Semiconductor firm Applied Materials puts supply chain at center of new commitments

July 28, 2020 by  
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Semiconductor firm Applied Materials puts supply chain at center of new commitments Heather Clancy Tue, 07/28/2020 – 02:00 The sustainability ambitions of the world’s largest cloud software companies — Amazon, Google, Microsoft and Salesforce — have been well-documented. The broad semiconductor industry’s position to date, however, has been less transparent and less ambitious, with the highly visible exceptions of AMD, IBM and Intel.  That stance is shifting, as the sector contemplates the explosive growth projections for connected computing devices, including sensors, smartphones, tablet computers and personal computers, not to mention the massive server hardware needed to process artificial intelligence algorithms.  By 2030, there could be a half-trillion such devices “at the edge” of the digital networks driving business innovation around the planet, Applied Material President and CEO Gary Dickerson noted last week in a keynote address during a virtual edition of the industry’s annual conference, SEMICon West .  The association behind the gathering, SEMI , projects semiconductor revenue could reach $1 trillion by that same timeframe, more than double last year’s sales of about $470 billion. It previously took 20 years for the industry to double in size.  The big question for the sector at large and Applied Materials specifically, Dickerson said, is how to support accelerating growth without dramatically increasing the industrywide carbon footprint associated with creating all those components — currently estimated at 50 million metric tons of CO2 annually across more than 1,000 fabrication facilities worldwide (a.k.a. “fabs”).  We are going to hold our supply chain to the same standards that we hold ourselves in the areas of environmental impact, labor standards, and diversity and inclusion. “I’ve been amazed at the increasing amount of power required to manufacture these ever-smaller chips, and I would join with others in encouraging all of the equipment manufacturers to work together to reduce carbon emissions in the manufacturing of these advanced semiconductors and finally continue decarbonizing the power supply on which the data centers operate,” former Vice President Al Gore  told me last week , when I asked him how the semiconductor industry could step up. Applied, which specializes in materials engineering, sells equipment and services used in the production of virtually every new chip and advanced display in the world. It generated more than $14.6 billion in annual revenue in 2019, and Dickerson estimated its Scope 1 and Scope 2 emissions — mainly from the power used to run its labs and factories — was the equivalent of 145,000 metric tons of CO2 in 2019. (Disclosure: Al Gore’s investment firm, Generation Investment Management, holds a position in the company. Applied was responsible for my invitation to lead an interview with Gore last week during the same conference.) “The first thing we need to do is decouple our growth from our environmental impact,” Dickerson noted. “If we double or triple the size of our company, it would be irresponsible to double or triple our carbon footprint!” That conviction resulted in the company’s decision to adopt a series of new policies designed to shore up its environmental, social and governance (ESG) story, including a commitment to use 100 percent renewable energy worldwide by 2030 (by 2022 for its U.S. operations) and to cut its Scope 1 and Scope 2 emissions by 50 percent over the next decade. Moreover, Applied has created a sweeping new initiative intended to bring other companies in the semiconductor supply chain along for the ride. “We are going to hold our supply chain to the same standards that we hold ourselves in the areas of environmental impact, labor standards, and diversity and inclusion,” Dickerson said. “We’re introducing a sustainability scorecard into our supply selection process, alongside our traditional metrics for performance, cost and quality.” Making improvements of this magnitude and — at the same time — driving the technology roadmap forward is not easy and requires deep partnerships with customers. The new program, SuCCESS2030 (short for Supply Chain Certification for Environmental and Social Responsibility) will extend to all aspects of Applied’s operations, from procurement to packaging. It will now require these shared commitments from its suppliers, according to the press release about the program: A shift to intermodal shipping to reduce the industry’s reliance on air freight, aiming for an interim emissions reduction of 15 percent by 2024. A transition to recycled content packaging, with a target of 80 percent of such materials within three years. The complete elimination of phosphate-based pretreatments for metal surfaces within four years. The creation of a diversity and inclusion strategy to increase Applied’s spend with minority- and women-owned businesses by the same time frame. (There is no disclosed percentage for this goal.) “The response has been great, and we have six key partner suppliers already signed up to help us kick off this program,” Dickerson said. Those companies are Advanced Energy, Benchmark Electronics, Foxsemicon Integrated Technology, NGK Insulators, Ultra Clean Holding and VAT. Technically, Applied doesn’t yet have an official emissions reduction target in place for its Scope 3 footprint, but the company has joined the Science Based Targets initiative with the intention of doing so within two years, according to Dickerson. To improve its own competitive story with customers, Applied will use risk scenario analysis recommendations from the Task Force on Climate-related Financial Disclosures, and it has adopted a new “ecoUP” policy that includes a “3 by 30” goal for improvements in its own manufacturing systems on a per-wafer basis: a 30 percent reduction in energy consumption, a 30 percent cut in chemical consumption and a 30 percent increase in “throughput density,” the number of wafers that can be produced per square foot of cleanroom space. “Making improvements of this magnitude and, at the same time, driving the technology roadmap forward is not easy and requires deep partnerships with customers,” Dickerson said. Among those actively working with Applied on the new approach include Intel and Micro Technology, which is stepping up its own commitments. The latter intends to dedicate 2 percent of its annual capital expenditures over the next five to seven years — about $1 billion — on environmental and social stewardship.  Pull Quote We are going to hold our supply chain to the same standards that we hold ourselves in the areas of environmental impact, labor standards, and diversity and inclusion. Making improvements of this magnitude and — at the same time — driving the technology roadmap forward is not easy and requires deep partnerships with customers. Topics Information Technology Corporate Strategy Technology Manufacturing Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Courtesy of Applied Materials Close Authorship

