deforestation was relatively muted last year, when compared to the tree-planting movement.  “Are there more companies with stated strategies? Generally, yes, we have seen a few more commitments and improvements,” notes Sarah Rogerson, research associate at Global Canopy and lead researcher for its Forest 500 report , which evaluates corporate deforestation strategies. “But not a step change over what we have seen in previous years. There hasn’t been an obvious gearup. We were hoping [2020] would be a big year for forests and nature.” (The next edition of the Forest 500 is due in late January; here’s last year’s coverage .) Progress takes root There were some hopeful signs over the past 12 months. Cargill, which has been evolving its deforestation policy for decades, reported in June that it was on track to “eliminate deforestation in all commercial palm oil concessions in its third-party supply chain by the end of 2020.” After being contacted for an interview for this story, the company provided several written updates about its soy sourcing strategy including these highlights: More than 95 percent of the soy it purchased in Brazil for the 2018-2019 crop year was “deforestation- and land-conversion free” It had mapped 100 percent of its Brazilian soy supply chain by early 2020 It continues to develop a certification program in Brazil and Paraguay, in order to provide a “large market” for soybeans grown via verified methods Aramark was praised by Green Century in mid-November for its ” prompt progress ” on its no-deforestation policy . Within one year of publishing the strategy in December 2019, the company already has shifted to sourcing 100 percent of its soy and 99 percent of its palm oils from regions with no deforestation risk. So far, 60 percent of the beef it sources is “deforestation-free,” according to Aramark. In written responses to questions submitted for this story, Aramark Vice President of Sustainability Kathy Cacciola noted that Aramark’s biggest challenge in delivering on the strategy is its position of influence in the value chain for the covered commodities.  “For example, we do not source any raw palm oil, but it is present in tiny amounts of a vast number of products that we purchase, thus our ability to influence producers is limited,” she wrote. “Moreover, although our supplier partners are always willing to provide us with the information we ask for, they do not always have full visibility to where their raw commodities are coming from.”  We’re seeing the end of the commodity era, where materials are sourced from largely unknown origins and bought purely for price on a transactional basis. Mars also generated plenty of headlines in 2020 with its claim of a “deforestation-free palm oil supply chain,” an initiative related to the Palm Positive Plan it adopted in September 2019. Getting there required a drastic reduction in the number of mills that the company uses to source palm oil — to fewer than 100 this year, compared with 1,500 previously. It plans further reductions by 2022, according to the press release Mars issues to trumpet this achievement.  In written responses to questions submitted for this article, Kevin Rabinovitch, global vice president of sustainability for Mars, said simplifying the company’s supply chain through longer-term contracts and fewer suppliers was crucial for helping it verify that partners are meeting environmental, social and ethical standards and for laying the foundation for collaborative engagement. “We’re seeing the end of the commodity era, where materials are sourced from largely unknown origins and bought purely for price on a transactional basis,” he wrote. “That model doesn’t address some key elements of the world we want tomorrow. The future will leverage sourcing from known farms, with price, human rights and sustainability impacts evaluated side by side.”  As of this writing, there has been no independent verification of the Mars palm oil claim. Mars is also part of the new Forest Positive Coalition , launched in September by a group of 17 companies belonging to the Consumer Goods Forum — including Danone, General Mills, Nestle, P&G, PepsiCo, Unilever and Walmart. The group has pledged support of collective, systemic efforts to “remove deforestation, forest degradation and conversion from the key commodity supply chains of palm oil, soy and paper, and paper, pulp and fiber-based packaging.”  Another coalition of companies — including ADM, Bunge and Cargill — is working with the World Business Council for Sustainable Development (WBCSD) to improve the traceability of soybeans grown in Brazil’s Cerrado region, one of the least-protected regions in the country, which is experiencing higher rates of deforestation than the Amazon. So far, the Soft Commodities Forum has engaged with about 121 producers, according to a December update .  “Only by bringing producers to the center of the quest for solutions will we be able to contribute to a world without commodities-driven conversion, balancing environmental outcomes with resilient and prosperous rural communities,” said Tony Siantonas, director of the Scaling Positive Agriculture initiative for WBCSD, in a statement.  Soybean production and cattle raising activities are linked to deforestation in Brazil’s Cerrado region. Engagement seen as central to effective strategies That sentiment was echoed by a number of companies that have devoted considerable time and resources to the evolution of their policies for addressing deforestation, including food companies Cargill and Mars, food services firm Aramark, restaurant chain McDonald’s and fashion company Kering.  “I think the headline would be: Don’t work alone,” Yoann Regent, biodiversity and animal welfare specialist with Kering, told me in an interview. “Map your sourcing. You can’t do anything if you don’t know where to do it.” But the companies interviewed for this article have differing strategies for how to handle suppliers that don’t comply with their mandates. As already mentioned, Mars made the decision to pare down its partners to root out those with possible connections to deforestation. Kering also takes a relatively hardline approach, one that’s sewn into its contracts.  “Any leather suppliers that have a link to deforestation, especially in the Amazon, would be terminated,” Regent says. “There are so many other alternatives.”  Kering uses tools from NGOs, such as the Forest Mapper from Canopy, and certification information from the Forest Stewardship Council to guide decisions. It’s also planning to embrace an emerging resource from Textile Exchange called the Leather Impact Accelerator , which uses benchmarks to trace animal welfare and deforestation/land-conversion issues at the farm level. Other companies shy away from outright termination and advocate the notion of big companies using their buying power to inspire and demand change deep down into supply chains. Once you sever ties with a supplier, you lose leverage when it comes to convincing them to change business practices, they say.  “Fortunately, all of our suppliers for the relevant commodities are already working on ensuring that deforestation is happening in their respective supply chains,” writes Aramark’s Cacciola. “We focus on continuous improvement, so we engage with our suppliers to make improvements where relevant. We also expect quick and decisive action from suppliers if they do identify issues.”  “We don’t need to boycott, we need to choose the sustainable commodity,” observes Dan Strechay, global outreach and engagement director for the Roundtable on Sustainable Palm Oil , which represents more than 4,000 members of the palm oil supply chain with standards focused on sustainable production. “It’s time for everyone to uphold their sourcing policies. We need to implement the policies and reward the growers that we’ve asked to take these steps.”   And, companies need to act with more urgency, he urges: “Don’t take the policy you missed and kick it five years down the road. Make it count in the next two to three years.” Traceability transformed through technology The social distancing requirements related to the COVID-19 pandemic have made the already complicated task of tracing and verifying supply chain claims related to forest degradation more difficult — and underscored the critical role that digital technology can play in supporting successful “no deforestation” strategies. Kering is looking to solutions such as isotope tracking, genetic mapping and laser markings as a means of verifying that materials meet health and sourcing requirements, Regent says. McDonald’s is also looking to advanced technologies, notably satellite-mapping, to define its approaches to addressing deforestation. For example, it is working with agtech company AgroTools and Proforest to trace the origin of all Brazilian beef used in McDonald’s restaurants, notes Rachael Sherman, director of global sustainability for McDonald’s, in response to questions submitted for this article. “After determining risk level based on sourcing location, we use a combination of satellite imagery of the farm area and data analysis to assess whether deforestation has taken place and/or is projected to take place,” Sherman wrote. “This enables our suppliers to implement continuous improvement plans with farms that don’t comply with our policy.” McDonald’s is expanding this resource to other regions and has shared it with The Tropical Forest Alliance to encourage broader use, according to the company.  Elsewhere, Cargill is increasingly using a combination of GPS information and satellite imagery to pinpoint where forest degradation is taking place, specifically as part of its cocoa sourcing practices in the Cote d’Ivoire and Ghana. Bar-coding technology helps trace cocoa to individual farms.  “All of this tracking, mapping and ranking leads us to the most crucial step for making change: partnering with farmers and farmer organizations,” wrote Cargill’s vice president of global sustainability, Jill Kolling, in a GreenBiz article about the project . “The insights we collect can help Cargill determine precisely where to invest resources and how to tailor its farmer engagement initiatives to prevent new deforestation.” The integral role of Indigenous communities Indeed, the companies, NGOs and others contacted for this article echoed a similar conviction: That it will take active, authentic and at-the-ground-level engagement with the communities affected by deforestation — particularly Indigenous peoples — to deliver real progress in eliminating deforestation.  “We’ve seen a big movement in jurisdictional approaches, multi-stakeholder collaborations that include governments, NGOs and smallholder companies,” notes CDP’s Lam. She points to two programs that might serve as models for other initiatives. The first, the forest management program nurtured by paper company UPM, works with landowners to help diversify their revenue sources by co-locating activities such as cattle raising and agriculture alongside sustainable eucalyptus production. The partnerships currently cover more than 296,000 acres of lands — about 30 percent of the wood requirements for the UPM Fray Bentos pulp mill. UPM commits to timber purchases and helps with technical skills and seedlings.  I think the headline would be: Don’t work alone. Map your sourcing. You can’t do anything if you don’t know where to do it. The second, focused on the Leuser Ecosystem in Indonesia , is coordinated by the Earthworm Foundation and funded by a who’s-who list of multinationals including The Clorox Company, Colgate-Palmolive, The Hershey Company, Nestlé, Mars and Reckitt Benckiser, among others. It relies on a satellite system to hone which local communities should be priorities for engagement. Within the communities, the focus is on helping local farmers and mill owners secure their economic livelihoods in harmony with conservation practices. “Engagement is very, very important and that is why these multi-stakeholder collaborations are important,” Lam says. A crucial voice in these initiatives should be Indigenous communities, according to the executives and researchers who contributed insights for this article. “You can’t go in with your idea of what sustainability is. … You can’t bring your own perceptions about what will work,” says RSPO’s Strechay.  In particular, businesses should be more diligent about integrating the concept of ” free and prior informed consent ” into their supply chain engagement practices, if they want to take meaningful action on fighting deforestation, notes Global Canopy’s Rogerson.  By considering these rights upfront, companies can surface potential development issues at a much earlier stage. This should be a priority for 2021, Rogerson says, but “far fewer companies have policies for this [than for deforestation], even though these issues are intertwined.” Sustainability teams that feel they are too far removed from those actors to make an impact should engage with organizations that do have those connections, says Kering’s Regent. “Rely on local NGOs, scientific communities,” he says. “They might challenge you, but that is part of the game. Otherwise, you may address the program from the wrong angle.” Rabinovitch of Mars notes that the most important thing a company can do is grasp the reality of the challenges it will face.  “By fully understanding the scale of your carbon footprint and the systemic issues in your value chains, you’ll be able to set science-based targets to guide strategies leading to transformational, not incremental change,” he said. “It certainly isn’t easy work, and you won’t be able to do it alone, so finding partners who share your values and can help you identify achievable goals means your business can make a measurable, meaningful difference.” Pull Quote We’re seeing the end of the commodity era, where materials are sourced from largely unknown origins and bought purely for price on a transactional basis. I think the headline would be: Don’t work alone. Map your sourcing. You can’t do anything if you don’t know where to do it. Topics Supply Chain Forestry Deforestation Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Shutterstock Fires in the Amazon, photographer from space. Close Authorship

