A Socially Responsible Investment (SRI) is an investment that is considered socially responsible because of the nature of the business the company conducts. Essentially, when using an SRI framework, an investor not only considers a company’s financial information but also the way in which the company operates. A major trend in recent years with SRI is the sustainability and environmental impact of a company. The Forum for Sustainable and Responsible Investment’s (US SIF) Report on Sustainable and Responsible Investing Trends in the United States found that as of 2013, approximately one out of every six dollars under professional management in the U.S. was invested according to SRI strategies. This number is staggering, especially when put in the context that the United States lags behind many other nations in Socially Responsible Investment.
globalEDGE Blog - By Tag: environment
On December 1st, the SPDR S&P 500 Fossil Fuel Free ETF (SPYX) will be launched as the greener version of the SDPR S&P 500 ETF Trust (SPY). This shows an overall global trend to investing in lowering our carbon footprint. This trend could have huge implications as the world shifts to less fossil fuel based industries because it could spell trouble for companies that rely heavily on the non-renewable energy business. The new ETF (Exchange Traded Fund) breaks up the S&P 500 of companies that own fossil fuel reserves. “While that's far from totally cleaning up an index that includes several carbon-emitting companies in different industries—namely, transportation—it does remove Big Oil, one of the largest offenders.” This statement made from Bloomberg Business also shows how important this could be, as it could set off a chain of events that cause more companies to invest more heavily in renewable energy, as well as cutting off companies who are huge in the oil business.
With a new development by an engineer at Michigan State University, soon a sky scraper could generate enough energy from its windows to supply all of the energy it needs. Researcher Richard Lunt, of Michigan State University, has been able to do what many have tried in the past, making a fully transparent solar concentrator. This new technology, within the next couple of years, could change the face of solar energy and global business. This new technique could change the windows in any building or the glass face on a mobile device into a solar power harvesting application.
On Wednesday, the European Union Commission approved plans to combine the energy markets of its twenty-eight member countries into a unified energy market. The Commission stated that the EU Energy Union would provide many benefits to the countries of the EU, lessening their dependence on energy supplies from foreign countries and boosting their economic power significantly. The ambitious plan is facing some criticism, and has yet to be approved by the European Parliament as well as the EU's member countries, but it certainly has the potential for major influence on European economics.
In part 3 of our global energy blog series, we discussed which countries could capitalize on the falling oil prices. For the fourth installment of the series, we turn our eyes to some of the environmental issues surrounding the energy industry, specifically the issue of carbon emissions. As climate change fears increase and become more urgent on a global scale, world leaders have been looking for solutions to reduce harmful emissions while avoiding the economic pitfalls that can be associated with taxes or regulation. One solution gaining popularity is carbon markets, which create carbon emission allowances that are given to businesses. These credits can be used or sold depending on the amount of emissions the business produces, giving companies an incentive to reduce their emissions.
Earlier this week construction began on a canal that will link Venado on Nicaragua's Caribbean coast to Puerto Brito on the country's Pacific side. The secretive project has an estimated price tag of $50 billion, which is four times the size of Nicaragua's economy, and the government claims it would create at least 50,000 jobs for construction and 200,000 more upon completion. A rival to the Panama Canal, this channel hopes to fuel growth within the agricultural, industrial, and manufacturing industries by facilitating heavy freight transportation.
In 2013, global meat production reached its highest level at 308.5 million tons, a 1.4% increase from the prior year. Due to a number of factors such as growing purchasing power, urbanization, and changing diets, the WorldWatch Report has determined that meat production has increased more than fourfold since 1961. The report was accompanied by a press release titled “Peak Meat Production Strains Land and Water Resources”, which additionally stated that meat production has increased 25-fold in the last two centuries. Although this has positive side effects for those working in the meat industry, the implications for the environment could be detrimental.
Much of the talk surrounding biofuels in the past has centered on corn, wheat, soybeans, and sugarcane, which are known as first generation biofuels. These food crops were seen by many as a way to become more energy independent, as they could be processed to create ethanol fuel that in turn could replace our dependence on oil. The excitement of this prospect led many countries, such as the United States, to implement mandates requiring specific amounts of ethanol to be mixed with gasoline. These countries hoped that ethanol could help by lessening the impact of oil prices on the economy and by saving the environment from the increasing use of oil.
