HSBC is latest bank to pledge net-zero financed emissions by mid-century

October 13, 2020 by  
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HSBC is latest bank to pledge net-zero financed emissions by mid-century Cecilia Keating Tue, 10/13/2020 – 00:46 HSBC has become the latest bank to commit to achieving net-zero financed emissions, announcing Monday that it intends to align its portfolio of investments and debt financing with global climate targets by mid-century. The bank, currently Europe’s second largest financier of fossil fuels, has committed to reaching net-zero across its supply chain and operations by 2030, before reaching net-zero across its customer portfolio 20 years later. The pledge does not include any firm commitments to phasing out support of fossil fuel companies, but confirms the bank’s plans to channel between $75 billion and $1 trillion of financing and investment over the next 10 years to support its customers’ transition towards net zero emissions. In an open letter to its clients, HSBC CEO Noel Quinn said the bank had been motivated to ramp up its environmental ambition by customer concern about climate change. “We know this is an issue that many of our 40 million customers care deeply about, particularly in our retail and private banking businesses,” Quinn wrote . “They care as citizens, consumers and business owners. We are committed to developing products that allow them to invest or participate in efforts to bring about a more sustainable global economy.” While the pledge provides limited detail on the measures it will take to slash the carbon emissions of its portfolio or operations, the bank said it would establish “clear, measurable pathways” to net-zero using the Paris Agreement’s Capital Transition Assessment Tool (PACTA). We know this is an issue that many of our 40 million customers care deeply about, particularly in our retail and private banking businesses. HSBC said it would “apply a climate lens” to all its financing decisions and disclose its climate risk in line with the recommendations of the Taskforce on Climate-related Financial Disclosure (TCFD). It also said it would work with the broader finance sector to create a standard to measure financed emissions and support a functioning carbon offset market. Ben Caldecott, director of the Oxford sustainable finance program and COP26 strategy adviser for finance, hailed the announcement as a “big deal,” noting that HSBC faced particular challenges due to its being more exposed to emerging markets than many of its peers. Elsewhere, the news elicited a more lukewarm response, with a number of environmental campaigners slamming the commitment as “empty” due to its lack of a phaseout timeline for its support of fossil-fuel companies and businesses responsible for deforestation. “HSBC’s net-zero commitment is a bit like saying you’ll give up smoking by 2050, but continuing to buy a pack a week or even smoking more,” said Becky Jarvis, coordinator of campaign group network Fund Our Future UK. “Any further financing of oil, gas and coal expansion today is utterly at odds with a net-zero commitment by 2050. That’s just science, not finance.” Adam McGibbon, energy finance campaigner at Market Forces, said the proposals represented “zero ambition, not net-zero ambition.” “If you want to know what HSBC’s stance on climate change really is, look at what they fund, not their fluffy marketing,” he added. “This is a bank that owns stakes in companies seeking to build enough coal power plants to emit carbon emissions equivalent to 37 years of the UK’s annual emissions.” HSBC, which provided $87 billion in financing to top fossil fuel companies since the Paris Agreement and nearly $8 billion in loans and underwriting to 29 companies developing coal plants between 2017 and Q3 2019, has faced growing pressure from shareholders to cease financing companies heavily dependent on fossil fuels. In May, 24 percent of shareholders voted in favor for an independent resolution that called for clear phaseout targets and in 2019 a group of investors, including Schroders, EdenTree and Hermes EOS, wrote a letter to the bank’s then-CEO urging him to end support of companies dependent on coal mining or coal power. This week’s announcement is the latest in a growing wave of pledges from across the financial sector from banks and investment firms looking to fully decarbonize not just their operations but also their portfolios. In the past month alone, Morgan Stanley and JPMorgan Chase have made similar pledges, while earlier this year Barclays and Natwest promised to move their investment activities into line with the Paris Agreement. Pull Quote We know this is an issue that many of our 40 million customers care deeply about, particularly in our retail and private banking businesses. Topics Finance & Investing Corporate Strategy Net-Zero BusinessGreen 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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HSBC is latest bank to pledge net-zero financed emissions by mid-century

San José’s bold new plan for climate-friendly transit

October 13, 2020 by  
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San José’s bold new plan for climate-friendly transit Elizabeth Stampe Tue, 10/13/2020 – 00:22 San José is rolling out the green carpet for biking, thanks to the city council’s unanimous passage of the Better Bike Plan 2025 . With the plan’s adoption, the city commits to building a 550-mile network of bike lanes, boulevards and trails to help thousands more people ride safely. The plan is realistic about the past, acknowledging San José’s sprawling 180-square-mile spread, its car-oriented layout and its inequitable history of transportation decisions, which continue to shape people’s lives. But the plan also looks ahead, aiming to create a city where anyone can comfortably bike to any neighborhood.  The planned network includes 350-plus miles of protected bike lanes, 100 miles of bike boulevards and 100 miles of off-street trails. Already, the city has built over 390 miles total.  First, make it safe The numbers are impressive. But the numbers don’t tell the whole story.  With this plan and its creation, the city lays out a thoughtful approach to who feels comfortable biking, who doesn’t and how to invite more people out onto bikes. Many cities have been finding creative ways to help their residents get around safely, healthily and affordably. For too long, bike lanes — not just in San José but nationally — have been created for the few people who feel fine biking on a street full of fast traffic, protected by only a line of white paint. The new plan acknowledges that’s often not enough for people to feel comfortable, instead offering “the evolution of a bike lane,” first by just widening that painted lane into buffer to create more separation from traffic, then putting parked cars between bikes and traffic when possible, and then building a whole raised curb between cars and the bike lane. Sometimes, instead of adding miles, it’s important to go back to make existing miles of bike lanes better and safer. The plan emphasizes that many of San José’s quiet residential streets can connect to create a “low-stress” network of “bike boulevards,” along with safe ways to get across the big busy streets. To create the plan, city staff talked with residents. They also partnered with community-based organizations such as Veggielution , Latinos United for a New America (LUNA) and Vietnamese Voluntary Foundation (VIVO). At meetings and focus groups in Spanish and Vietnamese as well as English, city staff and partners asked residents: What would help make them more likely to bike?  Paramount across communities was concern for safety.  Build quick, aim high  The city already has shown that it can move quickly. With its Better Bikeways project and with the assistance of the Bloomberg Philanthropies American Cities Climate Challenge, San José will have built 15 miles of protected bike lanes between 2018 and 2020.  The “quick-build” model is impressive. A few of us from the Climate Challenge got to tour San José’s downtown by bike last year with Mayor Sam Liccardo and the National Association of City Transportation Officials (NACTO). We pedaled along new green lanes, protected by sturdy green posts and complete with ingenious bus islands that are wheelchair-accessible and allow bus riders to cross bike lanes safely. The green posts that protect bikers look reassuringly solid but they’re actually plastic, making them low-cost, easy to install yet imposing enough to form a kind of low wall between bikes and car traffic. It felt safe. Now the trick is to build out from downtown, connect to neighborhoods and get more people using them.  The city has set ambitious goals for “bike mode share,” which means the percentage of all trips people take in the city by bicycle. San José’s current General Plan aims for 15 percent bike commute mode share by 2040, and its Climate Smart plan seeks to reach 20 percent by 2050.  These are tall orders. Today, just 1 percent of commute trips in the city are made by bike, although a city survey found that 3 percent of people reported biking as their primary way of getting to work and even more residents using a bike as a backup mode of transportation. Of commute trips to downtown, 4 percent are by bike. These numbers might sound small, but it’s important to consider that bike commuting is on the rise: Between 1990 and 2017, San José saw a 28 percent increase in commute trips made by bike. But not all trips are commute trips; in fact, in San José, only one in five trips are to and from work. That’s especially true in these teleworking times. Encouragingly, the plan notes that 60 percent of all trips people make in the city are less than 3 miles long. Those short trips, combined with the city’s mild climate and flat terrain, make biking a good option, creating the opportunity for the city to achieve its bold goals. The Better Bike Plan 2025 includes a five-year action plan of prioritized projects to implement and coordinates with the city’s paving program to save money. It offers a range of costs to make these changes, from quick and temporary to more permanent, that total roughly $300 million.  The prioritized projects listed in the plan — the list of streets where bike improvements will go — were chosen with three aims: Increase biking mode share: Areas where bicycle trips are most likely, based on factors such as population, employment and connections to transit, downtown and the existing bike lane network. Increase safety: Projects that will fix “high-injury” streets where collisions are most serious and frequent. Increase equity: Low-income and historically underserved neighborhoods, also called “Communities of Concern,” especially just to the south, east and north of downtown. People living in these neighborhoods are likely to have fewer transportation options, less access to a private car and may be essential workers, required to show up at a job in person every day. More safe, healthy, affordable transportation options are needed, and soon. What comes next: A time for action In this difficult year, many cities have been finding creative ways to help their residents get around safely, healthily and affordably. Biking nationally has boomed . San José has launched an Al Fresco program that repurposes streets for outdoor dining. In March, nearby Oakland launched the nation’s first and most ambitious “Open Streets” program along its planned bike network, acting quickly to make those streets safer by discouraging most car traffic. Oakland’s Open Streets program also creates more safe outdoor areas for people in neighborhoods with less access to open space, reduces crowding at Lake Merritt and other parks and frees up more space for social distancing than sidewalks typically offer. Oakland recently released a report to help cities in the Bay Area and beyond learn from its example.  San José has a less dense footprint than Oakland, but its residents still have a great need for safe, affordable transportation in these times. The city can take its thoughtful Better Bike Plan as a starting point to act quickly, and rebuild its streets to bring safe biking to all. Pull Quote Many cities have been finding creative ways to help their residents get around safely, healthily and affordably. A city survey found that 3 percent of people reported biking as their primary way of getting to work. Topics Cities Transportation & Mobility NRDC Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off A shark appears in a San Jose bike lane, a nod to the local ice hockey team. Shutterstock Anna MacKinnon Close Authorship

