Outdoor co-op REI nudges suppliers on climate and equity

April 14, 2021 by  
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Outdoor co-op REI nudges suppliers on climate and equity Deonna Anderson Wed, 04/14/2021 – 05:01 Outdoor recreation retail co-op REI is asking its suppliers to double down on their climate strategies and social justice policies, and will require all existing partners to share their climate action plans by the end of this year. The expectations were included in the impact report REI released today along with the company’s 2020 financials. In it, the outdoor recreation retail co-op shared that it reached $2.75 billion in revenue in 2020 and highlights other wins from the year that was, including details of the organization’s climate strategy. Included in the report is an overview of how REI has been implementing circular business model practices for years now, offering re-commerce and gear repair as ways to extend the life of products. In 2020, it tested a retail format with a pilot of two standalone used gear pop-up stores in Manhattan Beach, California, and Conshohocken, Pennsylvania, according to the report. “REI, as a company, we believe that this broader kind of shift to a more circular economy is something that the world is really going to have to do over the next 10 years,” said Ken Voeller, director of circular commerce and new business development at REI, during GreenBiz 21 earlier this year. As a retailer that sells over 10,000 products in its 168 stores, REI believes it has an opportunity to push the ball forward more quickly when it comes to the issues it is trying to address like climate and racial equity. That’s where its  Product Impact Standards , a set of expectations for the brands REI sells in its stores, come in. While the standards were updated in December 2020 and first launched in 2018, REI is now working to ensure that all products in REI stores adhere to the standards. To do that, it is working with its more than 1,000 vendors to meet the standards’ respective deadlines. “By providing a comprehensive framework for base-level brand expectations and aspirational preferred attributes, REI’s sustainability standards have encouraged us, and others who are just as dedicated to elevating sustainability, to step up our efforts,” Mark Galbraith, vice president of product at Osprey, told Outside Business Journal back in December.  The list includes both required expectations and voluntary preferred attributes, which are more rigorous than the former.  For example, when it comes to REI’s standard related to fair and safe supply chains, the expectation is for brands to have a manufacturing code of conduct in place “that outlines the social and environmental standards to be upheld within their supply chain.” REI further prefers that suppliers use the Fair Trade USA, Fairtrade International or Fair for Life certification for their products. Standard highlights The standards are part of a holistic approach to ensure that every purchase at REI supports better ways of doing business, according to the company, which has set a 2030 goal for 100 percent of the products it sells to have a preferred attribute. The standards cover a wide swath of operational concerns. There’s the fair and safe supply chains, which was mentioned earlier, along with chemicals management, animal welfare, diversity and inclusion, and climate and environmental stewardship. “What you see across the co-op is this real redoubling of our efforts, particularly around climate and racial equity,” said Matthew Thurston, director of sustainability at REI. “And we just simply feel that those are the two most important pressing existential challenges that the industry is facing.” One recent addition to REI’s Product Impact