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Fighting deforestation should be a top priority for 2021, and here’s how it can be

The year ahead for water: The Roaring ’20s and creative destruction

January 7, 2021 by  
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The year ahead for water: The Roaring ’20s and creative destruction Will Sarni Thu, 01/07/2021 – 01:00 A recent issue of the Economist featured an article titled ” The Plague Year: The Year When Everything Changed ” (subscription required). Few will be surprised by this title. However, aside from the COVID-19 reflections, the article provides insights about lessons learned from several events from the early part of the last century. The article explains, “The horrors of the first world war and the ‘Spanish Flu’ were followed by the Roaring Twenties, which can be characterized by risk-taking social, industrial and artistic novelty.” In the U.S., Warren Harding built his 2020 campaign around “normalcy.” What unfolded was not a return to normal. According to the Economist, the survivors of the Spanish Flu and the first world war left survivors with “an appetite to live the 1920s at speed.” While making predictions for 2021 would be a fool’s errand, I am willing to place a bet that our view of water, including the more traditional view of the water sector — think utilities, solutions providers, NGOs — will not return to normal. And, frankly, we shouldn’t go back. The water sector from a technology, business model and funding perspective will be transformed, driven by lessons learned from the pandemic but also due to the natural rhythm of “creative destruction.” 2021 and creative destruction I believe this is the year where creative destruction will transform the water sector and our view of water. In the early 20th century, economist Joseph Schumpeter described the dynamic pattern in which innovative entrepreneurs unseat established firms through a process he called “creative destruction.” According to Schumpeter, and discussed in detail in ” The Prophet of Innovation: Joseph Schumpeter and Creative Destruction ,” the entrepreneur not only creates invention but also creates competition from a new commodity, new technology, new source of supply and a new type of organization. The entrepreneur creates competition, “which commands a decisive cost or quality advantage and which strikes not at the margins of the profits and the outputs of the existing firms but at their foundations and their very lives.” This innovation propels the economy with “gales of creative destruction,” which “incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.” Schumpeter’s view of creative destruction was applied to the emerging trend of sustainability in 1999 by Stuart L. Hart and Mark B. Milstein in their article, ” Global Sustainability and the Creative Destruction of Industries.” This is the article that got me curious about the cycles of creative destruction and its relevance to the water sector. For me, the key point from Hart and Milstein is that with technological innovation there is a dramatic transformation in institutions and society. The technology innovation — and, in turn transformation in institutions and in society — create profound challenges to incumbent businesses. Historically, these incumbents (the installed base) “have not been successful in building the capabilities needed to secure a position in the new competitive landscape.” One additional point about disruption, a term used frequently without distinction from innovation. Disruptive innovation “describes a process whereby a smaller company with fewer resources is able to successfully challenge the incumbent business.” Innovative companies disrupt incumbents by successfully gaining a foothold by delivering functionality frequently at a lower price while incumbents chase higher profitability in more demanding segments and tend not to respond effectively.   Advancing the water sector with disruptive innovation What does creative destruction and disruptive innovation mean for the water sector? I believe it will, in general, be the democratization of water. It will be an “end run” around the public sector, infrastructure and traditional financing of innovations to deliver universal and equitable access to safe drinking water, sanitation and hygiene. The creative destruction of water will include real-time and actionable information on water quantity and quality and increased access to capital to scale innovative solutions. A few examples of disruptive innovations we might anticipate for 2021 and this decade include: Digital technologies such as earth observation systems (satellite data analytics) for real-time water quality and quantity evaluations for watersheds, source water and asset management; real-time water quality monitoring at the tap; and artificial intelligence, inexpensive sensors and virtual reality/augmented reality applications to improve the management of utility and industrial assets and resource use Innovative business models and financing such as water as a service for outsourcing water conservation and treatment; or crowdfunding startups, projects and programs to supplement or serve as an alternative to traditional sources of investment capital Democratizing access to safe drinking water such as air moisture capture Decentralizing water treatment and reuse systems at the residential and community scale The water sector is poised to undergo a “gale of creative destruction” to a large degree by the pandemic. The accelerated transition to using digital technologies is also an enabling tool, in addition to providing readily accessible actionable information to the general population. I believe we are now entering the Roaring ’20s for water. Topics Water Efficiency & Conservation Innovation Featured Column Liquid Assets Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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The year ahead for water: The Roaring ’20s and creative destruction