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San José’s bold new plan for climate-friendly transit

David Crane is back, with a climate-tech SPAC

October 8, 2020 by  
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David Crane is back, with a climate-tech SPAC Heather Clancy Thu, 10/08/2020 – 01:45 One of the hottest 2020 trends in raising capital is infiltrating climate-tech investing.  As of mid-September, the stock market had welcomed at least 82 initial public offerings this year by special purpose acquisition companies (SPACs) — organizations that collectively raised more than $31 billion. Last week, former NRG Energy CEO David Crane joined the frenzy.  Crane was instrumental in leading NRG into renewables and other clean energy sectors and was ousted in late 2015 after its stock tanked. (Disclosure: Crane is a former GreenBiz editor at large, and you can read his body of work here .) As of Monday, his new company, Climate Real Impact Solutions (CRIS), had raised more than $230 million for the purpose of merging with a company focused on solving the climate crisis.  “Over the past decade, American entrepreneurs have brought forth a wide array of exciting products and services which are clean, green, smart and affordable,” Crane said in a statement. “We have formed Climate Real Impact Solutions to help those entrepreneurs gain access to the capital, the connections and the talent they need to take their businesses to the next level while amplifying their climate impact.”  The public markets have this appetite for companies that want to change the world. The “we” in that statement includes high-profile clean energy veterans: former Green Mountain Power CEO Mary Powell (the chairperson), ex-Credit Suisse energy group executive John Cavalier (CFO) and onetime GE vice chair and GE Ventures lead Beth Comstock (chief commercial officer).  A SPAC , also known in financial circles as a “blank check” company, is a corporate structure created with the mission of merging with another firm — usually within a two-year timeframe. After the merger, the acquired company becomes listed.  Why would a startup do this? You can think of it as an alternative for a late-stage venture capital round, Crane told me last week when we chatted about the venture. It’s of interest to companies that feel capital-constrained, and the current uncertain state of the economy has galvanized interest.  There isn’t as much scrutiny on the company going public as there would be with a traditional IPO, which is why SPAC-enabled deals are a controversial topic right now. One of the most vivid examples of what could go wrong is the hoopla surrounding Nikola Motors, the electric truck maker. The company’s founder, Trevor Milton, resigned in September after being accused of fraud and sexual misconduct. Quite a few next-generation transportation companies have used SPACs to go public this year, including EV maker Fisker and autonomous vehicle sensor company Velodyne Lidar. Even former Uber executive Emil Michael is getting into the act: He registered plans for a $250 million SPAC late last week. Crane told me he actually considered creating a SPAC three years ago but decided the market wasn’t ready. But now, investors are far more interested in startups looking to raise capital that have strong environmental, social and governance (ESG) stories. “The public markets have this appetite for companies that want to change the world,” he said. What is CRIS looking for? A SPAC can only buy one company but the team plans to evaluate carbon removal and avoidance businesses. There’s a long list of categories that fit that bill, including ones where Crane and company have a lot of expertise in their background: distributed generation plays (such as rooftop solar), utility-scale renewables ventures, energy storage startups, renewable natural gas, energy efficiency service providers and green energy retailers, electric vehicle infrastructure or decarbonized fuels. There’s also a chance the company could focus more on organizations removing carbon from the atmosphere, such as a reforestation, regenerative ag or carbon capture company, although those startups tend to be at an earlier stage given the dynamics of carbon pricing, Crane said.  CRIS plans to use both traditional financial evaluation methods and “climate-focused environmental metrics” to make their decision, and you can expect the CRIS crew to be actively involved with mentoring and supporting the acquisition target’s management team. The CRIS board also includes Mimi Alemayehou (Black Rhino Group), Richard Kauffman (former New York energy and finance czar) and Jamie Weinstein (managing director of PIMCO, which helped organize co-sponsors for the offering). I’m eager to see who CRIS targets, aren’t you? Pull Quote The public markets have this appetite for companies that want to change the world. Topics Climate Change Finance & Investing Climate Tech Featured Column Practical Magic Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off NRG.com Close Authorship

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This new cooling technology also prevents viral spread