Standards is the requirement for partner companies to have an action plan for measuring their annual carbon footprint and reducing their carbon emissions in alignment with the recommendations of the United Nations and the Intergovernmental Panel on Climate Change (IPCC). Existing partners have until  the end of 2021 to share their action plan; new partners will have 18 months from REI’s first purchase order. “What you’ll continue to see us doing is really finding ways to lock arms with our partners who are really leaders in this space,” Thurston said. “[We] serve almost as the connective tissue to then lock arms with those who want to be part of that work and want to find ways to accelerate or catalyze their own sustainability journey and to move forward.” Related to the issue of diversity and inclusion, REI expects that all products marketed as “nude” be available in a range of tones and that brands establish creative controls that prevent cultural appropriation, which is when a person — or in this case, companies — adopts aspects of a culture that they don’t belong to.  “I think this is really important because I’ve seen a lot of companies take Indigenous art, and put it on their product, and it’s not cited or … the artist isn’t compensated,” said Victoria Rodríguez, outings leader at Latino Outdoors (LO), a Latinx-led organization that has been working since 2013 to create a national community of leaders in conservation and outdoor education. “I think that’s just such a big injustice, so the fact that [REI is] actually looking at that and making that a standard is something else that really excites me.”  In the process of updating its standards, REI consulted with more than a dozen nonprofits, advocates and ambassadors from across the outdoor industry and community, including LO, Venture Out and Minority Veterans of America . “I think [engaging with communities] is going to bring more power to these companies, in terms of reaching a wider demographic of folks,” Rodríguez said. “I do think it’s really important for them to be able to speak to us,” Rodríguez continued, noting that companies should also have people of color on staff. REI merchants use the standards to help them make purchasing decisions. “How those brands are showing up in terms of leadership in these spaces is really one of the factors in determining which brands we’re looking to really cultivate, to grow to partner with long term, which ones we may need to have some conversations with around seeing progression in areas where there are gaps,” Thurston said. He also noted that the standards help REI hold itself accountable to its own goals and commitments, “and that we have the data, the metrics to prove that we’re actually having an impact on the broader industry.”  One of the other standards Rodriguez said she is excited about is one related to inclusive marketing. By the end of this year, REI expects each of its brand partners to have guidelines in place that “ensure diverse and inclusive representation across race, age, gender identity/expression, body size and disability,” according to the standards document. Additionally it expects for the photography that the companies provide to REI meet these standards. “If I had seen that as a kid, I probably would have been involved in snow sports much sooner in my life. And I think it also empowers just everyone at a younger age to be able to see themselves as you know as a hiker, as an outdoors mountaineering person, as a snowboarder, as a skier,” said Rodríguez, who has a marketing background. “I think once we see ourselves in those positions, you’ll have more diversity in that area.” Topics Circular Economy Retail Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Courtesy of REI Close Authorship