3 circular economy trends that defined 2020

December 21, 2020 by  
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3 circular economy trends that defined 2020 Lauren Phipps Mon, 12/21/2020 – 00:15 As the year comes to a (welcome) close, it’s worth taking a moment to consider how the circular economy concept has emerged and evolved during this very particular year. Here are three trends that defined the circular economy in 2020, and what they might mean for the year to come.  1. Reuse is on the rise. Despite some setbacks posed by the pandemic (including misinformation about the safety of reusables peddled by industry lobbying groups), the transition from single-use to reusable packaging is building real momentum. With such proof points as Loop’s continued growth and recent $25 million Series A , Algramo’s New York expansion and the launch of the Beyond the Bag initiative, to name a few, it’s clear that reuse is taking hold at scale.  In 2021, I’ll be watching CPG and food and beverage companies, which have been scrutinized for one-off pilots and an overall failure to move quickly enough towards commitments to make all packaging recyclable, compostable or reusable by 2025. If brands and retailers intend to fulfill their public commitments, we’ll need to see real investment in reuse platforms and systems in the year ahead.  2. Metrics begin to materialize. This year saw the launch of new tools and standards to calculate and track the circular nature of products, business and systems. Notably, the World Business Council for Sustainable Development released the Circular Transition Indicators and the Ellen MacArthur Foundation launched the Circulytics tool; GRI established a new standard on waste ; and the Cradle to Cradle Products Innovation Institute released the fourth version of its product standard . The bright and shiny narrative of the circular economy’s promise will lose its luster without verified data and material evidence to show that circular is indeed better, and these tools are a step in the right direction.  Next year, I expect to see an emphasis on reporting and consistency of data behind various claims, as well as an effort to fold circular economy metrics into existing sustainability and ESG frameworks. I also will be looking for more actionable datasets and analysis on the link between climate change and the circular economy, and opportunities to mitigate carbon emissions using circular economy strategies.  3. It’s (still) all about plastic. Plastic continues to be the star of the show when it comes to the global conversation about materials management and circular economy solutions. The topic is top of mind for most of us given the increased demand for single-use everything amid the pandemic, which has led to a surge in plastic waste entering into waterways and oceans. But this year also offered a collective leveling-up of our data-backed knowledge and understanding about the flows and intervention points that could stem the tide on plastic pollution.  While source reduction continues to be the No. 1 solution to the global plastic waste crisis, many companies continue to solely address end-of-life management — notably in chemical recycling technologies for plastics packaging and synthetic textiles .  2021 is sure to bring continued tension between the problem of plastic waste and the problem of plastic production and use. I’ll be keeping my eye on the policy landscape and the balance between upstream action and accountability alongside downstream solutions.   This article is adapted from GreenBiz’s weekly newsletter, Circular Weekly, running Fridays. Subscribe here . Topics Circular Economy Reuse Plastic Featured Column In the Loop Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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3 circular economy trends that defined 2020

3 under-the-radar forces in food

December 18, 2020 by  
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3 under-the-radar forces in food Jim Giles Fri, 12/18/2020 – 01:00 Last week, I unpacked three hype-worthy trends shaping our food systems. Now I want to shine a light on three behind-the-scenes forces that aren’t generating headlines but should be. Let’s drive straight in. 1. Our two-tier food system The story: Online marketplaces that connect consumers with small-scale producers have boomed during the pandemic. Membership at Crowd Cow , a marketplace for craft meat and seafood, doubled in April alone. Thrive Market — tagline “healthy living made easy” — is closing in on 1 million members following a 50 percent jump this year . The backstory: This is good news from a sustainability perspective, because both companies provide additional sales channels for producers that practice organic and regenerative agriculture. They’re also using zero-waste commitments and new packaging technology to aggressively tackle the delivery sector’s waste problems. These achievements make me hope these companies prosper, but I’m unnerved at the fragmentation of food retail they represent. We’re seeing a surge in new sales channels that allow relatively wealthy consumers to make healthy and sustainable choices, but nothing like the same momentum elsewhere in the market. Convenience and dollar outlets remain the only food outlets in many low-income neighborhoods.  This is a (sadly familiar) failure of social justice. It’s also a problem for sustainability. We can’t create the food system we need — one that’s low-carbon and biodiversity-enhancing — if only one tier of that system delivers those benefits.  2. Ghost kitchens in the parking lot The story: Amazon disrupted retail by creating a marketplace for all sellers. Now something similar is happening in the restaurant industry, where a company named REEF is setting up and running kitchens in parking lots, which restaurants use to fulfill take-out orders. The restaurant specifies the recipe, REEF creates the dishes, and a delivery service (say DoorDash or Uber Eats) gets the meal to your maw. The backstory: This trend will bring changes both good and bad to the dining sector. I want to make the case that this consolidation of takeout infrastructure is also potentially a big deal for sustainability.  U.S. restaurants throw away more than 10 billion of tons of food every year, one reason why 6 percent of global greenhouse gas emissions come from food waste. One solution is to deploy a food waste tracking technology, such as Leanpath . That can be a challenge for small restaurants, but it makes more sense for a centralized operation such as REEF, which just raised $700 million . REEF’s hyper-local approach also lends itself to cargo bike deliveries. Although the company declined a request to discuss its broader sustainability strategy, it is experimenting with bikes: In May, it announced a pilot with delivery firm DHL that involves four electric bikes in the company’s hometown of Miami. 3. A rapid route to the right recipe The story: Kapor Capital and the Emerson Collective are among the funders behind Planet FWD, maker of Moonshot, a new climate-friendly snack brand . The backstory: Why have a bunch of well-known Silicon Valley investors backed a company that sells crackers? Well, Moonshot is a real product, but Planet FWD’s raison d’être is actually the software the company used to source ingredients for its snacks. The tool allows food brands to easily identify ingredients that meet key sustainability metrics, including low emissions. Rivals in this space include Latis and Journey Foods .  This kind of digital infrastructure is invisible to anyone outside of the food business, but until recently it’s been a missing piece of the sustainability jigsaw. Large retailers and brands can pressure suppliers to discuss environmental metrics, but smaller companies and startups don’t have the leverage. As a result, comparing the sustainability bona fides of different ingredients becomes very time-consuming. By solving this problem, services such as Planet FWD will act as an accelerant, allowing brands with ideas for new sustainable foods to get to market much quicker.  This article was adapted from the GreenBiz Food Weekly newsletter. Sign up here to receive your own free subscription. Topics Food & Agriculture Social Justice Featured Column Foodstuff Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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It’s time to nominate rising stars for the GreenBiz 30 Under 30 list