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Semiconductor firm Applied Materials puts supply chain at center of new commitments

How Cargill’s new science-based water targets go with the flow

July 27, 2020 by  
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How Cargill’s new science-based water targets go with the flow Joel Makower Mon, 07/27/2020 – 02:11 Cargill, the giant food and ag conglomerate, last week announced a new set of 2030 corporate water targets, the latest to do so among firms in its sector. But this was no me-too kind of endeavor. Rather, it put the company at the front of the pack, going well beyond its own operational footprint to engage its entire supply chain, and to do so using a novel science-based approach for water. Specifically, Cargill said that by the end of the decade it would restore about 158 billion gallons of water, reduce about 5,500 tons of water pollutants and boost access to safe drinking water — all in what it refers to as  priority watersheds , regions around the world where the company has a significant operational or supply-chain water footprint.  This isn’t small potatoes. Agriculture represents about 80 percent of freshwater use in the United States and about 70 percent globally. Ag also is a major contributor both to water pollution and climate change; the water sector, which includes the collection and treatment of wastewater, accounts for 4 percent of total global electricity consumption,  according to the International Energy Agency . Few food and ag companies have taken on the full measure of their water footprint the way Cargill seems to have done, and by using a science-based approach. “If there’s a more robust enterprise level ambition for water, I haven’t seen it,” said Jason Morrison, CEO of the Pacific Institute and head of the United Nations  CEO Water Mandate , who advised on the project. “This is a really impressive piece of work that they’ve done and a pretty ambitious commitment they’re making. It’s got a lot to it.” If there’s a more robust enterprise level ambition for water, I haven’t seen it. Cargill has made water commitments in the past, but they covered only the company’s direct operations, a relative drop in the bucket of the water needed to bring to market the $114 billion or so of products and services it sells each year. About a year ago, the company set out on a journey to understand its water risks relative to its supply chain and operations, explained Jill Kolling, the company’s vice president for global sustainability. “Where does water really matter for us in our business?” she explained to me recently. “And where should we really be putting our efforts?” The goal, she said, “was to come out of this and have some aspirational goals to work against and also to make sure we’re working where it matters most. So, having that strong prioritization, backed up by science.” Science-based targets have become de rigueur in setting corporate greenhouse gas commitments. In effect, they ask what level of carbon reductions represents a company’s fair share, given its contribution to the climate problem. It was inevitable that this approach eventually be applied to water. Indeed, for the past two years a group called the Science-Based Targets Network has been looking at how to apply such methodologies to  a range of environmental impacts , including  water . But water is unlike climate gases in several fundamental ways. First, water is inherently local, with droughts in some areas and a surfeit in others. With climate gases, any improvement anywhere in the world helps alleviate the global problem; not so with water. Water is also temporal, with conditions changing throughout the year and from year to year, based on both normal and abnormal climatic shifts. And while the aggregate amount of available water is important, so is its quality. Having millions of gallons of water isn’t helpful if it is toxic, brackish or otherwise unsuited for human use. Rivers of data In the case of Cargill, these and other factors were applied not just to its own operation, but also to its more than 250,000 suppliers, ranging from multinational corporations to single-family farms in developing nations. They provide the raw materials for everything from cocoa and cotton to salmon feed and sweeteners. Cargill already had dipped its toes into water issues. It has invested in such programs as the  Soil and Water Outcomes Fund , which helps farmers adopt soil health and water conservation practices. It also participates in the  Midwest Row Crop Collaborative’s efforts to support and accelerate sustainable agricultural practices in Illinois, Iowa and Nebraska, including on improving water quality across the Upper Mississippi River Basin, which supports nearly 44 percent of U.S. corn, soy and wheat production. Still another Cargill initiative is  BeefUp Sustainability , which focuses in part on restoring grasslands, which perform many ecosystem services including filtering water. To develop its latest commitments, the company turned to World Resources Institute, with which it had previously worked on water issues. The first step was to aggregate the data Cargill needed to prioritize locally relevant decisions. “We’ve got  globally comparable data on water risks that we help companies leverage in order to look at water risks to their supply chain, and now increasingly use that same data to help think through what an effective science-based target could look like,” Sara Walker, WRI’s senior manager, water quality and agriculture, told me. “They’re kind of our science partner,” Kolling said of WRI. “What they bring to the table is datasets, tools and scientists who are able to help do the analysis. It’s also good to have an NGO partner working with you to push you to be more aspirational. They’ve provided tremendous guidance through this.” “There’s quite a lot of good data out there,” explained Truke Smoor, director of water at Cargill. “But if you look at the number of companies who have said they want data for water quality and costs, for both operations and the supply chain, you see there are very few.”  600 billion liters — it’s insanely large. It’s more than the total amount of water that we use in all our operations.   That may be in large part because the available data isn’t always consistent across watersheds and borders. Smoor said that Cargill ended up “combining a global data set with a better data set for the U.S. to meet our needs. And now we have the data we need to help us prioritize.” The commitments Cargill settled on were stretch goals, Smoor said. For example: “Six hundred billion liters — it’s insanely large. It’s more than the total amount of water that we use in all our operations. So, we’re basically offsetting double our total water use in those priority water systems in the regions where it’s needed most.” Down on the farm In some ways, getting the data was the easy part. Working with farmers — from Big Ag behemoths to smallholders in far-flung economies — is another matter. Promoting change can be hard work, although some farmers are beginning to realize the need to adapt new kinds of practices to ensure the long-term viability of local water supplies. “I think farmers are starting to realize that it’s ultimately the consumer who’s starting to care more and more about this,” Kolling said. “Over the coming years, those pressures and those desires from consumers to want to know more about how their food was produced and having greater expectations, we believe it’s going to grow and will continue to trickle back to the farmer. I think some of those more resistant farmers may realize that this is the way things are going.” Most farmers aren’t yet feeling those market impacts, she said, but there are other compelling arguments for their linking arms with Cargill on water. “At the end of the day, farmers are businessmen and women,” Kolling said. Toward that end, her company is helping farmers understand the business case today for improving water management practices, ranging from improving soil health to ensuring community water supplies. “It helps us make the change we want to make for the environment and for social and economic reasons.” And, of course, there’s climate change. Specifically, its relationship to both water quality and quantity, as well as the role of farming in sequestering carbon dioxide, which, in turn, improves soil health. “Water is so critical for nature, for agriculture, for communities,” Smoor said. “And it has that synergies with climate change.”  For example, she said, “Look at soil health practices. They help in carbon sequestration and they help in reducing greenhouse gas emissions. That is tied to fertilizer use, water quality and runoff. So, soil health practices provide water quality benefits. And through increasing soil moisture, we actually make sure that more water can recharge, so you have improved water availability. They really go hand in hand, which is such a powerful thing. Through combining these, you have so many touchpoints, whether it’s through farmers or regulators or the community.” Pooling resources As with every sustainability issue, one company’s leadership action is but a start. It will take collective action to achieve global goals, but also to ensure each company’s efforts aren’t undermined. For example, Cargill’s water conservation efforts in a particular basin may be for naught if other companies, large or small, aren’t similarly engaged there. In April, Cargill  announced that it would contribute $2 million to the next phase of its partnership with WRI. The two entities said they will combine their expertise to accelerate the development and improvement of tools, including a new Water Management Toolkit, to enable companies to set science-based targets for water. The toolkit “will allow us to address shared water challenges and promote sustainable water use within planetary boundaries across the industry,” they said in a statement. Cargill is already making its methodology publicly available. “We’re hoping we can invite others — customers, competitors, whomever — to collaborate with us where their sourcing and focus may intersect with our same watersheds,” Smoor said. But companies seem to be uncertain about when to jump into the pool. “We’re getting a lot of questions from companies like, ‘Should I wait for better data or should I wait for the Science-Based Target Network to tell me what exactly to do?’” WRI’s Walker said. “We’re really trying to encourage companies to act now. I think Cargill is a good example of this.” On the other hand, Smoor said, companies can wait until — some day. “You can continue to analyze everything forever, and especially in water, with all the different aspects. You can get stuck in risk analysis. You can get stuck in needing better data. Our approach is, we’re starting now; we’re going to drive the change. We will validate if we are doing the right thing.” 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 If there’s a more robust enterprise level ambition for water, I haven’t seen it. 600 billion liters — it’s insanely large. It’s more than the total amount of water that we use in all our operations. Topics Food & Agriculture Water Efficiency & Conservation Science-based Targets Featured Column Two Steps Forward 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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How Cargill’s new science-based water targets go with the flow

