Search

William Jackson Food Group (WJFG) has launched an initiative to help provide food security to a farming community in Malawi, Africa.

Owners of Abel & Cole, Aunt Bessie’s, Jackson’s Bakery and MyFresh, WJFG has committed £225,000 to the five-year project which aims to help a community of up to 1,000 farmers become self-sufficient by equipping them with the knowledge, skills and equipment needed to create a sustainable livelihood through organic farming techniques.

“Sustainability is at the heart of what we do at WJFG, so to be able to apply our expertise to the important pursuit of food security in Malawi is a powerful use of our knowledge and skills,” said Norman Soutar, WJFG's chief executive.

The company has released the first set of funds which will be used to buy seeds and livestock, as well as initiate training programmes.

The planning process has been in place for more than a year, and a dedicated project manager, Cintia Martinez from WJFG (pictured above) has visited Malawi to ensure the initiative will deliver tangible, long-lasting results for the village. She is working alongside The Cooperative College and the Malawi Organic Growers Association.

Headquartered in the U.S., Booz Allen Hamilton provides strategy and technology consulting services to leading Fortune 500 corporations, governments, and not-for-profits employing more than 22,500 people across the globe.
With a majority of its offices surrounding America’s capital in Washington D.C., the firm has strong connections with the U.S. government. Booz Allen currently carries out projects for clients like the Department of Defense (DoD) and the U.S. Department of Veterans Affairs. Connections between Booz Allen and U.S. government clients can be traced as far back as 1940, when the U.S. Navy employed the firm to help prepare for World War II. Though Booz Allen is proud of the services it provides clients, the firm is more than just a government consultant. Through numerous corporate social responsibility (CSR) initiatives, employees around the world use their skills to further human-conscious causes.
As Christine Hoisington, director of community partnerships, explains, “We have tremendous impact when we align our CSR efforts with our business goals. As an organization, we make it our mission to solve our client’s toughest challenges. When we apply our experience and expertise to making a difference in our communities - it’s a powerful intersection.” In other words, employees take what they know and apply it to social causes in need.
The CSR programmes at Booz Allen are as diverse as the firm’s day-to-day services. The firm deploys employees to support areas like gender-equity in science education, special-needs services, veteran’s affairs, just to name a few. And this isn’t just charity work. These are areas that closely align with its business mission. For instance, the goals of client work within many DoD offices closely align with its CSR initiatives with Wounded Warrior Mentor Program, United Service Organization, and Operation Homefront.
At Booz Allen, in addition to grant-making, CSR is tiered and usually falls into one of three categories: employee ad hoc volunteering; skills-based volunteering initiatives; or formal pro bono in-kind engagements.
Employees are passionate about the causes the company supports. Most volunteers take time out of their own schedules to engage in CSR programs and even recruit family members to join.
What makes CSR at Booz Allen different is that in addition to their strategic philanthropic alignments, they also align resources with the interests of staff. Employees help identify the programmes that will have meaningful results and lasting impacts. This empowers them to be catalysts for change; and as employees personally commit to serve socially responsible causes, the firm backs them up with corporate resources.
In 2014, Booz Allen employees volunteered a record 152,713 hours, for 1,497 not-for-profits in communities throughout the United States - as part of the firm’s 100th year “Centennial Community Challenge.”
“We don’t just write cheques to good causes, we choose to support those things that inspire our employees themselves to participate. This employee centric approach is an integral component to the Booz Allen corporate giving and philanthropy philosophy,” says Hoisington. Let’s look at some examples of how Booz Allen employees are helping.
