Companies Scramble to Meet Consumer Demand for Zero Deforestation
By Adam Wiskind
The global uptake of 'zero deforestation' claims is growing, with demand for deforestation-free products on the rise. The Consumer Goods Forum, representing 400 global brands such as L’Oreal, Proctor & Gamble and Unilever, has committed to help members “achieve zero net deforestation” in their supply chains by 2020. Retailers have also stepped up, such as Safeway, with its recent pledge to source palm oil only from sites where “no deforestation has occurred after Dec. 20, 2013.”
In fact, more than 50 percent of the palm oil traded globally is now covered by some “deforestation-free” commitment. Governments, too, are taking action, with more than 60 countries signing onto the World Wildlife Fund’s Zero Net Deforestation pledge in 2013.
These pledges are significant and represent an important driver of interest and attention. How these claims are translated on the ground will determine their actual impact in terms of protecting critical forest habitat around the globe. The next step is verified action. This is where leveraging existing responsible forestry and palm oil certification schemes can help.
What is meant by zero deforestation?
A variety of different terms are in use with different shades of meaning, leading to confusion and potentially to misleading claims. “Zero net deforestation” means that there has been no human-caused net reduction to the total forested area within a designated geographic region. For example, General Mills has committed to “zero net deforestation” from its sources of palm oil. A shortcoming of this term is its inherent emphasis on quantity versus quality, allowing newly-planted forests to compensate for converted older forests.
Another term, “no deforestation,” literally means no loss of forest cover in a defined geographic area, but it is also erroneously perceived by some to mean that all timber-cutting activity has ceased. Safeway’s “no deforestation” pledge for its sources of palm oil is one example. Yet even protected forest regions generally allow some level of timber management. A stricter term, “zero gross deforestation,” means that there has been no conversion of any forestland within a defined geographical area, but no major brands have yet to make this explicit claim.
The geographic area at which the no/zero net deforestation concept is applied also directly influences the substance and credibility of any such claim. Generally, the larger the geographic region to which the concept is applied, the more suspect it is, as exploitative practices can be more easily masked by unrelated “afforestation” (establishment of a forest in an area where there was previously no forest) activities within the same region. An excellent case in point is the United States where the total forest area has increased over the past century. But making a claim that wood products sourced in the U.S. are “deforestation free” is a meaningless assurance.
The situation is further complicated by the fact that there is no agreed-upon assessment standard. The ability of a palm oil producer to achieve any of these commitments is highly dependent on the extent of the area being assessed, and the ecological thresholds set to define an area as “forested” as well as what constitutes “deforestation.” It is unlikely that the companies that have signed onto WWF’s Zero Net Deforestation 2020 have a clear understanding of whether they are purchasing Zero Net Deforestation palm oil or how close they are to meeting their overall goal.
Driving the uptake of zero deforestation
The zero deforestation concept was borne out of the recognition that the cultivation of commodity crops – especially palm oil, beef, soy and wood products – are the major drivers of tropical deforestation. Production of these commodities can result in illegal logging and irresponsible forest conversion practices, damaging ecosystems, exploiting communities and contributing to about 10 percent of global climate change emissions.
Many of the companies pledging a commitment to zero deforestation are palm oil producers or users. Conventional palm oil production has a significant environmental footprint. According to a National Academy of Sciences study, clearing forestland for palm oil production in the early 2000s resulted in a 1 percent biodiversity decline in Borneo, a 3.4 percent biodiversity decline in Sumatra, and a 12.1 percent biodiversity decline in Peninsular Malaysia -- the equivalent of a permanent loss of more than 60 species. The endangered orangutan has become the poster child of this growing threat.
The challenge in establishing effective standards
The destructive impact of unmitigated palm oil production on natural forests has prompted calls for a palm oil production standard that protects carbon-rich forests and areas critical for local communities’ livelihoods from forest conversion. Existing standards have their shortcomings. The Roundtable on Sustainable Palm Oil (RSPO), the dominant palm oil standard, has been harshly criticized by non-governmental organizations (NGOs), local civil society, and the scientific community for failing to protect secondary forests, peat lands, local land rights, labor laws, and the climate.
