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1、INDEPENDEN T P U B L I C AT I O N BYR AC O N T EU R.NE T07/09/2022#Is high-performance Accoya timber the answer to reducing construction industry emissions?How one innovative start-up is changing wood to change the worldSee page 21SUSTAINABLE BUSINESSTHE COST SAVINGS OF RENEWABLES16HOW TO MEASURE SU
2、STAINABILITY09IS GREENWASHING HERE TO STAY?20R A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S0302SUSTAINABLE BUSINESSMorag Cuddeford-JonesBusiness journalist with more than 20 years experience delving into evolving topics covering major commercial and transformation issues.Clara MurrayAs
3、Raconteurs data journalist,Clara writes and creates data-led stories,interactives and infographics.She previously worked at Reachs Irish titles and was a Google News Initiative digital fellow.Jonathan EvansJournalist who specialises in writing about HR,SMEs and C-suite leadership.His work has been p
4、ublished in The Independent and Metro.Richard PallardyJournalist covering humans and other animals,conservation and culture,with articles published in Encyclopedia Britannica,ODDA Magazine,Vice and Hidden Compass.Sean HargraveFormer Sunday Times innovation editor and now freelance journalist,coverin
5、g technology,business issues and financial services.Mark WalshNew York-based freelance writer covering business,tech and media.He has contributed to outlets that include TheS,The Guardian and New York Magazine.Emma WoollacottJournalist who regularly writes about business,technology and science.She i
6、s a regular contributor to the BBC News website,Forbes and Private Eye.Georgia LewisJournalist who has written internationally across a wide range of industry sectors,with a special interest in Africa and the Middle East.Distributed inPublished in association withContributorsraconteurraconteur.stori
7、esAlthough this publication is funded through advertising and sponsorship,all editorial is without bias and sponsored features are clearly labelled.For an upcoming schedule,partnership inquiries or feedback,please call+44(0)20 3877 3800 or email Raconteur is a leading publisher of special-interest c
8、ontent and research.Its publications and articles cover a wide range of topics,including business,finance,sustainability,healthcare,lifestyle and technology.Raconteur special reports are published exclusively in The Times and The Sunday Times as well as online at The information contained in this pu
9、blication has been obtained from sources the Proprietors believe to be correct.However,no legal liability can be accepted for any errors.No part of this publication may be reproduced without the prior consent of the Publisher.Raconteur Mediaraconteur-mediaCampaign managerCristina CosenzaDeputy edito
10、rFrancesca CassidyEditorSarah VizardChief sub-editorNeil ColeSub-editorChristina RyderCommercial content editorsLaura BithellBrittany GolobReports editorIan DeeringDeputy reports editorJames SuttonDesign/production assistant Louis NassDesignKellie JerrardHarry Lewis-IrlamColm McDermottSean Wyatt-Liv
11、esleyDesign directorTim WhitlockIllustrationCelina LuceySamuele MottaHead of productionJustyna OConnell/sustainable-business-oni Mitchells iconic 1970 song Big Yellow Taxi pleads:“Give me spots on my ap-ples but leave me the birds and bees.”At the time of its release,this protest at the widespread u
12、se of chemical pesticides seemed like a Hail Mary.Would farmers and their counterparts in other industries heed this call for an ecologically friendly version of capitalism?Now,more than half a century later,corporations are doing just that,having started to integrate more sustainable practices into
13、 their business models.Whats more,they have found that,in an environmen-tally conscious marketplace,sus-tainability can be good for business.Shel Horowitz is the founder of Going Beyond Sustainability,a con-sultancy which guides businesses toward greener practices.He traces the origins of this movem
14、ent to the publication of Rachel Carsons Silent Spring in 1962.This prescient vol-ume detailed the alarming effects of pesticides on the environment and precipitated a groundswell of activ-ism to hold industry accountable for its effects on the environment.The voices of consumer activists remain an
15、essential motivator today.Legislative efforts such as the UNs Sustainable Development Goals,the 2021 Environment Act in the UK and the EUs Environment Action Programme have provided extra impetus.But many companies now undertake sustainable initia-tives of their own volition.Taking responsibility,it
16、 seems,is just good business nowadays.Across industries,sustainability is increasingly a vital aspect of most consumer-facing businesses.Half measures no longer cut it.“If its treated as a nice-to-have,it fails.Ultimately,it is not successful for the business,its reputation or its objective financia
17、lly,socially or environmentally,”says Noa Gafni,executive director of the Rutgers In-stitute for Corporate Social Innova-tion.And there is growing demand for accountability.Auditing bodies now play a crucial role in certifying sustainability initiatives,providing the public with an objective meas-ur
18、e of their success.“Greenwashing is real,”Gafni con-tinues.“But companies are taking bigger steps to ensure they arent doing that.Theyre partnering with external auditors to look at where theyre doing well and where they can improve.”Consumers are becoming aware of greenwashing,observes Tara Mil-bur
19、n,founder of sustainable brand-ing company Ethical Swag.“They will break off relationships with brands that dont take their stated commitments seriously,”she says.Robert Bird is Eversource energy chair in business ethics at the Uni-versity of Connecticut.He says that some companies will try to green
20、-wash,avoiding the certifying body.“But the certifying body will find out whats going on and makes the problems public.Then the company improves.There is some cat and mouse involved,but theres a long arc towards improvement,”he says.Sustainability initiatives work best when they are distributed even
21、ly across the value chain.“They should be implemented across all primary activities,as well as secondary ones like infrastructure,technological development and procurement,”says Juan Carlos Lascurain of Las-curain-Grosvenor Sports Brokerage,which helps stadiums globally in greening their operations.
22、“They cannot be siloed,”explains Gafni.“Thats the tricky part.It re-quires levels of collaboration that or-ganisations arent necessarily used to.Its important that they partner internally but also externally.”The effect of these initiatives is not solely internal.Supply chain pressure has created a
23、competitive market.“Consumers arent just concerned with sustainability prac-tices in stores,”Bird says.“Theyre also interested in the green creden-tials of the supply chains.”“Every business has an upstream and downstream in their supply chain,where their business is the crux,”says Stacy Savage,foun
24、der and CEO at Zero Waste Strategies in Austin,Texas.“All the operation-al decisions taken by the crux affect the chain.The buyer holds all the cards.If the current vendor cant do what they ask,they can look for a new vendor.”She cites the example of a business that wants to avoid using cardboard in
25、 its shipping operations.It could demand that its shippers use reusa-ble,collapsible crates,reuse them,and ask clients on the receiving end to also reuse them.Unless suppliers get onboard with this,they“wont get access to the best partners or the best contracts.They may be excluded from pro-curement
26、 opportunities”.So says Simon Glynn,co-lead of the climate and sustainability platform at con-sulting firm Oliver Wyman.Still,value chain implementation varies by industry.“For a business without physical products,like a SaaS business,Id imagine that sus-tainability initiatives sit lower on Richard
27、Pallardy Danist SohviaUnsplash55%Deloitte,2022of C-suite leaders list customer satisfaction as the main benefit of sustainable business practicesIf sustainability is treated as a nice-to-have,it fails.Ultimately,it isnt successful for the business,its reputation or its objectiveNo half measuresWhen
28、it comes to implementing sustainable business practices,companies need to go all in if they want to reap the rewards B U S I N E S S P R A C T I C E SJPrint media cant generate leads.WWr ro on ng g.Some of the advertisers in this report will generate over 200 leads thanks to Raconteurs integrated pr
29、int and digital campaigns.Email to find out more.R A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S0504Having a transparent,accountable and socially and environmentally responsible supply chainA strong public perception,record and reputation around climate change and sustainabilityA public
30、commitment and positioning around sustainability and climate change,including net-zero commitments and greenhouse gas reductionsBeing a certified B CorporationReceiving net-zero commitment verificationHaving a partnership with sustainability NGOs and charities OtherDo not knowNothing can influence h
31、ow much I trust brands and businesses commitment to climate change and sustainabilityCommercial featureustainability is a growing pri-ority for millions of consum-ers around the world,but as inflation surges and the cost of living crisis intensifies,shoppers are finding it increasingly hard to be as
32、 ethical as theyd like.According to research by GfK,some 80%of consumers globally say that sustainability remains important to them.Yet more than 30%of Europeans say they will put their own economic security and wellbeing before environ-mental problems this year,with that rising to over 40%in the US
33、 and 50%in developing Asia.This is forcing fast-moving con-sumer goods companies(FMCG)and tech and durables businesses to rethink their operating models from the design of their products to the way they engage with customers and stakeholders.Both sectors are major carbon emitters and the lifecycle e
34、nvironmental impact of their prod-ucts is significant.Consumers expect them to take action no matter what the economic climate is like.FMCG companies have been respon-sive when it comes to embracing sus-tainable business practices,from cutting back on single-use plastics to using more sustainable ma
35、terials in their products.Its paid off,with the global eco-consumer market now worth$800bn each year a huge rise or refurbish to prolong their lifespans.The trend of leasing as opposed to selling goods is also gathering pace,reflecting consumer desires to save money while cutting waste.Brands like B
36、osch,BlueMovement,Decathlon and Ikea are just a few big names starting to adopt the rental model.Meanwhile in the FMCG sector,the success of the Too Good To Go app which lets shops sell goods near-ing their expiry dates at a discount proves there is true consumer value in curbing food waste.As house
37、hold budgets are squeezed,companies might be tempted to hold back on product innovation,but that would be a mistake.FMCG and tech and durables companies should continue to take the lead,not wait for consumers or legal measures to force them.That may make shopping slightly less convenient initially a
38、s happened when New York State banned single-use plastic bags in shops,or the EU banned plastic straws but consumers will ulti-mately adapt and respect the brand more for sticking to its principles.This is especially true when embedded in the right communications campaign.Get your messaging rightThe
39、 messaging around sustainability is,of course,key and companies will have to rethink their marketing as consumer trends change.Greenwashing when a brand exaggerates its green creden-tials is a growing problem as more companies adopt environmental poli-cies under pressure from campaigners and shareho
40、lders.According to GfKs research,more than 60%of European shoppers dis-trust what companies tell them about their sustainability practices.When you consider that one in four has doubts about the proper functionality of green products,it seems this trust issue could become a real dealbreaker for bran
41、ds.“If companies are making a huge effort to change their business model and products and consumers dont buy it,its a key challenge,”says Schils.“Trust is vital and transformational marketing will play a big role here.”FMCG companies must use clear and compelling communication to help products stand
42、 out,empowering green consumers who want to find sustaina-ble products.Theres also a need for better guidance and classification of products at the point of sale.Shopping involves thousands of small decisions and people dont always have time to process what is printed on packaging or written in onli
