Designate a driver. Economic sustainability encompasses financial costs and benefits. Plastic bags and Styrofoam containers can take up to thousands of years to decompose leading to marine animal death and the contamination of soil and water. Climate change is defined as “a change of climate that is attributed directly or indirectly to human activity, that alters the composition of the global atmosphere, and that is in addition to natural climate variability over a comparable time period.”. BIOEAST. Graduate 70% of the world is covered by water, yet only 2.5% of it is fresh and only 1% of it is easily accessible for human use. The group was cognizant of antitrust guidelines and avoided discussion of topics such as pricing, costs, and business and marketing plans. It is now possible to collect accurate-enough data to assign true costs to goods sold. The creators of the index began by looking at the entire set of the Fortune 500 and then stripped out the 250 that fell in the lower half on sustainability performance. The first trend contributing to Sustainability 3.0 is the recent progress on quantifying ecosystem services— that is, measuring, in dollar terms, the value of the myriad beneficial services that natural environments perform. Sustainable resource use requires that environmental, social and economic sustainability be demonstrated; this holds true for so-called ‘green’ or renewable technologies, including bioenergy. Smart money will flow to the ends of the earth in a quest to “go long” on profitable value chains with the lowest all-in cost to the planet, whereas value chains with high true costs will increasingly be viewed with greater concern, and will be subject to lower ratings and higher costs of capital. As the rise of mutual funds turned average citizens into investors, niche funds were established to provide assurance to the socially minded that their money was not supporting business activities they found objectionable. He is co-author of Harvard Business Review’s “. Even harder if its decisions come back to bite it in a massive lawsuit, which is far more likely in an age of rising awareness and activism. Sustainable economic activity At Sigel, sustainable economic activity means giving equal weight to all elements of the sustainability principle for all corporate decisions. Plant-rich diets reduce emissions and tend to be healthier, leading to lower rates of chronic disease. First, investors will benefit as the “brand view” afforded by a VCI gives them a means of comparing the sustainability performance of publicly traded companies. 28. Solutions to one problem must be solutions for all.” – Ban Ki-Moon. BBI JU connects key biobased sectors to ultimately create a sustainable and competitive biobased economy in Europe. Because sustainability cuts across industries and sectors of the U.S. economy, defining just what contributes to the green economy … As the tool has taken shape, its potential has become clear; in particular, the design of the tool to provide three distinct views of performance—at the brand level, the factory level, and the individual product level—means that decisions at all levels can now be informed by sustainability considerations. The Sustainable Apparel Coalition (SAC) built on existing efforts in the industry, creating a version 1.0 index that was a “mashup” of an earlier tool created by the Outdoor Industry Association and Nike’s Considered Index. Agricultural Emissions could be reduced by as much as 70% by adopting a vegan diet and 63% by adopting a vegetarian diet. Already, there are laws on the books that advance the effort to internalize externalized costs. Perhaps few would actually do so, but the availability of the data would only add to the credibility of the rating. A value chain index (VCI) provides a way to make apples-­to-apples comparisons of products on the basis of the impacts that accrue to them at each phase of their journey from raw material to consumed, discarded good. Another positive development is the Good Guide Rating, applied to 100,000 products in 600 categories by specialist teams of chemists, toxicologists, environmental life-cycle assessment experts, and nutritionists. Copyright © 2020 Harvard Business School Publishing. The UK’s Climate Change Act, passed in 2008, creates a legally binding framework for greenhouse gas reductions of 24% by 2020 and 80% by 2050, against a 1990 baseline. The Ariel Fund, for example, screens for environmental impact, tobacco, weapons, nuclear energy, and lack of diversity. INDIVIDUALS IMPACT OUR ENVIRONMENT . California AB 32, passed in 2006, requires a statewide 25% reduction of greenhouse gas emissions by 2020 against a 1990 baseline. To appreciate how these three views mitigate impacts, imagine the CEO of a casual-apparel maker in a meeting with the head merchant of the company’s largest customer. Even those concerned about only business and not the fate of the planet recognize that the viability of business itself depends on the resources of healthy ecosystems—fresh water, clean air, robust biodiversity, productive land—and on the stability of just societies. 18. Growth and a sustainable economy, how does this go together? Value chain indices address that confusion with a single, much simpler and more effective standard for an industry. Will they be of interest to equity fund managers? Sustained and inclusive economic growth can drive progress, create decent jobs for all and improve living standards. The researchers are frank: “Current economic models are deeply inadequate in capturing the opportunities of such a transformational shift, or the grave dangers of climate inaction,” they write. Perhaps the biggest conflict seen regarding sustainable development is economic in nature. Headquarters - Rue Mauverney, 28 Capital costs represent expenses incurred when setting up the process. 