Posted by Mette Vågnes Eriksen May 9, 2012

How to consume and produce sustainably?

United Nations Environment Programme (UNEP), in collaboration with the European Commission, has recently published a report entitled ‘The Global Outlook on SCP Policies. Taking an action together’ . 

How can you produce sustainable?

The main objective of this report is to share best practices globally through examples of effective policies. The document also proposes recommendations to adapt, replicate and scale up Sustainable Consumption and Production (SCP) initiatives. The report looks at areas such as energy, transport, food and waste management. It includes 56 cases studies of initiatives across the globe: 

  • City sustainable consumption and production plan (Egypt)
  • Plastic bag waste management (Kenya)
  • Greening the supply chain (Thailand)
  • Water – free environmentally friendly sanitation (China)
  • Sustainability standards for housing (Brazil)
  • Energy efficient housing (Ukraine)
  • Sustainable clothing Action Plan (UK)
  • EU Ecolabel (Europe)

It is also interesting to note that the Global Outlook provides a set of recommendations that covers: 

  • Integrate SCP into policy frameworks and strategic plans
  • Ensure the collection of more SCP data to measure policy effectiveness and track progress
  • Learn from experience to develop an optimal policy mix
  • Provide enabling policy frameworks to encourage business investments on SCP
  • Give more emphasis to the demand side to promote sustainable lifestyles
  • Enhance responsible marketing and media through policies and campaigns
  • Draw on and further develop partnerships among all actors and regions

These are all challenging issues in challenging times – but I’m optimistic about consumers demanding better products and producers innovating more sustainable solutions – meeting the expectations of tomorrow.

Best regards, Mette

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Posted by Bjørn Haugland April 11, 2012

Managing risks and seizing opportunities in renewables in Africa

African countries are on the verge of an economic breakthrough and offer great opportunities for those seeking to turn risk into reward in an increasingly complex global economy. China has grasped these opportunities and Norwegian public and private enterprises could do so too. The scene is set for a win-win situation. If risks are managed in a good way, there will be rewards – both for African nations on a path to reaching their development potential and for Norwegian and international public and private enterprises seeking to achieve returns on their investments while at the same time contributing to a sustainable future for Africa.

Tables have turned in the global economy

In a new paper, which was recently published in a report by WWF Norway, I share my reflections on Chinese investments in Africa, the opportunities this implies for Norwegian renewable energy actors, and how the investments risks can be managed.

 -Bjørn Haugland

 

 

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Posted by Mette Vågnes Eriksen February 23, 2012

Corruption in the EU

The European Commission has recently published a Eurobarometer report on Corruption in the EU. The publication presents results of a survey carried out in the 27 EU Member States in September 2011.

The main aim of this research was to see how European citizens’ opinions about corruption have changed since 2009 when a similar survey was carried out. The questions asked during the survey focused on the European citizens’ perception of the extent of corruption in the EU, the levels of government (local, regional, national) facing the biggest problem with corruption, the correlation between corruption and business culture, and also their views about who should be responsible for fighting corruption.  

The main outcomes of the survey are the following:

  • The majority of respondents think that corruption is a major problem in their country (less positive than in 2009) and almost half think that corruption in their countries has increased in the last three years
  • Most respondents think that corruption exist at all levels – local, regional and national and 73% of them think that corruption takes place within the EU institutions
  • The majority of respondents think that there is an insufficient level of transparency and supervision of the financing of political parties
  • Two in three Europeans sees corruption as part of their country’s business culture
  • The institutions that Europeans are most likely to think have a responsibility for fighting corruption are national Government (63%) and judicial system (59%)

In the press release of 15 February presenting the report, the Commission highlighted its previous policy initiatives on fighting corruption. In more detail, in June 2011 an anti-corruption package was adopted calling for a stronger focus on corruption in all relevant EU policies. Since then, the Commission established a specific EU monitoring and assessment mechanism and will publish in 2013 the first EU Anti-Corruption Report, which will give an account of the state of play of anti-corruption efforts in EU Member.