One example comes from Operation Homefront where employees supported by moving a service-disabled soldier and his family from an apartment near a Military Medical Center to their new home. This is planned and executed by employees on their own time, and without even using their consulting skills. Another example comes from the U.S. state of North Carolina. An employee based in the state used her strategic communications skills to design marketing materials for the not-for-profit Our Military Kids.
One of Booz Allen’s major CSR partners is Compass, a non-for-profit based in Washington D.C. For more than 10 years, hundreds of employees have participated in skills-based volunteer consulting projects with Compass. The not-for-profit’s mission is to inspire the active engagement of business professionals with local causes to transform communities. Over the past few years, 50-60 volunteers from Booz Allen have served on Compass projects, providing over $5.8 million in value to the community and providing services on their own time, after work hours.
The firm became Compass’ first corporate partner in 2004. Top leadership from Booz Allen saw the value in the work Compass was providing to the not-for-profit sector, and supported employees volunteering with Compass projects. In addition to supporting Compass volunteer recruitment, Booz Allen also provides sponsorship funding to Compass, supporting the infrastructure required to manage pro bono consulting projects.
Another one of Booz Allen’s philanthropic initiatives is its pro-bono consulting work. Teams of employees provide in-kind consulting services to not-for-profit organizations using the same type of approach they would use for clients. These projects range in length from a few months to two years or more. For example, a Booz Allen team finished a two-year project with the Tragedy Assistance Program for Survivors (TAPS). The team developed an evaluation tool for the organization to measure the impact of the services they offer to those grieving the death of a loved ones serving in the Armed Forces. Then they successfully tested the use of this tool, providing $200,000 in consulting services and a valuable way for the organization to more efficiently meet its goals.
Booz Allen was founded on the belief that helping its clients succeed requires a human touch, and the founding partners pushed each employee to have a sense of responsibility and support his or her community.
Working to have a positive impact in communities is a core value at Booz Allen, and their work with not-for-profits—particularly those that support veterans and wounded warriors—gives them a deeper connection to our clients. “The Department of Defense is one of the firm’s biggest clients, and there is no better way to feel personally connected to the Department’s mission than to spend time with wounded warriors and military families,” says Hoisington.
It’s not just junior staff who volunteer at Booz Allen. Four years ago, the firm launched an innovative program that combines leadership development with community service for a select group of senior managers. Booz Allen’s “Leadership Excellence for Senior Associates” programme combines career development with philanthropy.
The programme is offered to top-performing Senior Associates who are put into teams and matched, by Booz Allen partner Compass, with regional and national not-for-profits in need of strategic guidance. The teams then spend four months providing consulting services, ultimately resulting in a set of recommendations for the not-for-profits to use to address specific problem areas. Each of these projects is valued at more than $100,000 and there are typically seven projects and seven recipient not-for-profits chosen per year.
The relationship between Booz Allen and partner not-for-profits is symbiotic and mutually beneficial; it’s not charity. “This way, our community outreach work is also an effective training tool and allows employees’ to develop even higher-level consulting and management skills,” says Hoisington. “In addition, participating Senior Associates have found value in being able to interact with the not-for-profit executives and board members, some of whom are luminaries in their fields and potentially good connections for Booz Allen’s business areas.” Networking at its finest.
The benefits to Booz Allen from CSR programmes, are incalculable, says Hoisington. “It makes business sense because much of our philanthropic work aligns with the interest of our employees and our clients – the Department of Defense, for example. It means that as well as fulfilling a meaningful role for the company, our employees are also learning more about the people and programmes they are working with and the needs of the end users. This gives us an important perspective and allows us to be smarter and more rounded for our clients.” 