October 8, 2020 by  
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This new cooling technology also prevents viral spread Gloria Oladipo Thu, 10/08/2020 – 00:40 In the face of dangerous heat waves this summer, Americans have taken shelter in air-conditioned cooling centers . Normally, that would be a wise choice, but during a pandemic, indoor shelters present new risks. The same air conditioning systems that keep us cool recirculate air around us, potentially spreading the coronavirus. “Air conditioners look like they’re bringing in air from the outside because they go through the window, but it is 100 percent recirculated air,” said Forrest Meggers, an assistant professor of architecture at Princeton University. “If you had a system that could cool without being focused solely on cooling air, then you could actually open your windows.” Meggers and an international team of researchers have developed a safer way for people to beat the heat — a highly efficient cooling system that doesn’t move air around. Scientists lined door-sized panels with tiny tubes that circulate cold water. Stand next to a panel, and you can feel it drawing heat away from your body. Unlike air conditioners, these panels can be used with the window open — or even outdoors — making it possible to cool off while also getting some fresh air. This reduces the risk of spreading airborne viruses, such as the coronavirus. “If you look at what the health authorities and governments are saying, the safest place to be during this pandemic is outside,” said Adam Rysanek, an assistant professor of environmental systems at the University of British Columbia who was part of the research effort. “We’re trying to find a way to keep you cool in a heat wave with the windows wide open, because the air is fresh. It’s just that it’s hot.” Cooling panels have been around for a while, but in limited use, because scientists haven’t found a good way to deal with condensation. Like a cold can of Coke on a hot summer day, cooling panels collect drops of water, so they have to be paired with dehumidifiers indoors to stay dry. Otherwise, overhead panels might drip water on people standing underneath. Meggers and his colleagues got around this problem by developing a thin, transparent membrane that repels condensation. This is the key breakthrough behind their cooling technology. Because it stays dry, it can be used in humid conditions, even outdoors. We’re trying to find a way to keep you cool in a heat wave with the windows wide open, because the air is fresh. In air conditioners, a dehumidifier dries out the air to prevent condensation. This component uses an enormous amount of energy, around half of the total power consumed by the air conditioner, researchers said. The new membrane they developed eliminates condensation with no energy cost, making the cooling panels significantly more efficient than a typical AC unit. The research team involved scientists from the University of British Columbia, Princeton, UC Berkeley, and the Singapore-ETH Centre. They published their findings in the Proceedings of the National Academy of Sciences. “This study demonstrates that we can maintain comfortable conditions for people without cooling all the air around them,” said Zoltan Nagy, an assistant professor of civil engineering at the University of Texas who was not affiliated with the study. “Probably the most significant demonstration of this study is that humans can be provided with comfort in a very challenging thermal environment using a very efficient method.” Researchers developed their technology for use in the persistently hot, muggy climate of Singapore, where avoiding condensation would be particularly difficult. To test their design, they assembled a set of cooling panels into a small tunnel, roughly the size of a school bus. The tunnel, dubbed the “Cold Tube,” sat in a plaza in the United World College of South East Asia in Singapore. Scientists surveyed dozens of people about how they felt after walking through the tunnel. Even as the temperature neared 90 degrees F outside, most participants reported feeling comfortable in the Cold Tube. We can maintain comfortable conditions for people without cooling all the air around them. Scientists said they want to make their technology available to consumers as quickly as possible, for use in homes and offices, or outdoors. Climate change is producing more severe heat , which is driving demand for air conditioners. Researchers hope their cooling panel will offer a more energy-efficient alternative to AC units. If consumers can use less power, that will help cut down on the pollution that is driving climate change. Before they can sell the panels, researchers said they need to make them hardy enough to survive outdoors. The anti-condensation membrane is currently so thin that you could tear it with a pencil, so it must be made stronger. Scientists also need to demonstrate that the panels work efficiently indoors. Hospitals and schools in Singapore already have shown interest in the cooling system. “We know the physics works. Now we need to do one more test so we have a bit more of a commercially viable product,” Rysanek said. “It’s really about trying to get this into people’s hands as quickly as possible.” Pull Quote We’re trying to find a way to keep you cool in a heat wave with the windows wide open, because the air is fresh. We can maintain comfortable conditions for people without cooling all the air around them. Topics HVAC Nexus Media News Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Cooling panels draw heat away from people standing nearby. Lea Ruefenach Close Authorship

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New leaders at Patagonia, McDonald’s, Netflix