Secrets for circular supply chain partnerships from Interface and Aquafil

June 29, 2020 by  
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Secrets for circular supply chain partnerships from Interface and Aquafil Elsa Wenzel Mon, 06/29/2020 – 02:00 It’s an enviable alliance that has outlasted most marriages. For two decades, Interface and Aquafil have worked together to close the loop on carpeting, an example that other companies have followed. The carpet maker and the nylon supplier moved long ago past the early steps of engagement and strategy. They’ve innovated on raw materials, resulting in Aquafil’s Econyl yarn that it recycles from ghost fishing nets, carpet fluff and other would-be waste. They’ve co-launched pilot projects that have reshaped their supply chains, including the Net Works program, which pays fishers in the Philippines and Cameroon for turning in castoff nets used to create new nylon. They’ve expanded their markets and slashed carbon footprints along the way, cementing reputations as innovators. What are the secrets for the successes of this longtime collaboration between Interface and Aquafil? A virtual GreenBiz event June 23, “How to Get Your Supply Chain to Embrace Circularity,” moderated by GreenBiz co-founder and Executive Editor Joel Makower, revealed insights. Buying 100 percent-recycled nylon from Aquafil has helped Interface reduce the carbon footprint of its carpet tile by 69 percent. Learnings from this partnership also helped Interface to move forward with other initiatives, such as being able to count recycled or bio-based ingredients in 60 percent of the material used in its carpeting and 39 percent of its luxury vinyl tile, the latter of which took only three years to achieve. It’s not easy to be ahead of your time “When I see a landfill I see a goldmine,” Aquafil Chairman and CEO Giulio Bonazzi told a banker in 2008, pitching his circular vision for using waste materials instead of oil to produce nylon yarn. “The guy was so shocked he jumped out of his chair, I’m not kidding, and said, ‘I will not give you one penny.’” Ten years earlier, Bonazzi was on the other side. When he heard Interface legend Ray Anderson position Interface as a regenerative company by 2020, he thought the man had lost his mind. Eventually, though, something tugged at Bonazzi. He began to find value in that audacious goal, a notion that eventually led Aquafil to collaborate with Interface on common working teams to tackle one problem at a time. The companies share a long-held desire “to engineer a product with the end in mind just like nature does,” as Bonazzi put it. For Interface, the journey was a solo one that began back in 1994. That’s when founder Anderson set “Mission Zero” goals to remove negative environmental impacts by 2020, an ambition that largely has been achieved. These include three goals of a zero carbon footprint, zero use of virgin materials and zero use of chemicals of concern, in addition to the “reuse or re-entry” of materials in each of Interface’s markets. The company took this commitment a step further by applying these same metrics and goals to its suppliers in what it called the Suppliers to Zero program. Reaching out to suppliers to get them on board took Interface a great deal of creativity and early consciousness raising. How can other companies find success in winning over their suppliers toward eliminating the very concept of waste in their products? Moving toward circularity is a tough sell if the concept is new to certain stakeholders, but know thyself and consider data your friend, urged Interface vice president and CSO Erin Meezan: “Look at your components individually so you can target your first steps toward what’s most material.” For example, in the early steps toward its Mission Zero path, a life-cycle analysis blamed nylon for being Interface’s largest environmental impact. In 1996, the company began working with suppliers toward using nylon produced from waste. Aquafil, in the meantime, fine-tuned a depolymerization process that it says sidesteps the use of toxic chemicals or dyes, relying largely on a food-grade catalyst to help separate waste material from nylon. Interface eventually unveiled its first recycled nylon carpet tile, using Econyl, in 2010. No-cost or low-cost ways to get the conversation going with suppliers include simply meeting with them, Meezan noted. Interface invited suppliers into its factories for sustainability summits in 2003, showing off practices that suppliers themselves could mimic. It raised awareness during these events and in other conversations, which included suggesting relevant webinars and other resources. Interface also requested new types of data from suppliers that often never before had been asked about the carbon footprint of their products. That introduced a new lens through which to view their approaches. As for higher impact results, Interface early on promised bigger purchases for suppliers that ramped up their recycled content.  How can the business case be made? “What we did with suppliers is share what we had learned about our own footprint and how we did that analysis,” Meezan said. “That was our best weapon and the best capability we had.” For Interface, 92 percent of its products’ environmental impacts come from raw materials. Knowing such figures is the first place to start, she added. “Data is really your friend, being able to map out for the senior leadership team how important your supply chain is.” Next, if you’re thinking of pitching something ambitious, start small. Don’t overwhelm stakeholders with a major reinvention of complex systems. Instead, consider a pilot project. “It’s a way less threatening way to pitch a senior leader,” Meezan said. And while a pilot keeps both the targets and the opportunity for failure modest, success can encourage new possibilities. Finally, don’t forget to bring strong examples of supply chain progress and innovation to senior leadership. Interface was the first carpet maker to use Aquafil’s Econyl, now widely used among competitors, too. Yet it’s common for arguments to spring up internally over when to open up an innovation to the greater industry, she said. Meanwhile, years ago Aquafil attempted to spark a parallel partnership toward circularity with its own supplier, a chemical giant. Once again, Bonazzi said he was laughed at and told he would fail. “Basically they were not happy, they were feeling more a competitor than a customer and made a big mistake,” he said. Today, Aquafil is selling the solvent-free nylon processing technology that it created back to that supplier. Bonazzi didn’t change suppliers, in part because he didn’t need to. The very nature of the progress Aquafil helped to advance with Econyl shifted the sourcing needs away from big petroleum. Instead, a widely distributed crew of fishers, carpet collectors, waste pickers and post-consumer material suppliers including Gucci and Stella McCartney have become primary suppliers. “Instead of oil, we use waste,” he said. For Aquafil, the costs of regenerating nylon initially were more expensive than for the process of producing virgin-oil nylon, but no longer. Bonazzi noted that it’s important to look at price trends over the course of several year when considering an innovation of this nature instead of reading too much into a recent rock-bottom price for petroleum . “If you take into account all the costs, sustainability is never too expensive because if we pay the cost of landfilling or incinerating or the raw material we take from the planet, the actual costs are much higher than the costs we are paying nominally,” he said. Both Bonazzi and Meezan noted that their customers are far more savvy than a decade or two ago about the fact that the cost of raw materials doesn’t reflect the negative effects caused by extracting them from the earth in unsustainable ways. Ahead of the times What happens when your circularity efforts are ahead of what most consumers are demanding? Interface and Aquafil have found themselves in the position of consumer educators, which requires ongoing diligence.  For example, Interface’s sales personnel bring the message to potential customers about why products designed for circularity make for greener, low-carbon buildings. In the last five to 10 years, Meezan has found these efforts amplified by an adjustment in popular sentiment led by advocacy from the likes of the Ellen MacArthur Foundation. Circular messaging by fashion companies such as Gucci, Prada and Stella McCartney — all Aquafil customers, by the way — have helped too. Despite speed bumps in the early days of figuring out nylon recycling, Bonazzi said the market and customers have been supportive along the way. He said working with a client with exacting sustainability standards, such as Interface, brings far more benefits than headaches. “They challenge us a lot but also the most challenging clients are the ones making the best products,” he said. “The more challenging the customers, the better they are. We work together to learn how to be better companies. This is really what we are trying to do.” Topics Supply Chain Recycling Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off A colorful fishing net. Shutterstock Anton Gvozdikov Close Authorship

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Timberland invests in regenerative leather ranches