T here’s a Polish proverb that goes: “If the farmer is poor, then so is the whole country”. It’s a problem that Tetra Pak is highly aware of – it recognizes the link and knows that for it to succeed and grow, it needs the markets in which it operates, to do the same.
Indeed, the food packaging company has always had a tradition of supporting sustainable development, says Ulla Holm, director of Tetra Laval Food for Development unit . With Food for Development’s Dairy Hub concept, operated through both Tetra Pak and its sister company DeLaval, this support is taken to a whole new level.
The idea stems from Tetra Pak’s role in pioneering national school milk programmes, setting up the very first school milk programme in Mexico as far back as 1962.
“Even in the 1960s our founder realized that helping our customers would lead to a profitable dairy industry which would ultimately benefit our business. Support for the dairy industry value chain is in our DNA,” Holm maintains.
Holm’s Food for Development unit, set up in 2000, was intended initially to develop a more systematic approach to advising governments on instigating national school milk programmes. It now goes further, examining the entire milk value chain to ensure that locally-sourced milk from small holder farmers is used and does not go to waste. “It’s about creating demand for locally produced, sustainable milk,” explains Holm.
“It’s a long term business development to create sustainability,” says Holm. “Good solutions for markets, good solutions for business. It’s good too to connect with communities. You need to build a sustainable milk value chain in order to build a base for sustainable future development.”
In many developing countries, smallholder dairy farmers find it difficult to collect, cool and transport their milk, particularly twice a day, so a lot of milk goes to waste.
“Milk has to be cooled very quickly after its been collected. At least within 4 hours and often farmers don’t have this facility,” explains Holm. And while cows have to be milked twice a day, many smallholders can only go to market once a day, so there’s that milk to potentially capture too.
An informal milk value chain where farmers sell milk directly to middle men who often dilute the milk to make it go further and also add chemicals to make it last longer, also presents an issue. “This opens up room for all kinds of health safety issues,” says Holm. “As a conequence, in many developing markets, milk is always boiled prior to use which means losing vital vitamins in the process.”
The creation of the hub was driven by the food crisis of 2008 when the world price of milk powder doubled. Developing markets found this time particularly hard and forced Tetra Pak to think of a new solution. “In developing markets, 80-90% of locally produced milk is through smallholder farmers, but there’s not really been the infrastructure to ensure a real process for collection,” says Holm.
The Dairy Hub concept requires Tetra Pak to work very closely with its customers, the dairy processing companies, as the concept is based on linking farmers in a specific area – covering a certain number of villages, smallholder farmers and cows – to a dedicated dairy processor. They then select an area, usually consisting of around 15-20 villages – home to around 10,000 cows. The processor sets up milk collection stations with cooling tanks where farmers deliver milk twice a day.
An advice centre is also set up which helps to train farmers in feeding techniques and hygiene. Tetra Pak, through Tetra Laval Food for Development Office, has been involved in setting up the training methodology and as a result of this training, farmers have seen the production of their cows double. “The focus of the training is about increasing the quantity of the local milk, as well improving its quality,” says Holm.
Farmers benefit from the transfer of knowledge and expertise – which leads to healthier animals and increased productivity and profit – as well as access to proper infrastructure and guaranteed twice-daily milk collections all year round. Processors are able to tap into a reliable supply of locally produced, high-quality milk and gain better control over the supply chain. And at the same time, public access to safe and affordable milk is increased.
Holm explains that the hub is about helping local entrepreneurs to grow a more commercial model. “It’s a way of growing the market as a whole,” she says. Adding, “It’s about moving these smallholder farmers to a more formal value chain and the Dairy Hub does just that – linking small producers to the formal chain.”
It also means that there’s a sustainable milk supply for the dairy processor which is a lot more economic than them investing in a large farm. By setting up a hub, processors give themselves the advantage of better control over the supply chain.
An important part to the success of a hub is building trust between partners. “The farmers are used to selling directly or to potentially unreliable middlemen, so the need for trust is vital. Once this is established, the farmer can concentrate purely on the hub and the quality of his milk,” says Holm.
Another vital element of the hub is data collection. In Bangladesh, statistics show that the collection costs of milk have reduced per litre over time and the production levels of the cows have increased.
The first dairy hub activities were set up in 2008 as a small pilot in Bangladesh with just 400 cows. “Over a short period of time, production doubled,” smiles Holm. In Bangladesh today, there are three hubs up and running involving several thousands of smallholder farmers. There are also hubs in Nicaragua, Sri Lanka, Kenya and Senegal. “We also see a huge potential in Asia, Pakistan, India and sub-Saharan Africa”, maintains Holm.
Other companies, in other sectors, are also now looking at this hub model. As Holm points out, if it works for dairy farmers it could work for other crops too, such as the fruit value chain.
Holm says there is lots of interest from customers, development agencies and governments. “The hub model represents a way of securing local business development which also helps create a sustainable food development chain.”
She believes that the initiative addresses many of the recently announced Sustainable Development Goals and that more public-private partnerships can help scale up these kinds of hubs. “Working together we can do so much more,” she insists.
 