October 7, 2020 by  
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New leaders at Patagonia, McDonald’s, Netflix Elsa Wenzel Wed, 10/07/2020 – 02:01 Heading into fall, this batch of career updates from the worlds of sustainability and business is somewhat top-heavy. It’s not necessarily that the game of musical chairs has intensified in the C-suite, but you’ll note major executive moves at big apparel, food, energy, finance and technology corporations, some of which have enlisted a chief sustainability officer (CSO) or equivalent for the first time. Amid myriad social, health and political crises, business sustainability is alive and well and living the Paris Agreement. Who’s news McDonald’s has formed a Global Impact Team to be overseen by EVP and Global Impact Officer Katie Beirne Fallon , who is departing Hilton Worldwide as EVP and head of corporate affairs. Fallon served President Barack Obama as director of legislative affairs and senior advisor. Emma Stewart , recently with Engie Impact and WRI, was named Netflix’s first sustainability officer. The streaming media giant just started reporting on its renewable energy usage last winter. Stewart is known for her longtime service to Autodesk, whose first Sustainability Solutions product group she founded. Stewart also launched and ran research and development at BSR. At Ventura, California-based Patagonia, Ryan Gellert is stepping into the shoes of longtime CEO Rose Marcario , who departed in June after leaving a high water mark for corporate activism. He’s at the helm of Patagonia Works, the parent company. From Amsterdam, Gellert oversaw the company in Europe, Africa and the Middle East for nearly six years, working before that at outdoor gear maker Black Diamond. That brings former VP  Jenna Johnson up to CEO of Patagonia, Inc. Lisa Williams , former chief product officer, becomes head of innovation, design and merchandising. HP Inc. has a new chief sustainability and social impact officer, Ellen Jackowski , who has led there for 12 years as global head of sustainability strategy and innovation. Jeffrey Hogue is slipping into the CSO role at Levi Strauss, moving from the same role at C&A, where he was involved with the launch of the world’s first Cradle to Cradle T-shirt . In addition to his circular economy efforts in apparel, he has been McDonald’s senior director of global CSR. Meanwhile, Michael Kobori left Levi Strauss at the start of the year to become CSO at Starbucks.  Mattel appointed Pamela Gill-Alabaster as head of global sustainability. She brings more than two decades of sustainability expertise honed at Centric Brands, L’Oréal, Estée Lauder Companies and Revlon. Katherine Neebe is the new president of the Duke Energy Foundation, as well as CSO and VP of national engagement and strategy at Duke Energy Corporation. Prior to this, she led ESG and sustainability stakeholder engagement at Walmart, after having spent six years with WWF on a partnership with Coca-Cola. Jeanne-Mey Sun is NRG Energy’s new CSO, joining from Baker Hughes, where she led the oil field services company’s clean energy transition strategy. Applied Materials hired Chris Librie as director of ESG, corporate sustainability and reporting. He held the same title at Samsung Semiconductor, after leading ESG and sustainability at eBay and HP Inc. Green chemistry pioneer John Warner , president of the Warner Babcock Institute for Green Chemistry, joined the biomanufacturing startup Zymergen as a distinguished research fellow. He’s also co-founder of Beyond Benign , an effort to integrate sustainability principles into K-12 chemistry education. Chantelle Ludski is serving as the North America and Asia Pacific COO for the Anthesis Group sustainability consultancy. Previously she served as chief administrative officer for the Americas at Renewable Energy Systems, and global chief risk officer at engineering consultancy Arcadis. Former JetBlue CSO Sophia Mendelsohn is the new chief sustainability officer and global head of ESG at IT services company Cognizant. Richard Threlfall , a 17-year veteran of the Big Four firm KPMG, is now global head of KPMG IMPACT in addition to partner and head of infrastructure. Former Microsoft sustainability director Josh Henretig became VP of global partnerships at Higg Co, known for the Higg Index for apparel. Edelman named Heidi DuBois as special ESG adviser, coming from the Society for Corporate Governance via BNY Mellon and PepsiCo. Former CEO of the Tides Foundation Kriss Deiglmeier just made a move to become chief of social impact at Splunk for Good, billed as a “data for everything” platform. BNP Paribas is enlisting Christina Cho , in her 13th year at the bank, as co-head with Anne van Riel of Sustainable Finance Capital Markets Americas. Jennifer Silberman has joined the hip cooler maker Yeti as VP of ESG, bringing her corporate responsibility background earned at Target , Hilton and BeyondBrands. Former Sephora Director of Sustainability Alison Colwell moved to Novi , a safer chemistry-AI startup, as VP of business development and partnerships. Kabira Stokes became CEO of circular economy startup Retrievr after nine years as co-founder and CEO of Homeboy Recycling. Tod Durst advanced to president from EVP at PolyQuest, which manufactures rPET, recycled plastic resins. Founder and former EVP John Marinelli is serving as CEO and chairman. Advocating The Institute for Sustainable Communities , which advances equitable community solutions to climate change, has appointed Deeohn Ferris as president and CEO. The environmental lawyer leaves the Audubon Society, where she was VP of equity, diversity and inclusion. The World Business Council for Sustainable Development (WBCSD) welcomes Managing Director for Climate and Energy Claire O’Neill . The former U.K. Energy and Clean Growth minister also served as COP President for the 26th UN Climate Change Conference. B-Lab co-founder Jay Coen Gilbert is the new co-chair of the new Imperative 21 campaign to “reset capitalism.” Cortney Worrall is the new president and CEO of the nonprofit Waterfront Alliance , which pushes for resilience along the New York and New Jersey coasts. She comes to the organization as former National Parks Conservation Association northeast regional director. Former Energy UK Chief Executive Lawrence Slade is the new CEO of the Global Infrastructure Investor Association . The American Council for an Energy Efficient Economy (ACEEE) brought on Nora Wang Esram from the Pacific Northwest Laboratory as senior director for research, and promoted Lauren Ross to senior director for policy from local policy director. The roles were previously held by Neal Elliott , now director emeritus, and Maggie Molina , who joined the U.S. Environmental Protection Agency as a branch chief. Andrew Howley , a longtime National Geographic director, joined the Biomimicry Institute as chief editor of its AskNature resource of biomimetic solutions. Thought for Food announced Melissa Ong as its Southeast Asia CEO. On the move Energy equipment maker GreenGen added its first director of healthy buildings, Dominic Ramos-Ruiz , who comes from the International Well Building Institute (WELL). Global asset management firm Neuberger Berman brought on Caitlin McSherry as its ESG Investing Team director of stewardships. She’s a former VP and ESG analyst at State Street. The Walton Family Foundation named its new environment program director, Moira Mcdonald , a freshwater conservation program officer there for a decade. She spent 12 years as a senior advisor with the National Fish and Wildlife Foundation. Jenna Jambeck, known for advancing an understanding of marine plastic waste, has been named Georgia Athletic Association Distinguished Professor in Environmental Engineering at the University of Georgia. She’s associate director of the university’s New Materials Institute and directs its Center for Circular Materials Management. Pax Momentum startup accelerator brought on Senseware co-founder and CEO Serene Al-Momen as a professor. Nikki Kapp came to the Ellen MacArthur Foundation as a research analyst, leaving Circularity Capital. Radha Friedman is now a senior adviser with the Uplift Agency, a woman-led social impact agency specializing in marginalized populations. She brings experience as a former Weber Shandwick VP of social impact and director of programs at the World Justice Project. The experimental Ray Highway in Georgia, named for Interface carpet’s late sustainability hero Ray Anderson, has brought on Matthew Quirey as landscape design and research fellow. Clare Castleman , a 2018 GreenBiz 30U30 honore, formerly of Eaton, has moved up at Self-Help Credit Union to small business support associate from clean energy intern. Mike Pratl became market leader for KAI Design’s Civic and Municipal market in St. Louis. On board General Mills Foundation Executive Director Nicola Dixon is ReFED’s new board chair, succeeding co-founder Jesse Fink , who remains on the board. Stacey Greene-Koehnke , COO at the Atlanta Community Food Bank, also joined the board of the food waste think tank, while Circularity Capital Founder and CEO Rob Kaplan , moving to Singapore, has left. The board of directors of the Green Seal product certification nonprofit brought on former U.S. EPA Assistant Administrator Jim Jones and Edward Hubbard Jr. , general counsel for the Renewable Fuels Association. Mike Werner , Google’s circular economy lead and Veena Singla , senior scientist at the Natural Resources Defense Council (NRDC), joined the board of the Healthy Building Network . CHEMForward pulled Kimberly Shenk , CEO of Novi, into its advisory board. Forest carbon credit company Pachama formed an advisory board, bringing on Josh Henretig ; forest scientist and Old-Growth Forest Network Founder Joan Maloof ; and Scott Harrison , founder of Charity:Water. Tom Popple , senior manager at Natural Capital Partners, is now a steering committee member of the Irish Forum on Natural Capital. All in the GreenBiz family Former GreenBiz Senior Editor Lauren Hepler has joined CalMatters as economy reporter. Keith Larsen , who worked under Hepler as a GreenBiz reporter , now reports on New York real estate for the Real Deal. Former GreenBiz Senior Account Manager Shaandiin Cedar brought her New Zealand adventure to GreenBiz readers this summer. Topics Leadership Collective Insight Names in the News Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Clockwise, from top left: Deeohn Ferris, ISD; Ryan Gellert, Patagonia; Jennifer Silberman, YETI; Dominic Ramos-Ruiz, GreenGen; Jeff Hogue, Levi Strauss; Veena Singla, NRDC; Chris Librie, Applied Materials; Katie Beirne Fallon, McDonald’s; Jeanne-Mey Sun, NRG Energy; John Warner, Warner Babcock Institute.

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New leaders at Patagonia, McDonald’s, Netflix

Seven ways to inform better decisions with TCFD reporting

September 28, 2020 by  
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Seven ways to inform better decisions with TCFD reporting Steven Bullock Mon, 09/28/2020 – 00:00 This article is sponsored by Trucost, part of S&P Global . The Task Force on Climate-related Financial Disclosures (TCFD) is helping to bring transparency to climate risk throughout capital markets, with the aim of making markets more efficient and economies more stable and resilient.  Many stakeholders are involved in the initiative, across corporations and financial institutions. Each can apply TCFD reporting intelligence to inform better decisions in different ways. Image of seven stakeholders; Source: Trucost, part of S&P Global. 1. Finance director: Developing a business case to increase capital expenditure on carbon-mitigation projects  A global manufacturing company wanted to undertake a carbon pricing risk assessment to understand the current and potential future financial implications of carbon regulation and related price increases on operating margins. The finance director felt the results could strengthen the business case for investment in low-carbon innovation at operational sites around the world. He used the carbon pricing risk assessment in Figure 1 to illustrate the differences the company might see in its operating margins under different climate change scenarios and highlight where investment in carbon-mitigation projects would matter most.  2. Purchasing manager: Minimizing supply chain disruption by identifying suppliers vulnerable to physical risks A global energy company wanted to undertake a physical risk assessment to understand the firm’s potential exposure to climate hazards, such as heatwaves, wildfires, droughts and sea-level rise that could lead to supply chain disruptions and increased operating costs for the business. The purchasing manager felt the results could help identify raw material suppliers that may be affected by these hazards and provide an opportunity to speak with them about steps they are taking to address these risks. As shown in Figure 2, a physical risk assessment can pinpoint vulnerable sites that could cause problems down the road.  3. Sustainability manager: Setting science-based targets for company greenhouse gas (GHG) emissions  A global beverage company wanted to quantify its carbon footprint for its own operations and global supply chain. The sustainability manager saw this as an excellent starting point to set science-based targets for a reduction in emissions, with the targets reflecting the Paris Agreement and carbon reduction plans for countries in which the company did business. As shown in Figure 3, targets could help the company understand the reduction in emissions needed to move to a low-carbon economy and enhance innovation. 4. Investor relations manager: Publishing a TCFD-aligned report  A large consumer goods company wanted to assess the firm’s climate-related risks and opportunities in accordance with the recommendations of the TCFD. Using four core elements — governance, strategy, risk management and metrics and targets — the TCFD assessment helps quantify the financial impacts of climate-related risks and opportunities. The investor relations team wanted to report these findings alongside traditional financial metrics to publicize that the company was taking steps to manage climate-related issues. To illustrate what could be done, the team pointed to the TCFD report shown in Figure 4 completed by S&P Global for its own operations.   5. Portfolio manager: Screening a portfolio for carbon earnings at risk using scenario analysis An asset management firm wanted to test its investment strategy by assessing the current ability of companies to absorb future carbon prices so its analysts could estimate potential earnings at risk. Integral to this analysis is the calculation of the Unpriced Carbon Cost (UCC), the difference between what a company pays for carbon today and what it may pay at a given future date based on its sector, operations and carbon price scenario. A portfolio manager wanted to use the findings, such as those shown in Figure 5, to report these estimates of financial risk to stakeholders and engage with portfolio constituents on their preparedness for policy changes and strategies for adaptation.  6. Chief investment officer (CIO): Using TCFD-aligned reporting as a way to engage asset managers on climate issues A large pension plan wanted to undertake a climate change alignment assessment of its global equity and bond portfolios to understand how in sync it was with the goals of the Paris Agreement, and where there could be potential future carbon risk exposure. The CIO wanted to publish the results and use the findings, such as those shown in Figure 6, to engage with the firm’s asset managers to determine how they were integrating climate risk into investment decisions. 7. Risk officer: Assessing exposure to climate-linked credit risk  A large commercial bank wanted to estimate the impact of a carbon tax on the credit risk of companies in their loan book. The Risk Officer felt this would add an important dimension to the assessment of creditworthiness. Figure 7 highlights the changes that might be seen in quantitatively derived credit scores for the materials sector under a fast-transition scenario. This shows a rapid increase in carbon tax, with companies reacting in various ways. Some invest in greener technology to meet the reduction targets in 2050 (green bars), while others do not invest and pay a high carbon tax or experience lost revenue resulting from bans on the use of certain materials (red bars). There are many more examples of how TCFD reporting is helping organizations inform better decision-making and capture new opportunities in the transition to a low-carbon economy.   Please visit spglobal.com/marketintelligence/tcfd or watch our on-demand webinar to learn more.   Topics Finance & Investing Risk & Resilience Sponsored Trucost, S&P Global Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article On Taking action to keep the world green; Source: Trucost, part of S&P Global.

