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?

Hard truths from a decade of investing in regional food systems

September 10, 2020 by  
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Hard truths from a decade of investing in regional food systems Meredith Storton Thu, 09/10/2020 – 02:00 The COVID-19 crisis has highlighted the inequities and fragility of our industrialized food system and accelerated the movement to create strong regional food systems that support local growers, provide food security, give communities agency over their food supply and yield environmental benefits. These systems will remain out of reach, though, unless we address persistent, decades-old structural issues. Price pressures continue to challenge the viability of decentralized food systems and communities of color continue to be underserved — as farmers, food chain workers, supply chain entrepreneurs and consumers. We need to change both who we fund and how we fund if we want to create equitable, thriving regional food systems. What will it take to achieve such massive shifts? RSF Social Finance has been reflecting on that question as we wind down our Food System Transformation Fund, a pooled loan fund launched in 2010 to help rebuild regional processing, manufacturing and distribution infrastructure that was lost as the food system industrialized. Restoring these supply chain links is essential to creating viable regional food systems, yet community-based infrastructure enterprises have limited access to both startup and growth capital. The Food System Transformation Fund attempted to address that problem with program-related investments from foundations, on the premise that risk-tolerant debt could enable early-stage businesses to grow and eventually access traditional capital from banks and community development financial institutions. As we wind down the fund and move our food system investments into other RSF portfolios, we’re sharing what we’ve learned in hopes of advancing efforts to build a regenerative food system. Investors seeking a better food system need to take the time to understand a company’s impact and its beneficiaries, toss out traditional assumptions about market rate returns and ensure that terms benefit communities. Over the past decade, the fund provided $6.5 million in debt to 27 organizations across 14 states. More than 25 percent of borrowers grew into our senior secured loan portfolio or accessed traditional debt, while nearly 20 percent had to cease operations or substantially change ownership. The enterprises between those two poles continue to need patient, flexible and diverse capital structures. That’s not because they’re failing, but because the finance ecosystem has failed to develop tools fitted to the needs of food system enterprises. This truth informs three fundamental insights from our work in the field of food system transformation. 1. In food systems, high impact and high returns don’t mesh Investing in food systems is very different from investing in a trendy plant-based–meat startup or a consumer packaged goods company that can outsource manufacturing and build a brand for sale to a conglomerate. Food system businesses are capital-intensive — they require substantial investment in processing equipment, trucks and warehouses — and they operate in a highly competitive, low-margin sector. Immense price pressure in the U.S. food system compresses gross margins and makes it challenging for food infrastructure businesses to achieve profitability. Our spending on food doesn’t reflect the true cost of production: Americans spend only 9.5 percent of their income on food, compared with 15 percent in Canada , 13 percent in France and 23 percent in Mexico . Most small farms in the U.S. aren’t profitable ; on average they earn only 17.4 percent of every dollar spent by consumers at stores. Workers throughout the industrialized food system face poor working conditions and low wages. Many food system infrastructure businesses are trying to fix these inequities, and it’s imperative for investors to understand the tradeoffs between returning capital to investors and reinvesting that capital into the business and the community. This issue is most glaring with the venture capital model. When venture-backed companies disrupt local food systems and don’t have the longevity or the relationships to create long-term impact, they actually can harm communities. In the worst-case scenario, these companies launch, rapidly scale, seize market share from existing community-based businesses and then run out of cash, leaving the community with less than it had beforehand. Similarly, pulling out high financial returns for investors undermines the positive changes these companies can achieve and puts more pressure on a strained, inequitable system. Investors seeking a better food system need to take the time to understand a company’s impact and its beneficiaries, toss out traditional assumptions about market rate returns and ensure that terms benefit communities. 2. Farmers and communities can’t bear the risk Traditional financing tools are seldom structured in a way that shares risk across the system. When times get tough, capital partners must navigate the delicate balance of principal return to investors versus making farmers and local food systems whole. Traditional collateralized loans place the burden on those least able to bear risk — the community-based enterprise and its stakeholders. The Food System Transformation Fund primarily issued debt backed by collateral — equipment, vehicles and accounts receivable. When portfolio companies had to cease operations, we had to choose between returning capital to investors or letting the company repay farmers and other community partners. Our investors prioritized community well-being, and we were able to forgive debt in these cases, but this is a structural problem that shouldn’t require an 11th-hour solution based on investors’ goodwill. When venture-backed companies disrupt local food systems and don’t have the longevity or the relationships to create long-term impact, they actually can harm communities. One way to distribute risk more equitably is to integrate various forms of capital — financial, social and technical — within the same transaction to support an enterprise. This may mean some combination of unrestricted grants, debt, equity, loan guarantees and forgivable loans. Guarantees can unlock capital that otherwise wouldn’t fund the space and forgivable loans can help businesses prioritize impact, which often takes a back seat to financial return. For example, if the enterprise is meeting its impact objectives but experiencing financial or operational challenges outside its control, the loan can turn into a grant. Funders need to be creative and partner with food system enterprises to find the optimal mix of tools to support the business and its stakeholders. 3. Transforming the system will require philanthropic, public and private capital While there is a lot of interest in food system enterprises, the current funding ecosystem is weak.   The capital needed to build these businesses is hard to come by and even harder to sustain over the long term. The funding is not readily available in many regions where the work is happening, and it is not equitably distributed. As in many sectors, entrepreneurs of color are woefully underfunded. Philanthropic capital, with its flexibility and public benefit purpose, is well-positioned to seed the space and attract other funders. Foundations and donor-advised funds can support this work not only through grant-making but also through investments and leveraging their assets to unlock capital from more-traditional lenders or community development financial institutions (CDFIs). These types of organizations steward deep relationships within their communities and are well-positioned to fund food system enterprises. Federal programs provide critical resources to local food organizations and small farmers, but support for sustainable food systems makes up only a fraction of the public funding allocated for agriculture. Increasing this share would have a multiplier effect. As more philanthropic and government funding flows into the food systems space, more private capital will find its footing there. Many enterprises in our portfolio accessed USDA grants to support early-stage programs and center equity in their work. The field needs all sources of nonextractive capital, which ranks community benefits above investor returns. But we have found that food system enterprises are best served when community-based funders lead. Food systems vary widely across rural, urban and geographic divides. Funders that hold direct relationships with food system entrepreneurs and ecosystem partners more clearly understand the regional food supply chain and are able to make more informed and effective funding decisions. The way forward Over the past decade, much has changed across food and finance systems. Consumers increasingly value sustainable and local production methods , and more funders are entering the space, especially with sustainable food production emerging as one solution to our climate crisis. With COVID-19 thrusting the inequities of our food system into the forefront of the national conversation, we must use this moment to catalyze investment into food systems that care for farmers, food chain workers, eaters and the environment. If we want to decommodify our food system, we must decommodify our food financing system. We need tools with impact-adjusted return expectations; we need investors and donors willing to redistribute risk; and we need local, integrated capital solutions. With those assets in hand, we can realize the vision of a regenerative food system that serves everyone. Pull Quote Investors seeking a better food system need to take the time to understand a company’s impact and its beneficiaries, toss out traditional assumptions about market rate returns and ensure that terms benefit communities. When venture-backed companies disrupt local food systems and don’t have the longevity or the relationships to create long-term impact, they actually can harm communities. Topics Food & Agriculture Finance & Investing COVID-19 Social Justice Investing 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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Hard truths from a decade of investing in regional food systems