Among current forest management certification schemes, the Forest Stewardship Council (FSC) has the most rigorous requirements regarding forest conversion. The FSC standard requires that any conversion “enable clear, substantial, additional, secure, long-term conservation benefits across the forest management unit.” In practice, this test is difficult to meet and with the exception of unique cases, conversion is effectively prohibited within FSC certified forests. FSC’s conversion requirements focus principally at the scale of individual forest ownerships rather than at the landscape scale.
Although FSC standards address plantation forests, they do not specifically address palm oil plantations nor the land management related to commodities such as beef or soy. The standards’ protections of High Conservation Value (HCV) areas, a concept initially developed by FSC for forest protection and utilized by groups like RSPO, has been criticized as inadequate to protect biodiversity in agricultural settings. Some further development would be needed to make the standards relevant to palm oil or other agricultural commodity cultivation.
As an alternative, Greenpeace and the Tropical Forest Trust have collaborated with a variety of stakeholders to develop the High Carbon Stock (HCS) approach. HCS is gaining recognition as an effective land-use tool for identifying plantable areas considered “conversion-free.” However, HCS faces challenges in its implementation. It is highly technical, and may require significant expertise and resources to meet the scale of the claims being made.
While a few major palm oil producers, such as Wilmar, have signed on to the HCS approach, other smaller palm oil traders and producers have recently signed a manifesto rejecting the HCS approach as flawed, and have commissioned their own year-long study on the topic. Moreover, despite HCS’ transparent development process, the approach is not a formal certification scheme. Without an accreditation system that maintains assessment standards and an auditable chain-of-custody system that tracks the flow of palm oil in the supply chain, it is not clear how HCS can be used to confidently support the diversity of claims in the marketplace.
Verification is needed
TFT is actively working with some of the largest companies to track and document their efforts. However, the growth of zero deforestation pledges and claims in the marketplace is far outpacing the ability to confidently assure that they are being met. Zero deforestation claims are now being applied to commodities well beyond palm oil, and to landscapes outside of the tropics, without adequate consideration of whether zero deforestation is an appropriate goal in these widening applications.
As standard bearers for responsible forest management, including the control of forest conversion in the tropics and elsewhere, existing certification schemes such as FSC and RSPO should be playing a significant role in helping companies to verify that they are meeting their zero deforestation commitments. Despite their limitations, the global recognition, transparent governance and established verification protocols that characterize FSC, and to a lesser extent RSPO, position them to make important contributions to the zero deforestation conversation.
Governments, companies and environmental organizations promoting zero deforestation should be engaging deeply with these existing schemes to make sure that they can be useful tools in the marketplace and, importantly, to avoid undermining the demand for and growth of these more comprehensive schemes. Given their partially overlapping goals – to limit impacts to the forest landscape – all parties would seem to benefit from better collaboration.
Image credits: 1) CIFOR, Flickr 2) Austronesian Expeditions, Flickr
Adam Wiskind is passionate about utilizing markets to drive responsible use of environmental resources. He is the Chain of Custody Program Director for SCS Global Services. He is also an occasional author and speaker on emerging sustainability and natural resource issues.
Masdar Invests $858M in U.K. Offshore Wind
Yesterday Masdar announced its partnership with two Norwegian firms in the Dudgeon offshore wind farm, located off the Norfolk coast in Eastern England. Valued at £1.5 billion (around US$1.9 billion or AED 8.95 billion), the wind farm will provide enough energy to power 410,000 homes in the U.K.
Masdar, Abu Dhabi's renewable energy company, acquired a 35 percent stake in the project from Statoil, a Harstad, Norway-based oil and gas company. Statoil remains as operator of the project with a 35 percent stake, with the remaining 30 percent owned by Statkraft -- an international hydropower company and Europe’s largest generator of renewable energy.
“As the only OPEC nation supplying both traditional and renewable energy to international markets, the United Arab Emirates is committed to accelerating the use of wind energy as an effective means of balancing the global energy mix as we move toward a sustainable, low-carbon future,” Dr. Sultan Al Jaber, chairman of Masdar, said in a statement.
Al Jaber, along with Ed Davey, U.K. Secretary of State for Energy & Climate Change, Statoil CEO Helge Lund and Statkraft CEO Christian Rynning-Tonnesen, announced the investment on the sidelines of the United Nations’ Climate Change Summit in New York.