The price for a cup of coffee could rise in the coming months, as a fungus, known as coffee rust, hits the coffee crop throughout South and Central America. The fungus, which cannot be treated, has significantly affected much of the crop in several major coffee producing countries, such as Brazil, Ecuador, Columbia, and Mexico. In Guatemala, officials have estimated that an incredible 70 percent of the crop is infected, worrying farmers across the country who depend on coffee sales. The loss of such a large portion of the world’s coffee supply will force prices up, impacting people in countries around the globe, as well as many major food corporations that rely on coffee.
When one strolls into their favorite coffee shop on a typical arctic-conditions day like the ones we've been enjoying in Michigan lately, they usually see coffee beans imported from well known "coffee countries," such as Colombia, Brazil, or perhaps an African country like Ethiopia, Kenya, or a rising coffee-exporting nation like Zambia. In spite of this, reports show that Vietnam is actually the world's second largest exporter of coffee, with its share of the global market rising nearly 20% within the last 30 years. Vietnam's coffee industry, which employs 2.6 million people, produced nearly 3 billion pounds of coffee in 2012-2013. The country's coffee exports have landed primarily in Germany and the United States, but imports from other European Union countries, as well as Japan and South Korea, have also contributed to Vietnam's rapid and surprising growth in coffee exports.
This past week, the World Economic Forum (WEF) hosted its 44th Annual Meeting 2014 in Davos-Klosters, Switzerland. Every year, the WEF brings together the leaders of the world to reflect on the past year and discuss the significant global issues to focus on for the year. The list of attendees are considered the world’s most influential leaders including government officials, economists, top corporate executives, actors and activists, among other prominent figures.
Singapore opened its first “green” factory two months ago setting up a milestone for Singapore’s green industry. The news brought great attention to a broader area—Asia, and people soon realized that most manufacturers in Asia have begun to turn “green” in recent years. This is becoming a trend in Asia that cannot be held back.
Within the European Union (EU), Poland stands as the union's coal-producing giant. Although the country suffered declining production rates during the global financial crisis, Poland's coal-mining sector has shown signs of recovery. More than 88 percent of Poland's electrical needs come from coal, and the mines at Belchatow are more than eight-and-a-half miles long, two miles wide, and have been measured to be the largest carbon emitter in Europe. Poland's coal industry produces 77 million tons of coal per year, making it the world's 10th largest coal producer. Due to the importance of Poland's coal mining industry, the Polish government has been increasingly active in blocking aggressive regulations by the EU to limit climate change.
The number of tourists traveling to Beijing, China’s capital, in the first three quarters of this year has dropped by roughly 50%. The main reason cited for this drastic decrease in tourism is poor air quality. In 2010, it was reported that air pollution contributed to 1.2 million deaths in China. Additionally, China spends a staggering 6% of its annual GDP on health care costs, material damages, and premature deaths caused by air pollution. China must do something to combat this serious issue or risk losing more than just tourists.
With China’s rapid economic growth in the past decade, fortunes were made as the country experienced an economic boon. However, this fast-paced growth also had its costs. During this growth period, air pollution and traffic congestion increased dramatically in many major cities around China. Now the government and businesses alike are developing ways to solve the costly side effects of rapid economic expansion.
Chinese oil companies that have held exclusive oil-extraction privileges for nearly a decade in Western Africa are now facing resistance from governments who claim that the Chinese are "gouging, polluting, or hogging valuable tracts." In Niger, private auditors have recently uncovered large costs and impractical charges made by the China National Petroleum Corporation, which has added another argument for the revisions of trade agreements that have already saved Niger tens of millions of dollars from the Chinese. In neighboring Chad, the government recently shut down Chinese oil operations after discovering immense amounts of environmental pollution within their borders. Gabon has also joined in the fight against the Chinese petroleum corporation, which surprised the oil industry by withdrawing a permit from another Chinese state-owned company, Sinopec, and giving it instead to a newly created national oil company.