20. Even if we only want things to stay the same, practices must change. Accreditations & Rankings But by the end of 2012, a version 2.0 tool will use quantitative life-cycle assessment data to create its weighted ratings. That's more than one person uses in two weeks. 13. That means it’s generally cheaper for consumers to buy a product that has a worse impact on the environment than the equivalent product that does less harm. Even as purely qualitative concerns, they have quantitative consequences; managing for greater sustainability can generate cost savings, but it can also identify and eliminate risks, create positive associations with a brand, and help to establish the kind of reputation that attracts talent. (2) Socially responsible investing has matured beyond negative screening to become a value-seeking discipline generating positive impetus for change. Examples include an initiative to achieve zero emissions by a PepsiCo Frito-Lay potato chip factory in Arizona; an IBM facility’s success in cutting annual energy and water use by $3 million even as it increased output by 33%; a project at General Mills to help broccoli farmers switch from furrow irrigation to a drip method requiring half the water, saving nearly 1.2 billion gallons a year; and operational changes at retailer The Gap that saved suppliers’ employees from excessive overtime hours. Regimes like “cap and dividend”—which proposes to tax carbon suppliers, raise the price of energy-intensive products and services, and then rebate all those costs back to consumers— would surely drive rapid market-based innovation. Agriculture is the biggest user of water worldwide, and irrigation now claims close to 70 percent of all freshwater for human use. In economic terms, to be truly sustainable, the overall demand for natural resources (also known as ecological footprint) must be less than the nature’s renewable supply of resources (also known as biocapacity). In that scenario, consumers’ bargain hunting would align perfectly with business practices that sustain a healthy and just world, and powerful market forces would be put in the service of sustainability’s goals. Switching to LEDs will use 90% less energy and last far longer than with the use of incandescent lights. The concept of circular economy looks beyond societies’ current take-make-dispose model to create a more restorative economy which designs out waste, keeps products and materials in use for as long as possible and regenerates natural systems. The Sustainable Apparel Coalition, a group we are closely involved in, was launched two years ago, when Patagonia asked Walmart to get behind an effort to create a value chain index for our industry. A sophisticated fund manager, accessing the same VCI tool as our blouse designer, would spot—perhaps faster than the designer would—the fact that her firm’s cotton order is more likely to go to India than China. Benefit-cost analysis of public policy 2. If people worldwide switched to energy efficient light bulbs the world would save 105 billion euros annually. We must connect the dots between climate change, water scarcity, energy shortages, global health, food security and women’s empowerment. Recycling one ton of paper saves 2584l of oil, 26498l of water and 2.5 cubic meters of landfill space. To reach its goal of 100% of its solid wood meeting its standards for sustainable logging, it will need to work with additional “preferred sources” that have their own certifications. Until recently, SRI generally focused on screening out the negative aspects of a given company or a sector. And Grenelle II, a French law, is already requiring certain consumer products to carry labels that disclose total GHG emissions and two other environmental impacts associated with the product. For the French government, with its law already on the books, that would be a godsend; the coalition currently is inviting the French government to participate in the development of its index. Sustainable development can be defined as an approach to the economic development of a country without compromising the quality of the environment for future generations. Sustainable economic growth is economic development that attempts to satisfy the needs of humans but in a manner that sustains natural resources and the environment for future generations. The world’s indigenous population makes up just 5% of the global population yet protects 80% of global biodiversity. The production of plastic is largely reliant on fossil hydrocarbons, which are non-renewable resources which contribute to climate change. In 2016 many world leaders adopted the United Nation’s 17 global goals/Sustainable Development Goals to improve life all around the world and preserve the earth’s resources and fight climate change. Like most holy grails, sustainability as a firm’s most dependable route to financial high performance has seemed a goal always beyond reach. As valuations and impacts become more measurable and auditable, basements full of quants at J.P. Morgan Chase will get busy working on related instruments. Less economic harm caused by increased weather-related damage