As we've reported here on Triple Pundit, Masdar has already invested billions of dollars in a sustainable future for the UAE. Notable projects range from massive solar power plants and energy-efficient desalination to the ultra sustainable Masdar City in Abu Dhabi. The company has also branched out to renewable energy undertakings elsewhere, including Africa's largest solar plant and the Republic of Seychelles' first offshore wind project, which both came online last year.
The 402 megawatt Dudgeon project will be Masdar's second major investment in U.K. offshore wind energy. The company also has a 20 percent stake in the 630 megawatt London Array project, the world’s largest offshore wind farm, which also went online in 2013. (For more information on that project, check out our exclusive interview with Dr. Sultan Al Jaber.)
While alignment with the project is clear for Masdar and Statkraft, an oil and gas giant may seem a less likely investor at first, but Statoil CEO Helge Lund said everyone has a role to play.
“The Dudgeon Project represents an important part of Statoil’s renewable energy strategy, and it will generate value to the owners, the offshore wind industry and the U.K. community. Statoil brings extensive offshore competence, while Statkraft brings expertise from the power generation industry. Masdar’s experience and ambitions within renewable energy will add to the quality in this project,” Lund said yesterday in a statement.
It's also worth noting that the oil and gas industry is beginning to take more interest in renewable energy investment overall: U.S.-based oil and gas companies invested roughly $9 billion in renewable technologies from 2000 to 2010, according to data compiled by the Independent Oil and Gas Association of West Virginia (scroll to page 8). Betting on offshore wind power in the U.K. is also a pretty solid investment -- and one that's expected to pay dividends.
The nation is the world’s leader of installed, offshore wind power capacity. Not resting on its laurels, the U.K. government recently agreed to financially support eight new, large-scale renewable energy projects that will power millions of homes – five of them being offshore wind farms (Dudgeon included). The projects are expected to add 4.5 gigawatts of clean energy capacity to the grid – enough to power more than 3 million homes.
Masdar said the decision to become a partner in Dudgeon underscores its belief that "the U.K. represents a major market for investment in offshore wind energy." U.K. Energy and Climate Change Secretary Ed Davey agreed that attracting major investors is a signal that the U.K. government is doing something right when it comes to offshore wind power, providing additional incentive to the rich wind energy potential along its coasts.
“[The] investment is a strong endorsement of the U.K. as the best place in the world to invest in offshore wind – and it shows the government’s plan for green growth is working. Since 2010 we have seen, on average, £7 billion a year invested in renewables and we expect to see up to £50 billion more between now and 2020,” Davey said in a statement.
Offshore construction on the Dudgeon project is scheduled to start in 2016, and it is expected to be fully operational in late 2017, Masdar said.
Image courtesy of Masdar
Based in Philadelphia, Mary Mazzoni is a senior editor at TriplePundit. She is also a freelance journalist who frequently writes about sustainability, corporate social responsibility and clean tech. Her work has appeared in the Philadelphia Daily News, the Huffington Post, Sustainable Brands, Earth911 and the Daily Meal. You can follow her on Twitter @mary_mazzoni.
Note to U.N. Climate Delegates: Don't Forget Renewable Natural Gas
By Joanna D. Underwood
Amid clamor for bolder action on climate change, there’s dispute over the U.S. strategy of boosting production and dependence on natural gas as a bridge to a low-carbon future.
2013 was a record year for global CO2 emissions, and included a 2.9 percent rise in U.S. CO2 emissions after several years of decline. Burning natural gas to generate power releases only half the CO2 of burning coal, and when it is used as a vehicle fuel, it’s 20 to 25 percent better in terms of overall greenhouse gas emissions than gasoline or diesel.
But it is, after all, still a fossil fuel. It consists mostly of methane, an unregulated heat-trapping gas 25 times more powerful than carbon dioxide. Methane leakage from well sites and pipelines has become a hot topic. U.S. environmental groups are demanding the EPA regulate it, and it’s an issue at the United Nations Climate Summit taking place in New York this week.
Renewable energy advocates point out that the money spent on natural gas development preempts renewables spending, and there’s a limit to how much methane leakage and emissions regulation can be controlled and how much natural gas emissions can be improved. It’s understandable why, for many, swapping natural gas for oil and mitigating carbon dioxide emissions with methane seems like incremental punting -- not a robust solution to climate change.