Economic bubbles have been a reoccurring economic cycle in the world throughout the history of capitalism. Recent economic bubbles that the world has experienced include dot-com/telecom, real estate, stocks, and biotech bubbles. They date back to the 1880’s when the first railroad tracks were laid down in the United States. The goal was to connect the United States through economic integration and development, which created a boom in the development of canals, turnpikes, railroads, and telephone lines. Many of these projects were funded by the government, and now green technology projects are funded by them as well. Globally, governments are beginning to promote green technologies through loans and subsidies. The rapid growth the world has seen in green technology could be the start of the next big economic bubble.
The international trade of consumer products is a regular occurrence and nearly everyone in the world is aware of its role in the global economy. However, how many people are cognizant of the fact that cities use imported garbage from neighboring countries and turn this waste into energy? I am guessing that not many people have heard of this phenomenon. This is exactly what is happening in the city of Oslo, located in southern Norway.
By 2030, demand for food, water, and energy is estimated to increase by approximately 50%. Because of this, businesses that are currently implementing energy saving strategies will be far better off in the future than those who are not. Fossil fuels are finite resources and as reserves of coal, gas, and oil run out, prices will climb rapidly. The uncertainty of future supplies of fossil fuels and the growing popularity of “green energy” should incentivize businesses to adopt sustainable strategies.
The World Trade Organization is investigating an Indian governmental program that requires solar energy producers to use Indian manufactured solar cells instead of imported products. Several U.S. environmental groups are pressing the WTO to not pursue action against India, saying that ending the program would threaten the ability of India to cut greenhouse gas emissions. The irony is that India’s green energy industry would be harmed if no action were to be taken, a blow to the environmentalists goal of increasing alternative energy use throughout the globe.
Germany’s economy holds a critical significance in the European Union, especially in regards to the ongoing debt crisis. Its industrialized economy has held steady despite a slump in the global economy. It might be surprising to hear that Germany, one of the most industrialized countries in the world, is undertaking an energy revolution that will dramatically transform its economy’s energy sector. The newly re-engineered economy will no longer receive its energy from nuclear powered stations as all nuclear power plants in Germany are being closed down. Renewable energy sources, including wind and solar power, will instead fill Germany’s energy gap. Will this move jeopardize Germany’s economy and how does this energy revolution affect Germany’s relationship with other countries?
The way in which shipping is conducted can have huge implications for consumers and businesses around the world. As talks of sustainability and green energy continue to dominate the energy sector, businesses are looking for ways to make shipping less harmful to the environment. Hence, some companies have begun to ship their goods via sailing ships that use the wind as the source of energy. The organic and eco-friendly sector has jumped on this idea because the maritime industry is said to currently produce 3-5% of global carbon dioxide emissions.
For the most part, Africa struggles to develop large amounts of energy, and Ghana is striving to change this. Apart from the northern and southern parts of the continent, Africa has no major energy sources and no efforts have really been made to fix the problem. Blue Energy, a British renewable energy investment firm officially verified plans to build Africa’s largest solar panel installation. It will be a one hundred fifty five megawatt photovoltaic plant, and construction will be located in Aiwaiso, Ghana. Officials are hoping that this is the start of a revolution for renewable energy in sub-Saharan Africa, and it will show whether or not governments can unlock the large potential that Africa holds for solar energy.
Lately, Iran has been under a lot of international fire because of its nuclear program and its questionable intent. Iran claims that the goal of its nuclear program is to generate an alternative energy source, but American and European officials believe that Iran has plans to build nuclear weapons. As a result, the United States and Europe have put sanctions on Iran’s oil and natural gas exports because they believe that this large source of revenue could be financing Iran’s nuclear program. Sanctions, however, have not been applied to Iran’s renewable energy program, which happens to be the largest in the Middle East. Iran is developing renewable energy sources to lessen its dependence on fossil fuels and in part to escape the sanctions that have been placed on its oil and natural gas industries.