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Outdoor co-op REI nudges suppliers on climate and equity

The rise of social metrics in ESG reporting

March 11, 2021 by  
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The rise of social metrics in ESG reporting Aman Singh Thu, 03/11/2021 – 12:00 Reprinted from GreenFin Weekly, a free weekly newsletter. Subscribe here . For years, companies have focused voluntary social reporting on metrics that are, let’s say, comfortable: government-mandated data, such as occupational health and safety or certain hiring metrics, that has been measured and managed for years. Add a few more nuanced data points, such as the results of an annual employee engagement survey or number of volunteer hours, and you get a bit more of a company’s approach to internal and community engagement. However, these data points — splintered and unwieldy — rarely have given investors the metrics needed to confidently evaluate risk and impact. Now, as we make our way slowly past the worst of the pandemic and face a consistent and ongoing call to action for racial justice and equity, things finally might be shifting. For years, companies have struggled to report on their social impact in a financially meaningful way — and taken solace in reporting efforts vs. impact. Along the way, multiple reporting frameworks have helped bring objectivity on some data points, including the Global Reporting Initiative (GRI), the U.N. Guiding Principles on Business and Human Rights  and the more recent — and perhaps the most detailed yet in scope —  Corporate Human Rights Benchmark (CHRB). Yet, there has been little consistency in corporate disclosures as adoption rates varied and as the focus deepened on easier quantified risks that have felt more urgent and actionable: greenhouse gas emissions; waste to landfill; diverse hiring/retention; etc. For instance, Unilever’s inaugural Human Rights report, published in accordance with the U.N. Guiding Principles in 2016, included multiple data points at the macro level, perhaps to make up for sparse company-specific data. For years, companies have struggled to report on their social impact in a financially meaningful way. That’s changing. Fast-forward to 2021, and Unilever’s third Human Rights report is a study in how social strategies and disclosure are evolving. The report offers a wealth of company-specific data such as the number of workers affected by discrimination, fair wages and working hours across the company’s supply chain. Direct impact numbers such as these more easily can be translated into measuring risk, making the disclosure more useful and implementable . Data that drives decisions Similarly, on the internal end, corporate reporting on diversity and inclusion — and lately, equity — performance across industries has been sporadic at worst and uneven at best. In 2020, this began to change: Global fashion house PVH released new data on living wages across its factories and benchmarked it against the rest of its beleaguered industry to show a clean, comparable view in 2020. For the first time, the company also disclosed diversity performance by store level, uncharted territory for most retail companies, which for years have focused instead on reporting the diversity of their boards of directors and leadership. Meanwhile, evidence is mounting on the correlation between good human capital management and financial performance. For example, the NYU Stern Center for Sustainable Business looked at more than 1,000 academic studies published between 2015 and 2020 on the correlation between financial and ESG performance . Just about 33 percent of the studies on investor portfolios found a positive correlation, while 26 percent found that companies with good ESG performance performed as well as conventional companies. I also posed the question to Erika Karp, founder of Cornerstone Capital and new chief impact officer at advisory firm Pathstone, who offered cautious optimism: “We are most definitely seeing a concerted effort to recognize the critical nature of governing with a social conscious,” she told me over email. “While the measurement of these factors is particularly challenging given lack of standardization, we do know that the interrelationships between the S, the E and the G are profound.” Context is everything (but hard to measure) At the GreenBiz 21 conference last month, I hosted a roundtable discussion along with Amanda Cumberland, senior manager for CSR strategy and insights at Cisco, and more than 50 attendees on how to make this growing surge of social data meaningful. According to Cumberland, measuring social impact at Cisco has been an evolving effort. With a public goal of “positively impacting one billion people through social impact grants and signature programs by 2025,” the team repeatedly has tweaked its measurement tactics, even developing a detailed Impact Framework along the way. As of Dec. 31, Cisco had reported 527 million people positively affected . However, herein lies a dichotomy. Efforts vs. outcomes Reporting frameworks such as GRI make it easy to overly rely on reporting efforts rather than impact by accommodating disclosure of actions vs. mandating. As a result, most companies have found little motivation to make the leap from intention to impact in their disclosures: from reporting volunteer hours to the number of lives affected; from diverse hiring to evidence of inclusive behavior, and so on. And for investors, intentions or volume of actions versus tangible results hold little value in assessing performance. This is where Tensie Whelan, director of the NYU Stern Center for Sustainable Business, sees a new level of seriousness beginning to emerge. “2020 shone a spotlight on the S in ESG, and corporate leaders and investors responded by beginning to get more serious about their social metrics,” she explained over email. “For example, many are beginning to report EEOC data publicly, which will enable accountability on diversity issues. More companies are increasing wages for their lowest-paid workers and many [companies] support an increase in the minimum wage as well, which will also improve their performance on social metrics.” With increased investor pressure sparking a quiet revolution in the expansion of measurable and meaningful environmental disclosure, perhaps with everything that 2020 threw at us, social reporting will see the same wave of maturity and transparency. After all, real progress — whether it is on inclusion or climate change — requires us all to do a better job at connecting the dots between people and planet. Or as Karp reminded me, “You can’t achieve women’s equality without access to water, education, healthcare, capital, broadband, etc. We need to impact the entire system.” Pull Quote For years, companies have struggled to report on their social impact in a financially meaningful way. That’s changing. Topics Finance & Investing Reporting ESG GreenFin Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off Shutterstock