The solar and wind industries can now breathe a bit easier. With President Barack Obama's signage of a $1.1 trillion spending bill on Friday, which includes tax breaks for everything from the child care to wind and solar construction, the renewable energy sector can now look ahead for a few more years of help from Uncle Sam.

The everything-in-one spending bill allows for $622 billion in tax credits, including a five-year extension on the Investment Tax Credit (ITC) for solar and the Production Tax Credit (PTC) for wind. The ITC allows for a 30 percent tax credit through 2019, when it will then gradually ramp down to 10 percent, ending in 2022. The PTC is also geared to boost production over the next few years, with tax credits gradually decreasing after 2017.

Some analysts are calling this extension a win-win for the solar industry, which was expected to show a 24 percent increase in production next year. Instead, the new projection is a slower, more incremental boost in production over the next five years, which Bloomberg Businessweek suggests will ultimately translate to less overhead for solar installation companies. Wind will benefit as well, with a better line of sight toward revenue-boosting projects. Analysts are expecting another 20 gigawatts added to the solar mix and 19 gigs to the wind sector.

In all, the two tax credit extensions are expected to boost renewable energy investment by $73 billion and add renewable energy to another 8 million homes.

The surprise announcement also provided a shot in the arm to two of the country's largest renewable companies, SunEdison and SolarCity, which both registered a significant jump in stocks after Congress agreed on the spending bill.

With all of the pluses being touted for this mega spending bill, not all Democrats were willing to vote for its added benefits to the fossil fuel industry. The bill also opens the door to lifting the ban on oil exports. In an 11th hour plea, House Minority Leader Nancy Pelosi appealed to her caucus to vote for the bill. Still, the 77 Democrat and 241 Republican yeas in the House were enough to send the bill on to the Senate, which passed it 65-33, preparing the way for the president's signature.

Other last-minute picks on the omnibus spending bill included the continuation of the "Nascar tax break," which was officially enacted in 2004 as a nod toward the costs incurred by race tracks of all stripes and species. Both the horse- and car-racing industries rely on the tax break to cover construction costs.

With the increasing decline of the horse-racing industry and this month's landmark agreement between global leaders to end the use of fossil fuels, the Nascar tax break fits neatly in place with the incongruity of a bill that now allows for fossil fuel exports. Neither are likely to have the long-term investment return that the renewable tax credit is likely to show. But, as Pelosi noted, their inclusion offered just enough holiday cheer for everyone to get the bill signed and avert a shutdown.

Image credits: 1) Oregon Department of Transportation; 2) John S. Quarterman

The world was abuzz earlier this month when Facebook CEO Mark Zuckerberg announced that he would donate 99 percent of his company shares to charitable causes over his lifetime. The announcement drew criticism about how the donation (currently worth $45 billion) would be apportioned, and for some it brought to light a bigger question about how tech giants decide to give back.

Billionaire tech philanthropy is nothing new. In October, when Square filed its initial public offering, CEO Jack Dorsey (of Twitter fame) announced that he would give 40 million of his shares, the equivalent of 10 percent of the entire company, to help underserved communities and “drive positive impact.”

And last month Bill Gates drew headlines when he announced that he would join more than 20 other billionaires – including Zuckerberg, Jeff Bezos of Amazon, Richard Branson of the Virgin Group and Marc Benioff of Salesforce – to launch a coalition that invests in clean energy projects around the globe.

Throwing money at causes doesn’t solve problems, but it certainly helps. It takes a lot more than dollar signs, though, to create lasting impact and be a truly responsible corporate citizen (tech or not).

It starts from within

For a growing list of companies, corporate responsibility has taken the form of employee volunteer programs. These programs have been on the rise, in part due to the fact that millennials will comprise about half of the U.S. workforce by 2020, and more than 50 percent of millennials want to work at a company involved with causes. Clearly companies realize the recruitment and retention benefits of engaging employees in this way.

The range of corporate volunteer programs varies. Some companies host an annual day of service, while others offer everything from 20 to 80 to unlimited hours of paid time off for volunteering on the job.

In addition to engaging employees through volunteering, some companies leverage more than their workforce to give back. Salesforce, for example, is known for pioneering a 1-1-1 model that donates 1 percent of the company’s equity, product and employee time to give back to communities around the world.

“The work of Salesforce.org has had a significant impact on the communities where Salesforce employees live and work,” Ebony Frelix, VP of philanthropy and engagement at Salesforce.org, told 3p. “This type of integrated philanthropy encourages companies and individuals to become corporate citizens in their communities, and gives our employees something to feel connected to."

Every Salesforce employee is able to spend six paid days every year volunteering, and each employee that reaches six days is granted a “Champion” grant of $1,000 to give to a nonprofit of their choice. To date, Salesforce.org has donated $100 million in grants, employees have volunteered 1.1 million hours, and the Salesforce product now powers more than 27,000 nonprofits.

What is great about this model is that it takes a systems approach to doing good, rather than trying to solve a problem by only writing a check.

Tech-quity

Indeed, businesses can do a lot more to support their local communities beyond giving away cash.

Upon Uber’s announcement in October of its plan to move its corporate headquarters to downtown Oakland, California, the city’s Mayor Libby Schaaf outlined her thoughts in a letter to Uber executives on how the tech company could make its move to the city across the Bay in a way that contributes to a “more vibrant and equitable city where [everyone] thrives.”

In particular, Mayor Schaaf called for businesses to support the city’s local economy, strive for equity, be a compassionate neighbor and fight displacement. Schaaf encouraged actions such as sourcing locally, eating and shopping at local small businesses, providing educational and job opportunities for low-income, young people of color from local public schools, hiring Oakland residents, encouraging employee volunteerism, reducing environmental impacts, and partnering with the city to identify creative solutions to help address the region’s affordability crisis.