Foreign and domestic investment are spiking for Canadian Corn because of global warming and a drought in the Corn Belt region of the United States. Climate change and the resulting increase in temperatures in the last 50 years have extended the growing season in Canada’s Prairie Provinces approximately two weeks. The Prairie Provinces: Alberta, Saskatchewan, and Manitoba have long been big producers of wheat, but are now beginning to incorporate and in some cases completely switch to corn. This is due to a decrease in corn supply in the drought-ridden Midwest region of the United States, high demand for the crop, and the fact that corn has a higher yield than wheat on a per acre basis.
Scientific advancements regarding genetic modifications have enhanced agricultural economies all throughout the globe. Most recently, researchers have implemented a gene in soy that resists drought. Formerly used in sunflowers, the gene has been transferred and is being applied to soy in Brazil. Agriculture plays a prominent role in Brazil’s economy, accounting for 36% of exports; $7.9 billion alone was in agricultural exports to China. This reconstructed soy will not only allow for drought resistance, but also the ability to grow in salty soil, thus allowing soy development in previously uncultivated areas in Latin America. Of course, this expansion may lead to issues, both environmentally and economically.
The changing global climate has become increasingly more difficult to ignore due to climbing air and water temperatures, rising sea levels, and melting of polar snow and ice. Recent reports have stated that the area of ice in the arctic has never been smaller, which has recently caught the attention of Asian economists. The opening of the Arctic north promises new trade routes, untapped reserves of oil, and an abundance of minerals to discover.
Have you ever heard of mapping underground pollution? I hadn’t until recently, after Doug Barry sat down with John H. Sohl III, the founder of Columbia Technologies. This mapping involves using sensor technology that tracks leakage of pollutants, and following an analysis, customers can make decisions on risk assessment, disposition of the property and proper cleanup actions. The more interesting aspect of this story is how the company grew internationally.
As the United Nations’ Rio +20 Summit came to a close this past week there was a large disappointment in the solutions, or lack of solutions, accomplished. In 1992, when the Summit was first held, there was a sense of hope that a plan could be created to both develop and stabilize the economy while also protect the environment. This year the final document, titled “The Future We Want,” has been seen as weak because it failed to come closer to conclusions on how the world can deal with the connected problems of economy and environment. Rather than focusing on what was unsuccessful, the Summit did create more of an awareness of the issues and put out good ideas on the table. In order to really achieve the future we want, action taken by businesses is necessary.
As the human population grows and environmental complexities become more widespread, social responsibility and the fight against climate change have become major issues for businesses across the globe. Many companies are beginning to implement sustainable business practices to combat climate change and mitigate harmful emissions. You may be wondering what businesses around the world are at the top of the list in developing environmentally friendly business operations. Look no further, because a United Kingdom research company has just released rankings that track how large global companies are mitigating climate change and creating clean technology solutions.
Over the years, clean energy sources have become extremely popular as countries and governments around the world try to mitigate climate change by reducing carbon emissions. One of these clean energy sources is solar power which converts sunlight directly into electricity. Solar power has been used as a major energy source for many applications such as providing electricity for residential homes and industrial equipment. Recently, solar power has been applied to many new projects. One of which is shipping and if successful, solar powered shipping can have large impacts on the environment as well as international trade.
Recently, Novozymes, a company that makes enzymes used to make goods such as household detergents and soft drinks, announced that it has developed an enzyme that will make it possible to derive cellulosic ethanol from waste material like household trash or corn husks. This company has discovered something that has been sought after by many clean energy producers- a way to inexpensively convert biowaste into fuel. Novozymes officially announced its new enzyme, Cellic CTec3, February 22, 2012, and already has deals in place to begin supplying it.
In many of the leading construction markets, the market for sustainable construction is expanding rapidly. This standard started in the mid 2000’s with the introduction of the LEED certification for buildings. LEED stands for Leadership in Energy and Environmental Design and was developed by the United States Green Building Council. This standard has started to transform the construction industry and is now taking off elsewhere in the world as well.
