How the climate crisis will crash the economy

September 14, 2020 by  
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How the climate crisis will crash the economy Joel Makower Mon, 09/14/2020 – 02:11 The chickens are coming home to roost. Even before the western United States became a regional inferno, even before the Midwest U.S. became a summertime flood zone, even before an annual hurricane season so bad that the government is running out of names to attach to them, even before Colorado saw a 100°F heatwave swan dive into a 12? snowstorm within 48 hours. Even before all that, we’d been watching the real-world risks of climate change looming and growing across the United States and around the world. And the costs, financially and otherwise, are quickly becoming untenable. Lately, a steady march of searing heat, ruinous floods, horrific wildfires, unbreathable air, devastating hurricanes and other climate-related calamities has been traversing our screens and wreaking havoc to national and local budgets. And we’re only at 1°C of increased global temperature rise. Just imagine what 2° or 3° or 4° will look like, and how much it will cost. We may not have to wait terribly long to find out. It’s natural to follow the people impacted by all this: the local residents, usually in poorer neighborhoods, whose homes and livelihoods are being lost; the farmers and ranchers whose crops and livestock are withering and dying; the stranded travelers and the evacuees seeking shelter amid the chaos. And, of course the heroic responders to all these events, not to mention an entire generation of youth who fear their future is being stolen before their eyes, marching in the streets. So many people and stories. But lately, I’ve been following the money. The financial climate, it seems, has been as unforgiving as the atmospheric one. Some of it has been masked by the pandemic and ensuing recession, but for those who are paying attention, the indicators are hiding in plain sight. And what we’re seeing now are merely the opening acts of what could be a long-running global financial drama. The economic impact on companies is, to date, uncertain and likely incalculable. The financial climate, it seems, has been as unforgiving as the atmospheric one. Last week, a subcommittee of the U.S. Commodity Futures Trading Commission (CFTC) issued a report addressing climate risks to the U.S. financial system. That it did so is, in itself, remarkable, given the political climes. But the report didn’t pussyfoot around the issues: “Climate change poses a major risk to the stability of the U.S. financial system and to its ability to sustain the American economy,” it stated, adding: Climate change is already impacting or is anticipated to impact nearly every facet of the economy, including infrastructure, agriculture, residential and commercial property, as well as human health and labor productivity. Over time, if significant action is not taken to check rising global average temperatures, climate change impacts could impair the productive capacity of the economy and undermine its ability to generate employment, income and opportunity. Among the “complex risks for the U.S. financial system,” the authors said, are “disorderly price adjustments in various asset classes, with possible spillovers into different parts of the financial system, as well as potential disruption of the proper functioning of financial markets.” In other words: We’re heading into uncharted economic territory. Climate change, said the report’s authors, is expected to affect “multiple sectors, geographies and assets in the United States, sometimes simultaneously and within a relatively short timeframe.” Those impacts could “disrupt multiple parts of the financial system simultaneously.” For example: “A sudden revision of market perceptions about climate risk could lead to a disorderly repricing of assets, which could in turn have cascading effects on portfolios and balance sheets and therefore systemic implications for financial stability.” Sub-systemic shocks And then there are “sub-systemic” shocks, more localized climate-related impacts that “can undermine the financial health of community banks, agricultural banks or local insurance markets, leaving small businesses, farmers and households without access to critical financial services.” This, said the authors, is particularly damaging in areas that are already underserved by the financial system, which includes low-to-moderate income communities and historically marginalized communities. As always, those least able to least afford the impacts may get hit the hardest. This was hardly the first expression of concern about the potentially devastating economic impacts of climate change on companies, markets, nations and the global economy. For example: Two years ago, the Fourth National Climate Assessment noted that continued warming “is expected to cause substantial net damage to the U.S. economy throughout this century, especially in the absence of increased adaptation efforts.” It placed the price tag at up to 10.5 percent of GDP by 2100. Last month, scientists at the Potsdam Institute for Climate Impact Research said that while previous research suggested that a 1°C hotter year reduces economic output by about 1 percent, “the new analysis points to output losses of up to three times that much in warm regions.”’ Another report last month, by the Environmental Defense Fund, detailed how the financial impacts of fires, tropical storms, floods, droughts and crop freezes have quadrupled since 1980. “Researchers are only now beginning to anticipate the indirect impacts in the form of lower asset values, weakened future economic growth and uncertainty-induced instability in financial markets,” it said. And if you really want a sleepless night or two, read this story about  “The Biblical Flood That Will Drown California,” published recently in Mother Jones magazine. Even if you don’t have a home, business or operations in the Golden State, your suppliers and customers likely do, not to mention the provenance of the food on your dinner plate. Down to business The CTFC report did not overlook the role of companies in all this. It noted that “disclosure by corporations of information on material, climate-related financial risks is an essential building block to ensure that climate risks are measured and managed effectively,” enabling enables financial regulators and market participants to better understand climate change’s impacts on financial markets and institutions. However, it warned, “The existing disclosure regime has not resulted in disclosures of a scope, breadth and quality to be sufficiently useful to market participants and regulators.” An analysis by the Task Force on Climate-related Financial Disclosure found that large companies are increasingly disclosing some climate-related information, but significant variations remain in the information disclosed by each company, making it difficult for investors and others to fully understand exposure and manage climate risks . The macroeconomic forecasts, however gloomy, likely seem academic inside boardrooms. And while that may be myopic — after all, the nature of the economy could begin to shift dramatically before the current decade is out, roiling customers and markets — it likely has little to do with profits and productivity over the short time frames within which most companies operate. Nonetheless, companies with a slightly longer view are already be considering the viability of their products and services in a warming world. Consider the recommendations of the aforementioned CFTC report, of which there are 20. Among them: “The United States should establish a price on carbon.” “All relevant federal financial regulatory agencies should incorporate climate-related risks into their mandates and develop a strategy for integrating these risks in their work.” “Regulators should require listed companies to disclose Scope 1 and 2 emissions. As reliable transition risk metrics and consistent methodologies for Scope 3 emissions are developed, financial regulators should require their disclosure, to the extent they are material.” The Financial Stability Oversight Council “should incorporate climate-related financial risks into its existing oversight function, including its annual reports and other reporting to Congress.” “Financial supervisors should require bank and nonbank financial firms to address climate-related financial risks through their existing risk management frameworks in a way that is appropriately governed by corporate management.” None of these things is likely to happen until there’s a new legislature and presidential administration in Washington, D.C., but history has shown that many of these can become de facto regulations if enough private-sector and nongovernmental players can adapt and pressure (or incentivize) companies to adopt and hew to the appropriate frameworks. Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. And there’s some news on that front: Last week, five NGOs whose frameworks, standards and platforms guide the majority of sustainability and integrated reporting, announced “a shared vision of what is needed for progress towards comprehensive corporate reporting — and the intent to work together to achieve it.” CDP , the Climate Disclosure Standards Board , the Global Reporting Initiative , the International Integrated Reporting Council and the Sustainability Accounting Standards Board have co-published a shared vision of the elements necessary for more comprehensive corporate reporting, and a joint statement of intent to drive towards this goal. They say they will work collaboratively with one another and with the International Organization of Securities Commissions, the International Financial Reporting Standards Foundation, the European Commission and the World Economic Forum’s International Business Council. Lots of names and acronyms in the above paragraph, but you get the idea: Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. To the extent they manage to harmonize their respective standards and frameworks, and should a future U.S. administration adopt those standards the way previous ones did the Generally Accepted Accounting Principles, we could see a rapid scale-up of corporate reporting on these matters. Increased reporting won’t by itself mitigate the anticipated macroeconomic challenges, but to the extent it puts climate risks on an equal footing with other corporate risks — along with a meaningful price on carbon that will help companies attach dollar signs to those risks — it will help advance a decarbonized economy. Slowly — much too slowly — but amid an unstable climate and economy we’ll take whatever progress we can get. I invite you to  follow me on Twitter , subscribe to my Monday morning newsletter,  GreenBuzz , and listen to  GreenBiz 350 , my weekly podcast, co-hosted with Heather Clancy. Pull Quote The financial climate, it seems, has been as unforgiving as the atmospheric one. Finally, there is collaboration among the leading nongovernmental organizations focusing on sustainability reporting and accountability. Topics Finance & Investing Risk & Resilience Policy & Politics Climate Change Featured Column Two Steps Forward Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off Shutterstock