43、ne product descriptions.“One in four people globally have never even seen zero carbon labels on products,which is a huge shortfall,”says Schils.“Closing this implemen-tation gap is key to keeping customers on board.”A massive opportunity It may seem like a tricky balance to strike,but companies have
44、 the market behind them.Last year,some 52%of shoppers globally said that sustain-ability had become more or much more important to them because of the pandemic.Meanwhile,consumers who prioritise environmental concerns when they shop accounted for 28%of the European population in 2021,up from 18%in 2
45、019.This year,the cost of living crisis will cause a temporary dent in this growth path,as shoppers are forced to deal with short-term worries.Putting ethical goods within the reach of many should be a key priority for companies and retailers alike.But in the longer term,the large-scale shift in con
46、sumer attitudes presents a huge opportunity for businesses bold enough to take it.GfK provides key insights on global sustainability trends and factual behaviour change,enables effective consumer targeting and supports cli-ents in their sustainable growth strat-egy.The organisation has found an obse
47、rvable disconnect between how consumers want to buy and how they actually buy.Overcoming this gap will be key to capitalising on all that untapped potential,Langer says.“More than half of consumers globally could fall into the eco-active category by 2029.But only brands that understand how to remove
48、 the barriers to sustainable retail behaviour will capitalise on this huge growth,”she says.“To do so they must increase the per-ceived value of sustainable products,ensure their effectiveness and use and compelling communication to create trust and to drive their message home.”Want to learn more?Jo
49、in GfKs free webinar Green ambitions,golden opportunities:Sustainability in times of instability on September 27th.Sign up today at a decade ago and a figure pro-jected to increase to$1tn in 2030.The tech and durables sector has been slower off the mark but eco-active revenue is still expected to ex
50、ceed$700bn in 2030.Rethinking green business modelsThese firms must continue to develop their sustainability agendas as shop-ping habits change,says Jutta Langer,vice president consulting at GfK.“During the pandemic,many consum-ers had more time to think about their consumption habits and the spare
51、cash to spend on ethical goods.Now,we are seeing a higher cost conscious-ness when it comes to these prod-ucts,”she says.Customers are still buying green,Lenneke Schils,global insights director at GfK,adds,but many premium life-style brands in FMCG are losing market share as shoppers move to more af
52、fordable store own-label ranges.“What sustainable looks like is also changing,”Langer adds.“It is becom-ing less about cleaning up and more about saving,be that using less energy or water,reducing wasteful consump-tion or recycling more.The trend is not new but is being turbocharged by the cost of l
53、iving crisis.”Companies are already changing their practices.Appliance manufacturers are making products easier to repair Tough climate:can businesses be green and fight inflation?Consumers are finding it harder to shop ethically as inflation surges companies must adapt to stay relevantof consumers
54、globally say that sustainability remains important to them80%GfK,2021Sof Europeans are prioritising economic security and wellbeing over environmental problems this year30%60%of European shoppers distrust what companies tell them about their sustainability practices25%of European shoppers have doubt
55、s about the proper functionality of green productsthe value chain,”comments Callo-way Cook,president of Illuminate Labs,a certified B Corp.Location can also play a key role.As Lascurain explains,companies in northern Europe may have tax in-centives and cultural motivation to encourage them to move t
56、owards sustainable practices.Conversely,those in emerging markets might be more resistant and Lascurain reports that clients in South Ameri-ca have been far less willing to adopt these measures.But while newer companies tend to bake sustainable principles di-rectly into their operations,it can be mo
57、re difficult for legacy corpora-tions with worldwide operations to incorporate them easily.“Companies that are deeply at-tached to a product or service that is inherently unsustainable require a fundamental change in how they operate,”cautions Bird.“Theyre going to have the most difficulty making ch
58、anges.Companies that are more B2B are also less likely to feel the pressure from consumers,and industries that have a very slim profit margin may not be able to in-vest in sustainable practices.”But that does not mean that larger corporations are incapable of inte-grating sustainable practices into
59、their value chains.Gafni cites the example of British consumer con-glomerate Unilever.“Their former CEO,Paul Polman,was a driving force,”she says.“But their sustainability plan was also supported by people in middle management.Its important that you not only have the vision from the top but also cha
60、mpions in different functional areas to under-stand how to get things done from a practical standpoint.”This point that leadership is important on all levels is echoed by most people who work on facili-tating sustainability in the corpo-rate world.Directives from the top can certainly have a major i
61、m-pact.But so too can pressure from lower-level employees.“It can come from all angles,”says Savage.“The biggest pressure gen-erator is when you have a scenario where your employees say,Hey,we have 3,000 employees and a cafete-ria.Why arent we composting?”When these messages reach upper management a
62、nd combine with ex-ternal pressure from environmental advocates,it pressures middle man-agement to implement real change.That,she claims,is where consul-tancies such as hers can help the often bewildered functionaries to make meaningful alterations to a companys practices.Responsiveness to these dem
63、ands translates into employee retention.Millennial and Gen-Z employees are insistent on seeing their values re-flected in their employers practices.If they consider that their values are in conflict they will simply leave the organisation,taking their institu-tional knowledge with them and ne-cessit
64、ating their former employers to plough money into training new employees.If,though,they see that its zero-carbon steel.The conversa-tions youre having with your cus-tomers are different and you have a more strategic relationship with them.Your customers are now bond-ed into buying from you.Decom-mod
65、itisation doesnt necessarily directly turn into a premium but it does turn into more stable relation-ships,customer loyalty and deeper customer collaboration.”This ultimately translates into good corporate citizenship.Wheth-er or not these projects make or save money,they are likely to have posi-tiv
66、e impacts on the world at large.And that is definitely something worth encouraging.of these firms are shunning compa-nies that arent trying to get ESG policies in place.Thats huge if you want to expand your business.”“Once companies and their em-ployees become used to a certain value or a certain no
67、rm,they will use sustainable practices almost reflexively.And they wont have to make the conscious decision as to whether its profitable,”says Bird.Many of the benefits of sustaina-ble practices are intangible.“It changes your relationship with your customers,”says Glynn.“Imagine you were selling a
68、commodity like steel.Well,now youre providing something differentiated because their employers are aligned with their principles,they will stay and reinforce those beliefs and practic-es,contributing to the organisa-tional knowledge pool.But where should proactive lead-ers start?While the goal is su
69、staina-bility across the entire value chain,waste management is perhaps the lowest-hanging fruit.“Theres a whole circular economy now.What we are seeing is a clear move away from a linear,destruc-tive economy,”says Savage.“In-stead,you transform your waste into a product.”She suggests that the goal
70、of these types of projects should be to“at least”break even.But sustainabili-ty can of course conserve money and even be profitable.“Focus first on things that will earn money,quickly.As those be-come successful,use them to fund some of the deeper,more compli-cated initiatives.Keeping profita-bility
71、 in focus means these efforts are less likely to be the victim of budget cuts when times are tough,”advises Horowitz.He cites the$31m(26m)ener-gy-efficiency retrofit of the Empire State Building in New York City.“It was a three-year payback.Thats a 33%return on investment.A fast-food restaurant migh
72、t have a mar-gin of 3%to 5%,”he enthuses.The adjustments have created millions in annual savings,and the building has attracted a suite of new tenants with deep pockets.Environmental,social and govern-ance(ESG)issues are also signifi-cant factors in attracting new investments.“ESG standards are now
73、one of the top-five indicators to investment firms and shareholders as to whether your company will still be viable and relevant in the next 10 years,”notes Savage.“Many SUSTAINABILITY COMMITMENTS THAT WIN CUSTOMER LOYALTY Business factors that positively influence consumer trust in the UKDeloitte,2
74、022Sustainability is a long game.Superficial sustainability measures no longer cut it in a heavily scrutinised market.Slapping a green label on a product or service simply doesnt pass muster anymore not with consumers,not with activists,not with business partners.By contrast,carefully considered ini
75、tiatives that adjust practices across the value chain can have profound effects on business success.While decarbonisation may entail an initial investment,it often means savings down the line if not an actual profit.Waste and energy-use reduction are among the most easily implemented sustainability
76、practices.The savings accrued by these easy initial steps can be used to subsidise more difficult,industry-specific actions.Whats more,pressure on suppliers can help to facilitate a competitive market where relationships between individual organisations are increasingly contingent on sustainable sta
77、ndards.Perhaps most importantly,sustainability can be crucial in securing investments for business expansion.Environmental,social and governance criteria are major factors for many investors today when deciding whether to divert funds to a particular organisation.Demonstrably sustainable practices a
78、re considered key indicators of future business success.They indicate a likelihood that an organisation will comply with increasingly stringent environmental regulations,avoiding liability.These commitments are also appealing to a vigilant consumer base,which reacts poorly to unsustainable practices
79、 and rewards companies that can demonstrate their sustainable practices over the course of time.Millennial and Gen-Z members of the workforce often look for employers that share their purported values.A visible and verifiable commitment to sustainable practices can help companies attract and retain
80、talent.Lower turnover means that human capital the resources invested in training employees and the resulting repository of institutional knowledge stays within the organisation.This can amount to significant cost savings in the long term.As beneficial as sustainable practices may be to a given orga
81、nisation,their benefits to the world are even more important.Corporate citizenship is now considered to be an unavoidable responsibility.Just as individuals ought not to hope to accrue direct benefits from behaving with decency and consideration towards their fellow citizens,there is now an expectat
82、ion that companies will do the same.Will these behaviours affect the bottom line in the near term?Perhaps.Perhaps not.But pursuing practices that benefit the planet and its inhabitants will help to maintain a healthy ecosystem for people,for other living things and for business as well.The business
83、case for sustainabilityWhen youre trying to get something like this off the ground,it requires levels of collaboration that organisations arent necessarily used to35%29%29%20%19%18%1%25%21%First Insight,202227%of business leaders cite high costs as the main obstacle to sustainable business practices