While many countries depend on each other for the trade of goods and services, few would think countries could depend on each other for one of the most important resources on Earth—energy. A proposed electricity supergrid spanning across several European countries could mean not only improved power sources but also cleaner energy. Advocates of this energy plan suggest that a transnational supergrid could connect power sources like wind farms in Scotland and solar arrays in Spain to the many population centers scattered throughout Europe. The need for an expanded and upgraded power network in Europe is clear. However, the political, regulatory, and economic obstacles are formidable and will be tough to overcome.
The European Commission has accused several airlines of not following a new European law that requires them to account for their greenhouse gas emissions. Non-compliance could eventually lead to these airlines being banned from European airports. While this is not seen as very probable, it could have dire effects on world travel, the European airline market, and the global economy.
Sustainability is a huge topic in modern business, as corporations and environmental groups alike strive to create more sustainable methods of production. For Indonesia, the world’s largest producer of palm oil, sustainability has been a sticking point. In the last three decades, plantations have expanded by over 2000 percent, and the total land area currently devoted to palm oil production is an estimated 7 million hectares. Some corporations around the world are realizing the negative environmental effects of palm oil production and are choosing to begin using only palm oil that is considered sustainable.
Skiing in Barcelona probably sounds like an oxymoron to most people. With its warm climate and lack of snow, Barcelona is not normally on avid skiers’ top lists of destinations, but that all could soon change once an indoor skiing facility is built in Barcelona.
The concept of an indoor skiing facility may be foreign to some, but there are actually a lot of facilities like this that already exist. There are several in Europe – mostly in areas with cooler climates, some in Asia, and others scattered across the world. The indoor skiing facility in Dubai is the most relevant to Barcelona because it is also in a very warm climate. The facility has had to take extra care by making walls several feet deep and heavily insulated to keep the inside cold enough for ideal skiing conditions, exactly what the facility in Barcelona will need to emulate.
Recently, many governments have slowed their momentum as far as environmental regulations policy creation efforts are concerned. This means that it is up to major corporations around the world to be more proactive about going green. One motivation is to be recognized by businesses and consumers as a environmentally friendly company. Newsweek annually ranks global companies and recently released their World’s Greenest Companies Rankings for 2011. They take into account “actual environmental footprints, management (policies, programs, initiatives, controversies), and reporting practices of each big company.” Using these hard facts and ignoring the publicity and public relations efforts companies may have made gives the most accurate picture of how firms are actually doing environmentally.
Over a decade of recurrent high energy prices has prompted Kenya to look beyond traditional energy sources. The traditional energy supply line in Kenya is unstable and has been for many years, which has caused consistently high prices that will unlikely subside. Green energy firms are emerging and have been largely successful thus far because of the increasing demand for alternative energy sources.
As the earth’s conventional oil supply continues to diminish, the discovery of new fuel types is becoming as important as ever. The Organization of the Petroleum Exporting Countries (OPEC) has recently released a statement stating that global tight oil reserves could produce as many as 300 billion barrels. Tight oil is another name for shale oil, which is a form of light crude oil found in shale deep below the earth’s surface. Although it will most likely be a decade before big supplies of tight oil are produced, the future production could rival the conventional oil production in Saudi Arabia.
The constant rise in fuel prices and the movement to cut fuel emissions are leading airline companies to develop biofuels. This year alone, the world’s airlines will emit 650 million tons of carbon emissions in the process of burning over 200 million tons of fuel. In recent years, the popularity of developing biofuels has increased and is now becoming more of a reality than a theory.
Last month’s blog series introduced readers to cloud computing, as well as digging deeper into numerous characteristics of the cloud. A particularly interesting aspect of cloud computing is the risks and benefits to the global environment. With the explosive growth of cloud computing in recent years, this is quickly becoming a very heated debate.
During routine trips to the supermarket, shoppers frequently face choices between organic and conventional food products. While these items may look nearly identical at first glance, they likely arrived on store shelves via radically different supply chains. Global regions have had varying reactions to the organic food movement. The future of agribusiness may well be determined by consumer preferences between organic and conventional foods.