Behind Microsoft’s bold plan to build social equity into clean energy buying

August 6, 2020 by  
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Behind Microsoft’s bold plan to build social equity into clean energy buying Heather Clancy Thu, 08/06/2020 – 00:45 There were plenty of juicy news tidbits in Microsoft’s recent progress report about its goal to become carbon negative over the next decade. But its new goal to link at least 500 megawatts of forthcoming solar energy contracts to environmental justice considerations is bold for many reasons.  For context, the total pledge amounts to about a quarter of the capacity that Microsoft already has signed (1.9 gigawatts) in solar and wind contracts. This is the largest commitment it has made to a single portfolio investment, so it isn’t some side project. Nor is this a reaction to the nationwide protests triggered by the death of George Floyd this spring — the active planning has been under way since December.  “We spend a lot of time talking about the energy transition needed if our society is going to transition to a net-zero economy by 2050,” Microsoft’s environment chief, Lucas Joppa, told me. “Microsoft’s position is that the transition has to be an inclusive and just one.” The arrangement, with project financer, investor and developer Sol Systems , will prioritize opportunities and investments in communities “disproportionately affected by environmental challenges.” What does that mean more specifically?  The installations could be in urban neighborhoods that haven’t typically had access to economically priced clean energy resources or that historically have been disproportionately affected by pollution. But they also might be sited in rural communities that have been negatively affected by job losses triggered by the closure of fossil fuels plants or extraction operations, notes Sol Systems co-founder and CEO Yuri Horwitz. “We think it’s equally important that we engage all segments of society,” he said.  As anyone responsible for renewable energy knows, it historically has been very difficult to build metrics around the social impacts of projects. The arrangement also will prioritize buying from minority and women-owned businesses. And it will provide at least $50 million in the form of grants to support educational programs, career training, habitat restoration and initiatives that provide low-income communities with access to clean energy and energy efficiency programs. “Solar is, and should be, an economic engine for everyone,” Horwitz added. To make this work, the two companies created a framework power purchase agreement to cover individual projects as they are identified with the intention of getting them validated and approved more quickly. Among the terms: A certain portion of the revenue that’s generated will be reinvested back into the community where a solar farm is located. “You can do this at scale and at a price point that is economically doable,” Joppa said. Microsoft will use third-party evaluators to help quantify and document both the social and environmental outcomes.  Lily Donge, a former principal in the energy practice at Rocky Mountain Institute and now director of corporate innovation for communities with Groundswell, believes Microsoft’s deal with Sol Systems is a sign of things to come. “We do not know whether the community process will be equitable, transparent or consultative,” she wrote on the community solar organization’s blog. “But this is a signal that a giant tech company is willing to understand the demands of the community, under-served customers and the public at large.” As anyone responsible for renewable energy knows, it historically has been very difficult to build metrics around the social impacts of projects, but Sol Systems has been focusing on methodologies for doing so for the past 12 years — it already has about 800 MW of similar projects in its portfolio , including deals it has done for Amazon and Under Armour . The latter project was built in Maryland on land that couldn’t be used for residential development; it will contribute about $1.4 million in tax revenue to the local community. Another Sol Systems ally is Nationwide Insurance, its financing partner . This isn’t the only relationship Microsoft will use to procure energy in the future, so it will be important to watch how that consideration bleeds into other contracts. I’ll definitely be asking. You should do so, too. This article first appeared in GreenBiz’s weekly newsletter, VERGE Weekly, running Wednesdays. Subscribe  here . Follow me on Twitter: @greentechlady. Pull Quote As anyone responsible for renewable energy knows, it historically has been very difficult to build metrics around the social impacts of projects. Topics Social Justice Renewable Energy Corporate Procurement Featured Column Practical Magic Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off Sol’s 196-kilowatt solar installation at Christ Church apartments, a low-to-moderate income senior living facility located on the Baltimore Harbor.  Courtesy of Sol Systems Close Authorship

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Behind Microsoft’s bold plan to build social equity into clean energy buying

This dad built a backyard coffee shop with repurposed materials

July 28, 2020 by  
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When Julianna Astrid posted about the DIY coffee shop that her dad, Ed, built in his  backyard , her social media blew up with supportive comments. The impressive backyard cafe uses only repurposed construction materials, combined with various pieces from swap meets, antique stores and thrift stores. Ed works full time as a contractor in Orange County and took unused  building materials  from past projects to build the structure. He finished the job in just three months, working on the weekends and after his regular work hours to complete the passion project. Related: San Francisco superdad builds homemade roller coaster in his backyard As daughter Julianna explained to  Newsweek , “My dad is a contractor and has been on so many job sites where he has to throw old materials away to make room for the new remodels ; but he saved some of the ‘trash’ from numerous jobs and repurposed it to create his coffee shop; these things included materials to build the structure, the coffee shops doors and the front window!” The mini coffee shop, or “La Vida” as Ed has named it, serves as a place to relax and enjoy a brew with friends and family. The design features a painted wooden exterior and interior, a bar area under one of the glass windows and a dedicated outside patio with string lights and seating. A cute pastry case and a mini-fridge filled with cold  coffee  beverages fill out the space. From the chalk menu board to the cozy chess table in the corner, you’d never know that you were in someone’s private backyard rather than an actual cafe. Julianna originally posted about La Vida on her TikTok in March before  tweeting  about it in June. Since then, the Twitter post has received over 37,000 retweets and 302,000 likes. According to Julianna, her dad has always loved coffee and building, so this project came naturally for the hardworking contractor. The space is still a work in progress, with Ed keeping an eye out for different types of coffee beans from around the world and unique pieces from second-hand stores to stock his shop. In the future, he plans on making  YouTube  videos teaching people to build things for their homes. + ELS Builds Via Twitter Images via Julianna Astrid

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This dad built a backyard coffee shop with repurposed materials

Estée Lauder’s sustainability leader on racial justice, ‘sector-agnostic’ solutions