“You chose Oakland because of its magic,” Oakland Mayor Libby Schaaf wrote in a letter to Uber executives. “This is how you can help us preserve it … [s]trive for equity, tech-quity, providing equitable access to top-notch technology training and jobs for our residents and fostering our local technology sector’s growth so it leads to shared prosperity.”

Tech-quity is certainly something other tech companies can strive for, as well.

Getting to resilience

Being good and doing good is not only about helping communities; it’s about creating resilience.

“Resiliency is much more than just earthquakes,” Patrick Otellini, chief resilience officer for the city and county of San Francisco told 3p. “Whatever [companies] can do internally to create a culture of involvement and giving back, in disaster relief and general volunteering, is a good for everyone.”

While the resilience conversation often focuses on climate adaption, disaster preparedness and economic vitality, resilience is really more than that. It’s about creating communities that thrive – for all people. Because communities that don’t thrive eventually crumble.

Tech companies, especially those in Silicon Valley valued in the range of $5 million to $500 million, certainly have a role to play, and it can involve more than money.

Requests for an interview with Uber went unanswered by press time.

Image credit: Flickr/Jimmy Baikovicius

In the aftermath of COP21, we need to shift rapidly to renewables in order to meet the goals set in the Paris Outcome. For some reason, the United Kingdom doesn't want to play along.

One of the reasons that COP21 ended with a stronger-than-expected agreement is that many developed countries stepped up to the plate. We saw strong financial commitments from the United States, Germany, Norway and even China. And we must also credit France, a masterful host, pushing forcefully for an agreement while showcasing its own commitment to renewable energy.

One country that was noticeably quiet was the U.K., whose right-wing government, apparently, wasn't even paying attention to COP21. They were busy gutting their green policies and promoting dirty energy like it was 1950.

In fact, earlier this week, news broke that the U.K. plans to drastically cut solar subsidies. From the Guardian:

"The government has decided to cut subsidies to householders installing rooftop solar panels by 65 percent just days after agreeing to move swiftly to a low-carbon energy future at the climate change conference in Paris."

What makes this even worse is that there was no complimentary move to reduce fossil fuel subsidies, for which the U.K. spends $4.2 billion a year. These fossil fuel subsidies are a major barrier to progress on clean energy as they artificially keep dirty fuel prices low and incentivize people to use more, not less, fuel. Moreover, study after study has shown that the poor – the main reason for many of the subsidies' existence – gain little benefit from them. In fact, the main beneficiaries are the wealthy.

How much are solar subsides capped at now? According to Friends of the Earth, just 35 million British pounds per year (about US$52 million). Even after COP21, the U.K. believes it needs to give fossil fuels eight times more support than solar.

“It’s outrageous that the government continues to hand out billions of pounds in subsidies every year to climate-wrecking fossil fuels, while trying to block the clean energy sources we urgently need to power our homes, hospitals and schools,” said Alasdair Cameron, a Friends of the Earth renewable energy campaigner, in a statement.

Knowing this, you probably shouldn't be surprised that the U.K. is far behind its neighbors France, Italy and Germany in solar. Germany – which has only slightly more solar irradiation than the U.K. – has six times the installed solar capacity, 38,301 megawatts, due to government policies that strongly promote renewables. On a per-capita basis, it's even worse with the U.K. ranking a paltry 15th in the European Union. This is definitely not the time to be cutting subsidies.

Wind is little better, but the U.K. – despite its vast wind resources -- ranks only at 13th in the EU per-capita, lagging, again, behind Germany and Spain.

What the U.K. is pushing forward on is fracking, which recently received government support during COP21.

Thankfully, the British people aren't falling for their government's follies, and are mostly opposed to both fracking and the solar subsidy cut. If we are to meet the goals in the Paris Outcome – goals that U.K. signed on to – then we need to promote renewables and stop the use of fossil fuels. Let's hope that Prime Minister David Cameron comes to his senses soon.

Image credit: Aikira Solar Power Plant via Wikimedia Commons

As the Paris climate negotiations closed last Saturday, you heard a great deal of hope and optimism as well as congratulations for vision and progress emanating from COP21. Indeed, important commitments have been made – but they’re pledges, not actions, and they don’t reverse the adverse climate change underway.

Which is why adaptation is more important than ever.