Sustainable finance makes sustainability considerations part of financial decision-making. And yet collectively we have not been making progress on reducing the damage business does to the world. Currently Ikea uses FSC-certified wood in 24% of its solid wood products. Inclusive and sustainable economic growth can drive progress and generate the means to implement the Sustainable Development Goals. Viele übersetzte Beispielsätze mit "sustainable facts" – Deutsch-Englisch Wörterbuch und Suchmaschine für Millionen von Deutsch-Übersetzungen. The 2020 edition of the Sustainable Energy in America Factbook – produced for the Business Council for Sustainable … Organizations like WITNESS enable ordinary citizens with mobile devices to capture images of negative impacts and add them to a growing pile of evidence. Translated from the German by Christine Kuhn and Luzie Schmitt. Our professional services include: 1. A VCI uses such data to set realistic parameters within each category and provides a basis for weighing categories against one another to give priority to impacts deemed to have the most negative consequences. For this system to … Whenever nonfinancial considerations are taken into account, fewer companies are left in the mix and some financial high performers are specifically excluded. A growing number of companies in Ger­many are already making a commitment to society as part of conducting sustainable business. Real change will come as high-level calculations filter down to individual companies’ bookkeeping. Keep in mind that when only the economic aspects of something are considered, it may not … The speed with which this group has aligned itself and moved forward has frankly been astounding. Sustainable Consumption and Production (SCP) Action Plan. Sustainability will simply be how business is done. The term sustainability has its most known roots in the 1987 Brundtland Report which officially defined sustainable development for the first time. It’s hard to imagine that the savvy fund manager in possession of that insight would not act on it: The obvious move would be to invest in companies involved in sustainable cotton production and processing in India. When inputs and outputs can be stated in like terms (which is to say, dollar terms), optimal solutions can be found. Agriculture is the … 11. Even without such alignment (and notwithstanding the failure of the Copenhagen climate conference) we are seeing interesting legislation proposed. 21. We see many signs of gathering will, too: The trends outlined here are being driven in large part by passionate businesspeople. The two code-named their partnership David and Goliath. 8. That evolved into a more strategic stance—let’s call it Sustainability 2.0. 9. When organic matter is landfilled it decomposes and produces gas methane which is up to 34 times more powerful than carbon dioxide over a century, thus contributing to climate change. Managers of such funds employed negative screens, filtering out “sin stocks” like the purveyors of tobacco, alcohol, gambling, and pornography and later companies with black marks on their labor or human rights reputations. The initial phase of the law is experimental yet involves 1,000 products made or traded by 168 companies. And as for Sustainability 4.0? In essence, this is a focus on the economics of sustainable development. Broadly speaking, the global economy has a neoliberal bent to it. Achieving economic growth and sustainable development requires that we urgently reduce our ecological footprint by changing the way we produce and consume goods and resources. Outcome 3: Trillion dollar markets open up. Here are 30 facts about sustainability to help connect the dots: 1. A company that resolves to go beyond what local law requires—by paying employees a living wage, for example, or ensuring factories do no undue harm to river systems—is hobbled by costs that its “leaner” counterparts don’t incur. The United Nations Environment Programme estimates, for example, that one-third of global food production depends on animal and insect pollination, and the value of this service is $200 billion annually. Forward-looking corporations will have the information they need to set priorities and make decisions that reduce and mitigate their impacts. From there, it’s a short hop to the second way that fund managers will use VCIs. An era of economic growth, reduced CO2 emissions and sharply falling energy costs for consumers Over the past 10 extraordinary years, the United States has fundamentally overhauled how it produces, delivers and consumes energy. One recipient later said, “When you get a letter from Mike Duke and Yvon Chouinard, with the logos for Walmart and Patagonia side by side, it’s so bizarre that you have to read it.” The goal was to assemble a coalition of stakeholders as wide as possible without diluting the vision. . Because many of these impacts have been hard to gauge with any precision—or to assign to individual businesses with fairness—their costs have remained external to businesses’ accounting. If the entire world ate like the average American, there would not be enough water in the world to sustain the global population. Does greater transparency allow the funds to achieve higher investment returns? Define the dimensions of measurement. A dizzying array of labels has cropped up in response to companies’ desire to communicate to consumers their environmental efforts. 23. 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