But natural gas critics and boosters alike are missing something important: the advent of a fuel called renewable natural gas (RNG), which is chemically similar to fossil natural gas, but better. It is produced not by drilling or hydrofracking fossilized deposits, but by capturing biogases wherever organic wastes decompose: in landfills, wastewater treatment plants, etc. The stream of organic waste is massive, but until recently, we’ve largely ignored it as a source of energy and emissions savings.
Over its lifecycle, burning RNG as a vehicle fuel lowers greenhouse gas emissions by 88 percent or even more. In fact, GHG emissions from RNG can be net zero, or even net negative, meaning that producing and burning the fuel actually prevents more greenhouse gasses from entering the atmosphere than it emits. Here’s why:
If we leave fossil fuel deposits in the ground, their hydrocarbons stay in the ground. But if we leave our organic wastes alone and don’t refine them into fuel, they release their hydrocarbons into the atmosphere anyway as they break down. Every day, in urban and rural landscapes across the U.S., over 78 million tons of food and yard wastes are thrown out by homes and businesses, plus much more organic waste from food processing plants, supermarkets, farms, sewage, etc., are decomposing and emitting GHG without producing usable energy.
If we turn their biogases into fuel, and use it to offset emissions from fossil fuels, the overall impact on GHG isn’t incremental; it’s dramatic -- vastly greater than an equivalent amount of fossil natural gas.
RNG now powers hundreds of buses and trucks in Sweden, Spain, France, Germany, the Netherlands and Norway. In recent years a dozen waste-to-fuel initiatives have been launched in the U.S., and RNG is powering trucks and busses in six states, a harbinger of much bigger impacts to come.
America’s fleet of 10 million trucks and buses are our economic lifeblood, supplying our cities with transit and waste and recycling services and transporting materials and goods nationwide worth 70 percent of GDP. They also consume nearly a quarter of the nation’s vehicle fuel and emit nearly a quarter of the transportation sector’s GHGs.
Every fleet converted from diesel to RNG would cut its GHG emissions by 88 percent or higher. This exceeds U.S. goals of a 20 percent reduction by 2020 and and 80 percent reduction by 2050, as well as even tougher goals recommended by the Intergovernmental Panel on Climate Change (IPCC). RNG would cost about a third of diesel, and create tens of thousands of sustainable, place-based, unexportable jobs.
RNG qualifies as an advanced biofuel under EPA’s Renewable Fuel Standard, which helps incentivize low-carbon non-petroleum fuels. But it’s in our environmental and economic interests to develop RNG rapidly. So, mayors and governors contending with costly waste streams and emissions regulation compliance, federal officials and U.N. Climate Summit delegates wrestling with hydrofracking and methane regulation, and renewables advocates and concerned citizens demanding robust climate action should take note: A significant part of the solution is languishing -- literally -- in our own backyards.
Image courtesy of the author
Joanna D. Underwood is president of Energy Vision, whose mission is to analyze and promote ways to make a swift transition to pollution-free renewable energy sources and to the clean, petroleum-free transportation fuels of the future.
Seattle Assesses Fine to Homeowners for Wasting Food
The push for increased sustainable methods can be seen everywhere these days -- certainly when it comes to local efforts to pare down on what we toss in the landfill.
Massachusetts’ ongoing effort to increase composting throughout the state is one such example, which will require any company or facility that disposes of at least a ton of organic material a week to compost its food scraps and other compostable materials. The disposal ban takes effect on Oct. 1 and affects more than 1,500 businesses, hospitals, public offices and facilities. Connecticut and Vermont have similar bans for wasting food that exceeds a 2-ton limit on organic waste per week.
The city of Seattle has also embraced the composting idea with a bit more of a creative edge: In an effort to encourage residents to stop wasting food, the city council passed an ordinance this last Monday that allows households to be fined $1 each time that garbage collectors find more than 10 percent of organic waste in their garbage bins.
Private garbage collectors will have permission to eyeball the garbage bins and decide independently if the resident has exceeded the limit. If so, the homeowner will receive a note tacked to the bin telling the household to expect a $1 fine on the next bill.
Apartment buildings and businesses will get two warnings and then be assessed a $50 fine on the third violation, which is entered into the truck’s computer system. While apartment buildings must have composting bins on site, residents don’t legally have to use them. Businesses don’t need to have the bin, but they are subject to the same two-warning process as apartment buildings.