December 15, 2020 by  
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It’s time to nominate rising stars for the GreenBiz 30 Under 30 list Heather Clancy Tue, 12/15/2020 – 01:30 The GreenBiz editorial team is looking for someone (actually, someones) to celebrate! If you know a young professional in the field of corporate sustainability — someone who already has made their mark during the first decade of their career — we would love an introduction. We seek nominations for GreenBiz’s sixth annual 30 Under 30 feature . This annual list recognizes individuals tackling some of the toughest sustainability challenges in business — from inside big companies, at the helm of startups, working in the nonprofit sector, shaping clean economy policy, the list is broad. You may nominate yourself or another individual using the form at the end of this article. (If you nominate yourself, you’ll need to provide a reference.) Review our age requirement closely: Nominees must not have reached their 30th birthday before May 17, when we plan to introduce the next list of honorees to the GreenBiz community.  We encourage submissions for individuals in all roles — even if the person doesn’t have “sustainability” in their title. If they are making a difference in climate action that has an impact on the corporate sector, we would love to hear about their work. And we are seeking diverse suggestions, in the many senses of that term, especially Black, Indigenous and people of color (BIPOC) individuals as well as those representing companies based outside the United States. We have much to learn from different perspectives. All finalists will be notified confidentially after the nominations close Jan. 23, when we’ll reach out to interview the selected honorees. We regret that we will be unable to contact those not selected for the list. Read about the 2020 class of GreenBiz 30 Under 30 honorees here .   Topics Careers Collective Insight 30 Under 30 Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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A vision for a Biden-Harris sustainable business agenda