84、83%of UK consumers are willing to spend more on brands that they consider truly sustainableDeloitte,2022R A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S0706anaging a supply chain is no easy business.And the task is expanding,as more businesses check up on the sustain-ability credentials o
85、f their partners.If a supply chain has many stake-holders or crosses borders,gaining the necessary transparency can be a daunting prospect.Understandably,many companies have prioritised getting their supply chains moving again after global lockdowns.Broad definitions of sustainability can further co
86、mplicate the process.Does it cover pay,working condi-tions and human rights,for exam-ple,or does it mean a tight focus on carbon footprint reduction and en-vironmental stewardship?If its going to work,then examining the sustainability practices of supply chain partners needs to be an em-bedded pract
87、ice from the outset,rather than an afterthought.Ralph Kirkwood is head of pro-curement at electric bike manufac-turer FreeFlow Technologies.He thinks sustainability needs to be considered at the point of contract-ing.“This is where you have the most leverage to demand output from suppliers to align
88、to your require-ments.That might be in relation to the product,service specification or wider sustainability goals.”Kirkwood admits that it can be“tricky”to assess commitment to sustainability during the tender evaluation.But,he says,these ques-tions need to be asked at the outset to help companies
89、assess if first-tier suppliers will“roll your commit-ment down the supply chain”.That requires leadership.“Suppli-ers want to see that the ultimate customer is serious about sustaina-bility issues,”says Malcolm Harri-son,CEO of the Chartered Institute of Procurement and Supply.“The He adds that genu
90、ine traceability means that companies can prove where their components originated,demonstrate regulatory compliance in all markets where products are made and sold,and show that environmental and ethical consid-erations have been followed.For Harrison,metrics are essen-tial,even if theyre not used a
91、s hard targets.Instead,they can be useful for showing progress,especially early in the relationship:“Sustaina-bility is a long-term goal and,as such,continuous improvement is key in the short term.Then its about hitting targets in the long term.”At flooring manufacturer Inter-face,a supplier code of
92、 conduct re-quires everyone in the supply chain to comply with relevant environmen-tal regulations and conduct opera-tions in ways to minimise the impact on the environment.The company is helping 26 priority suppliers to iden-tify projects in their operations to re-duce greenhouse gases and providin
93、g technical support to reduce the manufacturing carbon footprint.“We share lessons weve learned and collaborate on potential solu-tions or new approaches,including sourcing alternative raw materials,”says Erin Meezan,Interfaces chief sustainability officer.“Were captur-ing more detailed life-cycle a
94、ssess-ment data on the materials to better understand their carbon impacts.These assessments will form a base-line that allows our supply chain team to develop a strategy to reduce carbon across that ecosystem.”But what about the often compli-cated,cross-border supply chains where monitoring,oversig
95、ht and communication are all more of a challenge?Thankfully,this is where technology can play a greater role.Automating processes,such as questionnaires for stakeholders to complete during the movement of goods,and even live location analyt-ics,can flag up risks.If compliance can be checked in real
96、time,con-cerns can be managed before they become bigger issues.“With mobility analytics,compa-nies can evaluate their supply chain networks,improve site selection for warehouses or distribution centres,and better understand supplier per-formance,which can all reduce the carbon footprint,”says Jeff W
97、hite,co-founder and CEO of location in-telligence provider Gravy Analytics.“For example,location analytics can help companies understand truck traffic patterns within their supply chain and determine where bottlenecks might be occurring.With these insights,organisations could address logistics issue
98、s to re-duce overall carbon emissions.”Interfaces Meezan agrees with this,noting that leveraging real data“is the most effective way to move the needle on achieving sustainabil-ity in our supply chain”.“We encourage our suppliers to measure their impacts by establish-ing tools like greenhouse gas in
99、ven-tories,as well as developing strong assessments of their current im-pacts through life-cycle assess-ments,”explains Meezan.“Given that the raw materials in our prod-ucts contribute the bulk of our im-pact,life-cycle assessment data helps us and our suppliers under-stand the impacts.”Introducing
100、the right technology,along with fostering a culture of trust and open communication,can not only help companies choose the right partners but also retain rela-tionships with existing partners.As Bob Glotfelty,chief growth officer at supply chain fintech compa-ny Taulia,puts it:“Since changing suppli
101、ers can be disruptive to the business or,in some cases,isnt even possible,many businesses focus on encouraging improvements by their existing suppliers to match their commitment to sustainability.”Supply chain transparency is vital to meet sustainability goals and ensure companies work with partners
102、 who share their values.But how practical is it to check everyones credentials?Above-board transparencyMGeorgia Lewisultimate customer is often a larger organisation with more resources than other companies in the supply chain.A commitment to support and educate smaller suppliers is a positive actio
103、n.”Increased public awareness of sus-tainability issues can also spur com-panies to examine their supply chains more closely.The textiles industry is one example of this,par-ticularly after many clothing manu-facturers were exposed in the media for poor working conditions,low pay and dangerous facto
104、ries.Rob Webbon,CEO of sportswear manufacturer Presca Sports,says that when the business launched,few companies were creating sus-tainably made fabrics.“We would go to trade fairs and ask exhibitors if we could see their recy-cled or renewable fabric lines.Wed be taken to the back of the stand and s
105、hown a small sample of hangers as if it was an afterthought,”he says.“Fast-forward a few years and now every textile company is desperate to show how sustainable they are.In many ways thats great for the in-dustry.But it does mean the market is much more open to greenwashing and we need to be aware
106、of that.”What,then,is the best way to get to the truth?Is it better to build con-fidence in that relationship by get-ting to know suppliers and seeking assurances on the basis of trust,or to set firm metrics that suppliers are expected to hit?Max Winograd,VP for connected products at manufacturing s
107、pecial-ist Avery Dennison,says both ap-proaches are important.“Trust is a foundational element in every busi-ness relationship.But firm metrics are needed to ensure that these standards are adhered to.”S U P P LY C H A I N SSustainability is a long-term goal.That means continuous improvement is key
108、in the short term.Then its about hitting targets in the long termAccenture,202263%of CEOs say difficulty in measuring ESG data across the value chain is an obstacle to sustainability60%of global emissions are generated by supply chainsCommercial featurerofit at all costs has never served society and
109、 thank-fully it is no longer the primary aim driving all companies.Instead,pur-pose offers a platform for growth and a mandate to create value for the world,not just extract value from it.The past three decades have seen a shift from the responsible business agenda being built on compliance and corp
110、orate social responsibility.After the 2008 recession,a more integrated approach emerged focusing on impact,materiality and earning a positive rep-utation and relevance with customers,colleagues,and suppliers.But the limitations of these approaches are now inspiring a more comprehensive,purposeful pa
111、radigm.The purpose-driven business has arrived,and its mandate is clear-prof-itably solving the worlds problems.This isnt altruism,its good business and it brings benefits.Purpose-driven companies attract and retain the best talent,innovate more and enjoy greater loyalty from customers.Alex Edmans,p
112、rofessor of finance at London Business School notes in his book Grow the Pie how such organ-isations financially outperform their peers over the long term.The benefits are so evident that most senior leaders in large and listed companies want in.However,recent research we commissioned from YouGov re
113、veals employees dont always think their leaders are doing a great job of practising what they now preach.This is what we call the purpose gap,highlighting a clear gulf between the ambition of senior leaders and the reality of workers experiences.Everyone in the boardroom may be talking about purpose
114、 but few are embedding it effectively into their business strategy and culture.Its not The win-win shift powering business performanceEmbedding purpose can drive everyone and everything in your business and help boost profits argues Becky Willan,CEO of Given Agencya question of intent,but of executi
115、on.And it means businesses are largely failing to reap the rewards that being purpose-driven generates.Closing the purpose-gap Our survey spoke to 2,000 UK employ-ees and found 69%of those at large businesses felt their companys pur-pose conflicted or only partially aligned with how it operates day-
116、to-day.Worryingly,two thirds(64%)at large businesses also said their busi-ness had changed only a little,or not at all,since it set out its purpose.These findings expose the challenge of translating inspiring ideas about a companys purpose into meaning-ful action.Purpose must mean com-prehensive tra
117、nsformation,not just a memorable tagline.To succeed,a different organisa-tional muscle has to be exerted.This is tough work,it takes time,measured in years,not quarters.It demands seri-ous questions about decision making,innovation,investments,and rewards.So while CEOs want to lead pur-pose-driven o
118、rganisations,most arent sure how to go about it.In response,we created the Given Insiders Guide to Purpose,a free,open-source handbook to help CEOs and their senior leaders embed purpose into their businesses.Five essential transformationsWe have drawn on over a decade of experience working with com
119、plex organ-isations serious about making their pur-pose real to identify five critical compo-nents of purpose transformation.1 GovernanceChange decision-making processes to always consider purpose.Start with your board.After all,they are the people holding your executive team to account.2LeadershipC
120、EOs and senior leaders must be visible champions of your purpose.If theyre not,no one else will be.Involve them in the transformation,invite them to find their own purpose and train them to talk about their journey.3Colleague engagementPurpose should change every con-versation in your business,but p
121、eople need time to figure out what it means for them and their team.Rally natural influ-encers.If around 15%of people are on board from the outset it creates a tip-ping point to stimulate lasting change.4Brand and innovationBrand innovation involving pric-ing,product and performance makes purpose ta
122、ngible for customers and employees.Businesses need not worry about accusations of purpose wash,unless purpose only shows up in mar-keting campaigns and PR stunts.5Metrics and measurementIts tough to measure purpose,but like performance,its multidimensional.Do you really believe business success is o
123、nly defined by profit?Similarly,by reducing purpose to a single measure,you risk pitting it against profit when the two should be mutually reinforcing.Download your free copy of the Insiders Guide to PurposePFelix CesareviaGettyR A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S0908Commercia
124、l featureearly 38%of UK adults now split their working week between their offices and homes.But many of us live and work in buildings that lack sufficient ventilation and light,arent designed to stay cool in our increasingly hot climate,and use environmentally unfriendly materials.So,how can we buil
125、d spaces that are healthy for people and the planet?1 Transition to sustainable materialsBuildings and the construction industry have a carbon dioxide prob-lem.Figures from the World Green Building Council show that together,theyre responsible for 39%of annual global CO2 emissions.Energy used to hea