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2020 was the year that…

December 28, 2020 by  
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2020 was the year that… Joel Makower Mon, 12/28/2020 – 02:11 It was a very long year. True, just 366 days (it was a leap year, after all), each one, I’m told, containing only the standard 24 hours. But it was much, much longer than that. Remember 2019? Neither do I. To recall some of the key developments, as I have done each December for more than a decade, I’ve plumbed the nearly 1,300 stories, columns and analyses we’ve published on GreenBiz.com since the dawn of 2020 — a.k.a. the beforetime — accentuating the positive, seeking signs of progress and hope. We need such reminders to get us through these challenging times. Here, in no particular order, are five storylines that I found encouraging during the 12 months just ending. And, perhaps, to set us on a more bullish course for 2021. Here, in no particular order, are five storylines that I found encouraging during the 12 months just ending. (All links are to stories published on GreenBiz.com during 2020.) What would you add to the list? 1. Companies accelerated the route to sustainable mobility The rise of electric vehicles has been a perennial story for nearly a decade, but 2020 saw the pace of change accelerate. Indeed, in January, my colleague Katie Fehrenbacher predicted that 2020 would be a key year for EVs. She was right. Both the private and public sectors delivered big wins for the electrification of transportation. California’s governor signed a history-making executive order , banning sales of new gas-powered cars within 15 years. Britain upped the ante , with a similar ban but within a decade, helped by McDonald’s plan to install EV chargers at its UK drive-thru restaurants. On the supply side, General Motors and Volkswagen planned major EV rollouts. Ultimately, how fast these markets rev up depends on demand from fleet buyers. Amazon continued its aggressive EV buying plans , as did both Walmart and IKEA . One reason for all this: Batteries continue their journey down the price-experience curve, where increased demand lowers prices, further pumping up demand. New technologies are helping, many still in early stages . Some are specifically geared toward truck and bus fleets , an indication that the markets for medium- and heavy-duty EVs are about to kick into high gear . 2. Sustainable fashion became material Fashion is another long-simmering environmental story that has finally reached a boiling point. The issues are many, from the resources needed to grow cotton or produce synthetic fabrics, usually from petroleum feedstocks, to the waste that ends up in landfills, especially for inexpensive and trendy clothing items that often have a short useful life. In 2020, several new developments help put sustainability in fashion. For example, the nonprofit Textile Exchange  launched a Material Change Index , enabling manufacturers to integrate a preferred fiber and materials strategy into their products. It also  launched a Corporate Fiber and Materials Benchmark to help the fashion and textile industry take action on biodiversity. Circular models made the rounds, starting with the design department, where a lot of negative environmental and social impacts are baked into garments, usually unwittingly. Adidas and H&M Group  teamed up for a project to recycle old garments and fibers into new items for major brands. German sportswear company adidas committed to using only recycled polyester across its supply chain by 2024. Markets for secondhand clothing racked up sales, including recommerce , where companies sell their own reclaimed and refurbished goods back to customers. In the wings:  startups touting a new generation of textiles, production methods and business models, suggesting there are a lot more innovations in store. 3. Forestry took root on the balance sheet Saving and planting trees has been a cornerstone of environmental action pretty much since Day One. (Hence, the often-epithetic moniker “treehugger.”) And pressing companies to eliminate deforestation in their supply chains has long been an activist focus. Now, companies themselves are seeing the business benefits of proactive forestry policies. First, there’s risk mitigation — ensuring “a company’s ability to sell products into a global supply chain,” as a BlackRock executive put it . It’s not just the climate impacts of concern to investors. Deforestation and human rights abuses often go hand-in-hand — “there’s almost a direct correlation,” said another investor — an additional layer of risk for companies from neglecting forests and those who live and work there. And then there’s the opportunity for companies to offset their emissions, since trees are a natural climate solution that can help draw down greenhouse gases, especially firms adopting net-zero commitments (see below). Microsoft , JetBlue and Royal Dutch Shell are among those seeking to offset a portion of their carbon footprint by investing in forest protection and reforestation. Finally, there are the innovators — entrepreneurs who see gold in all that green. Silicon Valley venture capitalists are beginning to branch out into forestry-related startups — companies such as SilviaTerra and Pachama that provide enabling technologies to facilitate forestry projects. These entrepreneurs likely saw opportunity in the Trillion Trees initiative launched in early 2020. Of course, success requires stopping deforestation in the first place, especially in tropical rainforests. And that remains a problem. Half of the companies most reliant on key commodities that have a negative impact on forests — palm oil, soy, beef, leather, timber, and pulp and paper — don’t have a publicly stated policy on deforestation, according to one report . Still, some firms are making progress. Mars, for example, announced that its palm oil — used in food and pet care products — is now deforestation-free after shrinking the number of mills it works with from 1,500 to a few hundred, a clear-cut sign that progress is possible. 