Mining for gold has traditionally been viewed as a toxic business that harms the environment leaving mercury and other harsh chemicals in the atmosphere. However, this view is beginning to change as gold mining practices turn to fair trade. The new fair trade standards set social, environmental, and economic measures to eliminate child labor and minimize the use of toxic chemicals such as mercury and cyanide. The major goal of this movement is to avoid the negative impacts that mining causes in the environment while also aiming to help the millions of people who depend on the gold mining industry for employment.
Are companies that have implemented carbon reducing practices performing better financially? The recent release of the CDP Global 500 report by the Carbon Disclosure Project answers in the affirmative. In fact, this report has revealed that the companies working to decrease their carbon emissions are outperforming those that have not begun this change. These same companies are said to be performing better in the stock market as well.
Currently, the global water supply is in a problematic state as Earth’s fresh water supply is being used up without having the chance to be recharged. As the population grows rapidly, more and more water is needed to produce the food that feeds this growing population. Agricultural crops and animals are not the only products requiring water. Industrial productions of almost all goods require water as a resource. In fact, water is a key material for almost any business application in the world today. On top of this, water is also being polluted and wasted which contributes greatly to the decline of the fresh water supply. Despite this bad news, businesses are helping turn this situation around by establishing an effort to save the water supply.
Since the Industrial Revolution coal has been one of the most important energy commodities for countries and industries across the world. However, this is beginning to change as many businesses search for cleaner energy sources. With new drilling techniques, lower prices, and a large domestic supply in the United States, natural gas is becoming a very popular energy commodity. This energy switch from coal to natural gas is often viewed as beneficial for the environment but there has been some doubt regarding this belief.
Nowadays many companies are becoming more environmentally conscious and are looking for new business practices that support sustainability. A company called Neutral Fuels in the United Arab Emirates has developed an innovating process that promotes sustainable development while also generating a healthy profit. Neutral Fuels converts used vegetable and cooking oil from local fast food restaurants to biodiesel so that it can be used to fuel trucks. This waste conversion process has had a tremendous impact on the environment and oil production in the United Arab Emirates.
There have been massive efforts recently to improve the quality of China’s polluted air by blending low-polluting imported coal with dirtier-burning domestic coal. Experts argue that while this will positively effect the air quality in the near-term, it might contribute to faster global warming in the long-term.
The rainforest of Borneo in the growing country of Malaysia is said to be the oldest rainforest on the planet, 70 million years older than the Amazon. Hundreds of species of plants and animals inhabit the forest of Borneo with many new species still being discovered each year. Borneo, with its dense forest and uncountable number of unique species, is one of the world’s greatest natural treasures. Malaysia, determined to develop its growing economy, has difficult choices to make about how to ensure the safety of its natural resources.
In part one we talked about the huge environmental costs for companies and the economic impacts these may have. Now we want to see what can be done, if reporting these costs should become standard, and the benefits this may have. Already many companies have made huge investments in reforestation, reducing water consumption, and an overall protection of natural resources. With the rising costs of valuable resources which are in danger, it only makes sense that these become a regular part of a company’s investment. With a strong sustainability agenda, corporations can help business be perceived as the place to best change what is going on in the world. As more companies realize how much sustainability helps their financial accounts, they’ll want to know how best to report these costs, and what can be done about them. The best step is to no longer ignore what’s going on, no matter what way you look at it.
In order to see if a company is viable as a going concern, environmental costs are vital to know for the long-run. The benefits to preserving the environment in terms of dollars may be surprising, but it’s not to many business leaders these days. A private sector solution may be the best solution on a global scale. Just last week, Puma became the world’s first major corporation to report the details of the cost of the company’s impact on the environment. They said the costs of the carbon emission and the water it used in 2010 totaled $134.3 million. The costs not only included the company, but all of its suppliers as well. The next step for the company is to measure their cost of waste and land-use change. Ecosystems are vital to the performance of most companies, and integrating the true costs of extracting these services could significantly impact bottom lines in the future.
In 2007, former president Oscar Arias announced Costa Rica’s goal to become the first developing country to go carbon-neutral in 14 years. At the time, that goal seemed to be very unlikely for such a small country with financial difficulties. However, over the past years Costa Rica has made significant strides in accomplishing their energy goal and has become one of the leading countries in environmental sustainability.