June 19, 2020 by  
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Timberland invests in regenerative leather ranches Deonna Anderson Fri, 06/19/2020 – 02:45 Regenerative agriculture practices have received a lot of attention in recent years, and much of the focus has been on food production. But more companies outside of the food space are figuring out how they can invest in or use regenerative practices in the supply chain for their products.  One of those companies is Timberland, which in late May announced a new partnership with the Savory Institute, a nonprofit focused on the large-scale regeneration of the world’s grasslands. The move comes on the heels of Timberland’s announcing a collaboration with Other Half Processing , which sources hides from Thousand Hills Lifetime Grazed regenerative ranches, to build a more responsible leather supply chain. The new partnership with the Savory Institute is two-pronged. One of those prongs is Timberland’s move to co-fund the Savory Institute’s ecological outcome verification (EOV) programs on all ranches within the Thousand Hills Lifetime Grazed network, made up of early adopter regenerative ranches across the United States. The investment is part of a larger sustainability strategy at Timberland that is focused on three pillars — better products, stronger communities and a greener world.  This offers an opportunity to actually source in a way that can help restore the environments that we sourced from, and actually have a net positive effect of giving back more than we take. “What’s so exciting about the regenerative agriculture opportunity is basically that it’s a way that we can hit on all three of those pillars with one project,” said Zack Angelini, environmental stewardship manager at Timberland, the outdoor apparel and footwear manufacturing company, which uses leather for much of its outdoor wear. “This offers an opportunity to actually source in a way that can help restore the environments that we sourced from, and actually have a net positive effect of giving back more than we take.” The funding, which Timberland shares with Thousand Hills, will help the EOV program collect data about the ranches with helping them continually improve their regenerative practices and outcomes. The program collects information about soil health, biodiversity and ecosystem function, which is related to water cycle, mineral cycle, energy flow and community dynamics. Additionally, the funds will support network ranchers with resource development and getting more trainers trained, as well as covering typical administrative and marketing costs to help explain the message of what regenerative is and why it matters. The second prong of the partnership is the opportunity for Timberland to test and learn and build a new supply chain from the ground up. This fall, Timberland plans to introduce a collection of boots using regenerative leather sourced from Thousand Hills Lifetime Grazed ranches. Angelini said this effort will serve as a proof of concept that can show what can be done.  “But definitely our long-term vision is to really get to the wide-scale adoption of these materials, both in our own supply chain, but also getting it to be industry-wide,” he said. Scaling up and reaching critical mass Chris Kerston, chief commercial officer for the land-to-market program at the Savory Institute, said that around the time the institute was reaching critical mass in its food work — where consumers are able to access options that were produced regeneratively at similar price points and with similar quality as conventional options — it decided to start working with apparel companies. For the apparel industry, critical mass would look like mass adoption of using natural materials and natural fibers. “So much of what we wear, if we think about it, is really just repurposed oil,” Kerston said. “And I think that the next generation, the millennials and [Gen Z] are saying, ‘Is that really what we want?’” “We think we have a big opportunity in front of us to … bring this to the mainstream and help drive towards that tipping point,” Angelini added, noting that this work has been in the pipeline for Timberland for over a decade. So much of what we wear, if we think about it, is really just repurposed oil. “It actually dates back all the way to 2005 [when] Timberland co-founded a group called the Leather Working Group (LWG), which basically was formed to address the impacts of the tanning stage of leather production,” Angelini said. Through the working group, Timberland was able to revolutionize the sustainability of the tanning of its leather by going down to that stage in the supply chain. LWG also helped to bring other players in the industry along. Now a not-for-profit membership organization that has developed audit protocols to certify leather manufacturers on their environmental compliance and performance capabilities, LWG counts other apparel brands such as Adidas, Eileen Fisher and VF, Timberland’s parent company, as members.  Now, Timberland hopes to move the industry forward even further. “We’re kind of excited about this next opportunity to basically help change the industry again, but this time, I’m going a step even further down the supply chain to the farms [where] the leather actually comes from,” Angelini said. Pull Quote This offers an opportunity to actually source in a way that can help restore the environments that we sourced from, and actually have a net positive effect of giving back more than we take. So much of what we wear, if we think about it, is really just repurposed oil. Topics Supply Chain Regenerative Agriculture Fashion Featured in featured block (1 article with image touted on the front page or elsewhere) On Duration 0 Sponsored Article Off Cattle on a Thousand Hills Lifetime Grazed ranch, Courtesy of Thousand Hills Lifetime Grazed Thousand Hills Lifetime Grazed Close Authorship

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Timberland invests in regenerative leather ranches