126、t,cool and light buildings accounts for 28%of emissions,while the remain-ing 11%is the result of carbon emis-sions from materials and construction processes throughout the whole build-ing lifecycle.To reach ambitious global climate goals,existing and future build-ings must be redesigned to become mo
127、re energy efficient,and we must transition to sustainable alternatives to concrete,steel,and aluminium or find ways to lower the carbon footprint of these materials.2Improve ventilation to stop viruses from spreadingDespite our enhanced understanding of how airborne viruses spread,there is still cur
128、rently no set of standards for mitigating the levels of bacteria or viruses indoors.Lone Feifer,director of sustainable buildings at roof win-dows company VELUX,says that man-datory ventilation standards must be enforced to stop the spread of res-piratory illnesses indoors and the loss of workers th
129、rough ill health.She adds:“Joseph Allen,the director of healthy buildings at Harvard University,firmly The building blocks of sustainable citiesHow can we build the sustainable environments needed to adapt to the modern world?believes your building operator is more important to your health than your
130、 GP;at VELUX we are striving to chal-lenge traditional thinking and to bring awareness to how our buildings can be healthy for both people and the planet,encouraging better daylight and fresh air in indoor climates.”3Use technology to create a healthy indoor climateBuildings of the future must be th
131、ought of as a system of interconnected parts that work together to optimise energy efficiency and the indoor climate.“You need to be able to have flexibility to contain heat in winter,but in summer,you need shades or shutters that pre-vent the heat from coming in,”says Feifer.Since 2017,VELUX has us
132、ed an integrated digital system to ensure its roof windows,blinds and shutters work in perfect harmony to do exactly that.Sensor-based ventilation tracks tem-perature,humidity and CO2 levels,and ventilates to keep the indoor climate healthy.Automatic heat protection protects homes from excessive hea
133、t by automatically closing blinds,awnings and shutters on hot days.4Use light and cooling for better night conditionsHumans have a circadian rhythm,or a natural sleep-wake cycle,that is reg-ulated by exposure to natural light throughout the day.But many people live and work in buildings that dont gi
134、ve enough access to daylight,which can disrupt our sleep patterns and affect our health.Designers should be mind-ful of this and ensure that buildings are designed to optimise exposure to nat-ural light.Meanwhile,most European buildings dont provide sufficient ven-tilation to cool them down at night
135、.The heat generated during the day builds up and is absorbed into the buildings surfaces and structure.Night cooling uses natural ventilation to allow warm air to be exhausted and the build-ing mass to be cooled.This process reduces energy costs and improves the energy efficiency of buildings.5Build
136、 partnerships to create sustainable citiesChange needs to happen at scale,but the building industry is a fragmented system of many different parts,includ-ing investors,contractors,engineers,architects and other specialist experts.As part of its Build for Life initiative,VELUX wants to build partners
137、hips with each of these sectors to show them how to build sustainably using insights gathered through the companys 80 years of experience.The end goal is to create liveable spaces that are healthy for people and the planet.To bring this to life,VELUX will unveil its Living Places project in Copenhag
138、en in 2023 in partner-ship with Effekt architects,Moe engi-neers and Enemrke&Petersen con-tractors.Living Places will showcase healthy homes with a significantly low-ered carbon footprint.This new way of thinking proposes healthy and sus-tainable housing that is affordable for many,due to the optimi
139、sed choice of materials and easy assembly process.It encourages a more responsible,regen-erative and collaborative approach.Think about buildings in a new way,visit Nt is the impactful acronym that can no longer be ignored.Arguably,all in-vestors,and therefore all compa-nies,are now aware of their e
140、nvironmental,social and govern-ance(ESG)profile,whether or not they choose to discuss it.In the 18 months since Larry Fink,CEO of BlackRock,wrote his famous letter to CEOs,the idea that companies that prioritise ESG are purposeful has become mainstream.As a product of this trend,global investors are
141、 beginning to focus on portfolio-wide data rather than company-level data.They are also considering ESG in terms of the value it can create,rather than as a measure of risk mitigation.These shifts can be linked to the fact that the business case for ESG is now proven.Even hard-nosed and experienced
142、investors can see that good ESG makes a stronger business.In other words,ESG in-vesting strategies are no longer just for ethical investors.This,of course,has been helped by a summer in which drought,fires and floods have hit wealthy nations as well as poorer ones.Climate change and with it greater
143、emphasis on ESG has become unavoidable for governments and businesses alike.Consequently,investors are look-ing to finance companies that will actively contribute to sustaina-ble solutions and that will acceler-ate progress towards the just transition the move to a low-carbon economy that doesnt dis
144、ad-vantage less-developed countries and particular demographics.Climate change is now being ac-cepted as an environmental issue that will generate more regulation.For example,the recently proposed EU directive on corporate sustaina-bility due diligence emphasises the importance of human rights withi
145、n supply chains.But the very presence of regula-tion is also helping to raise the standard for action.What was pre-viously considered leading practice for investees is now seen as the minimum level of compliance.But it can be debated whether regula-tion is being influenced by inves-tors or vice vers
146、a.Companies are now faced with a choice:they can lead by example,taking proactive steps to drive ESG performance;or they can be com-placent,and face the risk of being forced to adopt and implement poli-cies by regulators or segments of their value chain,like customers or business partners,who might
147、de-mand certain standards because of their own regulatory requirements.The question,then,for corporate leaders is not so much about wheth-er or not to address ESG issues,but more about when they do so.Doing it now means doing it at a lower cost and at a pace determined by the business,utilising volu
148、ntary frame-works.The alternative is being forced down a path by hard legisla-tion,such as the UN Guiding Princi-ples on Business and Human Rights and the Task Force on Climate-Related Financial Disclosures.The last word,which seems fit-ting,is on employees.ESG is of increasing importance to current
149、 and prospective talent in the finan-cial services sector,but also more generally.If a person is going to commit part of their career and working life to a company,it is likely that they want to see evi-dence of alignment with their personal values.In this way,ESG can also act as a powerful tool for
150、 the attraction,retention and moti-vation of employees.ESG investing strategies are no longer just for ethical investorsI N S I G H TJennie GalbraithChair,Institute of Corporate Responsibility and Sustainability and ESG director,Inflexion icrs.infoJennie Galbraith explains why the business case for
151、ESG is increasingly compelling for investorsShort of universal KPIs,organisations are charting different paths to sustainability.But all agree that to be impactful,sustainability must be ingrained in the company ethos and other suppliers meet require-ments such as providing an envi-ronment that cons
152、iders employee health and safety and complies with national laws.But the compa-ny readily acknowledges that“it is not always possible to monitor and control the conditions of each individual involved in the produc-tion of the products”.Tom Berry,global director of sus-tainable business at Farfetch,w
153、ould not be drawn on specific KPIs per department,only saying that:“Sus-tainability is a very broad subject and touches all departments.Each department needs to take owner-ship and leadership of the elements it can most influence.”Ethical cosmetics company Lush relies more on forging relationships t
154、han actuarial targets in order to in-spire its staff towards sustainable behaviours.Ruth Andrade is lead for giving,regenerative impact and or-ganisational development at Lush.“Our strategy is about building engagement,”she explains.“If we have direct connections with the indigenous communities who
155、are being affected by palm oil in Indo-nesia,then the people who are for-mulating the products have a vested interest because they have a encourage corporates to get their houses in order.In July 2022,it placed Asos,Boohoo and George at Asda under investigation to verify their green credentials.The
156、carrot-and-stick approach of bonus versus litigation is a start.But to bring about meaningful change,sustainable behaviours need to be embedded across the business.As what gets measured gets done,this means setting key performance indicators(KPIs)at as granular a level as possible,across every team
157、and department.Nestl UK&Irelands Dr Emma Keller,head of sustainability,ex-plains:“Breaking down the big long-term goals into tangible,actionable and meaningful goals at depart-ment-,team-or individual-level is essential if all the actions are to ladder up to the overall aim.After all,reaching net ze
158、ro and be-coming a genuinely regenerative organisation that puts more back in than it takes out is new territory no one has been there yet,and no one has all the answers.”What is clear is that,overall,there is an acceleration in the number of companies taking steps to make a measurable(and therefore
159、,ac-countable)impact on sustainability.But first,its important to get the what youre measuring pinned down,as well as the why.“I prefer the word impact to sus-tainability,which is so overused and is conceptual.But the word im-pact is much easier to measure.”comments Hannah Keartland,who was formerly
160、 financial director and then head of innovation at Cancer Research UK before launch-ing her consultancy as an out-sourced chief impact officer.“Look at procurement.If we buy this item,what is its impact?You can then look through the whole supply chain and say,Whats the packaging?How was this produce
161、d?How was it transported?What were the impacts on people and nvironmental,social and governance(ESG)account-ability is increasingly a fea-ture of many companies annual reports,with the trend for linking sustainability performance to exec-utive pay growing by the year.In a survey by Corporate Secreta
162、ry,60%of European respondents stated their board tied ESG goals to execu-tive pay,compared to only 37%of North American boards.Reporting and remunerating ac-cording to ESG performance remain a voluntary decision,based largely on recognised impacts on company effectiveness and brand perception;but ma
163、ndatory reporting is on the way.Already more than 1,300 of the UKs largest registered companies will need to report using Task Force on Climate-Related Financial Dis-closures in financial years starting after 6 April 2022.Despite this,there is still a surpris-ingly large amount of greenwashing going
164、 on.Some companies are still not afraid to make sustainability claims that are based on creative fudging of the numbers.And the regulators are taking note.The Competition&Markets Au-thority(CMA)has sent a shot across the bows of the industry to Matthias Tunger via GettyMorag Cuddeford-Jones the plan
165、et,water and waste in every single stage of that journey?You can map that back.”There are myriad examples of how organisations are trying to cod-ify their efforts to create a measura-ble and reproducible set of behaviours that lead to tangible change.But they are often as differ-ent as they are many
166、.Good provenance Conventional raw materials are generally accepted to be more harmful to the environment and human health than organic raw materials.Weleda is committed to including 80%minimum certifia-ble organic raw plant materials and the team reports directly to the companys managing directors.T
167、he company is also certified by the union for ethical biotrade,meaning it must follow strict pro-cesses to meet requirements and submit to audits.One of the most difficult elements of delivering a product or service that is sustainable through and through is ensuring that the supply chain meets exac