Among conference influencers, I heard many reasons against adaptation. Such projects aren’t bankable, contended the head of Regions20, a United Nations investor collaboration. Mitigation is more interesting, maintained a global nonprofit agriculture sustainability advocate. And from the United Nations' adaptation chief: Lessening greenhouse gases is the only thing insurance companies should spend money on.

But these leaders, among the most active climate actors at the historic conference, postpone adaptation at their peril – and so does the rest of the world. Consider the warnings that sound so loudly from Stanford and Berkeley calculations: Global incomes could decline 23 percent by 2100 relative to a world without climate change. And by 2030, annual costs of adaptation could be $150 billion to $300 billion a year, by the U.N.’s own estimate.

U.N. officials acknowledge that even in the best-case scenarios of greenhouse gas mitigation under the agreement, climate change will persist for at least three to four decades. So much for helping the health and safety of our children and grandchildren.

On the other hand, one group that seemed willing to consider adaptation at COP21 was the private sector:

1. The sustainability director of Mars, Inc. noted that he often starts discussions with climate adaptation when conferring with his government hosts about doing chocolate business in Cote D’Ivoire, Ghana and Nigeria.


2. An executive of nonprofit health plan Kaiser Permanente defined his role as climate adaptive in supporting human resilience.


3. Investment firm South Pole Group, leveraging its growth in mitigation markets, has seen exponential growth in its developing-country water purification adaptation investment partnership.


4. PepsiCo, a historic adaptation leader, continues to innovate throughout its food-and-beverage supply chain.


5. The U.N. Global Compact had the courage and foresight to release a paper of adaptation best practices at its Caring for Climate business forum. The Notre Dame Global Adaptation Index (ND-GAIN) participated in creating The Business case for Responsible Corporate Adaptation document.

The biggest adapters at the COP21 negotiations seemed to be – wait for it – the United States government, which pledged $800 million for adaptation at the conference.

As I joined other tired souls exiting the climate talks and onto the crowded bus to the Metro station, I thought to myself: Adapt or bust. For while I share hope that countries will make good on the significant commitments emanating from COP21, I’m a pragmatist. I recognize from similar pledges made in both private and local government sectors over the years that the best of intentions differs from impact. And making good on mitigation commitments can be slow, failure-prone work.

Still, recognizing the important mitigation actions galvanized by COP21, I’m encouraged that the private sector is opening doors to new markets, creating collateral benefits, building efficiencies and innovating for adaptation. Well beyond the hope and promise of the Paris agreement, private-sector voices will help ensure that extreme events do not become disasters.

Image credit: Flickr/Premnath Thirumalaisamy

Joyce Coffee is managing director of the Notre Dame Global Adaptation Index (ND-GAIN), whose mission is to increase the world’s awareness about the need to adapt, informing public and private investments in vulnerable countries.

By Hugh Jones

Polluters very rarely offer to pay for cleaning up the pollution they cause. Lessons from history tell us that when there are private profits and public costs, it usually takes an intervention from government to put a price on externalities.

Carbon emissions don’t respect national borders, so tackling a global problem like climate change is ultimately going to require a global solution. And slowly but surely the prospect of a worldwide price on carbon emissions is beginning to seem more likely, particularly following the latest international climate change agreement coming out of the Paris COP21 talks. This lays the groundwork in Article 6 for creating mechanisms and markets to reduce carbon emissions, both multilaterally and globally.

There is already considerable momentum behind carbon pricing around the world, with existing regional, national and subnational schemes currently covering around 12 percent of global emissions. Carbon taxes or emissions trading schemes are either operational or planned in the EU, U.S., China, Japan, South Korea, Switzerland, Norway, Turkey, Mexico, Chile, Thailand, Ukraine, Kazakhstan and South Africa.

With a strong global commitment to limit global warming to no more than 2 degrees Celsius, alongside the urgency of the challenge of addressing climate change, there is every reason to expect carbon pricing to continue its expansion.

The volume of emissions covered by such schemes has trebled over the past decade. China’s regional pilots are expected to turn into a national scheme from 2017. States in the U.S. and provinces in Canada are already linking their cap-and-trade schemes, with Mexico looking to get involved from 2017.

Internal carbon pricing

These are markets that matter for many companies, where paying for carbon emissions is becoming part of the cost of doing business.

In response to these schemes, or in anticipation of future carbon-pricing legislation, this year the CDP reported that 437 large companies say they now use an internal carbon price in decision-making. This is an increase from just 150 in 2014. A further 583 companies reported that they intend to use an internal carbon price in the next two years.