Episode 225: Lyft’s electrifying declaration, please open the windows

June 19, 2020 by  
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Episode 225: Lyft’s electrifying declaration, please open the windows Heather Clancy Fri, 06/19/2020 – 02:30 Week in Review Stories discussed this week (4:27). To make offices safe during COVID-19, buildings need a breath of fresh air Unilever unveils climate and nature fund worth more than $1 billion How Perdue, Smithfield and Silver Fern Farms are reducing packaging waste The unmasking of Corporate America Features Moving from analysis to action on circular food (29:10) Emma Chow, project lead on the Ellen MacArthur Foundation’s Food initiative, chats about the role menus play in counteracting food waste and sharing practical steps for addressing the “brittleness” of the existing food system. ESG and the earnings call (39:40) Most companies don’t directly address environmental, social and governance concerns on their quarterly earnings calls. That needs to change. Tensie Whelan, director of the NYU Stern Center for Sustainable Business, offers tips for how companies can buck that trend most effectively.  Lyft drives toward electric vehicles (49:30) Ride-hailing service Lyft has committed to electrifying all of its cars by 2030. GreenBiz Senior Writer Katie Fehrenbacher has the scoop. *Music in this episode by Lee Rosevere:  “4th Avenue Walkup,” “Arcade Montage,” “I’m Going for a Coffee,”  “Here’s the Thing” and “As I Was Saying” Happy 20th anniversary , GreenBiz.com! Virtual conversations Mark your calendar for these upcoming GreenBiz webcasts. Can’t join live? All of these events also will be available on demand. Supply chains and circularity. Join us at 1 p.m. EDT June 23 for a discussion of how companies such as Interface are getting suppliers to buy into circular models for manufacturing, distribution and beyond.  Fleet of clean fleet . Real-life lessons for trucking’s future. Sign up for the conversation at 1 p.m. EDT July 2. In conversation with former Unilever CEO Paul Polman . One of the most influential voices in sustainability joins Executive Editor Joel Makower at 1 p.m. EDT July 16 for a one-on-one conversation about redesigning business and commerce in the post-pandemic era to better address sustainability and social challenges. Resources galore State of the Profession. Our sixth report examining the evolving role of corporate sustainability leaders. Download it here . The State of Green Business 2020. Our 13th annual analysis of key metrics and trends published here . Do we have a newsletter for you! We produce six weekly newsletters: GreenBuzz by Executive Editor Joel Makower (Monday); Transport Weekly by Senior Writer and Analyst Katie Fehrenbacher (Tuesday); VERGE Weekly by Executive Director Shana Rappaport and Editorial Director Heather Clancy (Wednesday); Energy Weekly by Senior Energy Analyst Sarah Golden (Thursday); Food Weekly by Carbon and Food Analyst Jim Giles (Thursday); and Circular Weekly by Director and Senior Analyst Lauren Phipps (Friday). You must subscribe to each newsletter in order to receive it. Please visit this page to choose which you want to receive. The GreenBiz Intelligence Panel is the survey body we poll regularly throughout the year on key trends and developments in sustainability. To become part of the panel, click here . Enrolling is free and should take two minutes. Stay connected To make sure you don’t miss the newest episodes of GreenBiz 350, subscribe on iTunes . Have a question or suggestion for a future segment? E-mail us at 350@greenbiz.com . Contributors Joel Makower Katie Fehrenbacher Deonna Anderson Topics Podcast Transportation & Mobility Food & Agriculture Circular Economy Electric Vehicles Supply Chain Collective Insight GreenBiz 350 Podcast Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 56:15 Sponsored Article Off GreenBiz Close Authorship

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Episode 225: Lyft’s electrifying declaration, please open the windows