July 27, 2020 by  
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Estée Lauder’s sustainability leader on racial justice, ‘sector-agnostic’ solutions Heather Clancy Mon, 07/27/2020 – 01:30 In the six years since Nancy Mahon assumed responsibility for CSR and sustainability strategy at Estée Lauder Companies — she’s currently senior vice president of corporate citizenship and sustainability — her team has launched a series of new initiatives that are a “first” among her organization’s sector. The list includes the company’s first virtual power purchase agreement for 22 megawatts, a move made in pursuit of its 2020 net-zero carbon emission goal. More recently, it energized on-site two solar arrays — one at its Melville, New York, campus that will produce 1,800 megawatt-hours of power annually, and a smaller one at the Aveda brand’s campus in Minnesota. The New York installation will provide 100 percent of the electricity required by the office operations, while the Minnesota one will contribute up to 50 percent — the remainder of its power will come from utility-sourced wind power.  Moreover, Estée Lauder Companies also has declared its intention to make 75 percent to 100 percent of its packaging recyclable, refillable, reusable or recoverable by 2025 — the strategy will depend on the needs of individual brands. As with many companies heavily dependent on nature for product ingredients, Estée Lauder Companies is developing biodiversity action plans and becoming far more attuned to it role in deforestation, afforestation and reforestions. And befitting its heavily female clientele, the company also funds initiatives focused on raising up girls and women, such as HERProject, a BSR initiative aimed at supporting low-income women in global supply chains. I recently checked in with Mahon, one of this year’s 25 Badass Women in Sustainability , to get an update on how her priorities have shifted in light of the COVID-19 pandemic and the corporate awakening about systemic racism. In mid-June, the company issued a series of sweeping new racial equity policies , i including reaching “U.S. population parity” for Black employees at all levels of the company within five years, doubling the amount spent on sourcing ingredients, packaging materials and supplies from Black-owned businesses over the next three years, and committing $10 million over the next three years to support racial and social justice initiatives. “Moving forward, I think where we are energized as a division — it’s become super clear — on how core the work we do is to the business, not only the environmental side, but also the social side,” Mahon told me. Following are excerpts from our conversations, edited for clarity and length. Heather Clancy: How has the COVID-19 pandemic changed the focus of the Estée Lauder sustainability team, if at all?  Nancy Mahon: I think the clear disparate impacts of COVID-19 across countries and communities has really highlighted, and I think really illustrated, the intersection … of gender justice and social injustice, essentially, and racial injustice. I think while before that intersectionality might have been a little obtuse for folks, I think it’s much clearer now that if you come from a community where there’s high rates of pollution, there’s a huge intersection between high rates of pollution, access to healthcare and health outcomes and COVID-19 outcomes. So I think the speed, the velocity and the ferocity of COVID-19 really highlighted that in a way that I think both unearthed that underlying reality and threw a spotlight on it. And also for consumers, [it] really allowed an opportunity to focus on what was most important in their lives around healthcare, around their families, and put an emphasis — really, I would say it hasn’t changed it, but it has really accelerated consumer interest, particularly — on supply chains, which is super interesting …  I think similar to HIV, there is a question of what will we make of this moment and how will we as stewards of funds or stewards of companies or stewards of our families make a difference. Internally, what it’s allowed us to do in a very agile, very energizing way is move very quickly across different functions to stand up programs that we were planning on setting up. For instance, we created an employee relief fund, and we had targeted that we were going to do it basically this fall. When [COVID-19} happened,”‘We thought, you know what? We have to do this right away.” We had incredible partnership from [human resources] and [information technology] and legal, and we started up right away, then globalized it.  We also created a race and social justice fund in a matter of a couple of weeks. In that way, we’ve had opportunities, which hopefully we’ve seized upon. Moving forward, I think where we are energized as a division — it’s become super clear — on how core the work we do is to the business, not only the environmental side, but also the social side. Clancy: In a previous role, you were very closely involved with addressing the AIDS crisis, which is a humanitarian but also an economic crisis as well. How are you layering that perspective into the strategy as you’re mobilizing around COVID-19?  Mahon: If there is a positive to all of this, it’s that in terms of HIV, it took us well over two decades to have a deep discussion around structural racism or classism or the ways in which structures like a criminal justice system or a healthcare system basically disadvantage certain communities. It was always very hard to get at that discussion. It was much easier to fund street outreach or various research pieces or services than it was to really say, “We have to look at the way we act — either as consumers or as companies — and we might need to give something up, in addition to actually giving.” I think what is exciting about this moment — and I think this is the largest civil rights movement clearly in the United States — there are similarities certainly to what I think the LGBTQ movement experienced around HIV. That was much more, I would say, expanded over time, but I think the discussions are similar. What I think also then is a big emphasis understandably in that movement around action, whether it be FDA approval of drugs or the acceleration of accessibility of healthcare or integration of HIV into other healthcare systems. And we’re seeing that very quickly now, the fact that out of the gate we’re funding a group like Equal Justice Initiative around structural racism and the criminal justice system is exciting.  There has been one difference: The acceleration of funding in the field. I was on a call [recently] and Dan Walker from Ford, who’s so eloquent, basically said that there is roughly a half a billion dollars now in the field of racial and social justice, whereas last year there was only 10 percent of that.  Clancy: Wow.  Mahon: So I think similar to HIV, there is a question of what will we make of this moment and how will we as stewards of funds or stewards of companies or stewards of our families make a difference. How will we change our behavior? I think that’s the exciting moment that we have. The complexity, of course, is that it’s up against enormous economic loss, a lot of fear — which we always had in HIV, but we didn’t have the economic backdrop that we currently have overall to COVID-19. But there’s a lot of great people who are rowing in the same direction now. The question is how do we integrate ourselves? How do we sit in on committees that are focusing on office reopenings or how we’re doing with COVID? How do we integrate social impact and environmental impact into the way we do business every day, and how we as a luxury company kind of show up in our communities? One of our strongest brands, Aveda, is in Blaine, Minneapolis, and we’ve had town halls and will continue to have town halls with our employees there, and how are they engaging, how are they thinking about how they can help? We spent a lot of time thinking about, well, what are virtual volunteering opportunities? What are the ways that we can basically help our employees channel their passion? We decided that we were going to allow, in our year one [of our response], our employees to give away most of the money. We created a five times matching campaign, and the groups we selected were Black Lives Matter, Global Foundation Network, Equal Justice Initiative, Race Forward and NAACP Legal Defense Fund. And we basically said to our employees: Every dollar that you give, we will match it five times. We saw literally over 4,000 employees engage. We had a higher engagement rate than we’ve ever seen. People were posting on their social channels. We’ll be giving away almost $2.3 million through that vehicle. Clancy: Putting the long-term lens on, have there been any adjustments to your long-term corporate sustainability plans in this period? Have your priorities changed?  