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How the climate crisis will crash the economy

Scaling Composting Infrastructure in North America

September 11, 2020 by  
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Scaling Composting Infrastructure in North America What will it take to build robust composting infrastructure at scale in the United States? Composting should be a win-win. In theory, corporations and cities could divert food waste from landfills and create a valuable agricultural product in the process. Yet examples of large-scale composting infrastructure are hard to find in the United States. According to the most recent EPA data, less than 10 percent of food waste finds its way into composting systems. Contamination of waste streams, haulage costs and “compostable” materials that don’t actually biodegrade are all part of the problem. Meet the entrepreneurs, city officials and corporate leaders who are turning things around. Speakers share details of successful composting businesses, systems for scaling up food waste collection and strategies for diverting corporate food waste into composting systems. Speakers Alexa Kielty, Residential Zero Waste and Special Projects Assistant, San Francisco Department of the Environment Kevin Quandt, Vice President of Supply Chain & Sustainability, sweetgreen Jim Giles, Food and Carbon Analyst, GreenBiz Group  Holly Secon Thu, 09/10/2020 – 20:34 Featured Off

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Scaling Composting Infrastructure in North America

Circular by Design: Physical Criteria for Circular Products

September 11, 2020 by  
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Circular by Design: Physical Criteria for Circular Products What physical attributes must be considered and prioritized when designing circular products? When creating circular products, businesses face a daunting task: They must balance product performance, health and safety, regulatory compliance, cost, and a host of physical criteria (such as durability, repairability and modularity) to name a few of the countless considerations — along with frequent barriers. With an ever increasing demand to deliver products to market with speed, effectively evaluating and prioritizing these attributes is a critical yet challenging hurdle. This discussion explores how businesses have balanced physical criteria when creating circular products. Speakers Joel Makower, Chairman & Executive Editor, GreenBiz Group  Sripriya Narayanan, Product Manager, Cisco Lauren Smith, Product Sustainability Manager, Columbia” Holly Secon Thu, 09/10/2020 – 20:26 Featured Off

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Circular by Design: Physical Criteria for Circular Products

Solving Food Waste and Hunger

September 9, 2020 by  
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Solving Food Waste and Hunger An estimated 1.3 billion metric tons of food is lost or wasted globally each year, according to the United Nations — about one-third of all the food produced for human consumption. Meanwhile, over 690 million people worldwide still went hungry in the last year. These two problems should seemingly solve themselves. Innovative circular economy models might be able to help.  Speakers Jasmine Crowe, CEO, Goodr Holly Secon Tue, 09/08/2020 – 22:37 Featured Off

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The 2020 Ray of Hope Prize

September 9, 2020 by  
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The 2020 Ray of Hope Prize How can biomimicry drive innovation, and which team will win the 2020 Ray of Hope Prize? Biomimicry, the design and production of materials, structures and systems that are modeled on biological strategies and processes, can accelerate the breakthroughs we need to achieve a circular economy. Created in honor of Ray C. Anderson, the founder of Interface and a sustainability pioneer, the $100,000 Ray of Hope Prize sparks the next generation of businesses that seek to lead us to a circular and regenerative future. Nearly 200 startups from 42 countries around the world entered the 2020 competition with the hope of being selected as this year’s top up-and-coming business applying lessons learned from nature to solve for climate change and sustainability challenges. Nine startup teams ultimately competed for this year’s prestigious prize, sponsored by the Ray C. Anderson Foundation. Join us at Circularity 20 as we announce the winner of the 2020 Ray of Hope Prize and learn about the startup’s approach to creating a more regenerative and circular world. The Ray C. Anderson Foundation also will award a $25,000 Runner-Up Prize and $25,000 in additional prizes, along with programmatic support provided by the Biomimicry Institute.  Speakers Beth Rattner, Executive Director, Biomimicry Institute John Anderson Lanier, Executive Director, Ray C. Anderson Foundation Holly Secon Tue, 09/08/2020 – 22:33 Featured Off

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The U.S. Plastics Pact launches new initiative to redesign the plastics value chain at Circularity 20