To assist in the works on this report, the Commission established also a group of experts on corruption that advises the Commission on issues related to establishing indicators, assessing Member States’ performance, identifying best practice, proposing new measures. You can find the list of experts here:

http://ec.europa.eu/home-affairs/policies/crime/List_of_selected_experts-Group_of_Experts_on_corruption.pdf. You can also find the whole report here: http://ec.europa.eu/public_opinion/archives/ebs/ebs_374_en.pdf 

The Commission also plans to set up a network of research correspondence that will complete the work of the expert group by collecting and processing information at national level. The EU anti-corruption policy also includes proposals for legislation in the following areas: confiscation of criminals’ assets, the reform of public procurement rules, more advanced statistics on crime and an enhanced anti-fraud policy at the European level.

In DNV we believe in handling fraud and corruption before it happens. Few things have such a profound and detrimental impact on the reputation as fraud and corruption. Few companies have so sound practices that they can ignore risks related to unethical business behaviour.

However, there is a way to build a shield. We call it the corporate integrity profile. It delivers an independent assessment of how robust your business culture is and your ability to manage risks – and a road map for how to improve transparency and integrity. We help your organisation with risk mapping, preventive measures, code of conduct implementation, “Think-as-a-Thief” workshops, dilemma training, monitoring and compliance reporting.

It’s all about trust.

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Posted by Thomas Gosselin January 19, 2012

Supply Chain: The New Frontier for Sustainability Risk

An estimated 3,200 companies will feel the effects of The California Transparency in Supply Chains Act of 2010 which entered into force on January 1, 2012. The law requires retailers and manufacturers with annual worldwide gross receipts that exceed USD $100 million and doing business in the state of California to provide information regarding their efforts to eliminate slavery and human trafficking from their supply chains. Furthermore,  the U.S. Securities and Exchange Commission is expected to adopt the final rules of Section 1502 of the Dodd-Frank Financial Reform Act covering the requirements for managing conflict minerals in the supply chain.

For a significant number of companies in the U.S., there will be challenges in adapting to these two recent pieces of legislation addressing supply chain operations.

Picture the likes of Nike, Levi’s, HP and Disney with their established supplier management programs, their risk mapping, their audit programs and the resulting  increased levels of transparency that are the inevitable outcome. For companies such as these, overlaying the supply chain risks emerging from these recent regulatory requirements (of higher immediate consequence and probability) on existing supply chain risk analysis will pose considerable challenges and dilemmas.

New laws in California with focus on sustainability in the supply chain.

It is increasingly clear that the roles of sustainability and supply chain officer are co-dependent. In some cases, the sustainability officer may own the risk whereas the supply chain officer will address the control of the risk. This, in itself, raises a barrier to implementation.

In implementation, aside from the risk ownership and control, addressing sustainability risks throughout the supply chain already poses interesting dilemmas.  These risks can be at odds with traditional procurement risks of cost, availability, lead times, quality and aspects of business continuity.  Is management adequately equipped with the resources to balance these risks in an increasingly constrained supply base?

If we highlight the electronics industry as an example, with its deep-dive into the supply chain beyond Tier 1 to control a myriad of risks, no less the risk to innovation, the term co-dependency is never truer. Circumstances have already manifested where the provision of certain vital components are constrained to less than a handful of possible suppliers; none of whom have emerged unscathed by risk on the supply chain dashboard. The efforts and direct costs of controlling these risks are often omitted from compliance cost estimations and the cost of alternative sourcing is hardly ever factored in.

Our fear is that the lack of a clear supply chain risk profile will lead to trade-offs. Certainly, this will be the case should the sustainability officer and the supply chain officer work in risk silos. However, we also see a clear opportunity, if done well, for these two functions to ensure that their organization’s supplier risk profile is complete, credible and accountable to itself, not least to the wider stakeholder community.