Mahon: I don’t think they changed. We have been fortunate in that our overall performance over the last I’d say two years in particular has really accelerated. We’re getting recognized by CDP or MSCI or ISS for that, which we find very gratifying. It feels like directionally we’re headed in the right way. And we certainly see in our brands, our consumers and our employees are basically saying, “We want more of this.” While it hasn’t changed the direction, it’s definitely accelerated. For instance, our climate work. We hit net zero early. We’re looking to hit our science-based target early…  We are leaning in on our social impact work, which we’re historically very well-known for. We have integration with social justice. That was an area in our social impact work which we hadn’t done in the past. Many of us had done somewhat similar work. We leaned in and spoke with allies and the Ford Foundation and some of the great foundations that are doing this work. We are looking forward to being part of a broader community and trying to leverage our corporate microphone and our company values to play an even bigger role. So I’d say [we’re moving] faster, perhaps more dimensionalized, and definitely [have a] better understanding not only how do we fund racial and social justice, but how do we as a business take concrete action around hiring and what our creative marketing looks like. So that’s very exciting, because what you don’t want as somebody in my job is to kind of be the nice people that aren’t really integrated into the business.  Clancy: Much of the work on renewable energy has really focused on electricity. Obviously, one of the toughest areas and processes to decarbonize is manufacturing. What solutions are you exploring for your production facilities? Mahon: Waste and water and energy are all linked together. Within each facility, we have an incredible team that’s been focusing on this for quite some time, which is looking at how efficient is our water use? Is there a way to reduce water use? Have we maxed out solar? And are there internal solutions before we move to offsets that we can buy to reduce our energy use? And the answer there is yes. It does vary somewhat by country, and by the state of the green energy and green finance in those countries. Also, as you know, government plays an important role, and of course, being in the U.S., we’ve seen a real rollback in terms of incentivizing green practices … What you don’t want as somebody in my job is to kind of be the nice people that aren’t really integrated into the business. I think the best thing that we can do is help the market grow so there are more alternatives for companies like ours. I think we don’t have to do any convincing at this point. It’s really about the level of sophistication of what we can invest in, and I think also kind of a deeper discussion about offsets, the quality of offsets, and where do offsets get us.  Clancy: Can you share your vision for sustainable packaging? How do things like reuse or refillable containers fit into that?  Mahon : What we’re trying to do, really, is to give the brand presence the most flexibility they can to get to sustainable packaging, and while at the same time reducing plastics and reducing carbon footprint. And that’s kind of a juggling act, frankly, because in many instances it involves added cost. We have a five-year glide path for every single brand. The ability to shift from plastic to glass is easier in skincare. Makeup innovation and sustainable packaging is a new frontier, and we’re really active in that. As you likely know, the size of makeup packaging, particularly samples, is too small — it falls through the filters in the MRFs — so it’s one of the areas that we’re really focusing on now, and really inviting innovation.  Clancy: You’re very excited about forestry and forest options as a means of carbon removal. Are there any particular things you’re looking at that you can mention? Can you elaborate?  Mahon: There’s been some companies that have basically supported, through grant funds, the creation and preservation of forests. And so we are looking at that. More directly, though, we would love to have direct investment in forestry as part of our climate portfolio, and an ability to create green energy. It gets somewhat complex, but obviously, we’re a beauty company, and we don’t want to be in the business of running forests … Those are the discussions that we’re having now, and we’ve been looking at various things over the last couple of years. We don’t have anything specific. We’re basically in due diligence phase on a couple of things. But because this moves so quickly, it doesn’t really make any sense to name names. But we would love, as a result of the article, to certainly invite both other companies who are looking at this [to talk about this and also have] a larger discussion about private/public partnerships around encouraging investment in forest preservation. We recently published a no deforestation policy, as many companies have, so there’s a nice intersectionality there between no deforestation and improving our climate component.  Clancy: I have two more questions. One is just a thread I hear often. What role will collaboration play in Estée Lauder’s strategy? What sorts of partnerships are you prioritizing?  Mahon: One of the exciting aspects of our company and our board … is we have folks who’ve worked in all different sectors. We have a lot of folks who’ve worked in government, like myself. We’ve worked in nonprofits. We’ve worked in for profits. So really, in order to move the ball down the field in a meaningful way, whether in social impact form or another form of impact, we have to basically look at this in a sector-agnostic way in which we really have company discussions about what we’re doing in climate.  What does government bring to the table? OK, there’s tax incentives. They can give various breaks in various laws, regulatory, both the carrot and the stick. What does business bring? Well, business brings enormous amounts of business discipline of understanding markets, understanding consumer needs, understanding how to scale a solution, understanding how to, candidly, abandon a solution if it’s not selling. And then NGOs clearly bring a lot to the table in terms of advocacy.  I think that as we’ve moved so rapidly in the for-profit sector being in favor of green energy and of strong climate solutions, the role I believe of NGOs will be more to be a bridge between government and I would say also private foundations [to come up with solutions]. For instance, in our VPPA, we will have excess green energy. Do we want to be in a position as a beauty company of selling energy, green energy? Or would we rather donate it? We’re having some conversations with the Rockefeller Foundation about, “Well, could we figure out a way where we could just donate it?” That’s where I think we really do need these cross-sector solutions.  Clancy: My last question is what do you feel is your most important priority as a chief sustainability officer in this moment? Mahon: At the end of the day, the great pleasure and complexity and entrepreneurism of CSO jobs is that we don’t own the P&Ls generally of the issues we need to influence. So, I would say the biggest priority really is continuing to listen to our key stakeholders with empathy, and be as responsive as we can, to try to run alongside the train of the business … A lot of what we do is obviously bring a substantive area of expertise, but also integrate as best as we can empathically to the business, and to drive value. At the end of the day, if we drive value for communities and our shareholders and our consumers, then we drive value for the business, and that is I think the great challenge … How do you sit at the table as a business person and understand and have empathy for the great demands being placed for instance on our retail team, and at the same time build climate solutions that help those retail teams, and don’t seem sort of pie in the sky and divorced from the rest of the business? Ultimately, how do we leverage the passions and the interests of our employees and our consumers and now our investors, which is great. Because I think that kind of creates an unlimited path.  Pull Quote I think similar to HIV, there is a question of what will we make of this moment and how will we as stewards of funds or stewards of companies or stewards of our families make a difference. What you don’t want as somebody in my job is to kind of be the nice people that aren’t really integrated into the business. Topics Corporate Strategy Social Justice Corporate Social Responsibility Racial Justice Forestry Deforestation Collective Insight The GreenBiz Interview 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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Closed Loop Partners teams with Walmart, CVS, Target to take on the plastic bag