AB InBev VP: Our quest for ‘agile’ sustainable development continues

May 19, 2020 by  
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AB InBev VP: Our quest for ‘agile’ sustainable development continues Heather Clancy Tue, 05/19/2020 – 02:37 Like most big companies with a complex multinational footprint, Anheuser-Busch InBev’s sales slipped in the first quarter and the beer maker is embracing new financial discipline amid the coronavirus pandemic. But the company also has  acted quickly to prop up key members of its value chain — from small liquor stores to farmers to  restaurants  — and the situation has galvanized its long-term corporate sustainability plans, according to Ezgi Barcenas, vice president of global sustainability for AB InBev. “We really cannot lose these learnings and agility, and I think that’s been a great learning and contribution of the pandemic — helping us to be more agile and to be more collaborative,” she told GreenBiz during an interview in early May. The beermaker’s 2025 goals pledge bold advances in water strategy, returnable or recyclable packaging, renewable energy procurement (its U.S. division in 2019 signed the  beer industry’s largest power purchase agreement  to date) and support for farmers adopting regenerative agriculture practices. Barcenas, the executive responsible for managing that plan and part of the GreenBiz 2020 Badass Women in Sustainability list , joined the company seven years ago. She’s also in charge of the 100+ Sustainability Accelerator, dedicated to startups that can bring technology-enabled innovation to AB InBev’s operations. Below is a transcript of our interview about how the company’s sustainability team is focusing amid the pandemic. The Q&A was lightly edited for length and clarity. Heather Clancy: How has the pandemic changed the immediate focus of the AB InBev sustainability team? Ezgi Barcenas : I really feel like this global situation is a stress test for sustainable development, compelling all of us to think about it more holistically, more collaboratively, and to be more flexible and continue to work together to create value for our entire value chain.  So, I would say when we think about the changes on the immediate focus of our team, I think it’s important to remember that beer is an actual product, and for centuries we’ve really relied on healthy environments and thriving communities. And most of our operations are local, so our sustainability strategy is really deeply connected to the communities and the business … What it’s doing is, it’s, in fact, galvanizing us and our partners to continue to work together and make really impact where it matters the most.  Clancy: What happens to long-term plans? Are they still going on alongside that? Barcenas: As you can imagine, we had to pivot some of our focus towards short-term mitigation plans but continue to power through towards our mid-to-longer-term plans as well. And our commitment in sustainability, our 2025 goals, they remain the same.  I think what I’m really seeing now is the agility and the sense of community that our teams are bringing around the world. And not just sustainability, right? So, sustainability at AB InBev is housed under procurement, so we have a great relationship with our procurement colleagues who are really delivering that impact and executing against those long-term commitments of our supply chain.  But also, our operations teams, logistic teams, our corporate affairs teams, we’re really working hard in creating that local impact today from the donation of masks and emergency relief water to providing hand sanitizers. We’ve figured out how to make them and donate them to our supply chain partners — to launching digital platforms to support bars and restaurants. Those are some of the immediate efforts that the teams have taken on. But at the same time, we’re really full speed ahead on those long-term commitments.  Our commitment in sustainability, our 2025 goals, they remain the same.   As we’re seeing signs of recovery around the world, our team is energized about continuing to work towards those longer-term commitments, towards the [United Nations Sustainable Development Goals]. One thing for sure: We really cannot lose these learnings and agility, and I think that’s been a great learning and contribution of the pandemic — helping us to be more agile and to be more collaborative. Clancy: You already referenced supply chains. This situation has made the vulnerability of certain types of supply chains very visible to the world. How have you worked to ensure the safety and sustainability of your partners within the supply chain?  Barcenas : Supply chain resilience is being tested with this — all the COVID-19 disruptions around the world, forcing countries and companies like ours to rethink our sourcing strategy, refocus our efforts. I would say we’re fortunate in that our operations — with operations in nearly 50 countries around the world our supply chain is much shorter and less complex than you’d think. We have historically invested heavily: We have been investing heavily in local sourcing and creating those local supply chains wherever possible. In fact, we always like to give this number out: We buy, make and sell over 90 percent of our products locally. So, you can think of us as a global company, but our local footprint is really deeply rooted in our operations. That connection hasn’t really changed.  Maybe one example. If you think about agriculture, right? Beer is made of natural materials. Raw material sourcing is really fundamental to the quality of our products. We take great pride in the quality of our raw materials that in turn can help us create some of the most admired brands in the world. And in doing that, in working closely with the farmers, we help contribute towards their livelihoods. And we work with tens of thousands of smallholder farmers around the world.  During the pandemic, one example I can give is how our agronomists are continuing to support our farmers remotely, even if they cannot do field visits, which usually that’s their way of working. They will go out onto the field and visit them in person, talk through their challenges, provide better management and technology tools for them. Right now, they’re doing all of that remotely.  We’re also working to ensure that there is proper sanitation and safety measures, for example, at buying centers. So, keeping those buying centers open — like barley buying centers and other raw materials — and up and running is really huge for farmer cash flow, if you think about it. So, we’re really working to maintain these wherever possible. That’s short-term efforts. In terms of mid-term, long-term, how are we helping our supply chain, especially on the ag front: We’re doing scenario planning with partners like TechnoServe to better understand the impacts on smallholder supply chains, so that it can better inform our ag support services moving forward, as well as our sourcing. Clancy: How has the situation affected your packaging commitments and recycling strategy, if at all? Barcenas : I want to highlight how our packaging sustainability journey has really accelerated — in 2012, when we came out with a commitment to remove 100,000 metric tons of packaging materials globally to when you fast forward to 2018, when we came out with our new public commitments to protect and promote a circular economy.  Today, as part of our 2025 goal, our focus is to make sure all of our products are in packaging that is returnable or made from a majority of recycled content. So, that’s our vision and our commitment.  You can think of us as a global company, but our local footprint is really deeply rooted in our operations.   