We also see that this will bring additional opportunities for early warning, where effective tools will allow a proactive approach to controlling the risks. Early and staged intervention may be required at some established suppliers, and engagement and enablement may be more appropriate in other instances where suppliers may have to be qualified.

But all this, as said, is applicable to the larger companies with established supply chain management programs addressing sustainability risks through voluntary social responsibility and environmental efforts. For the vast majority of the 3,200 companies affected by the California law, as well as those companies  (and their suppliers) affected by the conflict minerals legislation on a national level, these new laws are likely to be a rude awakening.

Initially, to the majority of affected companies these laws may be considered purely compliance issues, but it is expected that such increased transparency is likely to be thin end of the wedge, exposing not only the companies themselves, but also their suppliers to greater scrutiny and oversight. Will these companies be far-sighted enough to prepare for this? We hope so.

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Posted by Priti Nigam January 12, 2012

Key Sustainability Risks and Challenges in the Telecommunications Sector

In a sector where the next revolution is just around the corner, the Telecoms industry is characterised by high rates of innovation in a rapidly changing technological landscape. This in turn is associated with a vast array of sustainability risks and challenges for Telecoms service providers.

The Telecoms sector has been revolutionising at a furious rate, especially so in the past few decades, with the widespread introduction of the internet, followed by mobile phones and more recently the transition to using smartphones and smart meters, which has led to an increase in mobile data services. New technologies, rapidly changing consumer requirements, the need for continuously modernising infrastructure to keep pace with these requirements, peaking demand in mature markets, countered by rapid advancement in emerging markets and increased outsourcing of services present a number of sustainability challenges for Telecoms service providers.

DNV works extensively in the Telecoms sector, carrying out H&S and ethical supply chain audits, assisting organisations with putting in place frameworks for identifying and managing their supply chain risks, training suppliers to embed sustainability within their own supply chains, and DNV’s International Sustainability Rating System (ISRS), which includes requirements of ISO14001, ISO9001, SA8000 and other international standards within one comprehensive system, is widely used. Based on our extensive project experience and through discussions with key sustainability personnel in some of the world’s largest Telecommunications companies, I have summarised what I think are the key sustainability risks in the Telecoms sector associated with 4 key categories: Environment, H&S, Supply Chain and general Corporate Responsibility requirements. Understanding and addressing these risks and integrating the most material ones within an organisation’s strategic and operational risk management processes would help convert these risks into opportunities, facilitating business continuity and enabling long term success in a rapidly changing sector.

Key Sustainability Risks in the Telecom sector

 

 

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Posted by Simon King December 15, 2011

You know your reputation is important

We know from our experiences working with larger organisations that they are the ones who are more likely to recognise that their reputation is so important that they “allow” it to appear among their top corporate risks. The big question is however: When Board members and senior executives say that maintaining their reputation is important; do they really understand how their reputation is impacted?

Many will see their reputation as being impacted by negative comments in the press. They may even assess this impact in terms of whether the criticism is local or national, and how long it lasts. But do they fully understand the complex dependencies within their business processes that could cause the actions or inactions that receive criticism?

Yes, there are differences between brand and reputation. And there is a lot that people do to project positive images of what they do. But is all the effort clearly focused, and are there plans in place to address actual concerns of stakeholders with deeds? Does effort get wasted window dressing the perceived or typical concerns of stakeholders?

Do you really understand how your reputation is impacted?

This could seem to drive organisations down a rather narrowly focused approach to managing a sub-set of risks, but two things should stop this:

  1. The most successful companies plan and act consistently on a much wider range of risks than this. It may be getting a tired cliché, but enterprise wide risk management helps to put the right effort into the right places.
  2. Sustainability is a long term game. The immediate impacts of something going wrong may not be on your reputation, your wider stakeholders, or your longer term strategic objectives. If something really goes wrong the impact could be long and far reaching.

Imagine doing a post mortem on your organisation, looking back and seeing what you could have prevented going wrong. How could you have done things differently? It really helps if you can see what the important things really are, and make sure that the right things get done at the right time!