168、ting requirements.Fashion ecommerce site Farfetch insists on a stringent ethical sourc-ing policy,demanding that partners Contained successB Corp is measuring the triple bottom line.Its a change from a shareholder model to a stakeholder modelThe big picture:a focus on the detail for overall success
169、P E R F O R M A N C EEIR A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S1110Commercial featureGetting the worlds buildings to net-zero carbonEngineering design is creating positive pathways to solve the biggest of all climate change challengesHelping Kews iconic Palm House reach net zeroRo
170、yal Botanic Gardens,Kew has appointed Cundall as decarbonisation consultants on the restoration of the heritage-listed Palm House.Protecting and conserving this impressive Victorian glasshouse,while also helping it achieve net-zero carbon is a rewarding challenge that will set the standard for how w
171、e restore other heritage-listed buildings in the future.The restoration will be respectful of the buildings heritage but will also improve the buildings operation,deliver improved internal conditions for the plant life and upgrade the energy systems for the future.the estimated value of real estate
172、on the planet,none of which is net zero carbonof the buildings that need to be decarbonised are already built$326tn80%he challenge of net-zero carbon is all around us and probably the toughest task lies in addressing the buildings that are fundamental to our everyday lives-homes,workplaces,schools,u
173、ni-versities,leisure centres and arenas.From the mundane to the magnifi-cent,they all carry a burden.The built environment is responsible for almost 40%of global CO2 emis-sions and,although new construction is decarbonising fast-albeit still not fast enough-a daunting 80%of the buildings that need t
174、o be decarbon-ised are already built.There is$326tn of real estate on the planet and almost none of it is net-zero carbon.The task is enormous and multifaceted but,as the UN Intergovernmental Panel on Climate Change(IPCC)has observed,it is also one of the quickest wins for reducing our collective ca
175、rbon emis-sions.The crux of the problem is that the majority of existing buildings were con-structed with techniques that had no concern for their carbon consequences.The use of glass and steel has created a generation of architecture high on kerb appeal but low on energy efficiency.Government and g
176、lobal regulations are now bearing down hard on the built environment while financial imperatives and ethical incentives are impelling corporations to drastically cut the emissions of their businesses.Major sources of capital including banks and investment funds are con-sidering carbon emissions befo
177、re deciding where to deploy their dollars,and the insurance industry is asking asset owners about climate risk.Substantial gainsDecarbonisation is now a fundamen-tal requirement of an organisations existence.The good news is that it is also a route to improved returns on investment when buildings fu
178、nction efficiently,attract premium tenants and ensure the value of building stock is retained and enhanced.“A significant part of the overall global emissions footprint comes from hous-ing and commercial properties,so this is an area where we need to make sub-stantial gains fairly quickly in order t
179、o meet our net-zero carbon targets,”says Robin Pritchett,Building Performance Services lead at Cundall,a leading multidisciplinary engineering consultancy that specialises in improv-ing the performance of existing build-ings and creating innovative design for new generation construction.“We know eve
180、ry building is capable of a net-zero carbon pathway.For us,it is a question of working with every-one concerned and bringing our expertise to bear.It is very rewarding when you start looking at the data and see tangible results because of changes we have implemented.”Environmental,social and govern-
181、ance(ESG)targets and new govern-ment energy efficiency ratings sys-tems are also placing demands on corporations to reduce greenhouse gas emissions,water consumption and waste to landfill volume across their building portfolio.Cundall has been working on projects around the world,assisting asset own
182、ers,asset managers and major tenants with multidisciplinary design and building performance services to ensure they can take the high-performance road.One of these major tenants Cundall is working with is Legal&General Investment Management(LGIM),which has an ambitious strategy to reach net zero acr
183、oss its 76 million square-foot real estate portfolio by 2050 or sooner.Cundall is helping develop net-zero audits and implementation plans for LGIMs building stock,then designing the interventions.“We are witnessing a huge growth in the commitment to decarbonisation from owners and investors,”adds P
184、ritchett.“With clients like LGIM,we are seeing a desire to go beyond minimum requirements,with clients making a real investment to future-proof buildings,protect assets against climate change and create long-term value and perfor-mance across their portfolio.”This groundswell is strengthened by the
185、realisation that to continue with business as usual poses the real threat of asset stranding as the market shifts.“Large occupiers,particularly multi-nationals,have their own ESG commit-ments and they are not going to sign up for buildings that arent net-zero carbon or on a pathway to net zero.Inves
186、tors want to maintain their asset values,which are partly driven by what people are willing to occupy,”says Pritchett.Engineering opportunitiesRetrofitting a building that was designed and constructed with lim-ited concerns for its carbon footprint is where Pritchett and the Cundall team see enginee
187、ring opportunities.Even the perceived quick wins,such as replacing old boilers with high-ly-efficient electric heat pumps,pose complex engineering challenges to effectively integrate these into exist-ing systems whilst maintaining the buildings function and setting it on a path to net-zero carbon.“T
188、he initial challenge is understand-ing the building and its systems,”says Pritchett.“We are fortunate because we have a breadth of engineering expertise from building physics to the detailed engineering of pipe systems and valve arrangements.You need all those skills and the knowledge of dif-ferent
189、disciplines to provide a coordi-nated answer.Once youve got that engineering understanding then you can really get to work.“Often you can identify some straightforward signals of inefficiency one client we worked with had their buildings heating and ventilation coming on every Saturday because its s
190、ystems had been scheduled for a one-off event and not switched back.We can make 10%to 15%energy sav-ings improvements just by managing assets more efficiently before we move into fundamental changes.”A blueprint for changeCundall is at the forefront of net-zero carbon design which is forming a bluep
191、rint for industry,clients,devel-opers and peers to learn from and collaborate for a brighter,more sus-tainable future.It is committed to achieving net-zero carbon design on all its projects by 2030 and confirmed that it will no longer work with clients who dont share its vision.“This is a very deman
192、ding and chal-lenging sector,but the need is crystal clear from a business and ethical stand-point.The positive news is that industry is moving forward and putting more weight and urgency behind the push to net-zero carbon,”says Pritchett.“We need everyone to wake up to the scale of this challenge.I
193、t is cen-tral to combatting climate change but does not seem to be on everyones radar at the moment.Flying and driv-ing get a lot of press coverage,but buildings get almost none.“Engineers are problem solvers and getting to net-zero carbon is a chal-lenge we welcome.We need to work together to achie
194、ve this.”To find out more,visit We are seeing a desire to go beyond minimum requirements,with clients making a real investment to future-proof buildingsUKGBC,2021Savills Impacts,2021Tcoherently at a top level.Again,there is contention as to who is re-sponsible for sustainability strategy.Wilson maps
195、 out the organisation chart:“Organisations where the CEO sees sustainability as a strate-gic business priority and proactively drives it,holding each member of the C-suite accountable for driving performance through their func-tion,will make the most impact.It needs a top-down and bottom-up approach
196、 which is why we have es-tablished environmental and social impact working groups.”Nestl UK&Ireland takes a similar view,“starting with the top”and with targets that“cascade down through teams and there is clear re-sponsibility and accountability,”says Keller.At Weleda,Kalns reports that the process
197、 is always collabora-tive and that“any employee can share their ideas”but ultimately,after the small team of five dedicat-ed sustainability employees,“the final decision on strategy is made by the head of corporate sustainability with the board of directors.”to“decarbonise the goods and ser-vices pr
198、ovided and address the so-cial impacts of their supply chain”.All in the mix Naturally,many companies are looking to include recycled products in their outputs or reduce carbon in their production processes.Weledas product development board is responsible for achieving 65%recycled material or biopla
199、stics in its natural cosmetics primary packaging(based on the weight of all packaging produced).“We are going to do this product carbon footprint that includes all the raw materials,all the supply chain,all the transportation and we have this goal anchored in the cor-porate strategy,”says Krlis Kaln
200、s,sustainability manager at Weleda.Impacts are also considered in non-tangible goods.Emma Swain,group head of legal at Unlimited Group,explains that advertising production is an area that can have relatively high carbon emissions.Linking to Ad Net Zero,the advertis-ing industrys emissions pledge,the
201、 company is working with AdGreen to introduce its levy on all client pro-ductions and will impose it on at least three client productions in 2022.“Weve also looked at every el-ement of a shoot to see how we can meet our 2030 carbon neutral pledge,”she says.The account teams join in these efforts,and
202、 their specific KPI is to be able to share the carbon footprint of briefs to encourage clients to take sustainable options in all Unlimit-eds creative work.A third-party specialist has been engaged to help measure and monitor those emis-sions and reporting will begin once the company has been able t
203、o estab-lish a baseline.Human resources Building advocacy for sustainable behaviour across the business is al-most as important as setting defined KPIs.Making sure staff understand the impact of their behaviour is a critical part.Greene King has relationship with these people.Its not a number,its no
204、t a target.In-stead,its about real people,real lives and real relationships.”Wise buys In its advisory report Empowering Sustainability Heroes,Nestl high-lights the approach taken by Greene King pubs.With differently sized sites,one of supply chain director Vance Fairman-Smiths tasks is to work with
205、 pub teams to identify dishes that create waste in some lo-cations but not others.“We had bread in our supply chain in boxes of 48 loaves,when for a lot of pubs this was too many.This creates space and waste issues.”In the UK,food waste makes up 6%to 7%of green-house gas(GHG)emissions.McLaren Racing
206、 is the first Formu-la One team to release a sustainabil-ity report.It is currently in the middle of discussing how introduc-ing sustainability KPIs might work across its business.Kim Wilson is McLarens director of sustainability and says that KPIs for procurement are under discussion.KPIs under con
207、sideration include incentives to work with key suppliers those with the greatest impact on the organisa-tions GHG footprint and/or where there is the greatest opportunity to implement change.The aim here is Aisling Connaughton,co-founder and sustainability solutionist at women-led sustainability con
208、sul-tancy Cyd Connects,says that,of all the sustainability frameworks she uses to help clients reach their goals,one of her most used is the B Corp accreditation.Not only does being able to put the B Corp logo on brand assets promote trust among custom-ers but it also helps the organisation to make