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Seven ways to inform better decisions with TCFD reporting

ESG investments: Exponential potential or surfing one wave?

September 21, 2020 by  
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ESG investments: Exponential potential or surfing one wave? Terry F. Yosie Mon, 09/21/2020 – 00:30 Amidst four concurrent crises — health, economic, race relations and climate — one stand-out 2020 development has been the rebound of major stock markets and, particularly, the growing performance and prominence of environment, social and governance (ESG) traded funds. ESG portfolios not only have outperformed traditional financial assets this year, but also a data analysis prepared by Morningstar, a financial advisory research firm, concluded that almost 60 percent of sustainable investments delivered higher returns than comparable funds over the past decade. Morningstar also found that ESG funds have greater longevity than non-ESG portfolios. About 77 percent of ESG funds that existed 10 years ago are presently available, whereas only 46 percent of traditional investment vehicles maintain that survivorship. These developments raise two overriding questions: what factors have converged to catapult ESG portfolios into the front rows of investment strategy, and what challenges can transform (for better or worse) ESG fund performance in the future? ESG investing has made important strides in the past decade and possesses significant momentum to expand its reach into the broader economy. ESG’s arrival at the Big Dance Since the rebound from the 2007-08 financial crisis, it would have taken a singularly motivated unwise investor to lose money in U.S. equity markets. ESG investors were not unwise. Several sets of factors converged to make these funds an even better bet than the S&P 500, Dow Jones or NASDAQ exchanges that covered a broad array of individual equities, mutual funds or indexed portfolios. These factors include: Less risk and volatility. ESG asset managers and their customers generally prefer a longer-term planning horizon than many of their traditional competitors whose reliance upon program trading or other methods result in more frequent turnover in holdings. In retrospect, it also turned out that ESG portfolios contained less financial risk because they had more accurately identified risks from climate change and considered other variables — such as resilience — for which no accepted risk methodology exists. The response to the international COVID-19 pandemic has become a de facto surrogate to measure corporate resilience and has previewed the economic and societal chaos that is increasingly expected to arrive from accelerating climate change. For investors, ESG portfolios have provided a welcome shelter in the storm and a more profitable one at that.   A declining investment rationale for fossil fuels. What was once a trend is now a rout. ESG asset managers, closely attuned to climate-related risks, recognized the receding value of first coal, and now, petroleum investments that are in the midst of an historic decline. Prior to the 2007-08 financial crash, ExxonMobil enjoyed a market capitalization in excess of $500 billion. By 2016 (and accounting for the rebound from that crash), it stood at about $400 billion. Today, it is $159 billion even as overall equity valuations reach historic highs. Asset write-offs from the oil sector continue to mount and include BP’s write-down of $17.5 billion and Total’s cancellation of $9.3 billion in Canadian oil sands assets. By virtually any established financial metric — net income, capital expenditures, earnings per share — petroleum companies are shrinking. As an industry group, energy is one of the smallest sectors in the S&P 500.   Convergence of transparency and governance. While there are frequent complaints about the lack of robust financial metrics to evaluate ESG investment opportunities, the fact is one of growing convergence around some critical reporting measures. For climate change, these include the information obtained from companies adhering to the Task Force on Climate-related Financial Disclosures (TCFD) that provide for voluntary and more consistent financial risk reporting. CDP is widely respected among asset managers, and there is growing interest in the efforts of the Global Reporting Initiative-Sustainability Accounting Standards Board to arrive at a simpler, sector-specific, financially relevant set of performance metrics. Governance expectations also have accelerated as more financial firms seek not only fuller disclosure but understanding of actual plans to achieve an impact through, as one example, Scopes 1, 2 and 3 reductions within specific time frames.   Collaboration among financial asset management firms. No longer is it necessary for nuns organized through the Sisters of St. Francis or the Interfaith Center on Corporate Responsibility to maintain their lonely vigil to persuade management of their social and environmental concerns. In recent years, their cause has been transformed by the world’s largest asset management firms that have the added advantage of being very large investors in the companies whose practices they wish to change. These organizations — including BlackRock, BNP Paribas Asset Management, CalPERS and UBS Asset Management — generally have no difficulty in meeting with CEOs or, more recently, obtaining increasingly large support for the shareholder resolutions they support. Most significant, in the aftermath of the 2015 Paris Climate Accord, these firms increasingly collaborate through organizations such as Climate Action 100+, known as CA100+ (which presently has more than 450 investor members with over $40 trillion in assets), Ceres and the Asia Investor Group on Climate Change. Their climate change action agenda includes setting an emissions reduction target, disclosing climate-related financial risks through the TCFD reporting framework and ensuring that corporate boards are appropriately constituted to focus upon and deliver climate results. In reflecting on this evolution, long-time sustainability investor John Streur of Calvert Research & Management wrote, “We need to spend more of our engagement time pressing for change, as opposed to asking for disclosure.” Disrupting and being disrupted — the road ahead The ESG investment movement has every reason to be optimistic in the short term. There is growing investor and stakeholder momentum for the goals of expanded disclosure, improved corporate governance and measurable plans and impacts, especially for climate change. There is significant expansion in the staff sizes and expertise that better enable firms with ESG portfolios to evaluate financial risks. And their financial performance continues to impress. What could go wrong, come up short or require adaptation? Several factors bear a closer scrutiny. ESG’s value proposition is principally based on de-risking assets. This is too limited a value proposition to meet future needs . For example, ESG data does not reveal much insight for identifying research and development priorities, product innovation opportunities or effective branding and marketing strategies. As Brown University professor Cary Krosinsky has commented, “ESG data doesn’t tell you the most important thing: who will win the race” in future business competition and success for the long-term. In short, is ESG investment too disconnected from the very purpose of an enterprise — to innovate new products, gain customers and make money over time through business development?   As ESG investment goes mainstream, it will face new challenges and risks. A current advantage that ESG managers possess is that their decisions focus more on pure-play outcomes such as de-risking companies from climate change or other sustainability challenges. As more traditional investment firms acquire or expand ESG capabilities, more complexity will enter into investment decisions to reconcile clients’ needs or manage the trade-offs between ESG performance measures and those applied through shareholder value driven outcomes (earnings per share, quarterly financial reporting). Aligning expectations concerning executive compensation, independence of directors and future investment opportunities are major unresolved issues between ESG and traditional investment practitioners.   To be more impactful, the composition of ESG portfolios will need to change. Currently, ESG funds are dominated by equities, but significant capital is invested in other sectors such as bonds, exchange traded funds (ETFs) and real estate. The methodology for evaluating these asset classes will need to be modified from that applied to the assessment of equities. At the same time, ESG funds are heavily weighted in ownership of technology stocks, particularly the so-called FAANG companies — Facebook, Amazon, Apple, Netflix and Google — in addition to Microsoft. A number of these firms have inadequate data security and privacy protections, weak corporate governance and poor business ethics. The long-term wisdom of piling so many investment eggs into a single sector basket, combined with the multiple ESG problems of current technology portfolios, challenges ESG asset firms to become more transparent about their own evaluation criteria and decision making about portfolio diversity.   ESG assessments should assign a higher priority to social issues. The “S” in ESG is the least understood of the three factors, and it will be the most challenging to apply. As diversity, inclusion and equity become a greater focus of corporate sustainability policies and programs, the methodology for their evaluation is the least advanced. In part, this reflects the cultural and racial filter of a largely white and wealthy investor class lagging in its comprehension that race and social justice are material investment criteria. Simultaneously, data on social indicators will be more difficult to collect. Large numbers of companies are reluctant to disclose such information because it will expose gender and racial gaps in pay and promotion and general under-representation of minorities. Again, the technology sector is a major laggard on such issues. More broadly, the collection of social data, especially for racial diversity, is made more difficult as a matter of policy by many governments outside the United States, including in Europe where it is illegal in some countries to collect ethic and racial information. Some ESG investors are beginning to expand their dialogue around these issues, but they are much further behind when compared to their assessments and investment policies on environmental and governance issues. ESG investing has made important strides in the past decade and possesses significant momentum to expand its reach into the broader economy. Karina Funk, portfolio manager and chair of Sustainable investing at Brown Advisory, sees an approaching convergence between ESG and traditional investment philosophies. “ESG is a value-add,” she noted in a recent conversation. “It provides an expanding array of tools — financial screening, data analysis, issue-specific consultations with companies, proxy voting and an emerging focus on social risks — so that, in five years, ESG will be a standard expectation in asset evaluations. The key will be to focus on all risks facing a company, quantifiable or not, the exposure of business models and identifying what factors are within a company’s control.” Will management listen to ESG investors? Voices as varied as the U.S. Department of Labor and Harvard economics professor Gregory Mankiw are urging company executives and fund managers to tip the scales against what they consider to be economically risky and materially irrelevant ESG factors. In re-asserting the primacy of shareholder value, they remind us that voice of Milton Friedman still echoes from the crypt even as it grows fainter within the rapid humming of today’s marketplace and changing society. Pull Quote ESG investing has made important strides in the past decade and possesses significant momentum to expand its reach into the broader economy. Topics Finance & Investing ESG GreenFin Featured Column Values Proposition Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Shutterstock