But what actually is an internal carbon price, and what are the advantages of implementing one?

There is no single method or price that is used. Broadly speaking, internal carbon pricing is most frequently used as a shadow price which can be added to future investments and operational costs as a way of hedging against future policy decisions to implement any carbon-pricing mechanisms.

As described in company testimonies contained within CDP studies, some of the key benefits of doing this include:

• To anticipate government legislation on carbon pricing


• To comply with existing government legislation


• To avoid intermediary/transaction costs associated with trading permits in national schemes in favour of factoring in these prices internally


• To justify investments that may have smaller margins without a carbon price


• To manage risk for future investments


• To monetise and record social cost

In some exceptional circumstances, a carbon price can underpin a more expansive company scheme. In 2012, Microsoft made the decision to use an internal carbon fee which was charged to individual business groups using Microsoft services. The funds from this internal tax were then used to invest in energy-efficiency initiatives, renewable energy and carbon offset projects in order to meet net carbon neutrality targets.

Since 2014, 100 percent of Microsoft’s energy consumption is sourced or offset due to these projects. In just three years, the company has reduced its emissions by 7.5 million tons of CO2 and saved more than $10 million on energy costs. This year it expects its scheme to amount to $20 million of internal charges.

Challenges and solutions

Useful work on carbon pricing implementation is starting to emerge to address these questions such as a recent study from the World Resource Institute and Caring For Climate. This finds one of the common challenges to setting an internal carbon price is a lack of guidance in knowing what price to set. This is related to a lack of clarity and certainty from climate policies at a national level. There are also issues with prices being set too low to actually affect investment decisions.

The good news is that it may be getting easier to predict the future. Many companies have now pledged to implement a carbon-pricing mechanism as part of their Intended Nationally Determined Contributions to action on climate change, submitted in Paris. The agreement by governments in Paris, alongside demands for action from the broad coalitions of corporates that came together, suggests that legislative action on carbon pricing will only become stronger.

Analysis by the U.K. government’s Department of Energy and Climate Change and the Carbon Trust estimates that, in a scenario where warming is limited to less than 2 degrees, the global price of carbon is expected to converge at $140 per ton of CO2 by 2030 and $400 by 2050. In a 1.5-degree scenario, these costs would be considerably higher.

Predicting the future and making decisions is one of the great challenges faced by the executives and non-executives responsible for long-term corporate strategy. Climate change will create both winners and losers, but setting an internal carbon price will help companies to better address the risks they face and choose the path needed for success in a sustainable, low-carbon future.

Image credit: Flickr/Thawt Hawthje

Hugh Jones is Managing Director of Advisory at the Carbon Trust.

ExxonMobil CEO Rex Tillerson promotes petroleum as the only solution to "energy poverty" in developing nations, but affordable solar power is on the verge of completely undercutting his argument, at least when it comes to household lighting. In Africa, for example, the company Off Grid Electric is offering a soup-to-nuts solar lighting system aimed squarely at replacing kerosene.

Off Grid Electric has been introducing its solar model in Tanzania, and with a new round of $70 million in financing, it is set up for a major expansion.

The end of kerosene

Relieving households from the health and safety hazards of burning kerosene indoors is the key advantage of solar power.

A paper prepared for the 2013 Off-Grid Lighting Conference identified the following risks from kerosene lighting:

"... burns caused by a wide variety of factors, indoor air pollution, non-intentional ingestion of kerosene fuel by children, suppressed visual health, and compromised health services and outcomes in facilities lit with fuel-based light. Each risk factor results in illness, and most in mortalities. Lighting is the dominant and sometimes only use of kerosene (referred to as paraffin in some parts of the world) in rural areas ..."

That's just the summary. The statistics cited in the report make it clear that adding more kerosene to emerging markets is literally adding fuel to the fire. Beyond fire risks and exposure to dangerous levels of airborne pollutants, that includes poisoning (accidental ingestion of kerosene is "the leading cause of child poisoning in developing countries") and vision problems related to habitual use of insufficient lighting.

Regardless of Mr. Tillerson's point of view, clearly kerosene needs to be replaced with a safer, healthier alternative.

The solar advantage

That's where Off Grid Electric comes in. This year, the company has accumulated a $70 million pool of solar financing that will enable it to expand its lease-based distributed solar model in Africa.

The lease model enables kerosene users to acquire solar power within their existing energy budget. Consumers with no formal credit record can use the platform to establish a credit record, too.