It is a sad reality that around the world we’re seeing waste management services and recycling programs being impacted. In some markets, they’re deemed essential and in others they’re not. And yes, we are seeing impacts of this, too. What we do in those cases is continue to partner with the recycling cooperatives to mitigate the impact and to ensure the livelihoods of our partners, as well. And to achieve that circular packaging vision, there are a number of things we do. Reuse, reduce, recycle, rethink is how we think about that, and we try to identify gaps in our current ways of working, or technological gaps so that we can identify scalable solutions.  One pilot that is actually currently underway that we kicked off about a month and a half ago is with this startup called Nomo Waste  [Spanish]. It’s a startup in Colombia that is part of 100+ Sustainability Accelerator. We are working with them now on collecting the bottles that get lost in the supply chain, “lost” in the supply chain … to bring them back to the breweries or back to the suppliers, so that bottles can be reused to continue to reduce waste in the supply chain.  We’re also working with another accelerator startup from our first cohort called BanQu … It’s this blockchain technology that we used in our smallholder farm supply chain. Now we’re implementing the same technology with our recycling supply chain — trying to improve the traceability of that bottle and therefore improve the financial inclusion of our recyclers or the waste pickers in the city of Bogota.  Clancy: I wanted to ask about the 100+ program. So, can you offer a status report? Barcenas : We had our first cohort applications back in 2018. We received over 600 applications in our first year, and we were really proud of it. It was born because when we set our 2025 sustainability goals, if you look at it, the language is 100 percent of direct farmers, 100 percent of communities in high-risk watersheds, et cetera.  When we were going through the strategy-setting or the goal-setting process we asked ourselves — we had a candid conversation in the company and with our partners: How sure are we that we’re going to hit these goals by 2025 based on existing solutions and ways of working, partnerships out there? We noticed that there was a clear gap in ensuring, for example, that 100 percent of our farmers will be financially empowered.  The 100+ Accelerator was born out of that to try and identify solutions for problems that we can’t solve today alone. It’s an open platform. We’re hoping any company can come and join us. In its first year, we had [21] startups in our cohort, and they’ve been hugely successful. Some of them we’ve extended them into multiyear commercial contracts. We’ve taken them to different markets. After the initial success of the pilots, we’re scaling them up. We just had our second round of applications wrap up late last year and had our kickoff meetings earlier in February in New York. We received over 1,200 applications from 30-plus countries, and we narrowed it down to 17 companies. Clancy: Can you give me some examples?  Barcenas : I glazed over BanQu , just a quick plug there. BanQu is a non-crypto blockchain technology that uses an SMS service to record purchasing and sales data. We’re using this now with farmers across Uganda, Zambia and India. We were able to scale this partnership to offer farmers a digital financial aid entity.  What used to happen is that these farmers did not really formally exist in our supply chain. They couldn’t go and open a bank account. They couldn’t get crop insurance. They couldn’t get a loan. By giving them a digital record of the transaction, they are able to prove that they are part of our supply chain. And we’re helping them with the digital capabilities as well. We’re offering digital payments, which in turn reduces their cash transactions and therefore lowers their risk for themselves and their families. So, we’re really proud of this. And now, this BanQu technology that we piloted in the ag supply chain we’re bringing to our recycling supply chains as well in Colombia, for example.  Another one, maybe just a quick one: EWTech  [Spanish] is another startup that we piloted in Colombia as part of our first cohort, a great example of how innovation can continue to drive efficiencies in our operational processes. What EWTech does is they offer a green replacement for caustic soda, which we use in the industrial cleaning process. In the pilot test in Bucaramanga, we found out that EWTech’s more sustainable solution, the green solution that they offered, actually showed a 70 percent reduction in water usage versus traditional disinfecting chemicals, 60 percent reduction in cleaning cycle time, which resulted in savings on energy, in freeing up time on bottling lines. So, this was a huge success for us, both from a financial and from an environmental point of view. We are now in the process of figuring out how we can roll this out across many more breweries in the middle Americas — so, Colombia, Peru, Mexico, Honduras and El Salvador. Of course, with the pandemic things are getting a little bit delayed, but it is our mission to, again, scale this innovation that we identified that is delivering great results for the business and also for the world. Media Authorship Anheuser-Busch Close Authorship Clancy: Can you offer a progress report on the fleet electrification strategy?  Barcenas : Transportation is about 9 percent of our global carbon emissions, and our ambition is to reduce our global emissions by 25 percent across the whole value chain by 2025. Most of this lies in Scope 3, and logistics is a piece of that. We are currently piloting a range of different solutions around the world, looking specifically to fleet electrification but also other things — routing efficiencies, other ways to reduce carbon emissions in our logistics operations. We currently have a pilot in each one of our six operating zones around the world … As you can imagine, COVID-19 has caused some delays to the delivery of additional fleet, and that’s slowing down somewhat the pilots. But we are very ambitious in this area and very keen to identify new solutions and confident that we’ll be able to identify and champion these new innovations and continue to electrify our fleet. Clancy: What do you feel is your most important priority as a chief sustainability officer and strategist right now? Barcenas : We always say sustainability is our business, and I think the biggest learning out of this is that we must not lose the momentum, the learnings and the agility that we’ve built up over the last couple of months to really tackle these problems. We’re a global company. We’re learning a lot along the way as the pandemic has spread around the world. We’re becoming more prepared. And we can’t pause now. Right? So, I think that’s another big learning. In fact, we’re working really hard to ensure and restore the resilience of the communities and the supply chains. That’s our No. 1 priority. And not just supply chain, our entire value chain. As I mentioned, we’re working with our key accounts — bars, restaurants, et cetera — to make sure that they can return to their businesses as well as recovery happens. And we’re really thinking, we’re really spending a lot of time thinking about — not just about how to recover or bounce back but also how to come back even stronger than before, how to retain that agility and focus to continue to create that local impact.  Today’s and tomorrow’s toughest challenges, I think, will require us to continue to be agile and learn new ways of working and continue to innovate. At AB InBev, we’re committed to just that: continuously innovating to future-proof our business and our communities, and inspiring our people in the meantime, right? Inspiring our consumers through our brands as well. Pull Quote Our commitment in sustainability, our 2025 goals, they remain the same. You can think of us as a global company, but our local footprint is really deeply rooted in our operations. Topics COVID-19 Food & Agriculture Corporate Strategy Beer Sustainable Development Goals / SDGs Regenerative Agriculture 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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AB InBev VP: Our quest for ‘agile’ sustainable development continues