November 17, 2020 by  
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A vision for a Biden-Harris sustainable business agenda Aron Cramer Tue, 11/17/2020 – 01:30 This article originally was published in the BSR Insight . Now that the results of the United States presidential election are in, it is time to focus on what business can do to promote a policy agenda that will accelerate the transformation needed to shift to a truly just and sustainable economy.  The U.S. government has been either absent or counterproductive on sustainability issues the past four years. This will change in a Biden-Harris administration. How much it changes will depend greatly on the actions and influence of the business community. BSR exists to catalyze business leadership to achieve a just and sustainable world. We believe strongly that sustainability is a primary source of strategic business advantage. We believe that comprehensive business action calls for companies to “act, enable, and influence,” creating change both through actions in the “real economy” and also in advocating for policy solutions. With a new government coming into power, now is the time for business to use its voice and influence to call for decisive action from a more receptive administration in Washington. With this in mind, here is the agenda that BSR urges businesses to call on the Biden administration to adopt, in the spirit of the campaign’s “build back better” mantra. It is time to focus on what business can do to promote a policy agenda that will accelerate the transformation needed to shift to a truly just and sustainable economy. Employment and economic Repairing the safety net:  It is time for business to engage with government in remaking the social safety net for the 21st century. 2020 has exposed the serious holes in the safety net, not least access to health care. It is also time to develop a consensus on portable benefits for people who change jobs or who work outside traditional jobs. Innovations such as the tax-deferred “401(j)” accounts proposed by Al Gore to allow employees to save for lifelong learning also would be a good step. These steps not only would enable economic security and mobility, they also would ensure opportunities for innovation and a dynamic workforce that businesses need. Income inequality: t is long past time for Americans to reverse the deep and widening inequality that plagues our country. While there are multiple reasons for this problem, three topics deserve to be made a priority. First is the need to raise the minimum wage to a level that is a genuine living wage. This would both enable families to support themselves and also reward labor in an economy in which capital has been rewarded more than it should be. Second is executive compensation, which has continued to rise far too fast. It is time for business leaders to take voluntary steps to reduce executive pay and for boards to commit to the same. Third, income inequality strikes communities of color especially hard and all pathways to prosperity need to address the wealth gap directly. Future of work: The changing nature of work is accelerating due to the confluence of COVID-19 and automation. Contingent or non-traditional work is the fastest growing category of work. There is no consensus on the rules governing such work or universal benefits people can access regardless of how their work is classified. Dialogue between business, government and workers’ representatives is needed to establish the rules of the road. Climate and environment Net zero target for the U.S.: Returning to the Paris Agreement will happen Jan. 20 — that is only the start. The U.S. should commit to a net-zero target the way that the European Union, China, Japan, South Korea and others — including many U.S. states and cities — have. The need for renewed climate diplomacy, with the U.S. playing a crucial role along with the EU, China and Japan, could not be more important in the run-up to COP 26. Climate justice/just transition: Awareness of the disparate impacts of climate — mainly hitting communities of color and those with less formal education — means that environmental justice should come to the forefront. The shift to net-zero is a generational opportunity for progress, not only removing the most toxic elements of the existing energy system but also generating economic opportunities in the clean energy economy as a means of combatting poverty and discrimination. Business should insist that the transition to net zero include policies that prioritize the phase out of toxic impacts on communities of color, incentives for investments that ensure that the clean energy economy delivers training, and employment for people who need opportunities the most, in both rural and urban communities. Green infrastructure:  Even with divided government, investment in green infrastructure is possible as a means of generating employment at a time when it is badly needed and to reduce the operating costs of U.S. infrastructure. Business should advocate for built environment and transport systems that accelerate and prepare for the net zero economy. The long debated Green Infrastructure Bank should become a reality, not least with the rise of green and “olive” bonds. And this is also the place where serious — and badly needed — resilience objectives can be achieved. Regenerative agriculture: At long last, there is mainstream recognition of the deep intersections of climate, human health and the vibrancy of America’s agricultural economy. What’s more, the political opportunity to bring the country together through heartland interest in thriving agriculture and coastal interest in climate action is one that could help unify a country that is divided against itself on climate action. It is time for business to make clear that it wants and needs strong support for human rights, with renewed action from the White House and State Department at a minimum. Social Racial justice: The Biden campaign made clear that racial justice was one of its four priorities, along with climate action, economic opportunity and public health. In fact, these four topics are interrelated and should be addressed as such. The business community should make sure that the many statements of support for Black Lives Matter in 2020 are strengthened by a long-term commitment to ensure that decisive action is taken to end the centuries-long scourge of systemic racism. As noted above, the wealth gap that exists in communities of color is a legacy of longstanding oppression. Steps taken to address climate, strengthen the social safety net, restore public health and invest in green infrastructure offer great promise in addressing the wealth gap, and business should support this objective vocally. In addition, business also should make clear its support for criminal legal system reform, starting with policing, but also including access to the court system and incarceration rates. Finally, business should call for mandatory disclosure of employee demographic information, which leverages transparency in support of greater equity. Technology and human rights/privacy: It is well understood that policy moves more slowly than technology. At a high level, the U.S. government should establish the principle that new technologies should adhere to international human rights standards in their design, development and use. In addition, the U.S. government can introduce a federal privacy law along similar lines to the GDPR, ensure that any revisions to Section 230 of the Telecommunications Decency Act of 1996 are consistent with the protection of human rights, and introduce sector-based approaches to regulating disruptive technologies, such as artificial intelligence, machine learning and biometric technologies. Companies from all industries should advocate for a technology policy and regulatory context that protects interdependent rights such as freedom of expression, privacy, security, freedom of assembly, non-discrimination, public health and access to remedy. Restoring support for human rights and democracy: The U.S. government has provided implicit and explicit support for some of the governments most responsible for the worst human rights abuses over the past few years. The business community shied away from calling this out the way they challenged the Trump administration’s approach to climate. It is time for business to make clear that it wants and needs strong support for human rights, with renewed action from the White House and State Department at a minimum. Human migration and refugee policies: The xenophobia unleashed in the first days of the Trump years must be relegated to the past. Business consistently has called for immigration policies that enable the U.S. to welcome the breadth of human capacity that comes from literally every corner of the world. This is needed both for humanitarian reasons, which speak for themselves, but also because of the positive impact open societies have on economic vitality and innovation. What’s more, this will also help to restore America’s soft power around the world, something that benefits U.S. businesses and which has been seriously damaged since 2016. Governance Corporate governance reforms and listing requirements: It is time for boards to reflect more fully the world in which business actually operates. This means diversifying board composition. It also requires that so-called “non-financial” considerations be embedded in corporate governance and listing requirements. A good first step towards integration of ESG into corporate governance would be business advocacy for making the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD) mandatory. This then can be extended to other steps including mandatory human rights diligence, executive compensation and workplace diversity. All these steps will strengthen the resilience of business and bring America’s trading rules in sync with advances in Europe and elsewhere. Restoring democracy: 2020 has made clear, yet again, of significant structural flaws in American democracy. Business associations stepped up to call publicly for democratic processes to be honored — and have continued to call for this post-election. This remains important as many have chosen not to honor the clear outcome of the election. Despite this, American democracy appears poised to survive in the wake of this unusual election, but issues remain. Business should use its voice to call for reforms that address voter suppression, campaign finance, gerrymandering and a judicial system infected by hyper-partisanship. This is an issue that many CEOs will seek to avoid for fear of appearing to pick sides, and that is understandable. But the reforms called for here should not be seen that way, as they are necessary for our system to function, for all people to have their voices heard and for faith in the system be restored. 2020 has made clear, yet again, that there are significant structural flaws in American democracy. Rules-based trading system with multilateral agreements: The U.S. was the primary architect of the rules-based trading system in the wake of World War II and the primary protector of that system over the past 75 years. While this system certainly needs significant reforms, the past four years have taken a scorched-earth approach that leaves us no hope of managing an interdependent world well and fairly. Business could not have more of a stake in restoring support for the concept of multilateralism and more of a need to make sure it is fit for purpose in the 21st century. Procurement: Finally, business should call on government to partner more aggressively on procurement policies. The U.S. government has immense purchasing power and it is not being used as fully as it could be to promote the creation and efficiency of markets for sustainable products and services. This is also a uniquely valuable way to address the wealth gap, with government partnering with BIPOC-owned businesses as suppliers. There will be a time to get more specific on policy solutions. For now, however, it is essential to define the areas where progress is necessary. Much of what is advocated here is also found in BSR’s call for business action to promote a 21st century social contract . The temptation to “go back to business as usual” will be strong for many, but that would be a mistake. Building a just and sustainable world never has been about opposing any single political leader. It always has been about building a future in which we can all thrive. It is about what we are for, not what we are against. After four years when the U.S. government failed to embrace — and often thwarted — the achievement of sustainable business, the business voice remains a powerful tool in creating an economy that works for all. Pull Quote It is time to focus on what business can do to promote a policy agenda that will accelerate the transformation needed to shift to a truly just and sustainable economy. It is time for business to make clear that it wants and needs strong support for human rights, with renewed action from the White House and State Department at a minimum. 2020 has made clear, yet again, that there are significant structural flaws in American democracy. Topics Policy & Politics Policy & Politics Paris Agreement Climate Justice Resilience Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off President-elect Joe Biden and vice president-elect Kamala Harris on stage at the Queen Theater in Wilmington, Delaware during the 2020 election campaign. Photo by  Stratos Brilakis  on Shutterstock.