4. Food equity showed up on the menu For all the talk about Big Ag and Big Food, there’s a growing recognition of the smaller players in the food chain, from farmers and producers to those who prepare and serve meals. And, of course, the 821 million or so humans who face food insecurity, according to the United Nations. And that stat was from 2018, long before this year’s pandemic and global recession created millions more hungry bellies. With restaurants closed and other foodservice operations curtailed, one lingering question is what the world’s largest food companies are doing to help their suppliers and other partners. “Retailers and brands are recognizing that if they don’t step in to help their producers and distributors, the links holding together those supply chains may crack in ways that aren’t easily repaired,” my colleague Elsa Wenzel reported back in June. Collecting uneaten food or unsellable produce for distribution to those in need is one activity that accelerated during the pandemic . A newish concept, “upcycled food” — goods that “use ingredients that otherwise would not have gone to human consumption, are procured and produced using verifiable supply chains, and have a positive impact on the environment” — is being promoted by a nonprofit consortium called the Upcycled Food Association. Increased concern for farmers is also on the menu. Fair Trade certified crops continue to rise , ensuring a living wage for many smallholder farmers, and there’s growing interest in supporting Indigenous farmers , who have long practiced regenerative techniques. The Regenerative Organic Alliance developed a standard to support farmers who promote soil health. All this will require making capital and assistance available to growers around the world, including the data and analytics that increasingly are core to 21st-century farming. And to do this quickly, before the ravages of a changing climate create further hardships for both food producers and consumers around the world. 5. Net-zero commitments found infinite potential And finally, zero — perhaps a fitting coda to a year that boasts two of them in its name. What began just a couple years ago blossomed into a full-on movement as the number of net-zero commitments doubled in less than a year . The list of companies making such commitments cut across sectors and international borders, among them BP , Delta , Facebook , HSBC , Nestlé , Walmart , even Rolls Royce . Verizon, Indian IT services giant Infosys and British consumer goods brand Reckitt Benckiser became the first global companies to join Amazon’s Climate Pledge initiative , committing to reach “carbon neutrality” by 2040. Some went further. Microsoft said it would become “carbon negative” within a decade , with a stretch goal to remove all the carbon it has emitted since it was founded in 1975. The travel-intensive strategy firm BCG said it aspires to be “climate positive” by removing more carbon dioxide emissions from the atmosphere than it emits. But getting to zero — or neutral or positive or some other goal — is not without controversy. As one report noted , net-zero commitments vary widely in terms of their metrics and transparency, among other things. That is, no single standard governs the way net-zero is defined or measured, or how it should be communicated. As such, net-zero could soon be in the crosshairs of activists eager to point out corporate greenwash. Help could be on the way. In September, the Science Based Targets initiative unveiled plans to develop a global standard for corporate net-zero goals, including the role of carbon offsets, a practice whose massive expansion is itself problematic and controversial . How it gets resolved will be an enduring storyline for 2021 and beyond. There’s more Those were hardly the only 2020 storylines of note. There was a significant uptick of Wall Street interest in  environmental, social and governance (ESG) reporting … a surge of attention by companies to  environmental justice … the continued rise and empowerment of  corporate sustainability professionals . Oh, and the advent of a new U.S. presidential administration that  promises to reengage with business and the global community on addressing the climate crisis. That is to say, 2020 wasn’t all about the pandemic, recession and you-know-who. If that’s not enough, here — in alphabetical order by company — are a baker’s dozen other hopeful headlines from the past 12 months: How Apple aims to lead on environment and equity Bank of America CEO: Each public company needs to reach carbon zero BP announces net-zero by 2050 ambition Delta lifts off with $1 billion pledge to become carbon neutral Inside Eastman’s moonshot goal for endlessly circular plastics General Mills, Danone dig deeper into regenerative agriculture with incentives, funding HSBC invests in world’s first ‘reef credit’ system IKEA will buy back used furniture in stand against ‘excessive consumption’ Microsoft is building a ‘Planetary Computer’ to protect biodiversity Morgan Stanley will measure CO2 impact of loans and investments How Ocean Spray cranberries became America’s ‘100 percent sustainable’ crop Unilever unveils climate and nature fund worth more than $1 billion Walmart drives toward zero-emission goal for its entire fleet by 2040 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 Here, in no particular order, are five storylines that I found encouraging during the 12 months just ending. Topics Leadership Featured Column Two Steps Forward Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off GreenBiz Group