July 24, 2020 by  
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Closed Loop Partners teams with Walmart, CVS, Target to take on the plastic bag Deonna Anderson Fri, 07/24/2020 – 01:15 Single-use plastic shopping bags are a real problem. They take decades to break down but nearly 100 billion of them are used in the United States every year to cart away goods from retailers. Fewer than 10 percent of those are recycled  — often winding up in landfills and waterways because many recyclers don’t accept them . Now, Closed Loop Partners’ Center for the Circular Economy is partnering with Walmart, CVS Health and Target to address that problem. Their $15 million joint Beyond the Bag Initiative  — similar to a previous collaboration focused on redesigning cups — will focus on creating solutions that reinvent shopping bags and that more effectively divert single-use plastic bags from landfills.  “By coming together to tackle the problem, we aim to accelerate the pace of innovation and the commercialization of sustainable solutions,” said Kathleen McLaughlin, executive vice president and chief sustainability officer for Walmart, in a statement. “We hope the Beyond the Bag Initiative will surface affordable, practical solutions that meet the needs of customers and reduce plastic waste.” Together these companies and others — Kroger and Walgreens, along with Conservation International and Ocean Conservancy as environmental advisory partners — make up the Consortium to Reinvent the Retail Bag. By coming together to tackle the problem, we aim to accelerate the pace of innovation and the commercialization of sustainable solutions. “A main focus of what we do at the center is bring together corporations, nonprofits, industry groups, and others to create unexpected partnerships of competitors, to bring them together to collaborate on challenges that really no one organization can solve in isolation,” said Kate Daly, managing director of the Center for the Circular Economy at Closed Loop Partners. The consortium’s goals include diverting single-use plastic bags from landfills and scaling solutions that would serve the same function and replace the retail bag, through this three-year partnership. It plans multiple approaches. The first approach, which Daly named as a backbone of the initiative, centers on reimagining the design through an Innovation Challenge with OpenIDEO. That effort, which will begin accepting applications Aug. 3, will seek innovative ways to “reinvent” the retail bag. It’s open to all sorts of solutions from students, scientists and companies of all sizes, because Daly acknowledges that there will be no one silver bullet solution that will solve the plastic retail bag problem.  “Some of those [solutions] might be new material, others might be entirely new approaches to transporting what we purchase from stores to our home,” Daly said. “There might be tech-enabled or AI-enabled solutions that we haven’t learned about yet.”  Once the search ends, the group will select about a dozen winners to join the Beyond the Bag Circular Business Accelerator, which will involve mentoring, capital investment, testing and piloting. Whichever solutions win and become scalable, Daly said, “It’s really important that these options be accessible and inclusive to all the different communities across the United States.” The retail partners, which have locations across the United States, should be able to make that happen. Back in 2018, the center — along with founding partners McDonalds and Starbucks — launched its NextGen Cup Challenge, which had the goal to reduce disposable coffee cup waste. Daly said the center is taking lessons learned from that effort into this new challenge.  One of those learnings was that extensive testing is critical. For the NextGen Challenge, Daly said the group asked questions such as, “Does [the cup] hold liquids up to a certain temperature Fahrenheit? Can you comfortably hold the cup? Does the lid work with the cup? Does the coating stay on the cup? Does the coffee leak through the bottom?” For the bag reinvention, it will ask similar questions centered on identifying potential performance issues, such as: “Does the bag break?” And if it’s a new, bagless way of transporting goods, “Does it effectively prevent any sort of breakage or leaks?”  It’s really important that these options be accessible and inclusive to all the different communities across the United States. In addition to performance, the consortium plans to do environmental testing on the types of materials being used across all applications, ensuring that the materials used for a given solution — even if it’s reusable — can be recovered through recycling infrastructure. That brings us to another approach the consortium is exploring with the Beyond the Bag initiative: investments in recovery infrastructure. Daly said the group wants to ensure that the solutions — no matter which form they take — align with the recovery options at their end of life. In addition to the design and infrastructure approaches, the consortium already has started learning more about consumer behavior when it comes to plastic bags — this is another of its four approaches. It’s been asking customers about their pain points and preferences when getting their goods from a store to their homes. “We know how important it is to bring our customers along on our sustainability journey, keeping in mind that most are looking for convenience with minimal environmental impact,” said Eileen Howard Boone, senior vice president for corporate social responsibility and philanthropy and chief sustainability officer at CVS Health, in a statement. As they continue their journey, the consortium partners share a sense of urgency in addressing the issue of plastic bag waste — that’s why these unlikely collaborators are working together and acting as a collective. “We see the importance of sending a unified market signal as being really critical if you’re going to have systems-level change, and address long-standing environmental challenges,” Daly said. “The nature of bringing competitors together can help reframe the issue beyond short-term fixes and alternatives to long-lasting, systemic solutions that really take a holistic approach from production to use to reuse to recovery.” Pull Quote By coming together to tackle the problem, we aim to accelerate the pace of innovation and the commercialization of sustainable solutions. It’s really important that these options be accessible and inclusive to all the different communities across the United States. Topics Circular Economy Plastic Plastic Waste Innovation Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off Source:  Emilija Miljkovic Shutterstock Emilija Miljkovic Close Authorship