Over the next three years, Off Grid Electric will leverage its partnership with the Tanzanian Investment Center to provide off-grid solar electricity to 1 million households. In addition to providing solar power for lighting, the system also enables users to power small appliances and recharge cell phones.

The U.S. Agency for International Development contributed $5 million to the $70 million solar pot with this observation:

"In Tanzania, approximately 40 million people lack access to electricity. Off Grid Electric currently provides affordable, reliable light and energy services to 10,000 new households per month to families faced with an expensive grid, an unreliable grid, or no grid access at all.

"Off Grid Electric borrows from the telecom industry's business model: rather than purchasing costly solar systems, customers pre-pay for electrical services using "mobile money" and are able to access small-scale, radically efficient solar home systems with integrated appliances."

The U.S. oil export ban

As a distributed solar provider, Off Grid Electric complements the Power Africa initiative, aimed at adding 30,000 megawatts of "new and cleaner" power generation to the continent, to bring 60 million new electricity connections to the grid.

Power Africa also includes biodigestion and other off grid electricity solutions that leverage local and scavenge-able resources.

Renewable energy is also challenging Africa's petroleum dependency in the cookstove field, where solar power is among the alternative sources edging into the marketplace.

With all this activity in mind, if petroleum fans were hoping that the newly-lifted U.S. oil export ban would expand the market in Africa and other developing regions, there may be some disappointment in store.

Image credit: Off Grid Electric, used with permission

Thailand’s shrimp industry is linked to human rights abuses and even slave labor. The Associated Press (AP) conducted an investigation into the shrimp industry this year and found that migrants work under terrible conditions. Some work 16-hour days peeling shrimp and receiving meager wages. If they try to leave, they are returned and forced to keep working. Some of the shrimp workers are children.

The AP investigation chronicles the story of a migrant shrimp worker and his wife. Named Tin Nyo Win, the man was called No. 31 by his boss -- stripped even of the dignity of being called by his name. The husband and wife “ripped the guts, heads, tails and shells off shrimp bound for overseas markets, including grocery stores and all-you-can-eat buffets across the United States,” the AP reported.

Tin Nyo Win and his wife, Mi San, peeled “about 175 pounds of shrimp for just $4 a day,” the AP investigations found. Five months into forced labor, they decided to run away, but Mi San was captured less than 24 hours later. Tin Nyo Win watched as his wife, who was pregnant, was “dragged away by her hair.” Almost two weeks later, he found her with help from a local labor rights group that prompted police to do something.

After Mi San was found, she was taken to the police who forced her to go back to work, taking her and her husband to another factory. Four days later they were arrested, held on almost $4,000 bail, and charged with illegally entering Thailand and working without permits.

This latest AP story is one of a series investigative reports on the Thai seafood industry. For this story, AP journalists “followed and filmed trucks loaded with freshly peeled shrimp from the Gig shed to major Thai exporting companies and then, using U.S. customs records and Thai industry reports, tracked it globally,” the AP story states. The Gig shed is where Tin Nyo Win and Mi San worked.

Americans love their shrimp and eat 1.3 billion pounds a year, as the AP story points out. And some of the shrimp they eat is a product of forced labor. The shrimp processed by people like Tin Nyo Win and Mi San found its way to U.S. retailers and restaurants like Walmart, Kroger, Whole Foods, Dollar General, Petco, Red Lobster and Olive Garden. The shrimp also made it into the supply chains of well-known seafood brands and pet foods such as Chicken of the Sea and Fancy Feast. The AP sent reporters into supermarkets in all 50 states and found “shrimp products from supply chains tainted with forced labor.”

One of the companies linked to shrimp from forced labor is Thai Union, which has also been linked to tuna from forced labor. Earlier this month, the company announced that, by Dec. 31, it will bring all shrimp processing operations in-house. “The move will provide us with full oversight of all processing stages,” the company said in a statement.

Greenpeace released a report last month on human rights abuses in the tuna industry. The report linked Thai Union “to the darkest sides of the seafood industry: human rights abuses, the wholesale waste of marine life, and the killing of endangered species with destructive fishing methods.” Greenpeace found that, although Thai Union has taken some steps to clean up its tuna supply chain, more action is needed.

Given the size of Thai Union, it has an “unrivaled position to drive positive changes” in both the tuna and shrimp industries, as Greenpeace put it. If the company ensured its supply chain is completely free of forced labor, it would impact Thailand’s entire seafood industry and help bring positive changes to the working conditions far too many workers face.

Image credit: Flickr/S Khan