 

SK

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Posted by Thomas Gosselin November 2, 2011

Call for change: conflict minerals and your cell phone

With legislation still being thrashed out in the political theater that is Washington, and lobbying coming fast and furious from all sides, a multitude of US companies are gearing up to comply with new rules on conflict minerals (defined by the US State Department as tantalum, tin, tungsten and gold and other minerals determined to be financing the ongoing fighting in the Democratic Republic of Congo [DRC]).

The issue of conflict minerals is not a new one. It is a complex, humanitarian problem comparable to the issue of “blood diamond” trade that a few years ago had become a term familiar in households worldwide, thanks, in part, to the Hollywood movie of the same name.  The Eastern hinterland of the DRC, a massive and largely land-locked country, is mineral rich and a main source of revenues for militias and warlords. Vying over the mineral ore, the first victims of the conflicts caused by the riches underground are artisan miners, the local population, and principally children and women.

Blood in your cellphone?

The electronics industry has had conflict minerals on the radar since the arrival of the new millennium. A significant proportion of minerals that are fundamental to electronic circuitry derive from the DRC. But this is a macro-issue. Simply too costly and complex for any one company to have seriously considered undertaking alone.

The topic blood diamond has had a few Hollywood productions help raise awareness.  Perhaps, because of the pervasiveness of the minerals in our latest cell phones, while not as celebrity-driven, is certainly as tragic.

The Danish documentary Blood in My Mobile is perhaps the best 80 minutes the public could spend in trying to get an oversight of the issue. It truly gets down to the coalface, claustrophobically so, in examining the working conditions of coltan miners who can remain underground for days while eclectically uniformed soldiers collect mining revenues above.

The film also illustrates how a corporation such as Nokia responds to stakeholder concerns. It is not fair to single out Nokia, the company that has stood out for reccognizing this topic in its corporate responsibility reports for nearly a decade.

So, while US industry and their global supply chains struggle over how to tackle this topic, and reduce the burden of legislation that is still under debate, the picture on the ground is bleak for thousands of Congolese.

Practically, the solutions lie in establishing a governance structure in place for a track and trace system upstream at the mining level, while pushing the supply chain from the downstream end, driven by the brands that have the clout to extract compliance from their vendors.

The latter approach is similarly challenging. The chokepoint for mineral ore being transformed into usable refined goods is at smelters, foundries or refineries. Efforts by industry groups such as the Electronic Industry Citizenship Coalition to create a standard and the auditing structure for a Conflict Free Smelter certification scheme are challenged by the need to convince global smelters to comply to a law they have never heard of, dealing with an issue that is entirely new to them while being pressured by end users who they may never meet.

DNV is assisting companies of all industries and at all levels of the supply chain. But, overall, we remain convinced that the humanitarian solution lies in a combination of downstream and upstream efforts.

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Posted by Mette Vågnes Eriksen November 1, 2011

New CSR strategy from the EU Commission

The EU Commission adopted a new Communication on CSR on 25 October 2011. Hopefully the package will boost financial, social and environmental development for Europe as well. I firmly believe heading for responsible investments instead of charity is the right thing to do. If you don’t have the time to read the whole EU Responsible Business Package  you might find this overview useful! 

New CSR strategy from the EU Commission

The Communication on CSR forms part of a new Responsible Businesses Package, together with amendments of two directives (the Accounting Directive and the Transparency Directive) and two communications (one giving a general presentation of the Responsible Businesses Package and one on Social Entrepreneurship). 

 In its CSR Communication, the European Commission puts forward a simpler definition of CSR as “the responsibility of enterprises for their impacts on society”. The new definition is consistent with internationally recognised CSR principles and guidelines, such as the OECD Guidelines for Multinational Enterprises, the ISO 26000 Guidance Standard on Social Responsibility and the UN Guiding Principles on Business and Human Rights. 