September 2, 2020 by  
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The U.S. Plastics Pact launches new initiative to redesign the plastics value chain at Circularity 20 Holly Secon Wed, 09/02/2020 – 00:45 The U.S. recycling market has been in free fall since 2018, when China, Malaysia, Thailand and other Southeast Asian countries announced that they would no longer import many types of recyclable material scraps. Of course, the U.S. recycling system had been a mess for far longer — seeing as the country never fully developed the infrastructure to recycle anywhere near the amount of plastic waste it produces. Indeed, only 8.4 percent of all the plastic produced in 2017 eventually got recycled, according to the U.S. Environmental Protection Agency .  But a new agreement announced last week at Circularity 20, GreenBiz Group’s virtual conference on the circular economy, has the potential to change that: The U.S. Plastics Pact. This new initiative is a collaborative project launched by the Recycling Partnership and the World Wildlife Fund (WWF) that aims to redesign the way the United States uses plastics so that they don’t become waste in the first place. The effort is part of the Ellen MacArthur Foundation’s global Plastics Pact network: The think tank has helped organize key public and private stakeholders to push towards a circular economy for plastic in countries around the world, from the United Kingdom to Chile to South Africa. Redesigning the way we use one of the most ubiquitous and convenient materials on the planet won’t be easy. But the initiative is setting distinct targets and deadlines for meeting them. Shooting for 2025, its main goals are: Make sure all plastic packaging is 100 percent reusable, recyclable or compostable  Take action to ensure that 50 percent of plastic packaging is recycled or composted Have the average recycled content or responsibly sourced bio-based content in plastic packaging be 30 percent The U.S. Plastics Pact has gathered more than 60 prominent partners, which will provide research and funding. They include local governments from Arizona to Texas to California; NGOs such as the Ocean Conservancy and The United States Composting Council; and companies ranging from Eastman to Target. All of these stakeholders have to agree to work in a pre-competitive environment towards the Pact’s targets. So what will this new collaboration look like? Stephanie Kersten-Johnston, director of innovation at the Recycling Partnership, told GreenBiz that she expects it to be not just a network, but “a network on fire” — with all partners engaged to take the most effective action and make the most impact on the targets. In some ways it’s a support group for organizations to meet these targets, but we can’t just expect some representatives talking — we need the full value chain in there acting. “In some ways it’s a support group for organizations to meet these targets, but we can’t just expect some representatives talking — we need the full value chain in there acting,” she added. A recycling facility for PET bottles, which can be transformed to make new products including carpeting and sneakers. Media Source Shutterstock Media Authorship Alba_alioth Close Authorship Hitting the target: How the U.S. Plastics Pact aims to achieve its ambitious goals 2025 isn’t too far off, so the U.S. Plastics Pact is getting started right away, according to Kersten-Johnston. In the first six months to one year, developing a roadmap will be the top priority for the project. “So we set these targets, these aspirations — but what are the practical steps we need to get there?” she said. “In the first year, this will look like network meetings,” she explained. “In practice, groups [of partner organizations] will be convening that will be called ‘workstreams.’ They focus on smaller, specific topics that can’t be solved by a singular organization … where the work is done, where the research is undertaken, and the formulation of the practical steps will take place.” For example, workstreams include deciding on the data that will be used. “How do we agree to tight definitions that we haven’t agreed on before?” Kersten-Johnston added. “What does that look like in the U.S. in practice? What cadence are we measuring on? What data sources will we be using?” If certain types of plastic are too hard to recycle or reuse, meaning they don’t have an end-of-life, they can’t have any place in a circular economy for plastics. Another workstream will decide which plastic materials are too problematic and unnecessary, and need simply to be eliminated from production. If certain types of plastic are too hard to recycle or reuse, meaning they don’t have an end of life, they can’t have any place in a circular economy for plastics.  After that, the organizations along the plastics value chain — from chemical companies to product designers to plastic recycling facilities and municipalities to materials recovery groups — will rework their operations in line with the targets.  That’s where the power of having corporate partners from several sectors comes in. Large companies and governments have been saying for years that they want to work to eliminate single-use plastics. In the past few years, there have been a flurry of plastics-related commitments. McDonald’s , for example, set a commitment in 2018 that its 36,000 restaurants would use only packaging from renewable, recycled or certified sustainable sources by 2025. Coca-Cola also announced it would help collect and recycle “the equivalent” of 100 percent of its packaging and make bottles with an average of 50 percent recycled content by 2030. Nestle , Disney , Starbucks , IKEA and others also have pledged to cut down on single-use plastics over that time. For all these companies, working together to make a better plastics value chain, from producing more recyclable plastics to creating more chemical recycling facilities, will enable them to meet both their targets and the targets of the entire U.S. Plastics Pact more easily. “We can start to address the plastic waste issue by taking fast and transformative action at every point in the plastic cycle,” said Viviana Alvarez, head of sustainability, North America, at Unilever, in a statement. “Recycling alone can’t solve the circular economy, but the circular economy can help solve the problem on waste and recycling. Keeping plastic in the economy and out of the environment will require everyone to work together — whether that’s product designers, governments, consumers or the waste management industry.” A history of the Global Plastics Pact The Ellen MacArthur Foundation first created its Global Plastic Pact as part of its New Plastics Economy Global Commitment in 2016. The circular economy powerhouse got over 20 percent of all global plastic packaging companies to pledge to address plastic waste and pollution at its source. (In total, more than 450 organizations have joined their global pacts around the world, according to the Ellen MacArthur Foundation.) These Global Plastics Pact are networks of plastic waste initiatives in different countries, which the Ellen MacArthur Foundation organizes.  They include the UK Plastics Pact , the Pacte National sur les emballages plastiques in France, Circula El Plástico in Chile, the Plastic Pact NL  (Dutch) in the Netherlands, the South African Plastics Pact , and the Pacto Português para os Plásticos  (Portuguese) in Portugal. Each country’s goals are slightly different, based on the infrastructure of the location, and the U.S. is the latest initiative. “There was an unspoken question in the U.S. about how we were going to meet these targets, particularly how we were going to achieve particularly closing the gaps between supply and demand so everyone viewed it as a topic that needed to be tackled but it was never addressed,” Kersten-Johnston described. So the Recycling Partnership stepped up to meet the massive opportunity in the U.S.: transforming the waste management system of the biggest economy in the world to foster sustainability on a massive scale. Pull Quote In some ways it’s a support group for organizations to meet these targets, but we can’t just expect some representatives talking — we need the full value chain in there acting. If certain types of plastic are too hard to recycle or reuse, meaning they don’t have an end-of-life, they can’t have any place in a circular economy for plastics. Topics Circular Economy Waste Management Plastic Plastic Waste Circularity 20 Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off