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Here’s how Joe Biden could cultivate a more sustainable food system

November 13, 2020 by  
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Here’s how Joe Biden could cultivate a more sustainable food system Jim Giles Fri, 11/13/2020 – 00:14 Let’s do a quick thought experiment. Imagine stepping into an elevator and realizing that the man next to you is President-elect Joe Biden. You have 30 seconds to urge him to focus on a particular issue. What would it be? Earlier this week, I invited leaders from food and agriculture to play that game. Specifically, I asked them what Biden’s administration should do to accelerate progress toward a more sustainable food system. I got more responses than I can share in a single newsletter, so I’ll be rolling out answers weekly until the end of the year. Here are three — spanning farm spending, technical support and farmers of color — to get the conversation started. No need to wait for Congress One of the most encouraging responses emphasized that there’s a lot Biden can do without additional support from Congress.  “The U.S. Department of Agriculture can take advantage of tools and money it already has to help farmers transition to more climate-friendly practices that can also lead to improved farm economic resilience in the long term,” said Chris Adamo, vice president of federal and industry affairs at Danone North America. “Via the Farm Bill, the department spends approximately $6 billion annually on conservation practices. As part of its conservation funding, the USDA could prioritize soil health through cover crops, crop diversification and other regenerative practices, and partner with the private sector to leverage resources.” Adamo added: “The current administration has also spent over $30 billion compensating farmers for COVID and trade-related losses. However, many farmers may not be in a better situation in the short term. If we’re going to continue to pay for market losses, it may be better to invest with diversity, equity and climate in mind.” Boots on the ground The federal government also can help support ongoing private sector projects in food and ag, where many companies are already working to cut greenhouse gas emissions from agriculture and to regenerate farmland and waterways.  “To support this transition, the USDA should boost farmer and rancher program service delivery through more boots-on-the-ground technical assistance,” said Debbie Reed, executive director of the Ecosystem Services Market Consortium . “There continues to be a real need for technical assistance to transfer knowledge, outcomes and benefits to working farmers and ranchers.” If we’re going to continue to pay for market losses, it may be better to invest with diversity, equity and climate in mind. Particularly when it comes to conservation programs, this support needs to recognize that different farmers have different needs, Reed added. In practice, this means it needs to be place-based and flexible enough to allow farmers and ranchers to improve environmental impacts without incurring excessive risk. One way to deliver this, suggested Reed, would be to rebuild the ranks of the USDA’s Natural Resources Conservation Service, which have fallen dramatically over the past two decades. Protect farmers of color Black farmers sometimes refer to the USDA as “the last plantation” due to the agency’s long history of discriminating against farmers of color. The results of this lack of support have been devastating. A century ago, there were a million Black farmers in the United States. Now just 45,000 remain, each earning, on average, one-fifth of what white farmers do.  That history is why Leah Penniman, co-director and manager of Soul Fire Farm in upstate New York, is urging Biden to enact protections and support for farmers of color. These include expanded access to credit, crop insurance and technical assistance; independent review of farmland foreclosures; and debt forgiveness programs where discrimination has been proven. (If you’re interested in learning more about this issue, Penniman helped create Elizabeth Warren’s policy proposals in this area , which remain some of the most ambitious.) What would you say to Biden during your shared elevator ride? Let me know at jg@greenbiz.com . I’ll include as many responses as possible in Food Weekly during the transition period. This article was adapted from the GreenBiz Food Weekly newsletter. Sign up here to receive your own free subscription. Pull Quote If we’re going to continue to pay for market losses, it may be better to invest with diversity, equity and climate in mind. Topics Food & Agriculture Policy & Politics Social Justice Regenerative Agriculture Featured Column Foodstuff Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Biden-Harris supporters gather at a farm market in Bucks County, Pennsylvania, for a “get out the vote” event on the eve of the 2020 presidential election. Shutterstock Ben Von Klemperer Close Authorship