209、defined progress and con-tinued improvement.“B Corp is measuring the triple bottom line.Its a change from a shareholder model to a stakeholder model.Underpinning it is the B im-pact assessment,which is now used all over the world,”explains Con-naughton,saying that there were 400 B Corps in the UK at
210、 the start of 2022 and by the end of the year there are predicted to be 1,200.“Its a living,breathing dashboard and its free,”she adds.“You can have different team members look-ing at the ESG frameworks,bringing in multiple stakeholders across the business.It puts you on a points sys-tem and,in the
211、same way youd want to see your money go up,you also want to see your environmental and societal points go up.”Continuous improvement comes from a process of ongoing auditing and yearly benchmarks.Companies need to acquire 80 points to gain the B Corp mark and then improve that score every year.Betwe
212、en now and 2025,for example,Weleda is seeking to achieve 125 points to prepare for the next certification.However granular the KPIs that contribute to company-wide pro-gress towards a more sustainable future,it must ultimately be led COMPANIES REPORTING SDG-RELATED SUSTAINABLE DEVELOPMENT GOALSLarge
213、st 100(sample of 5,200)and 250 companies(according to Fortune 500 ranking,2019),by revenue,worldwidecreated champions at each of its sites people who are passionate about sustainability.The business has also added energy and waste to its training,while incentives are under consideration for these ch
214、ampions in the future.Weleda uses the Theory U model,which shifts from individual-cen-tred behaviours to collective ones that should support a more sustain-able,healthy life.It is used in order to prioritise internal goals,with 145 workshops held over two years for collegial leadership training alon
215、e.“People who want to work on inno-vative and sustainable solutions need creativity,vulnerability and trust,”Kalns says.“They have to feel safe.We can never make a KPI based on individuals ability to be vulnera-ble,but at least we can quantify workshops and training hours.Thats where were at current
216、ly.”Again,Lush prefers to replace classrooms with action.At Brighton Pride 2022,the local store ran a litter pick,part of the companys overarching aim to monitor the waste it collects.“Its about winning hearts and minds,making people feel proud of what theyre doing,”explains Andrade.Reporting succes
217、sUnless there is a regulatory frame-work to follow,many companies will beat their own path towards what measurable sustainability impacts mean to them.But there is a desire for those frameworks and datasets to measure against and motivate where necessary.Even Lush,with its preference for engagement
218、over tar-gets,notes that its diving deeper into insight to inform activity.“Theres a lot of work in integrated reporting and weve been discussing how we do it much more.We dont have it yet.We have been working quite closely with the business intel-ligence team to increase their capac-ity,so they can
219、 help us.Just now we are setting up dashboards mixing non-financial and financial data,”reveals Andrade.Becoming a genuinely regenerative organisation that puts more back in than it takes out is new territory and no one yet has all the answersKPMG,202051%56%49%44%250100YesNo70%Measure Protocol,2021o
220、f UK consumers said they would be more likely to buy from a company that has B Corp certificationRicardo Gomez Angel via UnsplashR A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S1312 THE RISE OFNET ZEROSince the term was first popularised at the landmark Paris Climate Conference in 2015,ne
221、t-zero commitments have been springing up around the world.Governments have enshrined them into law,and companies have started embedding them into their corporate strategies.But how meaningful are these promises,and where do gaps remain?OF THE WORLDS 2,000 LARGEST PUBLICLY TRADED COMPANIES1 in 3now
222、have net-zero targets,up from 1 in 5 in December 202040%plan to use offsetting to achieve net zero.Less than 2%have explicitly ruled this out38%have pledged to address scope 3 emissionsA BRIEF HISTORY OF NET ZEROIn less than a decade,the term has become the guiding principle for sustainability effor
223、ts.The next challenge is turning words into action200202001620152014The IPCCs Fifth Assessment Report recognises that tackling climate change means reducing net ongoing emissions to zeroThe World Bank outlines the need for a global climate agreement to“provide a clear pathway t
224、o zero net emissions before 2100”The Paris Climate Agreement aims to limit global warming to a maximum temperature increase of 2 degrees by reducing emissions to net zero as soon as possibleSweden is the first nation to enshrine a net-zero target in lawThe IPCCs Special Report recommends limiting gl
225、obal warming to a 1.5 degree increaseThe UK becomes the first G7 nation to legislate for a net-zero targetChina,the worlds largest emitter,commits to carbon neutrality“before 2060”National net-zero pledges now cover more than 90%of the global economyCompanyEnd target,yearScopeCarbon offsettingAnnual
226、 revenueUS123WalmartNet zero,2040$559.2bn123AmazonNet zero,2040$280.5bn123AppleCarbon neutral,2030$260.2bn123CVS HealthNet zero,2050$268.7bn123Exxon MobilNet zero,2050$256.0bn123UnitedHealth GroupNet zero,2035$246.3bn123AlphabetNet zero,2030$166.3bnBerkshire HathawayOther*$254.6bn321EUCompanyEnd tar
227、get,yearScopeCarbon offsettingAnnual revenue2312312312VolkswagenCarbon neutral,2050$252.0bnShellNet zero,2050$421.1bnDaimler AGCarbon neutral,2039$193.0bnEXOR GroupNo target$160.9bnAllianzNet zero,2050$122.4bnAXANet zero,2050$150.0bnTotalEnergiesCarbon neutral,2050$176.2bnDeutsche Telekom
228、Climate neutral,2040$90.1bnA SHARED ENDEAVOUR?Published emissions targets from the worlds largest companies(by annual revenue,US$)YesNoPartialNot specifiedScope 1All emissions under an organisations direct control,including from fuel used in manufacturing or fleet vehiclesScope 2Indirect emissions f
229、rom electricity purchased and used by the organisationScope 3All other indirect emissions from sources not owned or controlled by the organisation,including emissions both up and down the supply chain*Berkshire Hathaway:striving to achieve net zero*Samsung Electronics:planned to use 100%renewable en
230、ergy by 2020 and claims to have achieved this*Teva Pharmaceutical:emissions reduction target-a 33%reduction versus 2017 baseline by 2030CompanyEnd target,yearScopeCarbon offsettingAnnual revenue123123MIDDLE EAST2132132Saudi AramcoNet zero,2050$329.8bnSaudi Basic IndustriesNo target$37.3bn
231、Teva PharmaceuticalEmissions reduction*$17.4bnSaudi ElectricityNo target$17.3bnQatar National BankNo target$15.9bnSaudi TelecomNo target$14.6bnEtisalatNo target$14.2bnEmirates NBDNo target$10.7bnCompanyEnd target,yearScopeCarbon offsettingAnnual revenue3123123123UK132BPNet zero,2050$271.6
232、bnHSBCNet zero,2050$67.2bnPrudentialNet zero,2050$67.2bnLegal&GeneralNet zero,2050$85.2bnAvivaNet zero,2040$89.5bnTescoNet zero,2050$82.7bnLloyds Banking GroupNet zero,2030$64.3bnUnileverNet zero,2039$58.2bnCompanyEnd target,yearScopeCarbon offsettingAnnual revenue121212ASIA-PACIFIC33333322221111321
233、SinopecCarbon neutral,2050$369.2bnPetroChina CoZero carbon,2050$364.1bnToyota MotorZero emissions,2050$280.5bnChina State ConstructionNo target$203.0bn3Samsung ElectronicsOther*$197.6bnICBCNo target$177.2bnHon Hai PrecisionNo target$172.8bnChina Construction BankNo target$162.1bn321Net Zero Tracker.
234、Energy and Climate Intelligence Unit,Data-Driven EnviroLab,NewClimate Institute,Oxford Net Zero,2022R A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S1514Commercial featureince it was founded in 1977,Recycling Lives has evolved into a pioneering circular economy business with social sus-tai
235、nability and the environment at the heart of its operations,winning support from customers,the indus-try and beyond.CEO Gerry Marshall says,“The business model has evolved par-ticularly in recent years,to deliver commercially as well as on a social value and environmental innova-tion basis.What sets
236、 Recycling Lives apart is were able to deliver fundamental progress to help move the recycling sector forwards in terms of environmental innovation and positive social impact when it comes to the people we help.“For us,the bottom line isnt just financial.Its important that our commitment to the envi
237、ronment and to social value is fully embedded into everything we do its something our customers,employees and suppliers are all fully bought into.”Whats the Recycling Lives goal?Doing good while we do busi-ness is the crux.We are lead-ing the charge when it comes to the circular economy and were wor
238、king hard to keep improving the level of sustainability across every aspect of our work and operations,making these as energy efficient as possible.Our goal is to drastically reduce land-fill as we move towards net zero.Tell us how Recycling Lives operates.We have four business units vehicle process
239、ing,metal processing,producer responsibility compliance and environmental ser-vices,which is also known as total waste management.We are the UKs largest vehicle pro-cessor,responsibly recycling more than 150,000 cars and generating around 500,000 tonnes of high-qual-ity recyclable green steel annual
240、ly.Recycling Lives is working towards generating energy to run site oper-ations,creating green hydrogen to power emission-free vehicles,and retasking batteries from end-of-life electric vehicles(EV)to be reused for energy storage.How many vehicles are recycled?Annually,around 2 million end-of-life v
241、ehicles(ELV)are produced in the UK.We recycle the parts we can and the remai-ning automotive shredder residue(ASR)amounts to about 25%of ELV mass left.Of this,we currently recover 20%,leaving 5%which goes to landfill.This 5%is now being addressed through Recycling Lives ground-breaking energy-from-w
242、aste solution to significantly reduce the amount of landfill.Do you help individuals and companies to scrap cars responsibly?Yes we have Scrap Car Network,which is part of the Recycling Lives Group,an online nationwide community of recyclers who offer people and businesses competitive prices for scr
243、apping their car responsibly.If we can,we repurpose the parts for reuse,giving them a second life,but if this is not possible,we recycle them.And what about EVs?The sale of electric vehicles and their subsequent end-of-life will increase the opportu-nities for us to ensure vehicles are disposed of a
244、nd recycled in the optimal way.For illustrative pur-poses,if 8%growth was assumed for new sales,and calculating historical attrition rates,there could be 75,000 to 100,000 end-of-life-state EV batteries for recycling,not including manufacturing rejects or other sources.Is there scope to reuse EV bat
245、teries?Yes.And with the UK govern-ment targeting net zero by 2050,we are poised to ensure that EV batteries have a second life.For instance,they can be used as bat-tery energy storage systems(BESS)in commercial,domestic and vehicle charging scenarios.The Government estimates technologies such as bat
246、-tery storage systems could save the UK energy system up to 40bn by 2050.Currently there are no com-mercialised UK-based recycling facil-ities to process spent batteries,but we are investing in this as a priority.Recycling for the futureQ&AGerry Marshall,CEO,Recycling Lives,explains how the companys
247、 pioneering circular-economy approach is giving waste a second lifeThe bottom line isnt just financial.Its important that our commitment to the environment and to social value is fully embedded into everything we doThe government estimates technologies such as battery storage systems could save the
248、UK energy system up toby 205040bnDo you recycle electric and electronic items?Yes,recycling is crucial to helping businesses meet their legal obli-gations around the disposal of electri-cal and electronic equipment(WEEE)and avoid the potentially hazardous components going to landfill.Recycling Lives
249、 offers clients total compliance so they meet producer responsibility obligations and also have access to the appropriate facilities.Mixed electrical and electronic waste is shredded the process uses magnetic separation,air blowers and screening for materials such as ferrous and non-ferrous metals,w
250、ires,plastics,rubber and glass.This reduces landfill waste and generates recyclable metals,recyclable plastics and rubber.How does Recycling Lives help the community?We support ex-offenders,long-term unemployed and those people in vulnerable groups through training and work placements.Providing the