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The U.S. Plastics Pact launches new initiative to redesign the plastics value chain at Circularity 20

Sun Chemical

August 29, 2020 by  
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Sun Chemical taylor flores Sat, 08/29/2020 – 09:58 Sun Chemical, a member of the DIC Group, is a leading producer of printing inks, coatings and supplies, pigments, polymers, liquid compounds, solid compounds and application materials. Together with DIC, Sun Chemical has annual sales of more than $7.5 billion and over 20,000 employees supporting customers around the world. Sun Chemical is a subsidiary of Sun Chemical Group Coöperatief U.A. in the Netherlands and is headquartered in Parsippany, New Jersey, in the United States.

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The rise (and rise) of sustainability-linked finance

August 24, 2020 by  
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The rise (and rise) of sustainability-linked finance Joel Makower Mon, 08/24/2020 – 02:11 One silver lining of this horrific moment is the rise of loans, bonds and other financial instruments linked to sustainability outcomes. In this sense, “sustainability” is broadly defined to include environmental issues as well as social ones. And, more recently, a new subcategory of, yes, pandemic-related issues. Indeed, the pandemic response is being financed in part through bonds designed to fund development of vaccines or treatments, support healthcare systems fighting the outbreak or provide relief efforts, such as for cities and counties facing budgetary challenges due to lost revenues and emergency spending. As of the end of May, governments, banks, companies and others raised just over $150 billion globally from selling pandemic bonds, according to research by BNP Paribas, as reported by the Wall Street Journal. “These instruments will contribute to the economic recovery of many sectors and will emphasize socially focused measures targeting specific segments of the population,” BBVA, the Spanish multinational financial services company, wrote recently. When the cost of money is tied to a company’s sustainability performance: Game on. Pandemic bonds join a growing list of sustainability-linked financial instruments that have been gaining the attention of investors worldwide. The bonds alone come in a veritable rainbow of flavors: green bonds; climate bonds; sustainability bonds; social bonds; ESG bonds; blue bonds (related to oceans); and more. Last month, German company Henkel, which specializes in chemistry for adhesives, beauty care and laundry products, issued a “plastic waste reduction bond” to fund projects related to the company’s efforts to reduce packaging waste. There are, no doubt, other flavors, with more to come. And yes, each of those flavors has a more-or-less specific purpose. Green bonds are used to finance projects and activities that benefit the environment. Sustainability bonds are used to finance projects that bring clear environmental and social benefits. Social bonds are aimed at achieving positive economic outcomes for an identified target population, with neutral or positive impact on the environment. (Nasdaq offers definitions and criteria for each type of bond here .) By whatever name, money is pouring in. Last week, Moody’s Investors Service raised its forecast for 2020 sustainable bond issuance to as much as $375 billion, a category that includes green, sustainability and social bonds. Companies are jumping in with such regularity that it is rarely newsworthy anymore, except when it is. A few examples from 2020: In February, Verizon’s green bond drew orders equivalent to eight times the $1 billion the company sought to raise. “Within 25 minutes, orders had already exceeded the $1 billion mark,” said James Gowen, the company’s vice president and chief sustainability officer. By that afternoon, more than 300 investors had ordered more than $8 billion in debt. Also in February, investment firm Neuberger Berman announced a $175 million sustainability-linked corporate revolving credit facility, the first North American financial services firm to do so. The loan will be benchmarked annually against several criteria, including that the company maintain an “A” rating or higher for its ESG integration on each module for which is scored by the United Nations-supported Principles for Responsible Investment. This month, Visa issued its first green bond, totaling $500 million, to be used to fund energy-efficiency improvements, expanded use of renewable energy sources, employee commuter programs, water efficiency projects and initiatives that support the United Nations Sustainable Development Goals . But the big kahuna of bond sales took place earlier this month, when Alphabet, the parent of Google, issued $5.75 billion in