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Here’s how Joe Biden could cultivate a more sustainable food system

How to ensure circular fashion is good for people and the environment

October 9, 2020 by  
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How to ensure circular fashion is good for people and the environment Annelise Thim Fri, 10/09/2020 – 00:15 This article originally was published in the BSR Insight . The COVID-19 pandemic has thrown the fashion industry into disarray, leaving supply chain workers without wages and causing major global brands to file for bankruptcy. In the United States alone, 2.1 million retail workers lost their jobs due to the crisis. In Bangladesh, the garment sector is expected to lose over a million jobs by December, with over 70,000 workers already laid off. While many underlying issues are not new to the industry, the unprecedented situation has made us acutely aware of the fragilities of our current economic system and of just how vulnerable people — especially workers and their communities — are to significant business disruption. As our society looks to build back better by emerging from the crisis with a more resilient and sustainable system, many industries are planning to integrate circularity into their recovery plans. Indeed, even before the COVID-19 outbreak, circular economic models had been sprouting up at increasing speed in the fashion industry, both to counter its enormous environmental impact and to respond to economic opportunities. The textile industry alone produces 1.2 billion tons of CO2 per year and accounts for around 20 percent of global industrial water pollution . Companies, brands and designers are increasingly looking to circular fashion models, including resale, rental and repair, to mitigate these impacts. A strong signal of the circular fashion opportunity: Resale grew 25 times faster than the overall retail apparel market in 2019. While the potential positive environmental impact of a shift to a circular economy is enormous, few organizations are considering the social implications for the more than 60 million people in its value chain . Given the sheer size of the industry and the many ways people intersect throughout production and consumption, social implications, whether positive or negative, are unavoidable. Women, who comprise between 60 to 90 percent of total apparel workers, of whom an estimated 80 percent are women of color , likely will take the brunt of the impact due to their precarious working conditions and existing gender-based discrimination. BSR’s new brief, ” Taking a People-Centered Approach to a Circular Fashion Economy ,” explores the potential social impacts that may emerge from a mainstream shift to circular fashion . The textile industry alone produces 1.2 billion tons of CO2 per year and accounts for around 20 percent of global industrial water pollution. Informed by BSR’s research and stakeholder engagement supported by Laudes Foundation , an independent foundation tackling the dual crises of climate change and inequality, the brief proposes opportunities for businesses, policymakers and advisers to design circular fashion business models to be inclusive and fair from the outset. In addition, we provide a set of guiding questions for companies and organizations to practically think through the social impacts of their shifts to circular fashion models, aiming to avoid and mitigate negative social impacts and more consciously target positive social impacts. “The vision of ‘circular economy’ presents an economy that is compatible with nature, but we cannot take for granted that it will be inclusive,” said Megan McGill, senior program manager at Laudes Foundation. “BSR’s work is enabling us to ensure that in our pursuit for a regenerative and restorative economy, we are actively managing and promoting the rights and equity of people touched by the fashion sector.” This current period of complex disruption presents a unique opportunity to leverage the shift to circularity to address some of the global fashion industry’s persistent and pervasive environmental and social issues. By taking a people-centered approach, we can build a more resilient industry and respond to the calls from stakeholders — through safer inputs that increase the health and safety of workers and production communities, enabling creative and dignified employment, and building inclusive models adapted to the needs of a diverse consumer base. Supported by Laudes Foundation, BSR is continuing to explore the impacts of the shift to circular fashion on job opportunities and quality — a topic largely ignored in the circular transition to date and which we begin to delve into in this brief. Our current work aims to explore and develop responses to these impacts in collaboration with fashion companies and broader industry stakeholders. In addition, we will leverage strategic foresight in developing and testing practical recommendations with special focus on the U.S., Europe and India. This brief was developed by Cliodhnagh Conlon and Annelise Thim, with input from Laura Macias and Magali Barraja and with the support of Laudes Foundation. As we delve deeper into this topic, we are keen to hear feedback and learn from others who are working to ensure that the circular fashion transition delivers benefits for people. If you are currently working on circular fashion or would like to learn more about our work, please reach out to connect with the team. Pull Quote The textile industry alone produces 1.2 billion tons of CO2 per year and accounts for around 20 percent of global industrial water pollution. Contributors Cliodhnagh Conlon Topics Circular Economy Supply Chain Fashion Supply Chain Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Garment worker in Bangladesh, where the garment sector is expected to lose over a million jobs by December 2020, with over 70,000 workers already laid off. Photo by Jahangir Alam Onuchcha on Shutterstock.

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