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Sustainability and the never-ending battle against burnout

July 20, 2020 by  
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Sustainability and the never-ending battle against burnout Chris Gaither Mon, 07/20/2020 – 01:04 I felt sure I’d put burnout in the past. I’d quit my high-stress job at Apple, started my own executive-coaching business and found balance in my life. Then, with shame burning my face, I had to cancel a GreenBiz workshop I was leading about how to take care of yourself. Why? Because I hadn’t taken care of myself. That’s the thing about burnout: It creeps back in as soon as you stop paying attention. I began discussing burnout with GreenBiz leaders in early 2019. Yes, my own, which came at the end of four years helping Apple become a model of environmental sustainability. But also the debilitating exhaustion of so many sustainability professionals who wear themselves down in service of this crucial work. “Sustainability is a challenging field,” an attendee of the GreenBiz 19 forum wrote in a post-event survey. “Many think we’re crazy, the news about the environment is typically negative, and all major ecosystems are still in decline. It can be depressing and sticking with the fight can be hard. How can we keep ourselves energized?” I eagerly agreed to lead a session called ‘Human Sustainability: Maintain Your Energy to Pursue What Matters.’ I’d failed to do that plenty of times in my life. I eagerly agreed to lead a session about this at GreenBiz 20 in Phoenix. We called it, “Human Sustainability: Maintain Your Energy to Pursue What Matters.” I’d failed to do that plenty of times in my life. As I recounted in the first article in this series, my 20-year career had left me with a desperate case of burnout. My tank was empty. Depression, fatigue and physical pain overtook me. So, I took a mid-career break to recuperate. I slept. Underwent chronic-pain counseling. Got in shape. Drove my son’s soccer carpools. Volunteered at my local food bank and in underserved schools. Read more than 120 books. Took creative writing classes. Walked in the woods. Reflected. Slowly, I began to diagnose what had gone wrong. My life was badly misaligned. Don’t get me wrong. Of course I was proud of being a director on Apple’s Environment, Policy and Social Initiatives team (and very grateful for the Apple shares that accompanied the title). I loved learning from my incredible boss, Lisa Jackson, leading huge projects with talented colleagues and championing our environmental stewardship. I’d gotten what I thought I wanted. But I realized that, in my early 40s, my values were coming into much sharper focus. Family, community, health, creativity — those are the things that light me up, give me meaning. When I examined where I actually focused my time, attention and physical energy, though, there was a huge disconnect. I was working nonstop, missing important family moments. I commuted three to four hours a day between my Oakland home and One Infinite Loop in Cupertino, Apple’s headquarters. I made little time for exercise or personal creative projects. And as I moved up the corporate ladder, I delegated much of the hands-on work that had brought me joy. In the huge gap between my values and my activities, pain and misery grew like a weed. My body and spirit were trying so hard to tell me that I was off the rails. I vowed to find alignment. I trained as a coach and started my own leadership practice. I’ve landed clients at big companies including Google, Apple, Facebook, Levi Strauss, Airbnb and Mars, as well as startups and nonprofits. I help them lead with purpose while not sacrificing their own human sustainability. The work lights me up with meaning, joy and energy, and constantly reminds me to rejuvenate myself. I was excited to help GreenBiz 20 attendees explore how they, too, could maintain their own sustainability. I’d booked my flight. I’d thought hard about the impact I wanted to have: to help these sustainability professionals avoid, or recognize and repair, the kind of burnout I’d faced. I’d spent weeks designing the workshop. Then I got overwhelmed. And sick. I overlooked the signs that I was out of alignment again. It began with a mild cold, just before Christmas. It stuck around and flared up hard after I made a 24-hour work trip, between San Francisco and Orlando, to please a new corporate partner. I felt awful. Hard coughing. Nasal congestion. Achy sinuses, ears and muscles. This was before COVID-19 swept the globe, so I tried to ignore my symptoms. I kept moving ahead: negotiating the legal aspects of my divorce, co-parenting our adolescent son, running leadership development workshops, coaching almost 20 clients. My symptoms, especially my cough, got worse. In late January, just a few days before GreenBiz 20, I found myself in radiology. The chest X-ray came back clean for pneumonia, but my doctor diagnosed me with a respiratory infection. What will help me make the long-term difference I want to bring to the world? It became crystal clear: I would honor my health. I told him I needed to travel to Phoenix to run a workshop. Environmentalists struggling with burnout were counting on me. He gave me antibiotics. They didn’t help. The Phoenix trip was drawing closer and closer. I couldn’t imagine suffering through a flight and energizing a roomful of people while feeling so crummy. I also couldn’t imagine canceling. I’d have to admit — to the organizers, to myself — that I’d failed to live up to the rejuvenation message I planned to deliver. I’d taken on too much, plowed past the warning signs my body was trying to send me and put the needs of other people above my own wellbeing. I panicked. I fretted. I asked friends for advice, hoping someone would decide for me. Then, I slowed down and coached myself. I asked, What’s most important right now? How do I want to be? What will help me make the long-term difference I want to bring to the world? And it became crystal clear: I would honor my health. To authentically deliver this message of human sustainability, I needed to live it. I had to take care of myself so I could take care of others. I canceled my session, stayed home and replenished the energy I need to do the work I love. GreenBiz 20 went just fine without me. The relapse was a painful and important reminder that finding balance isn’t something you do once. You do it each day, by aligning your values with your activities. And when you get it wrong, like I did, your body and spirit will tell you, unequivocally. Pull Quote I eagerly agreed to lead a session called ‘Human Sustainability: Maintain Your Energy to Pursue What Matters.’ I’d failed to do that plenty of times in my life. What will help me make the long-term difference I want to bring to the world? It became crystal clear: I would honor my health. Topics Leadership 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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Sustainability and the never-ending battle against burnout