Cargill’s Ruth Kimmelshue on resilience and regeneration in our food system

February 20, 2020 by  
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Cargill’s Chief Sustainability Officer and Head of Business Operations & Supply Chain, Ruth Kimmelshue, discusses the integration of sustainability and supply chain at one of the largest agricultural companies in the world.

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Cargill’s Ruth Kimmelshue on resilience and regeneration in our food system

Most major companies failing to report on deforestation risks

July 22, 2019 by  
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A large majority of leading companies are failing to report on the risk of deforestation in their supply chains, says CDP.

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Most major companies failing to report on deforestation risks

Combating Marine Debris with Courageous Collaborations

March 11, 2019 by  
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Marine debris is a growing issue for companies throughout the supply chain, as they grapple with their role in this challenge and how they can pivot operations to have a positive impact. Collaboration is key in developing creative, impactful solutions. Hear from leaders at Dow, Ocean Conservancy and Circulate Capital why collaborations across industries, governments and value chains are necessary to define and drive effective outcomes, and how companies can join these efforts.

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Combating Marine Debris with Courageous Collaborations

Cultivating a Sustainable Palm Oil Future

March 11, 2019 by  
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Palm oil and its derivates have become ubiquitous ingredients in consumer products, with the oil appearing in about half of all packaged goods sold in the supermarket. The palm oil supply chain is complex, facing challenges linked to environmental protection, human rights, economics in developing countries, and international trade. How can companies take meaningful steps to responsibly address these issues in the face of increasing demand for palm oil?

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Cultivating a Sustainable Palm Oil Future

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