The new CSR policy presents an action agenda for the period 2011-2014 covering 8 areas:

  1. Enhancing the visibility of CSR and disseminating good practices  This includes the creation of a European award from 2012 onwards and the establishment in 2013 of sector-based platforms for enterprises and stakeholders to make commitments and jointly monitor progress.
  2. Improving and tracking levels of trust in business  The Commission will launch a public debate on the role of enterprises and organize surveys on citizen trust in business. The Commission will also address the issue of misleading marketing related to “green-washing” in the report on the application of the Unfair Commercial Practices Directive foreseen for 2012 and consider the need for possible specific measures on this issue.
  3. Improving self- and co-regulation processes  The Commission will launch a process in 2012 with enterprises and other stakeholders to develop a code of good practice for self- and co-regulation exercises, which should improve the effectiveness of the CSR process.
  4. Enhancing market reward for CSR  This means leveraging EU policies in the fields of consumption, investment and public procurement in order to promote market reward for responsible business conduct.
  5. Improving company disclosure of social and environmental information  The new policy confirms the Commission’s intention to bring forward a new legislative proposal on this issue.
  6. Further integrating CSR into education, training and research  The Commission will provide further support for education and training in the field of CSR and explore opportunities for funding more research.
  7. Emphasizing the importance of national and sub-national CSR policies  The Commission invites EU Member States to present or update their national plans for the promotion of CSR by mid 2012.
  8. Better aligning European and global approaches to CSR  The Commission highlights the OECD Guidelines for Multinational Enterprises, the 10 principles of the UN Global Compact, the UN Guiding Principles on Business and Human Rights, the ILO Tri-partite Declaration of Principles on Multinational Enterprises and Social Policy and the ISO 26000 Guidance Standard on Social Responsibility. The Commission aims to monitor the commitments of large European enterprises to take account of internationally recognized guidelines and principles. It will also present a report on EU priorities for the implementation of the UN Guiding Principles on Business and Human Rights and develop human rights guidance for a limited number of industrial sectors and for small businesses.

According to international principles and guidelines, CSR at least covers human rights, labour and employment practices (such as training, diversity, gender equality and employee health and well-being), environmental issues (such as biodiversity, climate change, resource efficiency, life-cycle assessment and pollution prevention) and combating bribery and corruption. Community involvement and development, the integration of disabled persons, and consumer interests, including privacy, are also part of the CSR agenda. The Commission is, with this policy package, trying to address all of these issues and although it has been welcomed by many involved in CSR policy in Brussels, it has also been criticised for being a bit too vague and weak.

There will be a first opportunity to discuss the Responsible Businesses Package with stakeholders at the Conference on Social Economy and Social Business hosted by the Commission on 18 November in Brussels. See you there?

Best regards

Mette

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Posted by Priti Nigam October 17, 2011

Ecocities

The cities of the future are being built today – Can our vision of what the future should look like translate into reality today?

Ecocities/Sustainable cities/ecotowns/ecoquarters/green urbanization seems to be the buzzwords for new and existing developments globally. Governments seem to have woken up to the fact that traditional methods of spatial design, planning and construction are not sustainable. Sustainable urbanization is a complicated issue, as different regions have varying constraints and opportunities based on the local geography, climate, population, and legislative mechanisms, and there may not be a one-size- fits- all solution. However, more can and should be done to incentivize sustainable urbanization.

Ready for green urbanization? (Shanghai skyline)

There has been a recent spate of legislation on this issue, particularly in the UK, where all new homes are required to be zero carbon by 2016, and all non-domestic properties are required to be zero carbon by 2019 (although the Government is still struggling to understand what zero carbon really means, and there is no policy for existing buildings, which will comprise majority of the UK’s built environment for the next few decades). In the UK, although legislation is in place to drive forward sustainable housing (sustainable urbanization in the sense of sustainable communities has been watered down considerably under the current government) , complicating factors include costs associated with sustainable construction, the lack of benchmarking for project financing, the lack of governmental subsidies, the lack of a consistent approach towards sustainable urbanization by different  political parties,  and uncertainty regarding the influence of sustainable construction on  factors such as land price.