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2020 was the year that…

Is ‘net-zero’ greenwash?

November 17, 2020 by  
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Is ‘net-zero’ greenwash? Joel Makower Tue, 11/17/2020 – 02:11 This year, there has been much ado about zero. It’s becoming hard to read the green media, or even the mainstream media, without seeing new net-zero commitments from companies, governments, institutions and others. Indeed, “net-zero” is the new “zero waste” — remember way back in 2019 when everyone was making that commitment? — which is the new “100 percent renewable,” which is the new “ISO 14001 certified,” and on and on, all the way back to when announcing a LEED-certified building was widely considered to be media-worthy . Now, net-zero is the flavor of the month. Global net-zero commitments doubled in less than a year and commitments by companies more than tripled, rising from 500 at the end of 2019 to more than 1,500 by September. In addition to net-zero companies, there are also net-zero buildings , communities , products , farming , factories , supply-chains , even ships . One large financial institution set forth a commitment to net-zero client emissions . There’s also net-zero water and waste . There are net-zero-committed oil companies , utilities and airlines . Earlier this year, the United Nations formed a Net-Zero Asset Owner Alliance of institutional investors. The Trump administration even has funded the development of net-zero coal plants . You can’t make this stuff up. So, you’d think all this talk about “zero” would add up to something, right? It’s hard to know, according to a new report, ” Navigating the nuances of net-zero targets ,” by the NewClimate Institute and Data-Driven EnviroLab . You’d think all this talk about ‘zero’ would add up to something, right? Not neccessarily. As the report notes, net-zero commitments vary widely in terms of their metrics and transparency, among other things. That is, no single standard governs the way net-zero is defined or measured, or even how it should be communicated. For example, companies may refer to becoming “carbon negative” or “climate positive”; or that they seek to achieve “net-zero” or “net-negative” emissions or “deep decarbonization”; or that they plan to become “emissions-free” or achieve “zero emissions”; or that they are committed to a “1.5 degrees C pathway.” It’s not just language. Another issue is the lack of standardization about goals. For example, according to the report, some companies aim to fully decarbonize their own operations along with those of their supply chain, while others have no target for reducing their own emissions. Net-zero goals range from commitments to reduce emissions by a specific percentage by a target year, which are reported through platforms such as CDP, to more general announcements of net-zero ambition. Target practice And then there’s the issue of target dates — and, even more so, interim targets. Setting 2050 as the year for achieving net-zero emissions (or some other goal) is one thing — that date aligns with the goals of the Paris Agreement — but that 30-year horizon is a bit far off to enable reasonable accountability, perhaps deliberately so. What progress can we expect to see in, say, 2025 or 2030? Relatively few companies have committed to such accountability: Only 8 percent of companies’ net-zero targets include interim targets to chart a decarbonization pathway, according to the NewClimate Institute and Data-Driven EnviroLab report, which notes, “Interim targets offer clarity and guidance on how particular targets should be implemented. They provide the transparency necessary to ensure accountability.” Reliance on offsets is yet another issue. Some experts have deemed it appropriate for companies to invest in emissions offsets once they have made all of the other appropriate emissions reductions — such as through efficiency measures or by buying green energy — but offsetting one’s emissions without really cutting them is another thing altogether. According to the report, only about half of the companies and one-quarter of the subnational governments “are transparent about their intention to use offsets for their net-zero targets. The number of actors that explicitly rule out using offsets is limited.” Moreover, it added: “Without a radical transformation of the offsetting market and the types of activities it supports, offsetting cannot be considered an equivalent alternative to an actor’s own emission reductions in 2020.” Even that’s not the end of the issues that companies need to consider. Getting to “zero,” it turns out, is no small thing. And it will loom larger in the coming months, as calls for increased corporate ambition grow, the United States (presumably) rejoins the Paris Agreement, governments edge closer to putting a price on carbon or creating other market mechanisms — and the ravages of a changing climate continue to be felt around the world. Increasingly, the makers of all those net-zero commitments will need to demonstrate that they truly are making significant progress, and fast. 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 You’d think all this talk about ‘zero’ would add up to something, right? Not neccessarily. Topics Commitments & Goals Climate Change Net-Zero Featured Column Two Steps Forward Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off GreenBiz photocollage, via Shutterstock

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What role does ESG play in the ‘new normal’?