In a recent Forbes article, they highlighted the top 10 green companies in the world. These companies have all in some way contributed a global environmental management system by reducing emissions, adjusting their manufacturing process, becoming environmentally certified and doing the best to adjust their performance records into a more positive light.
Recently gold prices have been up, but another metal connects countries around the world and provides insight into future economic and global trends. This metal happens to be copper and unlike gold, copper is not often viewed as a glamorous commodity. However, its practical use in water pipes, electrical wiring, computer circuit boards, and other electronic gadgets makes copper a valuable resource. Today the world’s copper mines are booming as copper prices continue to rise dramatically.
Wine production is a source of great pride for many French citizens. Partners throughout the global supply chain are proud to take part in an industry with such cultural importance. Change is not easily embraced in an industry with so much history and a rapidly aging workforce. Regardless, to make products more affordable and accessible there has been a push to use plastic wine bottles. There are clear advantages and disadvantages associated with this trend, but its popularity amongst consumers is becoming increasingly difficult to ignore.
As we are wrapping up this globalEDGE blog series of “top trends,” we thought there’d be no better way to finish then with a custom-made list talking about top global business trends as seen by us here at globalEDGE. The list is in no particular order (i.e. trend number 1 is no more prevalent then trend number 5), but we feel that all of these trends are making themselves known in the international marketplace now. Here’s the list!
As the world’s population continues to grow and the problem of poverty remains, it is clear that we must continue to develop the world economy. However, many believe that this economic growth should not come at the cost of the environment that supports our lives. Recently, the United Nations released a report that estimated the cost of changing the world from an unsustainable economy to one that is both resource efficient and environmentally friendly.
Can environmentally conscious consumers convince businesses to develop sustainable practices, or must government regulations force their hand? According to United Nations officials such as Christiana Figueres, the executive secretary of the U.N. Framework Convention on Climate Change, governments cannot be responsive enough to quickly alter the negative impacts of human actions on the environment. As government, business, and academic leaders recently met at the CNN Earth’s Frontiers debate in Cancun, Mexico, many people are asking which organizations are best suited to lead the fight against global warming.
Businesses and countries alike are finding new ways to protect the environment by reducing emissions of harmful pollutants. One of these ways is a market-based approach called carbon trading which provides economic incentives for business firms that limit their output of carbon emissions. These carbon trading markets are beginning to form all around the world and the country of Kenya plans to launch Africa’s first carbon exchange.
With China’s push for rapid economic development, it’s no surprise that China consumes more energy than any other country in the world. As China dominates the global energy market, it also is the single biggest force in causing oil prices and carbon emissions to increase. However at the same time, the International Energy Agency claims China to be the most influential country in the development of renewable energy. China is looking to lower the costs of oil and reduce carbon emissions linked to negative climate change by improving the progress of green energy. This developmental process of increasing the supply of energy in China will affect almost every country in the world.
A new study by NEWSWEEK ranked the top 100 largest publicly traded companies in the world based on their green performance. Each company was given a rating for three different components: environmental impact, green policies, and a reputation survey. International Business Machines (IBM) came out as top dog, Hewlett-Packard was ranked second, and Johnson & Johnson took home the bronze medal.
Dubai, one of the seven emirates of the United Arab Emirates, faces major environmental problems after years of rapid urbanization and business growth. Located in the desert south of the Persian Gulf, Dubai’s biggest challenge is providing fresh water to its residents. However, the city has many other problems including waste management and sewage treatment operations. Despite being situated on vast oil reserves, the region is also running low on energy sources to support its lifestyle. On top of these complications, the United Arab Emirates (UAE) is preparing for a population boom this upcoming decade. Therefore, concepts of sustainability and environmental issues are becoming very important to businesses and citizens of Dubai.
Say goodbye to your flat-screen TV and that new car battery you were going to buy. In late July China announced that they would be decreasing the supply of rare earth metals to the rest of the world. Now it may not seem like an obvious connection but these rare earth metals in question are the materials that help produce our flat-screen monitors, car batteries, and many more products we manufacture and sell. Now the question comes to, why is China doing this?