The new ordinance does seem to beg some questions, such as whether a quick visual analysis (and by a private garbage collector, not the city) can really tell all when it comes to legal infringements of an ordinance. And does the homeowner have any privacy rights when it comes to that half-eaten English muffin or three-quarters consumed apple? What about the other stuff that a recalcitrant resident might have thrown in the trash for quick disposal in the landfill, like phone numbers, bank account information and letters that have privacy concerns?
Sustainability measures seem to be taking us into new territories these days, and Seattle’s continued effort to promote the three Rs (reduce, reuse and recycle) -- and downsize a portion of that 36 million tons of food that end up each year in the U.S. landfill system -- is an example of that. So is its robust recycling program, which is lagging behind in its effort to meet a 60 percent benchmark by 2015. At the present time, its success is at 56 percent, an accomplishment that city council member Sally Bagshaw refers to as “stalled.” There are probably many cities that would consider that a significant coup.
Still, what’s to do with that old, forgotten and green lasagna in the back of the fridge when all you want to do is dispose of it? Will residents weed out their organic material, deciding which they will sacrifice to the allowable 10 percent and which they can bear to open up to compost? And how accurate is scientific analysis anyhow when standing in an alley in Seattle’s finest downpour eyeballing the week’s mildewing garbage collection?
Seattle’s landfill disposal ban takes affect Jan. 1, 2015, with an educational period. Fines won’t start until July of that year.
Image credit: SMcGarnigle
MyMeter Provides Energy-Saving Tools to Homes and Businesses
On a sunny summer day in Los Angles, a thousand air conditioners might easily turn on at the exact same moment. That would elicit a surge of electrical power to get all of those compressors running, driving up what is known as peak demand. Typically, a power plant must have enough capacity to meet that demand whenever it occurs. That requires the power plant to be much larger than what is needed most of the time, which makes it inherently less efficient. But if starting those thousand air conditioners could be spread out -- using tiny delays, over a period of less than a minute -- that would reduce peak demand, and the required plant capacity, considerably.
This is the idea behind demand management, an essential element of a smart grid architecture. Overall, a smart grid relies on a number of elements from the various domains. Generation includes the various sources and generating types, both variable and non-variable. Distribution includes storage, switches and transmission lines. Both of these domains have become smarter through the use of technology to control, measure and record the amount of power passing through them, as well as to protect the various elements from surges or overloads.
The customer domain is regulated primarily through the smart meter, which helps the user to optimize efficiency and manage demand. Software applications like MyMeter, from Accelerated Innovations LLC, help to “empower electric, gas, and water utilities and their customers to better manage end-use demand and consumption. It’s the engaging, intelligent connection that transforms meter data into insights for action.”
If knowledge is power, MyMeter provides power in that form, to both the customer and the utility, about the other kind of power being provided and consumed -- allowing each to optimize their own interests.
What this application does for utilities is to make the connection between demand, consumption and cost visible to the customer. It also gets the customer more involved in the management of his or her consumption. This can be further enhanced with games, challenges and providing comparisons with neighbors. By keeping demand from spiking, the utility avoids the need to build additional capacity or run inefficient “peaker” plants. It also provides a convenient way for the utility to communicate with customers in a timely manner and to collect certain types of information that can be used for targeted marketing.
What it does for the customer is to provide a powerful set of tools to engage with and better understand the relationship between their consumption choices, their carbon footprint and the bills they receive. It helps to prevent surprises and provides incentives like the “Energy Challenge." Tools like interactive charts help to identify unseen problems and wasteful usage patterns. MyMeter also allows customers to work with utilities to help diagnose problems.
Overall, the software has been independently verified to deliver energy savings between 1.8 and 2.8 percent in a study that included four Minnesota utilities: Beltrami Electric Cooperative, Wright Hennepin, Lake Region Electric Cooperative and Stearns Electric Association.
Mark Vogt, president and CEO of Wright Hennepin Electric said: “The thing that always frustrated me is that we could never help people understand what a kilowatt hour was. It’s our unit of sale, but it’s not something that the customers can get their hands around or could really understand … In my career, [MyMeter is] the first tool that we’ve been able to provide our consumers that helps demystify the kilowatt-hour.”
The idea that feedback data can help change behavior is one that is gaining ground, whether it’s using apps like FitBit to reduce your waistline or those like MyMeter, or its competitors Opower or C3 Energy to reduce your carbon footprint. With tools like these in hand, consumers and businesses alike will be in a position to reduce their energy bills and their impact on the planet.