251、support to help integration back into society and establish self-suffi-ciency means were helping to reduce their risk of reoffending.The national average reoffending rate in the UK is about 60%,whilst the reoffending rate at Recycling Lives is under 5%.Whats Recycling Lives like as a workplace?Its a
252、 really positive and sup-portive environment.We invest heavily in welfare,training and diversity.This year,we launchedThe Terry Jackson Academy,named after the companys founder,which pro-vides desk-based tuition,remote learning,hands-on demonstrations and virtual reality experiences.It was created t
253、o induct new employees,upskill and develop existing staff and support young people in schools,col-leges and disadvantaged groups.For more information please visit S Vehicle recycling process On arrival,vehicles are inspected before proceeding to the depollution process.There,the potential pollutants
254、 are drained,and hazardous materials,such as fuel,brake fluid,engine oil,washer fluids,wheels and batteries are removed.Next,engines are removed and the vehicles are processed through a fragmentiser,which separates ferrous and non-ferrous metals from other materials.The waste is known as automotive
255、shredder residue(ASR).Some engines can be reused,but non-functioning engines are recycled.Other car parts that can be reused include gearboxes,mirrors,tyres,lights and side panels.The remaining materials(seats,carpets,plastics,glass)are subjected to separation and extraction technologies to remove r
256、ecyclable components.Ferrous metal is shredded and cleaned to become quality green steel,ready to be used in another guise in its next life.Non-ferrous metals(zorba)are also made ready for their next use.Recycling Lives energy-from-waste solution will reduce the amount of ASR that goes to landfill b
257、y diverting clean and graded material through thermal treatment technologies to generate energy.Advanced thermal decomposition converts ASR waste into energy,generating by-products char being used to create green hydrogen,residual char may be applied as a soil modifier and ash as construction-sector
258、 aggregate.National Grid,2022Support for climate resolutions at energy companies and investment managers alike has slipped,as ESG faces criticism from both political groups and concerned corporatesIn the former category,As You Sow won majority support this year for a novel proposal asking insurance
259、giant Chubb to report on its plans to measure,disclose and reduce the greenhouse gas emissions associat-ed with its underwriting activities.The aim is to make the insurance in-dustry more accountable for its role in financing fossil fuel projects.But Behar says he expects share-holder resolutions to
260、 focus on direct action after the adoption of a pro-posed US SEC rule that would re-quire companies to provide detailed reporting on climate-related risks,emissions and net-zero transition plans.Under the new rule,large com-panies must disclose that informa-tion starting in the 2023 fiscal year.Even
261、 more than stricter demands,others attribute softer support for climate proposals in order to push back against ESG investing more broadly.Conservative-leaning in-vestors such as Peter Thiel,business figures like Elon Musk and the Re-publican party in the US have lately taken aim at ESG as irrespons
262、ible“woke capitalism”.“I would not underestimate the im-pact that the anti-ESG backlash is having on some investors,”says Tom Powdrill,head of stewardship at Lon-don-based proxy adviser Pensions&Investment Research Consultants.“There is significant political and corporate pressure.”Despite its pullb
263、ack on climate proposals this year,BlackRock has come under attack by conservative groups and politicians as a leading proponent of ESG investing.Accord-ing to an Axios report,Republicans plan to haul in the CEOs of invest-ment firms such as BlackRock before Congressional committees if they retake p
264、ower in January.For his part,Van Baal has no plans to change strategy in the wake of the ESG backlash or soaring oil industry profits.That means continuing to push for reductions in emissions aligned with the Paris accord and building on the minority of share-holders its proposals have attracted.“To
265、gether with these investors,we must convince a majority of investors that big oil will not change unless they use the power they have,the power of the vote,”he says.But only nine won majority approv-al versus 11 last year,while the aver-age voting support fell to 33.4%from 49.9%.(The firms analysis
266、was based on data compiled by proxy adviser Institutional Share-holder Services.)The upwelling of shareholder support for environmental issues last year was highlighted by activist investor Engine No.1 succeeding in having three new directors voted onto the board of ExxonMobil Corp for climate-relat
267、ed reasons.But that remains a high point after the weakening of shareholder support this year.Mark van Baal,founder of Dutch environmental advocacy group Follow This,re-cently even described 2022 as a“lost year”fighting climate change as the major oil companies can claim greater shareholder support
268、in the proxy wars.Indeed,its hard to ignore the im-pact that record profits this year at oil giants such as BP,Exxon,Shell and Chevron may have had in softening investor sentiment on climate demands.“These proposals are about the long-term horizon but proxy voting is affected by cur-rent realities,”
269、says Heidi Welsh,executive director of the non-profit limate-related initiatives were front and centre dur-ing the 2022 proxy season,but shareholder support dwindled from last year amid a booming oil market and a broader backlash against environmental,social and governance(ESG)principles.The number
270、of environmental(in-cluding climate)proposals filed at companies listed in the S&P 500 and Russell 3000 this year surged 69%from 81 to 137 through July,according to the Conference Board,a non-profit business research group(based on data from Esgauge).But overall voting sup-port for environmental pro
271、posals slipped to 34%from 38%.A separate analysis of shareholder voting by US-based multinational law firm Gibson Dunn in July found climate change proposals alone jumped 57%to 130 from 83 last year.Eric McGregor via GettyMark WalshSustainable Investments Institute in Washington DC,which tracks ESG-
272、related proposals and voting.The oil supply shock following Russias invasion of Ukraine has put the focus back on fossil-fuel produc-tion.“Potential natural gas shortag-es in Europe and possibly higher oil prices have shifted priorities to securing supply while weaning the EU off Russian hydrocarbon
273、s from addressing climate change,”wrote S&P Global energy analyst Simon Redmond in a mid-year report.At the same time,asset manage-ment giants like BlackRock and Van-guard rejected climate proposals they deemed overly prescriptive.BlackRock reported voting in favour of 27%of environmental and social
274、 resolutions in 2022,down from 43%last year,“as many climate-related shareholder proposals sought to dic-tate the pace of companies energy transition plans despite continued consumer demand.”That put the firm at odds with activists like Follow This,which in-troduced several proposals calling for oil
275、 companies to reduce emis-sions in line with the goal of the Paris agreement to limit global warming to 1.5 degrees Celsius above preindustrial levels.At Shell,for example,that initia-tive drew support from 20%of share-holders,down from 30%last year,while winning just 15%at BP,down from 21%in 2021.U
276、ntil this year,support had been increasing for the measure at both companies since Follow This first filed it in 2016.Proposals that set more stringent targets on greenhouse gas emissions or reaching net zero are naturally going to be a harder sell than those which only ask companies for re-porting
277、or disclosure,according to proxy experts.Tougher requests could include that companies adopt policies which align with the Inter-national Energy Agencys net xero emissions by 2050 scenario.“Disclosure resolutions are get-ting the same level of support,”says Andrew Behar,CEO of envi-ron-mental and so
278、cial advocacy non-profit As You Sow.“But its the newer resolutions which are a little more granular that are chal-lenging the status quo.”Investors turn down the heat on big oil Climate proposals are about the long-term horizon but proxy voting is affected by current realitiesPiggy in the middle:Bla
279、ckRock rejected climate proposals but is still viewed as pro ESG by some Proxy Preview,2022S H A R E H O L D E R A C T I V I S MCTHE 2022 PROXY SEASONBreakdown of shareholder resolutions filed with the SEC by type in 2022Climate changeCorporate political influenceHuman rightsDecent workDiversity at
280、workOther environmentBoard oversight/diversityHealthConservativeSustainability21%19%15%12%9%6%5%5%5%3%R A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S1716he energy crisis squeezing business and consumer finances today is not with-out precedent.As Russia continues to use its gas supplies a
281、s a weapon in its war with Ukraine and,in turn,the West,commentators have com-pared todays situation with the energy crisis of the 1970s.Back then,a political conflict de-liberately disrupted supply chains and caused surging energy prices.The recession that stemmed from this disruption differed from
282、 its predecessors by simultaneously causing high inflation and high unemployment a phenomenon known as stagflation.The Bank of England has made it clear it will do everything it can to stop inflation and stagflation from taking hold in the UK econo-my.But unfortunately for business-es,the solutions
283、to stemming the rise of inflation threaten to tip the UK into a recession.After the biggest interest rate rise in 27 years,the Bank of England warned in August that the UK will fall into a recession later this year.This downturn is forecast to last until the end of 2023,with econom-ic growth expecte
284、d to grind to a halt next year.But if there is a silver lining to the current energy crisis,its the increas-ing demand from businesses for clean and renewable energy supplies.The combination of high costs as-sociated with non-renewables and longstanding concerns about the environmental impact of fos
285、sil fuels has reframed renewables as a more economical and reliable source of energy than dirtier alternatives.The first half of 2022 saw a record investment globally in renewable own green energy onsite.Research by NatWest Group found that 7%of SMEs have already started to invest in onsite green en
286、ergy generation,with most of this investment going to battery storage and installing solar panels.This figure is predicted to double next year,meaning that by 2023 around one in six SMEs(17%)will generate and store their own green energy onsite.The push towards onsite green en-ergy generation from S
287、MEs is time-ly,given the disruption in the energy market.British Gas is re-portedly planning to stop selling energy to its biggest business cus-tomers.And in March,Scottish Power announced plans to stop supplying its British industrial and commercial customers.Williams says the decisions taken by Br
288、itish Gas and Scottish Power are typical of an energy market that lacks both“independence”and“forward thinking”.He says:“Businesses need to be-come more energy independent.Gaining this independence is a great way to keep energy costs low.Making your building more energy-efficient is the first step,s
289、o insulate it and get your onsite renewables to cover your heat and power needs.Energy efficiency is incredibly effective at bringing down demand because the cheapest energy youll ever use is the energy that you dont use.”Nigel Pocklington is CEO at Good Energy and agrees with this view.He observes
290、that,despite the re-quirement for a significant initial outlay,switching to onsite green energy generation is a win-win for businesses because it not only re-duces energy costs but it also sig-nals a commitment to the climate that customers can easily see.“Businesses were already shifting towards re
291、newables because thats increasingly what their customers expect.The UK market is such that the cost benefits of renewables are difficult for businesses to access unless they invest in generating their own clean power,because en-ergy prices continue to be set by gas.But what is positive is that this
292、has not diminished interest from busi-nesses in switching to renewables.”But for many businesses,finding the investment to make onsite green energy generation viable is not pos-sible in todays economic climate.The cost-of-living crisis that is now evident,occurring together with the drop in househol