An article by the Huffington Post investigates the world’s most polluted cities. The top ten list includes Linfen, China; Los Angeles, United States; Niger Delta, Nigeria; London, United Kingdom; Dzerzhinsk, Russia; Phoenix, United States; Bandung Indonesia; La Oroya, Peru; and Lake Karachay, Russia.
According to the article, “Living in Linfen, China, is equivalent to smoking three packs of cigarettes a day”
“In 2003, Dzerzhinsk, Russia’s death rate surpassed its birth rate by 260 percent.”
“Phoenix, Arizona, United States is 2010's worst place in the United States for year round particle pollution... a mix of dust, soot and aerosols.”
Many companies around the world find that nature loss is a challenge to growing their business. Nature loss is described as the disappearance of diverse natural resources such as plants and animal species. According to a survey by PricewaterhouseCoopers, more than half of CEO’s see biodiversity as a concerning issue for their company. In 2002 a target was set to control global biodiversity loss by 2010, which is far from accomplished today. This target would have decreased the rate of habitat loss and degradation, controlled the spread of invasive species, and protected animals from extinction due to foreign trade. Some global regions have made some progress, but overall there has been failure to meet the goals set back in 2002, making a number of species subject to extinction.
A Copenhagen hotel is trying to be more environmentally friendly in a very interesting way. If you bike in the hotel enough to generate 10 watts of electricity, you earn a free meal! The goal of this project is to increase environmental awareness in the city. Also, it promotes exercise by combining an aspect of Copenhagen's culture (biking) with the incentive of a delicious meal. A BBC video gives more details on the hotel's creative strategy.
Poultry farmers all over the globe are running into serious problems with the waste from chickens, which is real trouble when it gets into the water supply. Years back John Logan, a farmer from Prentiss, Mississippi, noticed the same problem. In an interview with NPR radio he recalled, "I said, 'I got to do something.' I can't be putting this on the ground. Now, I have a river right here. What's to happen when that phosphorus overload washes into the river, which then ends up in the Gulf of Mexico?"
In the past decade "going green" has been a popular word among businesses. Many have changed a plethora of their methods to be more environmentally friendly. The business green movement has evolved from the global green movement in other areas.
Going green and being conscious of the environment is something that dates back to the ancient Greeks and Romans. In the middle of severe fuel shortages, they began building cities and houses with windows facing the sun in the wintertime to make use of solar energy. A more recent example is the idea of sustainable development, meeting human needs while preserving the environment. This idea emerged in a series of meetings during the 1970s and 1980s. In 1972, the UN Stockholm Conference on the Human Environment was the first great international meeting to address how human activities are harming the environment. However, action plans were not drawn until the UN Conference on Environment and Development in Rio de Janeiro in 1992.
Greenland is covered by ice on nearly 80% of its surface, making business activities in this area rather difficult. However, as we all know, the northern ice caps are beginning to melt due to rising global temperatures. In fact, it has been predicted that in the next few decades the Arctic Ocean will be almost all open water. While this is bad for the environment, it does open up new opportunities for business.
Gary Locke, now a prominent figure in the U.S. Government is charged with the responsibility of forming U.S. Commercial policy across the globe. Gary is a recent appointee into the Obama administration and career politician. Prior to his current position, Mr. Locke served two terms as the governor of Washington. Given his new role, the obvious question becomes: How will Mr. Locke’s policies impact global trade? Here are two points to consider:
Sadly, this is the final chapter in our China and America blog series. We hope you enjoyed learning the many different aspects that make the U.S.-China relationship one of the most important in this day and age for the current global business climate. This especially holds true for the energy sector.
"If you can't measure it, it doesn't exist."
So says the old adage about the importance of quantifying results. If we're applying it to environmentally friendly products, then our progress is almost non-existent. Customers at the store don't have the time or information to calculate the environmental impacts of various products, and so they are forced to balance their taste for saving mother earth with their suspicion of empty greenwashing.