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ESG investments: Exponential potential or surfing one wave?

How the climate crisis will crash the economy

September 14, 2020 by  
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How the climate crisis will crash the economy Joel Makower Mon, 09/14/2020 – 02:11 The chickens are coming home to roost. Even before the western United States became a regional inferno, even before the Midwest U.S. became a summertime flood zone, even before an annual hurricane season so bad that the government is running out of names to attach to them, even before Colorado saw a 100°F heatwave swan dive into a 12? snowstorm within 48 hours. Even before all that, we’d been watching the real-world risks of climate change looming and growing across the United States and around the world. And the costs, financially and otherwise, are quickly becoming untenable. Lately, a steady march of searing heat, ruinous floods, horrific wildfires, unbreathable air, devastating hurricanes and other climate-related calamities has been traversing our screens and wreaking havoc to national and local budgets. And we’re only at 1°C of increased global temperature rise. Just imagine what 2° or 3° or 4° will look like, and how much it will cost. We may not have to wait terribly long to find out. It’s natural to follow the people impacted by all this: the local residents, usually in poorer neighborhoods, whose homes and livelihoods are being lost; the farmers and ranchers whose crops and livestock are withering and dying; the stranded travelers and the evacuees seeking shelter amid the chaos. And, of course the heroic responders to all these events, not to mention an entire generation of youth who fear their future is being stolen before their eyes, marching in the streets. So many people and stories. But lately, I’ve been following the money. The financial climate, it seems, has been as unforgiving as the atmospheric one. Some of it has been masked by the pandemic and ensuing recession, but for those who are paying attention, the indicators are hiding in plain sight. And what we’re seeing now are merely the opening acts of what could be a long-running global financial drama. The economic impact on companies is, to date, uncertain and likely incalculable. The financial climate, it seems, has been as unforgiving as the atmospheric one. Last week, a subcommittee of the U.S. Commodity Futures Trading Commission (CFTC) issued a report addressing climate risks to the U.S. financial system. That it did so is, in itself, remarkable, given the political climes. But the report didn’t pussyfoot around the issues: “Climate change poses a major risk to the stability of the U.S. financial system and to its ability to sustain the American economy,” it stated, adding: Climate change is already impacting or is anticipated to impact nearly every facet of the economy, including infrastructure, agriculture, residential and commercial property, as well as human health and labor productivity. Over time, if significant action is not taken to check rising global average temperatures, climate change impacts could impair the productive capacity of the economy and undermine its ability to generate employment, income and opportunity. Among the “complex risks for the U.S. financial system,” the authors said, are “disorderly price adjustments in various asset classes, with possible spillovers into different parts of the financial system, as well as potential disruption of the proper functioning of financial markets.” In other words: We’re heading into uncharted economic territory. Climate change, said the report’s authors, is expected to affect “multiple sectors, geographies and assets in the United States, sometimes simultaneously and within a relatively short timeframe.” Those impacts could “disrupt multiple parts of the financial system simultaneously.” For example: “A sudden revision of market perceptions about climate risk could lead to a disorderly repricing of assets, which could in turn have cascading effects on portfolios and balance sheets and therefore systemic implications for financial stability.” Sub-systemic shocks And then there are “sub-systemic” shocks, more localized climate-related impacts that “can undermine the financial health of community banks, agricultural banks or local insurance markets, leaving small businesses, farmers and households without access to critical financial services.” This, said the authors, is particularly damaging in areas that are already underserved by the financial system, which includes low-to-moderate income communities and historically marginalized communities. As always, those least able to least afford the impacts may get hit the hardest. This was hardly the first expression of concern about the potentially devastating economic impacts of climate change on companies, markets, nations and the global economy. For example: Two years ago, the Fourth National Climate Assessment noted that continued warming “is expected to cause substantial net damage to the U.S. economy throughout this century, especially in the absence of increased adaptation efforts.” It placed the price tag at up to 10.5 percent of GDP by 2100. Last month, scientists at the Potsdam Institute for Climate Impact Research said that while previous research suggested that a 1°C hotter year reduces economic output by about 1 percent, “the new analysis points to output losses of up to three times that much in warm regions.”’ Another report last month, by the Environmental Defense Fund, detailed how the financial impacts of fires, tropical storms, floods, droughts and crop freezes have quadrupled since 1980. “Researchers are only now beginning to anticipate the indirect impacts in the form of lower asset values, weakened future economic growth and uncertainty-induced instability in financial markets,” it said. And if you really want a sleepless night or two, read this story about  “The Biblical Flood That Will Drown California,” published recently in Mother Jones magazine. Even if you don’t have a home, business or operations in the Golden State, your suppliers and customers likely do, not to mention the provenance of the food on your dinner plate. Down to business The CTFC report did not overlook the role of companies in all this. It noted that “disclosure by corporations of information on material, climate-related financial risks is an essential building block to ensure that climate risks are measured and managed effectively,” enabling enables financial regulators and market participants to better understand climate change’s impacts on financial markets and institutions. However, it warned, “The existing disclosure regime has not resulted in disclosures of a scope, breadth and quality to be sufficiently useful to market participants and regulators.” An analysis by the Task Force on Climate-related Financial Disclosure found that large companies are increasingly disclosing some climate-related information, but significant variations remain in the information disclosed by each company, making it difficult for investors and others to fully understand exposure and manage climate risks . The macroeconomic forecasts, however gloomy, likely seem academic inside boardrooms. And while that may be myopic — after all, the nature of the economy could begin to shift dramatically before the current decade is out, roiling customers and markets — it likely has little to do with profits and productivity over the short time frames within which most companies operate. Nonetheless, companies with a slightly longer view are already be considering the viability of their products and services in a warming world. Consider the recommendations of the aforementioned CFTC report, of which there are 20. Among them: “The United States should establish a price on carbon.” “All relevant federal financial regulatory agencies should incorporate climate-related risks into their mandates and develop a strategy for integrating these risks in their work.” “Regulators should require listed companies to disclose Scope 1 and 2 emissions. As reliable transition risk metrics and consistent methodologies for Scope 3 emissions are developed, financial regulators should require their disclosure, to the extent they are material.” The Financial Stability Oversight Council “should incorporate climate-related financial risks into its existing oversight function, including its annual reports and other reporting to Congress.” “Financial supervisors should require bank and nonbank financial firms to address climate-related financial risks through their existing risk management frameworks in a way that is appropriately governed by corporate management.” None of these things is likely to happen until there’s a new legislature and presidential administration in Washington, D.C., but history has shown that many of these can become de facto regulations if enough private-sector and nongovernmental players can adapt and pressure (or incentivize) companies to adopt and hew to the appropriate frameworks. Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. And there’s some news on that front: Last week, five NGOs whose frameworks, standards and platforms guide the majority of sustainability and integrated reporting, announced “a shared vision of what is needed for progress towards comprehensive corporate reporting — and the intent to work together to achieve it.” CDP , the Climate Disclosure Standards Board , the Global Reporting Initiative , the International Integrated Reporting Council and the Sustainability Accounting Standards Board have co-published a shared vision of the elements necessary for more comprehensive corporate reporting, and a joint statement of intent to drive towards this goal. They say they will work collaboratively with one another and with the International Organization of Securities Commissions, the International Financial Reporting Standards Foundation, the European Commission and the World Economic Forum’s International Business Council. Lots of names and acronyms in the above paragraph, but you get the idea: Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. To the extent they manage to harmonize their respective standards and frameworks, and should a future U.S. administration adopt those standards the way previous ones did the Generally Accepted Accounting Principles, we could see a rapid scale-up of corporate reporting on these matters. Increased reporting won’t by itself mitigate the anticipated macroeconomic challenges, but to the extent it puts climate risks on an equal footing with other corporate risks — along with a meaningful price on carbon that will help companies attach dollar signs to those risks — it will help advance a decarbonized economy. Slowly — much too slowly — but amid an unstable climate and economy we’ll take whatever progress we can get. I invite you to  follow me on Twitter , subscribe to my Monday morning newsletter,  GreenBuzz , and listen to  GreenBiz 350 , my weekly podcast, co-hosted with Heather Clancy. Pull Quote The financial climate, it seems, has been as unforgiving as the atmospheric one. Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. 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Applying science and healthcare principles to soil wellness can help our planet