Image courtesy of Accelerated Innovations LLC
RP Siegel, PE, is an author, inventor and consultant. He has written for numerous publications ranging from Huffington Post to Mechanical Engineering. He and Roger Saillant co-wrote the successful eco-thriller Vapor Trails. RP, who is a regular contributor to Triple Pundit and Justmeans, sees it as his mission to help articulate and clarify the problems and challenges confronting our planet at this time, as well as the steadily emerging list of proposed solutions. His uniquely combined engineering and humanities background help to bring both global perspective and analytical detail to bear on the questions at hand.
Follow RP Siegel on Twitter.
Nominate Your Favorite Nonprofit to Win $10,000 from Tom's of Maine
Now in its sixth year, the Tom’s of Maine 50 States for Good program rewards grassroots nonprofits with a total of $500,000 in project funding. But the natural personal care brand doesn't pluck these groups out of thin air -- it allows the public to weigh in on how funding is dispersed through a simple online nomination.
Nominations are open to anyone 18 years of age or older – including nonprofit representatives and supporters. Any qualifying 501(c)3 nonprofit in good standing with an operating budget under $2 million is eligible for nomination.
After the nomination period ends on Sept. 30, an independent panel of judges will pick the winners. This year, for the first time, the program will feature 51 winners across the country, one from each state and the District of Columbia -- bringing this year's project funding total to $510,000.
In addition to nominating a nonprofit, participants can also show their support and make an immediate impact on revitalizing a distressed park in Detroit with just a few clicks. Also new for 2014, Tom's is asking consumers to be “Virtual Volunteers” and use their collective social media power to bring much-needed park equipment to Knudsen Park along Detroit’s historic 8 Mile Boulevard.
Participants can visit 50StatesforGood.com and use the social sharing buttons to show their support for park needs ranging from swing sets to picnic tables. Renovations will be made possible by consumer support online and a $25,000 donation from Tom's to the nonprofit Eight Mile Boulevard Association, the company said.
"Our partnership with Tom's of Maine and the community embodies the way we pursue progress through collaboration,” Jordan Twardy, Eight Mile Boulevard Association executive director, said in a statement. “Together, we’ve attracted new interest, energy and commitment to revitalize and preserve this highly symbolic Detroit park. We are proud to join with Tom's and breathe new life into a space where Detroiters of all ages can gather with pride."
Over the past five years, the 50 States for Good program has provided $650,000 in funding to build playgrounds, support community gardens, maintain sustainable nature trails, provide shelter and food for the homeless and care for animals, among many other initiatives, the company said.
“There’s a desire inside each of us to bring a little more goodness to our communities, which is why we’re really excited to provide funding to a nonprofit in every state and the District of Columbia for the first time,” Susan Dewhirst, goodness programs manager at Tom’s of Maine, said in a statement. “Whether you want to say 'thank you' to an inspiring nonprofit in your community or join us in rooting for Detroit, it’s easy to make a difference.”
Click here to nominate your favorite nonprofit to receive $10,000 in funding from Tom's of Maine. The nomination period ends on Tuesday, Sept. 30.
Image courtesy of Tom's of Maine 50 States for Good
Based in Philadelphia, Mary Mazzoni is a senior editor at TriplePundit. She is also on the judging panel for this year's 50 States for Good and can't wait to learn more about your favorite nonprofits! You can follow her on Twitter @mary_mazzoni.
How to Tell Your Company's Sustainability Story
By Nicole Skibola
Building a narrative around a social enterprise is tricky. You need to appeal to the bottom line, convey social/environmental impact, resonate with a variety of different stakeholders, and every team member needs to feel personal passion when they tell the story or make a pitch.
At Centurion Consulting, we began working with a technology-driven sustainable agriculture enterprise in its startup phase last month. (That’s all I can say until they launch officially, but our work with them is a mix of sustainability, economic development, technology, and business model and product design). Going in, we had read a lengthy business plan. We had a sense of what our clients were trying to accomplish, but there were many moving parts and we knew the product was complex. We also gathered that the client team didn’t have a crystal clear understanding of what the product was.
In the old world of business plans, this would be a problem. We, however, saw it as an opportunity to bring the team together to craft a shared narrative. We knew that the only way we could help them to accelerate both their product development and prepare them for telling a cohesive story was through the Running Lean world of product experimentation and validation.