July 6, 2020 by  
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What role does ESG play in the ‘new normal’? Janine Guillot Mon, 07/06/2020 – 01:25 Facing existential crisis, it’s only natural that our perspective will change — for better and for worse. In recent weeks and months, as many of us have “sheltered in place” in the face of a global pandemic, each of us has come to grips with a valuable reminder of what’s truly important: family, friends and colleagues; security and safety; food and water; healthcare. By comparison, everything else seems small and suddenly insignificant. For some of us, that includes our work. When people are sick, suffering and dying — with little certainty about when or how it will end — how can we be expected to focus on a project deadline, a business meeting or a PowerPoint presentation? Recently, I was asked to participate in a webinar discussion about environmental, social and governance (ESG) investing in the wake of COVID-19, and I had to ask myself, “Is the work we’re doing at SASB completely irrelevant or more relevant than ever?”  The most urgent and important work being done today is that of our healthcare workers, grocery employees, delivery people and others on the front lines of meeting society’s most basic and most critical needs. We shouldn’t let a day pass without thanking them for their service, nor without asking ourselves how we can better support them as they rise to meet the scale of challenge before us. And soon, we must start giving serious thought to what we can do to ensure they’re never put in such a desperate position again. Respond now, adapt as soon as possible While today’s triage efforts are paramount, society is clearly starting to think about what’s next. This is an opportunity for all of us — companies, investors, government, civil society — to think critically about what our role might be in creating a more resilient future.  Although the global COVID-19 outbreak is first and foremost an existential public health threat, it also likely represents the dawn of an economic “new world order” and a reshaping of the global economy. Without question, it’s too soon to draw any conclusions about the lessons we’ve learned from this experience, but it’s nevertheless clear that businesses, investors and our entire system of free enterprise will need to adapt to a new normal in the coming post-coronavirus era.  Transparency leads to accountability, accountability drives innovation and innovation is key to resilience. In recent years, the rise of ESG, responsible investing, corporate sustainability — different people use different terms — has focused on evolving “business as usual” by recognizing that effectively managing environmental and social issues is key to the long-term sustainability of both business and society. The COVID-19 crisis is likely to accelerate this trend. The key questions that have arisen from the crisis are essentially ESG questions, such as: Will rising biodiversity loss and the changing climate influence the frequency and intensity of pandemics? How can companies adapt to ensure business continuity in such an uncertain environment? How can we ensure more resilient supply chains for essential goods, such as food and medicine? What can businesses in B2C industries do to ensure the health and safety of their employees and customers? How can healthcare providers better ensure access to critical tests and treatments at an affordable price? How might a long-term period of “social distancing” influence the adoption of artificial intelligence and robotics, and how will that affect workers whose jobs can’t be done remotely — such as manufacturing, waste management and deliveries? How can traditional and ecommerce retailers ensure fair pricing and reduce the risk of supply hoarding or price gouging? How can a wide range of industries — across the transportation, technology, hospitality and infrastructure sectors and beyond — effectively adapt in the wake of an anticipated rise in telecommuting and teleconferencing? Will the COVID-19 crisis permanently change consumer behavior regarding shopping, travel and entertainment, with significant implications for the retail and hospitality sectors?  Once the worst of the current crisis is behind us, it’s crucial that we don’t weaken our resolve to ensure that individuals, businesses, investors, economies — and thus society at large — can become more resilient in the face of 21st-century challenges. An opportunity to adapt In the coming months, as the forces unleashed by the COVID-19 crisis continue to reshape the economic landscape, they will bring long-held assumptions under scrutiny and potentially render entire business models irrelevant. They will bring more questions, but also — if we’re receptive to them — more answers. At SASB, we encourage long-term thinking in capital markets, and while that may not help solve today’s crisis, we believe it can contribute to preventing — or at least tempering — tomorrow’s.  We believe transparency and disclosure on business-critical ESG issues will improve how companies and investors measure and manage so-called non-financial — but nevertheless critical — resources such as natural, social and human capital . Further, it will help corporate directors and managers, along with investors, understand how effective management of those resources is critical to the long-term sustainability of a business. Emerging from this crisis, we can shape a future in which the interests of business, investors and society are in closer alignment.   The best answer to my question about the relevance of our work came during a recent “industry deep dive” webinar. Our restaurant industry analyst was discussing the connection between worker health and foodborne illnesses — a business-critical issue in the restaurant industry — and the metrics that can help drive effective management of such risks, including worker training and food-handling protocols.  I immediately thought about the increasingly clear connection between lack of paid sick leave and the spread of illness, and it became clear: This crisis will provide important new insights into non-traditional performance metrics that will help drive a structural shift in how both companies and investors think about delivering long-term value to both shareholders and society. To return to my original question — is ESG disclosure irrelevant or more relevant than ever — I believe the communication piece is key. Transparency leads to accountability, accountability drives innovation and innovation is key to resilience. When investors readily can identify and direct financial capital to the forward-looking companies that are evolving their business models to thrive in the face of future risks, markets will be more stable, more efficient and better prepared to absorb unexpected shocks. Today, we’re being asked to choose between lives and livelihoods. Emerging from this crisis, we can shape a future in which the interests of business, investors and society are in closer alignment. When economic and human prosperity are mutually supportive, we won’t have to sacrifice one for the other.  Pull Quote Transparency leads to accountability, accountability drives innovation and innovation is key to resilience. Emerging from this crisis, we can shape a future in which the interests of business, investors and society are in closer alignment. Topics Finance & Investing Corporate Strategy 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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What role does ESG play in the ‘new normal’?