sustainability bonds , the largest sustainability or green bond by any company. (It was one part of a larger, $10 billion bond offering.) The proceeds are intended to fund a laundry list of initiatives, including energy efficiency, clean energy, green buildings, clean transportation, circular economy products and processes, affordable housing, purchases from Black-owned businesses as well as from small and midsized companies, and to support “health organizations, governments and health workers on the frontlines.” Like a growing number of bonds, Google’s hew to the Green Bond Principles and the Social Bond Principles , both promulgated by the International Capital Markets Association. Loan arrangers It’s not just bonds. Sustainability-linked loans — sometimes called ESG-linked loans — are also garnering interest . Last year, the issuance of sustainability loans (which includes social as well as green loans) jumped 168 percent to $122 billion, according to BloombergNEF . Sustainability-linked loans may sound similar to the similarly named bonds described above, but they’re not. Rather than raising funds for a particular category of projects or initiatives, the proceeds of sustainability-linked loans can be used for general business purposes. However, their interest rate is tied in part to the borrower’s sustainability performance. It requires the borrower to set ambitious and meaningful “sustainability performance targets” and report regularly — at least annually — on its progress, ideally with independent verification. Such loans have a built-in pricing mechanism, in which the interest rate drops if the borrower achieves its goals; it may rise if the goals aren’t met. So far, 80 percent of sustainability-linked loans have been made in Europe, although the practice is expanding in other countries. One company took out a loan for a renewable energy project, with the interest rate linked to the company’s gender equality performance. Late last year, building controls company Johnson Controls linked the pricing of a $3 billion line of credit to its ESG performance. The deal was underwritten by a consortium of 18 major banks, including JPMorgan Chase, Bank of America, Barclays and Citibank. The sustainability performance targets are tied to employee safety and to greenhouse gas emission reductions from customer projects as well as from Johnson Controls’ own operations. In February, JetBlue Airways announced a sustainability-linked loan deal with BNP Paribas, the French banking group, amending an existing $550 million line of credit. The interest rate is tied to the airline’s ESG score as calculated by Vigeo Eiris, a U.K.-based provider of ESG research and services. In yet another case, one company took out a loan for a renewable energy project, with the interest rate linked to the company’s gender equality performance, according to Mallory Rutigliano, green and sustainable finance analyst at BNEF. All of this is expected to continue to grow, with no apparent ceiling, as various types of instruments gain popularity based on a combination of hot-button issues and a hedge against risk. For example, it’s probably not surprising that in today’s climate of social and racial inequities, not to mention the pandemic, social bonds are currently a hot property. According to S&P Global , “We expect social bonds to emerge as the fastest-growing segment of the sustainable debt market in 2020. This stands in sharp contrast to the rest of the global fixed-income market, for which we expect issuance volumes to decline this year.” As with any growing market, there’s a need for standardization of definitions and metrics. But that’s inevitable. For now, let’s celebrate that financial institutions are — finally — beginning to hold companies accountable in ways that can directly affect their their bottom line. And when the cost of money is tied to a company’s sustainability performance: Game on. Pull Quote When the cost of money is tied to a company’s sustainability performance: Game on. One company took out a loan for a renewable energy project, with the interest rate linked to the company’s gender equality performance. Topics Finance & Investing ESG GreenFin Featured Column Two Steps Forward Featured in featured block (1 article with image touted on the front page or elsewhere) Off Duration 0 Sponsored Article Off GreenBiz photocollage

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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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Closed Loop Partners teams with Walmart, CVS, Target to take on the plastic bag

The State of Producer Responsibility in the United States

July 17, 2020 by  
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The State of Producer Responsibility in the United States

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