August 27, 2020 by  
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Applying science and healthcare principles to soil wellness can help our planet Poornima Param… Thu, 08/27/2020 – 01:00 Basic human health principles tell us that we should diagnose before we treat and that we should test before we diagnose.  From annual physicals and screenings to blood tests and imaging exams, providers and specialists have many new tools and resources to address the health issues we experience in real-time and to prevent new issues from arising. For example, our deepening understanding of DNA helps us discern how drugs, medication, multi-vitamins or treatment plans work differently in patients — creating a brand-new frontier, personalized medicine. Today, by leveraging advancements in technology and new medical discoveries, we are able to treat and prevent diseases and enhance our quality of life, health and wellness. Take the influx of at-home genetic testing kits that provides data on food sensitivities, fertility and predispositions to disease. These same principles of human healthcare, and these same scientific and technological advances, are starting to be applied to soil — our most important asset for securing our food supply. Soil at the center  Soil is one of the most important natural resources we have, yet we’ve degraded over a third of the soil used to grow food, feed, fiber and fuel with intensive farming practices. Healthy soil is critical for environmental sustainability, food security and the agricultural economy — even large food companies are starting to fold soil health efforts into their sustainability programs as they understand the impact it has on creating a viable, cost-effective supply chain.  Soil removes about 25 percent of the world’s fossil fuel emissions each year through carbon sequestering, a natural way of removing carbon dioxide from the atmosphere. From a food security perspective, farmers can harness soil organic matter to ensure greater productivity of their fields and reduce erosion and improve soil structure, which leads to improved water quality in groundwater and surface waters. If we continue to apply science and technology — and at scale — we can address disease and deterioration of the soil, and we can give it the nutrients it needs to survive and thrive. According to the Howard G. Buffett Foundation , a foundation whose mission is to catalyze change to improve the standard and quality of life, soil loss costs an estimated $400 billion per year globally. Undoubtedly, soil is foundational to human life, yet we know very little about the soil itself. We need to get to know our soil if we want a science-based, data-driven agricultural ecosystem. The first step in improving the health of the planet, the quality and quantity of our food, and the prosperity of agricultural businesses is soil wellness. And now we have the tools to investigate.   A global, comprehensive soil intelligence project Agronomists are agricultural specialists — soil doctors — who test, touch and smell our soil to assess the earth’s physical and chemical characteristics to determine how to make it most productive, now and going forward. They ask questions such as: Does the soil have large or small pockets of air? Does it have a silty, sandy or clay loam texture? What are the phosphorous levels of the field? Based on their findings, they might recommend chemical inputs or physical measures farmers can take such as adding tiles to the field to help with drainage, planting cover crops or adding a new crop to rotation to reduce depletion of certain nutrients from the soil to improve its resiliency.   Problematically, agronomists have a dearth of information on the biomes that makes up our soil. Over 10,000 species and 100 billion actual specimens of bacteria are in a single handful of soil. More biodiversity is in the earth beneath our feet than in all above ground ecosystems combined. Without the ability to account for the biological make up of soil, our agronomists, farmers, chemical and fertilizer providers, food companies, environmental scientists and more cannot fully diagnose, treat or increase the wellness of the soil to grow more food, farm profitably or capture more carbon.   The agriculture, food, environment, science and technology communities are collaborating to change this. Combining microbiology, DNA sequencing, data science and machine learning, we can digitize the physical, chemical and biological aspects of the soil to generate evidence-based, actionable soil intelligence. This allows agricultural stakeholders to better identify and prevent disease, understand soil nutrients to make better planting decisions and preserve and restore our deteriorating top soil. Then you add in hyperspectral imagery technology, which collects and processes information from across the electromagnetic spectrum to help collect and determine soil properties and composition. Alternatively, farmers can use a method called the Haney test to evaluate soil health indicators such as soil respiration and water-soluble organic carbon. Automated sensors can monitor and measure soil’s physical traits, such as respiration and temperature, with predicted development towards the measurement of soil’s biogeochemical properties.  This is all in an effort to gather data to create intelligence that can help us better understand how to improve the health of the earth beneath our feet. What does it look like in action? Like a 23andMe test but for the soil, farmers can sample their soil and know if their field is at high-risk of certain diseases or nutrient deficiencies based on soil composition; this allows them to make informed decisions about which crop to plant, how many inputs are needed, what kind of and how much fertilizer to use — all based on known risks.  This isn’t unlike taking our daily vitamins. A 2019 survey showed that 86 percent of Americans consume dietary supplements for their overall health and wellness, yet only 24 percent of those had information indicating a nutritional deficiency. Not every vitamin is needed, and not every treatment plan will work for everyone. The same goes for our fields.  The same health and wellness interventions we use on ourselves can and should be applied to our living soil. If we continue to apply science and technology — and at scale — we can address disease and deterioration of the soil, and we can give it the nutrients it needs to survive and thrive.  Hurdles to jump moving forward  There are hurdles to scaling and applying science to soil — from lack of regulations and investment to upending the status quo — but it’s essential we address them as soil health has vast implications, above and below ground.  Investing in intelligence to drive agricultural decisions rather than reverting to traditional practices is a major obstacle. According to the latest AgFunder Agri-FoodTech Investing Report, $19.8 billion was invested in agrifood tech across 1,858 deals in 2019. The report shows that the largest year-over-year growth in funding was for downstream innovations such as meat alternatives, indoor farming and robotic food delivery. Investment in startups operating upstream, or closer to the farmer, increased 1.3 percent year over year. There’s a significant opportunity to boost investment for upstream innovations — and nothing is more upstream than soil.  Today, farmers are experiencing setbacks due to the pandemic. According to the University of Missouri’s Food and Agricultural Research Institute, this year, farmers face losses of more than $20 billion . Taking a risk to try new practices or invest in new technologies weighs heavy on these communities. Combining microbiology, DNA sequencing, data science and machine learning, we can digitize the physical, chemical and biological aspects of the soil to generate evidence-based, actionable soil intelligence. Embracing regulation to protect the planet is also key to creating real change for our soil, air and water. Take the phase-out and eventual ban on methyl bromide , a fumigant used to control pests in agriculture and shipping: Methyl bromide used to be injected into the ground to sterilize the soil before crops are planted, with 50 to 95 percent of it eventually entering the atmosphere and depleting the ozone layer, until it was phased out from 1994 to 2005 .  Furthermore, diseases are spreading quickly due to climate change and expanding global trade. For instance, seeds are grown and traded around the world, and there are many examples where diseases in agriculture that originated in other countries have spread across the world in a matter of weeks or months via the seed market. This can have a huge economic toll on food security, quality and production.  Monitoring, measuring and regulating our ecosystem, along with the substances that we put into our ecosystem and the practices we use to create a global food and agricultural economy, is vital as we work to create a healthier, more vibrant earth for ourselves and future generations. This is an urgent need because of the state of our soil and the depletion of our topsoil. If we continue to use soil the way we are today, we’ll have only 60 more cropping cycles left.  Now is the time to build a cohort of stakeholders — including farmers, chemical manufacturers, small and large food brands, policy makers, activists, scientists and technologists — armed with information on what good soil looks like, why we should care about what’s under the surface and what immediate and long-term impact soil wellness can have our world to fast-track innovation and positive change.  Pull Quote If we continue to apply science and technology — and at scale — we can address disease and deterioration of the soil, and we can give it the nutrients it needs to survive and thrive. Combining microbiology, DNA sequencing, data science and machine learning, we can digitize the physical, chemical and biological aspects of the soil to generate evidence-based, actionable soil intelligence. 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This is why investors want financial regulators to tackle climate risk