It will take personal sustainability to meet the global challenges we face

July 6, 2020 by  
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It will take personal sustainability to meet the global challenges we face Chris Gaither Mon, 07/06/2020 – 02:15 Earth Day, when we remember the planet’s fragility and resilience, was when I finally understood that I had nothing left to give. It was April 2017. After two decades of striving in my career, I had risen to a role of great impact: a director on Apple’s Environment, Policy and Social Initiatives team. My boss, former EPA Administrator Lisa Jackson, had entrusted me with orchestrating the company’s annual Earth Day celebration. And, wow, had we stepped up our game that year. We released a 58-page environmental responsibility report and a series of animated videos about Apple’s environmental achievements, posing curious questions such as “Do solar farms feed yaks?” We turned the leaf on our logo green at hundreds of Apple stores around the world. Even bolder, we announced ambitions to make Apple products out of entirely recycled or renewable materials. I drank beer and hugged the brilliant people from so many Apple teams who had pulled all of this off. I smiled. But mostly, I wanted to fall into bed. To inspire Apple employees, we created an hour-long presentation for Lisa to deliver in Town Hall, the campus theater where the first iPhone was announced. And we brought musician Jason Mraz to play an Earth Day concert on the green lawns of One Infinite Loop. Whew. Surrounded by thousands of my colleagues as Mraz performed, I drank beer and hugged the brilliant people from so many Apple teams who had pulled all of this off. I smiled. But mostly, I wanted to fall into bed. Insistent inner voice That wasn’t new. The enormity of my job, leading strategy and engagement for Lisa’s team, usually left me exhausted — especially after Earth Day, when I felt like one of Santa’s elves just after Christmas. What was different? This time, when I told myself I’d bounce back soon, I knew I was lying. Underneath my sheen of accomplishment and pride, a quiet and insistent inner voice told me I was depleted. Cooked. Burned out. That voice was right. As May deepened, so did my sadness and fatigue. The physical and emotional crisis overwhelmed me. Nearly every day, I sat in my glass-walled office and tried to avoid eye contact with my colleagues so they wouldn’t see my tears. I felt like I was failing at everything. I couldn’t gain any momentum on projects. My well of creative energy had run dry. My body no longer allowed me to pretend that this hard-charging life was right for me. Previous injuries flared up, sending lightning bolts of pain along the nerves in my hands, feet and back. As I tried to ignore the pain, my body kept turning up the volume: a 3 out of 10, then a 4, then a 7. My body seemed to be asking, “Can you hear me now?” The pain reached a 10 that spring of 2017. And still I tried to soldier on. Don’t be an idiot, I told myself. Your boss served President Barack Obama, and now she reports to Tim Cook. You have a wonderful team. You have a great title and lots of stock in the world’s most valuable company. Even better, you get to tell stories of the powerful work Apple is doing on climate action, resource conservation, natural-disaster relief and HIV prevention. You show others what’s possible. You become what Robert Kennedy (whose photo hangs on the wall of Tim’s office, alongside Martin Luther King Jr.’s) called a “ripple of hope,” spreading inspiration through customers, investors, suppliers, policymakers and industry. Listening to your spirit So what if you feel down? Most people would kill for this job. Suck it up. Here’s the thing: You can’t think your way through an existential crisis. You can’t talk your way out of burnout. You need to listen, deeply, to your spirit. You need to honor what it’s telling you. And my spirit was telling me something profound: For the previous few years, I’d devoted myself to corporate and planetary sustainability. But along the way, I’d completely lost my human sustainability. Only when I hit the depths of my crisis did I understand that I needed to quit the job I’d worked so hard to get. Only when I hit the depths of my crisis did I understand that I needed to quit the job I’d worked so hard to get. I’d let the burnout go for so long that stepping off the corporate treadmill was the only way I could truly recuperate from the punishment of two decades of high-stress work, long commutes, poor health habits and time away from my family. So that’s what I did. I sat across from Lisa in her office, swallowed hard past the lump in my throat and told her I was leaving to recover my well-being. It was one of the hardest things I’ve ever done, and I haven’t regretted it for a moment. In the three years since, I’ve come back to life. I’ve gotten well. I’ve crafted a career of purpose and meaning. I’m an executive coach who helps leaders — especially environmental sustainability leaders — nourish and inspire themselves so they can keep doing the work they love. Why am I telling you this story? Because, my friends, I see myself in you. I see you suffering under the weight of the environmental crisis. I see you struggling with weariness, depression and burnout. I see you decide you can’t take a day off when the planet is burning. I see you sacrifice your own sustainability for planetary sustainability. I get it. You keep going because you have a big heart. You’re called to do this work, maybe by your love of wildlife or natural places, or by a deep desire for racial and economic equality. The problem is, if you don’t take care of yourself, you won’t have the energy or creativity that you need to do great work. And great work, maybe even transcendent work, is critical right now. That’s why I’m starting this series with GreenBiz. I’ll be writing regularly about ways you can tend to your human sustainability. Purpose. Love. Natural beauty. Breath. Poetry. Stillness. Rest. I’ll use as examples things my clients and I get right, things I get wrong (so, so wrong) and things I still struggle with every day. My hope is that you’ll reconnect with that wise voice inside you, and the spark that brings you most alive, so you can be at your absolute best. Because, to find solutions to our most pressing problems, the world needs you at your best. Pull Quote I drank beer and hugged the brilliant people from so many Apple teams who had pulled all of this off. I smiled. But mostly, I wanted to fall into bed. Only when I hit the depths of my crisis did I understand that I needed to quit the job I’d worked so hard to get. Topics Leadership State of the Profession Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off The author with Lisa Jackson at the Apple campus, Earth Day 2017. Photo courtesy of Chris Gaither.

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It will take personal sustainability to meet the global challenges we face