From a developers’ perspective in the UK, sustainable homes and communities not only cost more to construct, there is no evidence that buyers in the UK would be willing to pay more to live in a sustainable community, despite the obvious benefits of doing so. From a governmental perspective, Ecocities would help reduce burden on infrastructure and help achieve targets under the Climate Change Act.  

Instinctively one feels that the concept of sustainability urbanization is sound and the bridge between developers and governmental thinking would be consumer preference for sustainable communities. However, there is a need for detailed analysis of these issues in the form of concrete case studies where these points are put to test. There is a need to establish a common baseline upon which project costs can be estimated, and while the drive towards sustainable urbanization in Europe, the US and more recently China, is admirable, what is disappointing is the lack of a coherent international attempt to address the challenges associated with Ecocities.

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Posted by Marcus September 14, 2011

A Silent Revolution

Approximately 95% of all businesses are Micro, Small and Medium-sized Enterprises (SMEs), and collectively they employ more than half the world’s workers. As well as being the backbone of the global economy, SMEs are a significant source of innovation. However, as SMEs often operate below the radar of NGOs and the media, their role in ensuring that we achieve the WBCSD’s vision of “One World – People and Planet” is often neglected. Luckily, a silent revolution is taking place.

Nearly a third of all Global Compact signatories are SMEs, indicating that issues such as human rights, labour conditions, environmental impact, and corruption are concerns shared by all businesses, both large and small. In addition to this, more and more SMEs are talking about sustainability, and the Global Reporting Initiative provide a range of tools and workshops aimed exclusively at SMEs. In Europe, the Small Business Act recognizes the fact that public policy often alienates SMEs. It therefore aims at promoting greater responsiveness to SMEs needs in order to enable them to participate more fully in creating greater economic growth in Europe.

There are also a number of localized initiatives encouraging SMEs to participate in creating a more sustainable future, such as the newly launched Responsible Business Standard exclusively aimed at SMEs in the UK. The standard offers practical guidance to SMEs in the form of a basic yet comprehensive non-financial audit, and requires companies to commit to continuous improvement within the areas of marketplace, environment, community, workplace, ethics, values and transparency and governance. 

Start by looking for opportunities to impact your local community! Here represented by Lofoten in the county of Nordland, Norway.

So, here are some tips for SMEs who are looking to increase their commitment to sustainable business:

  • Impact locally: SMEs are the backbone of the global economy, but are, more often than not, deeply rooted in local rather than global communities. Start by looking for opportunities to impact your local community, e.g. through the local school, providing internships through the local employment office, or campaigning for a local social or environmental cause.
  • Be an advocate for ethical supply chains: SMEs are often at the compliance end of the CR yardstick, being subjected to compliance audits by larger organizations. Use your voice to be an advocate for clearer, more comprehensive, and perhaps even more stringent criteria in order to ensure that your business partnerships are catalysts for a greener future. Talk to your own suppliers too and see if you can work together to create a greener supply chain for your businesses.
  • Think strategically: Make sure that your CR activites are aligned with your business goals. If you want to donate to charity, look for synergies in the philanthropic partnerships you create, for example the learning opportunities of working closely with a local charity, or opportunities for joint ventures that will both support a local cause and create competitive advantage for your business.
  • Achieve eco-efficiencies: Take a good look at your main business processes and identify ways of minimizing both the resource intensity (water and energy use) and environmental impact (emissions and waste created) of your business operations.
  • Engage with stakeholders: Tell all of your key stakeholders (e.g. employees, suppliers, customers, local government) what you are doing, and ask for their ideas and feedback. If possible, get them involved too.
  • Communicate openly: it is important to tell people about the good things you are doing, and all the things you are working on improving. Going public deepens your commitment to change. It also promotes your business to new markets, new customers, and potential employees who share your vision and can help your business grow.
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