August 24, 2020 by  
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This is why investors want financial regulators to tackle climate risk Ravi Varghese Mon, 08/24/2020 – 01:15 To understand economic crises of the recent past, present and future, there may be no finer teacher than Michael Lewis. Many readers will be familiar with Lewis’s book “The Big Short,” which documented how excesses in global credit markets spawned a worldwide financial crisis. But a later book of his — “The Fifth Risk” — best explains why we were unprepared for the current pandemic and why we need a different approach to deal with threats such as climate change.  Lewis’s thesis is simple, but profound: Dealing with catastrophic risks is the purview of government. In particular, the U.S. government bears the unenviable burden of “the biggest portfolio of such risks ever managed by a single institution in the history of the world.” Some of these risks spring readily to mind — financial crises, hurricanes and terrorist threats, just to name a few. Others, such as a global pandemic, previously might have seemed too far-fetched to be worthy of serious consideration. Lewis warns that these risks are “like bombs with very long fuses that … might or might not explode” in the distant future. Climate change falls squarely in this category. It is far easier to mobilize resources and public support to combat a spreading virus than to make investments and formulate policy which might only reap rewards decades from now. It is even more challenging when multiple government agencies are involved, requiring the hard, thankless work of endless coordination. This was one lesson of the financial crisis: it wasn’t always easy to know which government entity had regulatory oversight of a complex cast of financial actors and a dizzying array of exotic instruments. Similarly, a threat such as climate change permeates so many elements of society and the economy that it’s hard to know who should do what. Thankfully, a timely new report from Ceres, a Boston-based sustainability organization, has eliminated some of that hard work. ” Addressing Climate as a Systemic Risk ,” produced by the Ceres Accelerator for Sustainable Capital Markets, exhorts U.S. financial regulators to take proactive steps to understand climate change. Appropriate oversight by financial regulators involves the collection of data, which can assist federal, state and municipal authorities in planning for a changing climate. The report offers 50 specific recommendations to seven federal financial regulatory agencies, as well as state and federal insurance regulators. Broadly speaking, Ceres calls for regulators to assess climate impact on financial market stability, increase oversight where climate change creates risk, and foster greater disclosure from companies and financial intermediaries.  Investors should cheer these ambitions. That’s why we joined more than 70 other signatories , including investment firms with more than $1 trillion of assets under management, in supporting a Ceres-led letter backing this initiative. As a signatory, we believe the logic is unshakable: Prudent regulation, enacted with a long-term perspective, can ensure that capital is funneled to sectors aligned with a future where global temperature rise is limited to 2 degrees Celsius. Investors are already concerned about stranded asset risk in large swathes of the economy, such as energy, utilities, transportation and infrastructure. To reduce this risk, regulators in the U.S. can benefit from joining their international peers in forward-thinking organizations such as the Network for Greening of the Financial System (NGFS).  Furthermore, appropriate oversight by financial regulators involves the collection of data, which can assist federal, state and municipal authorities in planning for a changing climate. Questions abound over the efficacy of stimulus spending in the ongoing pandemic. Long-term planning helps ensure that spending is implemented in a thoughtful manner, with maximum return wrung out of every dollar. The fiscal implications of climate change, meanwhile, are already appearing. As Ceres points out, recent research suggests private mortgage lenders are already shifting riskier mortgages to government-sponsored entities. Most investors surely will balk at the notion of privatized gains and socialized losses.  In “The Fifth Risk,” Lewis is unstintingly effusive about the dedication and caliber of government employees he encountered. But even if regulators were to adopt all of the Ceres recommendations, they would not make headlines for their actions. That, perhaps, makes their work all the more important. As Lewis reminds us, “it’s the places in our government where the cameras never roll that you have to worry about most.” Armed with this new report from Ceres, financial regulators can help investors worry a little bit less.  Pull Quote Appropriate oversight by financial regulators involves the collection of data, which can assist federal, state and municipal authorities in planning for a changing climate. Topics Finance & Investing GreenFin 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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