Wall Street, ESG and the Wild West

May 14, 2019 by  
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The world of ESG is growing by leaps and bounds among big companies and mainstream investors. But the metrics — and the impacts — are still inconclusive.

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Wall Street, ESG and the Wild West

What you need to know about the bold new building laws in New York and D.C.

May 14, 2019 by  
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The cities are tackling their largest source of carbon emissions. Here are the key differences, and why they matter.

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What you need to know about the bold new building laws in New York and D.C.

Sustainable tourism: valuing experiences, efficiencies and ecosystems

June 28, 2018 by  
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How do tourism industry stakeholders — hotels, business owners, airlines — define “sustainability” from an economic standpoint? How can leaders advance efficiency and conservation without compromising — even increasing — the experience for travelers?  What are the metrics that the industry can align on to demonstrate data-driven progress in reducing greenhouse gas emissions while creating new economic opportunities?

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Framing the sustainability policy opportunity in Hawaii

June 28, 2018 by  
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Building on a long history of systems thinking and sophisticated natural resource management, Hawaii’s leaders continue to advance the sustainability of communities, the environment, and economic prosperity. In 2016, Hawai’i passed legislation formally aligning the state with the Paris Agreement on climate change. The State legislature with elected official and public and private sector partners launched the Aloha+ Challenge, which serves as a local mechanism to achieve the UN Sustainable Development Goals (SDGs). Senate Majority Leader J.

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Framing the sustainability policy opportunity in Hawaii

These fish and meat options are the most environmentally costly

June 12, 2018 by  
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Farmed seafood, wild-caught fish , or livestock : which one is the most environmentally costly to produce? A University of Washington -led study probed that question by scrutinizing 148 life-cycle assessments for animal protein production. Lead author Ray Hilborn, School of Aquatic and Fishery Sciences professor, said in a statement , “If you’re an environmentalist, what you eat makes a difference. We found there are obvious good choices, and really obvious bad choices.” (function(d, s, id) { var js, fjs = d.getElementsByTagName(s)[0]; if (d.getElementById(id)) return; js = d.createElement(s); js.id = id; js.src = ‘https://connect.facebook.net/en_US/sdk.js#xfbml=1&version=v3.0’; fjs.parentNode.insertBefore(js, fjs);}(document, ‘script’, ‘facebook-jssdk’)); The environmental costs of producing meat, seafood Which food type is more environmentally costly to produce — livestock, farmed seafood, or wild-caught fish? New research from the University of Washington takes a comprehensive look at the environmental impacts of different types of animal protein production. Read more: http://www.washington.edu/news/2018/06/11/choice-matters-the-environmental-costs-of-producing-meat-seafood/ Posted by University of Washington News on Monday, June 11, 2018 Scientists drew on four metrics to compare environmental impacts of different animal proteins: greenhouse gas emissions , energy use, potential to add excess nutrients like fertilizer into the environment, and potential to emit substances that help cause  acid rain . They used 40 grams of protein — around the size of an average burger patty — as their standard amount . Related: Vegan diets deliver more environmental benefits than sustainable dairy or meat Industrial beef production and farmed catfish were the most environmentally costly in general, according to the university. Farmed mollusks such as scallops, oysters, or mussels and small wild-caught fish were the least environmentally costly. The university said capture fish choices like pollock, the cod family, and hake also have relatively low impact, and farmed salmon performed well. But there were differences across animal proteins — for example, the researchers said livestock production consumed less power than most seafood aquaculture as continual water circulation uses up electricity. Farmed tilapia, shrimp, and catfish used the most energy. Beef and catfish aquaculture generated around 20 times more greenhouse gases than chicken , farmed salmon, farmed mollusks, and small capture fisheries. “When compared to other studies of vegetarian and vegan diets, a selective diet of aquaculture and wild capture fisheries has a lower environmental impact than either of the plant-based diets,” according to the university. The journal Frontiers in Ecology and the Environment published the study this week. Four University of Washington scientists and one scientist from company Avalerion Capital contributed. + University of Washington + Frontiers in Ecology and the Environment Images via

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