293、d dispos-able income are impacting busi-nesses just at a time when they are also grappling with supply chain issues and high inflation.Corporate insolvencies in England and Wales rose by more than 80%in Q2 compared to a year earlier,while the number of firms opting for liquida-tion reached the highe
294、st level for at least six decades.High energy costs appear to be driving this trend,with 77%of business leaders reporting that energy prices are the biggest chal-lenge that their company must tackle,according to recent research by Npower Business Solutions.“There is,rightly,a national con-versation
295、happening about the economic and wellbeing hardship on people right now,with less about the pressure on businesses,”says Pocklington.“There will be more insolvency,uncertainty and increased prices across the economy unless there is significant government interven-tion to tackle rising energy costs f
296、or both people and businesses.”The governments role in alleviat-ing the energy crisis and incentivis-ing widespread renewable adoption among businesses has been under the spotlight again,following the passing of the Inflation Reduction Bill in August.This long-awaited legislation is a significant vi
297、ctory for the renewables sector,with$369bn going towards encourag-ing the production of renewable electricity plants.Williams believes that action on a similar scale is needed in the UK to ensure that the businesses which have switched to renewables during the energy crisis do not return to fossil f
298、uels,once the prices have normalised.“Its frustrating when you consider that roughly$11m per minute is going towards subsidising fossil fuels.The switch to renewable green energy wont happen quickly enough unless businesses realise the cost of fossil fuels unsubsidised and we divert the money used t
299、o subsidise fossil fuels to create clean-er grids,cleaner infrastructure and facilitate the energy transition.”But according to Rhianna Wilsher,director and clean energy lawyer at Freeths,the UK governments focus on tackling the cost-of-living crisis for consumers may limit the support offered to bu
300、sinesses.“The pinch that the government finds it-self in is that introducing financial incentives or tax cuts to support de-velopment or rollout of renewable technologies has previously been funded by an increase in green levies on consumers energy bills,”she says.“The need to reduce energy bills to
301、 ease the cost of living is consid-ered by many to be a priority over the imposition of green levies.So,its currently being used as a politi-cal football.This may result in holding back the governments in-vestment in renewables,over the need to ease the cost of living.”Jonathan EvansUnless businesse
302、s realise the cost of fossil fuels unsubsidised,the switch to renewable green energy is not going to happen quickly enoughMaking your building more energy-efficient is the first step,so insulate it and get your onsite renewables to cover your heat and power needsANNUAL GROWTH RATE IN CLEAN ENERGY IN
303、VESTMENTS WORLDWIDEenergy,which reached$226bn(191bn).Solar and wind were the most popular choices,according to BloombergNEF.Christophe Williams is the co-founder and CEO of Naked Ener-gy.He does not believe the energy crisis will be an immediate catalyst for widespread renewable adoption,pointing to
304、 our recent history with fossil fuels as proof that our energy habits are hard to shake.“Covid showed us that after lockdown and when economies wanted to reboot,the first thing they did was burn fossil fuels.Its low risk.Investors love it because its a very steady return.Its a safe investment.”Willi
305、ams notes that the ongoing energy crisis creates an opportunity for companies to protect themselves from future price shocks.He says firms that switch long-term to clean energy now will be far better placed to weather future economic uncertainty and primed for the next big energy challenge currently
306、 facing businesses:net zero.One option that some businesses are pursuing is to generate their The ongoing energy crisis is pushing more businesses towards using renewables.But is this a long-term trend?Or will the shift towards renewables abate once the energy crisis is over?The switch-on to renewab
307、lesR E N E WA B L E E N E R GYT200520007200062000820%BloombergNEF,2022Commercial featureorporate transparency regard-ing sustainability levels and activities is a cornerstone of the European Green Deal,which pro-vides policy measures inten
308、ded to help make Europe the first climate-neutral continent by 2050.Whats more,the EUs sustainable finance initiative supports the Green Deal by helping to channel private investment towards a transition to a climate-neutral economy.(The UKs Green Finance Strategy operates on a similar model.)EU sus
309、tainability reportingThe EU Taxonomy for sustainable activ-ities is supporting this transition by providing transparency regarding the economic(business)activities which contribute most to meeting the EUs environmental objectives.By clas-sifying environmentally sustainable actions,the EU Taxonomy is
310、 designed to improve sustainable investment,create security for investors and moti-vate companies to be more sustainable.Companies based in Europe,or those operating a European legal entity with more than 500 employees,are now required to disclose sustainability risks and opportunities.How to achiev
311、e sustainability and profitabilityIs your business ready for the new EU Taxonomy corporate mandates?The Taxonomy also supports the upcoming Corporate Sustainability Reporting Directive(CSRD),which is the first common reporting frame-work from the European Commission focused on non-financial ESG data
312、.More than 50,000 companies must submit their report aligning with the CSRD on 1 January 2024,for the 2023 financial year.Business support for environmental objectivesMore broadly,reporting demonstrates how a companys actions are contrib-uting towards the EUs six environ-mental objectives.Companies
313、should be aiming to contribute to at least one of these,while not harming any other objectives and also meeting minimum social safeguards.Many manufactur-ers are well positioned to contribute substantially to advancing the follow-ing two objectives:climate change mitigation and the transition to a c
314、ir-cular economy.Product design and manufacturing are the linchpins of successful sustain-ability efforts,as companies determine more than 80%of a products envi-ronmental impact and cost during the design phase.Measuring manufacturing emissionsOn emissions,you cant manage what you cant measure,so ma
315、ny manufac-turers are adopting the Greenhouse Gas Protocols Corporate Value Chain Standard(Scope 3)to measure their carbon emissions throughout the supply chain.Once there is a baseline for a prod-ucts current carbon footprint,one other option is for manufacturers to work to reduce CO2 emissions and
316、 meet their other product requirements simultaneously.Teams can make deci-sions by evaluating trade-offs among cost,sustainability,and manufactura-bility.Some product brands are already using aPrioris Manufacturing Insights Platform to:Identify alternative materials to reduce CO2 emissions and weigh
317、t,etc.Select alternative manufacturing processes to save electricity and reduce scrap,etc.Update product designs to cut man-ufacturing times and incorporate alternative materials,etc.The key to sustainable product developmentCompanies are increasingly using dig-ital transformation(DX)capabilities to
318、 incorporate sustainability insights into their strategic planning and manufac-turing operations.With a unified view of the product development and man-ufacturing process,businesses can understand a products CO2 impact during the early design phases,and then evaluate opportunities to reduce a produc
319、ts carbon footprint.Product design and production teams can simulate design alternatives using dif-ferent materials and manufacturing processes to meet key targets on CO2 emissions,cost and performance.Manufacturers with the insights to evaluate cost,sustainability and manu-facturability are well po
320、sitioned to capi-talise on the market demand for“green”products at an attractive price point.Companies can use the EU Taxonomy to differentiate themselves as sustain-able manufacturers and clearly com-municate this advantage to customers,investors and other stakeholders.For more information please C
321、Companies can use the EU Taxonomy to differentiate themselves as sustainable manufacturersR A C O N T E U R.N E TS U S TA I N A B L E B U S I N E S S1918Environmental pledges abound.But wheres the social action?Jamie Coats,co-founder and CEO of Wise Responder,outlines a new tool kit that allows busi
322、nesses to show they are rooting out poverty in their workforceusinesses know they need to be purpose-led to reflect the environmental and so-cial values their customers and in-vestors hold dear.This means theyre now starting to move beyond net-zero pledges to providing assur-ance that their goods an
323、d services are provided through a workforce that is treated well.Nevertheless,the gap between en-vironmental and social action is huge.Even though ending poverty is the first priority for the United Na-tions Sustainable Development agenda for 2030,more than half(53%)of FTSE 100 companies failed to m
324、ention the word poverty in their“Our data shows that across Cen-tral America and some parts of Latin America,the average rate of multidimensional poverty for companies in the agricultural and beverage industries is around a third of their employees.So,a sig-nificant amount of the population is strug
325、gling,and that impacts their business.”By addressing the issue and estab-lishing where a business can im-prove its workers situation,Coats reveals companies can show they care,and that has a significant im-pact on brand image,as well as em-ployee morale.“Everybodys talking about pur-pose.Weve seen t
326、hat when compa-nies help individuals,that creates an esprit in the business by showing it has an authentic purpose,”he says.“Employees show a lot of grati-tude when companies take action.Thats very good for loyalty.”The data from Wise Responder not only shows areas where multidi-mensional poverty ha
327、s been record-ed but also highlights areas where the business may be able to help.For example,debt problems can poten-tially be dealt with through finan-cial advice,and access to healthcare could be improved through compa-ny-wide health insurance schemes.There are,inevitably,areas where a company ca
328、nnot make an impact on its own.For these larger projects,such as improving schools and sanitation,companies can work in partnership with one another,as well as with local governments and non-governmental organisations(NGOs).Although it is early days,there are already signs that this can work well wh
329、en all parties share the same data.“We have a partner in Costa Rica,called Horizonte Positivo,which is a business-led coalition of 70 compa-nies with approximately 300,000 employees,”says Coats.“They discovered that between them they employ just under 10%of the multidimensionally poor people who liv
330、e in Costa Rica.They have now launched thousands of actions,whether thats looking at providing education,health care,help with re-financing debt,or home improve-ments.That coalition of companies is now also working with a set of NGOs that can help supply and sup-port those issues.”This not only impr
331、oves worker con-ditions but is also proving to be a way of showing investors that a business takes identifying and dealing with poverty in its workforce seriously.“There are now trillions of dollars that are targeted to ESG but there are just too few quality vehicles to take those funds and then rep
332、ort back on change,”says Coats.“The financial markets are saying,if you can come to us with data,we will have a better conversation about capital allocation.That means investing in social data,alongside environmental data,gives a business something they can liter-ally take to the bank.“Citigroup,for
333、 instance,has made a$500bn commitment to under-write sustainable loans based on social indicators.One of the chal-lenges around all this is that there are no standards in social data.Weve seen environmental data get a lot better but social data has fallen behind.”Ultimately,Coats believes social indicators for poverty will begin to catch up with those for environmen-tal impact,so businesses will b