It takes a village to succeed in climate tech

June 3, 2020 by  
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It takes a village to succeed in climate tech Ben Soltoff Wed, 06/03/2020 – 02:00 Solving climate change depends, to some extent, on technological innovation. The world’s leading climate authority, the Intergovernmental Panel on Climate Change (IPCC), published a landmark 2018 report highlighting the urgency of limiting warming to 1.5 degrees Celsius. The report outlines four potential pathways for reaching that goal. The pathways are vastly different, but one thing they have in common is a central role for new technologies, all of which fall under the growing category known as climate tech . Relying on emissions-reducing technology isn’t the same as blind techno-optimism . New technology needs to complement existing solutions, deployed immediately. But the IPCC pathways make clear that the route to mitigation goes through innovation. So, what does it take to turn a societal need into a functional reality? Scientific breakthroughs are only part of the challenge. After that, there’s a long road before solutions can be implemented at scale. They require funding through multiple stages of development, facing many financial and operational risks along the way. There’s a parallel here with the response to COVID-19. Even if a working vaccine is developed, it must go through trials to determine efficacy and the logistical challenge of distribution to billions of people. But a key difference is that effective climate solutions are more varied than a single vaccine and usually more complex. At a webinar last week hosted by Yale, Stanford and other groups, Jigar Shah, co-founder of clean energy financier Generate Capital , noted that climate technologies, unlike medical breakthroughs, must compete with systems already in place.   “In the biotech industry, which I think folks herald as a well-functioning market, once companies reach a certain validation of their technology and approach, there’s a payoff there,” he said. “And in [climate tech], there really isn’t one [in the same way], largely because there are a lot of incumbent technologies that provide electricity, energy, water, food, land and materials.”   The period when a new technology is costly to develop but too early-stage to produce commercial revenue is often called the “Valley of Death” because even promising technologies often fail during this period. Success requires the collaboration of a wide set of partners and investors. As an Environmental Innovation Fellow at Yale, I’ve helped compile insights for investors on overcoming the unique barriers faced by nascent climate technology. Fortunately, many investors are already tackling this challenge.   The new wave of climate tech investors In the early 2000s, there was a well-publicized boom then bust in clean energy investing. According to Nancy Pfund, founder and managing director of impact venture capital firm DBL Partners , much of this interest was from “tourists” looking for an alternative to the dot-com failures earlier in the decade. On a GreenBiz webcast last week, she observed that the current interest in climate tech is markedly different. “Today there’s such a high level of focus, commitment and knowledge on the part of both the entrepreneurs and investors,” she said. Pfund said the interest in climate tech is partially due to the compelling economics of renewable energy compared to alternatives. “There’s been a stunning cost reduction over the past decade,” she said. “This brings in mainstream investors who are just making dollars and cents. They’re not even necessarily waving the climate banner. They want to rebalance their portfolio for the future.” During the same webcast, Andrew Beebe, managing director of Obvious Ventures , noted that an additional factor in the rise of climate tech has been the overwhelming public demand for climate action. “There’s been a societal shift as well,” he said. “In entrepreneurs today and investors, I see an urgency like we’ve never seen before. People are not that interested in doing yet another social media company, unless it has a real impact.” In entrepreneurs today and investors, I see an urgency like we’ve never seen before. It’s important to note here that climate tech takes many forms. There are software solutions that can help reduce emissions and that don’t face the Valley of Death I mentioned earlier. But some of the most critical solutions are physical technologies that require a lot of time and capital to succeed. “You can’t spell hardware without the word ‘hard,’ and everyone knows that,” said Priscilla Tyler, senior associate at True Ventures , at the Yale-Stanford webinar. “Hardware is hard, which isn’t to say it’s impossible. And if anything, in my opinion, it begets more impact and more opportunity.” There are promising signals that climate tech is here to stay. Tyler is part of a group of venture capital investors called Series Green , which meets regularly to discuss climate tech opportunities. Additionally, multiple weekly newsletters share the latest deals in climate tech, and in a recent open letter , a long list of investors confirmed that, despite the COVID-19 economic downturn, they remain committed to climate solutions. Going beyond traditional venture capital A notable climate tech deal that happened last week was the $250 million investment in Apeel Sciences . The California-based company has developed an edible coating for fruits and vegetables that can help to preserve some of the 40 percent of food that normally gets thrown away. Investors in this round included Singapore’s sovereign wealth fund and celebrities such as Oprah Winfrey and Katy Perry. A company such as Apeel doesn’t start out raising hundreds of millions of dollars from large institutional investors and celebrities. At the early stages, many new technologies depend on government grants and philanthropy. Apeel got started with a $100,000 grant from the Gates Foundation in 2012. Apeel coats fruits and vegetables with an edible layer that can is designed to extend shelf life by two to three times. Media Source Courtesy of Media Authorship Apeel Sciences Close Authorship Prime Coalition is an organization that helps foundations deploy philanthropic capital to climate solutions through flexible funding structures that allow for long periods of technology development and multi-faceted risk. It calls these funding sources “catalytic capital,” because they can help unlock other forms of finance further down the line.  In addition to helping others deploy catalytic capital, Prime also makes its own catalytic deals directly through an investment arm called Prime Impact Fund. “We’re looking to support companies that have specific things to be de-risked before they will be attractive to follow on funders, and then we can be the source of that de-risking capital,” said Johanna Wolfson, principal at Prime Impact Fund, at last week’s Yale-Stanford webinar. By collaborating with one another, investors such as Prime can help technologies move through the stages of innovation, until they’re ready for more traditional investment structures. Catalytic capital invested today could help create the next Apeel Sciences several years from now. At each stage, investors serve not only as sources of money but also strategic partners for the startups themselves. This is particularly true for corporate investors, who may have substantial industry knowledge to share and more flexible expectations than traditional investors. There’s a lot more sophistication on part of corporate investors now than there was 10 years ago. “There’s a lot more sophistication on part of corporate investors now than there was 10 years ago,” said Pfund. “Then, you saw the agenda of the corporation being pushed around the board table more than you do today, and that’s never a good idea.” If their interests are aligned, corporations and startups can create mutually beneficial relationships, where each offers the other something that it couldn’t have obtained on its own. “These corporate investors see so many different technologies, and they believe their own products are better than the startup products, so how do you actually get their support?” said Andrew Chung, founder and managing partner of 1955 Capital , on last week’s GreenBiz webcast. “Well, you need to have a widget or product they haven’t seen before or can’t build themselves.” Non-financial support also can be catalytic Investors such as DBL Partners often connect the startups in their portfolio to corporates and other partners. These connections can be hugely valuable for startups, especially in emerging industries where networks are largely informal. While investors’ main role is to provide capital, they also provide many forms of non-financial support, which can be essential to advancing innovation. In addition to connections, they also can help startups to navigate dynamic policy environments at the state and federal level. “Policy plays a pivotal role,” said Pfund. “We don’t invest in policy, we invest in people, but we know that our companies are going to have to address the changing policy landscape.” We don’t invest in policy, we invest in people, but we know that our companies are going to have to address the changing policy landscape. DBL Partners helps to shape the policy landscape by convening roundtable meetings, advocating for legislation and reaching out to regulators in order to help create a more favorable environment for innovation. This sort of engagement is relatively low-cost in the short term, but it can have massive benefits in the long term, especially as new technologies begin to scale up. Shah pointed out that the challenges facing climate tech don’t end once solutions reach commercialization. Nascent technologies still need to be deployed at a large scale to have impact. “A lot of us focus on going from zero to millions,” he said, “but then, in fact, millions to billions is still nascent.” Reaching the necessary scale requires a careful alignment of technological development, market creation, political support and investment across a wide spectrum of capital. “All of these things work together in tandem to really unlock nascent technologies,” Shah said. This story was updated June 4 to correct Apeel’s funding information. Pull Quote In entrepreneurs today and investors, I see an urgency like we’ve never seen before. There’s a lot more sophistication on part of corporate investors now than there was 10 years ago. We don’t invest in policy, we invest in people, but we know that our companies are going to have to address the changing policy landscape. Topics Innovation Climate Tech Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off

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It takes a village to succeed in climate tech

Rimbin concept offers a look into the future of infection-free playgrounds

June 1, 2020 by  
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Berlin-based inventors Martin Binder and Claudio Rimmele believe that parents shouldn’t have to make the choice whether or not to let their children enjoy a playground in a world changed by COVID-19. In the early days of the pandemic, Binder, a designer and artist, and Rimmele, a psychologist and publicist, noticed a shift in the playgrounds of their city. Where there were once lively, laughter-filled spots in the city were now forbidden and barren because of necessary precautions in the fight against the novel coronavirus. The two understood the importance of playgrounds for developing children’s social skills and improving mental health. Six weeks later, they found their solution in Rimbin, an infection-free playground concept inspired by nature and influenced by Berlin parents. Related: Solar-powered “bubble shield” focuses on physical distancing in public The concept calls for a separate play platform for each child and a playground path leading to each area with a separate entrance. The platforms are large enough for children or siblings of the same household to stay together, far enough from unfamiliar children to ensure social distancing, yet open enough for kids to communicate and play games from a safe distance. Features in between the platforms, such as speaking tubes, horizontal ladders and seesaws, offer interaction without the need for physical contact. Surface areas, handles and tubes would be made of metal materials that are easy to sterilize, and permanent disinfectant dispensers would be installed for parents if they’d like to clean as an additional safety precaution. Inspiration for the playground and platforms came from biology and nature, according to the designers. The play areas were created to imitate the leaves of the Amazon water lily, inspired by the 1849 project conducted by biologist Joseph Baxton where he placed his young daughter in the water lily leaves to demonstrate their strength and carrying power. Rimmele and Binder hope that the concept will allow the children of the future to continue to enjoy the social interactions, creativity and imagination that playgrounds helped encourage before the pandemic . + Martin Binder Images via Martin Binder

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Rimbin concept offers a look into the future of infection-free playgrounds

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