In some ways, not having a clear vision for a product, especially a human driven design product (i.e., one meant to help people around the world who are living in different social/economic/cultural contexts) can be an advantage. When entrepreneurs hatch a brilliant invention, it’s easy to grow attached to the idea for the idea’s sake. Clinging to an idea leads to rationalization. (“Well, Bob didn’t like the product, because he just didn’t get it.”) It becomes the customer’s fault for not adopting the product, not the designer’s fault for not listening to what the customers’ aggregate behavior is telling him/her.
When there is less of an attachment to an initial idea, it could make it easier to embrace the iterative nature of product development. This is where design thinking has the chance to come in. Think rapid experimentation and prototyping meets empathy driven hypotheses. Translation: Derive the solutions from the customer base, then test them to see if they stick. Don’t hold onto a feature set if the data shows customers aren’t buying it. Turn back to your customer base and listen for other solutions or features. Keep trying until you can validate these solutions.
Of course the team had some preexisting ideas of what kind of product and business they wanted to build. They were very passionate about some of the topics — economic empowerment, good food, sustainable agricultural practices, to name a few. However, because they didn’t have a product idea completely fleshed out, we had enough space that we were able to lead them through business model and then product model exercises.
A couple of introductory definitions before we get to the rest of the blog:
- Business Model Canvas (BMC): A business model is the design for the successful operation of a business, identifying revenue sources, customer base, products, and details of financing. The Business Model Canvas (seen below) is a tool to map out the key elements of a successful business model: customer segments, customer relationships, channels, value propositions, key activities, key resources, key partners, costs and revenue.
- Lean Product Canvas: A spin-off of the BMC, the Lean Product Canvas hones in on the product itself, but within the context of the bigger picture. So only one aspect of the product is the “solution.” The rest of “the product” is the articulated problem as matched to customer segments, the metrics, cost structure, etc. In short, its about the sum of the parts, not the physical solution in isolation. (Read more by Running Lean author Ash Maurya here)
We have used these canvases for a number of projects, ranging from shaping a consulting offering to product design to marketing. They present a highly visual, conceptually driven approach to thinking about a system. Sometimes, only the Lean Canvas is necessary. There is overlap between the two, as you will see. We opted for both because we are guiding our clients toward a product platform play, meaning the product as a whole is guided by the BMC, and component parts are guided by the Lean Canvas. There is no right answer, but we found that this combination worked in this instance.
Regardless, we think that the best place to start upon your first foray into the world of canvassing is with the BMC. Here are a few things to think about when walking through a BMC for the first time.
1. Identify all of your customer segments as PEOPLE
This is really helpful when constructing your narrative. Rather than labeling a customer segment as broadly as “governments,” think who in the government to whom you’ll be selling a product/service. Maybe it’s a procurement official, a ministry of regional and local government official or a trade minister. When you break it down, you will have an easier time articulating what these people find valuable and what their problems are (a deeper dive into problem/solution fit occurs in a Lean Product Canvas but we’ll start here).
For example, a trade minister may value surplus agriculture production that can enter the export market, whereas a minister of the regional and local government may value capacity building an local economic farm growth. When you are in a conversation with these people trying to sell your product or your service, they are going to care about different things. So you need to convey the value of your offering in different ways.
2. Match your PEOPLE (aka Customers) to a Value Proposition
Building on the point above, different people value different things. They have different jobs to be done and thus will purchase an offering (or not) based on how the value of the product is presented to them.
Build out a customer persona before working on the specific value proposition. It might go like this. Bob is the minister of agriculture in X County in Kenya. His oversees farmers and agriculture production. His biggest challenges are x, y, z. He is probably successful at his job if he does a, b, c. Get inside Bob’s head. Who is he, what are his challenges and what do you think his performance metrics are based on. This information could be partially speculative, but should also be based on customer conversations, or extracted from similar persona profiles.
To keep things organized, start with your customer segments using different post-it colors. Make sure that each box in the Canvas matches the segment by post-it … meaning that you need to address every segment in every box. Every customer should have their own value proposition.
3. Craft an overarching narrative
This was big with our clients. There are nine founders, all well developed along their professional paths. They bring a different set of experiences to the table and thus tell their vision and story of the product in a different way. This is especially common when dealing with social enterprises or nonprofits. Leaders are really passionate about their product and have their own set of values that enter the story they tell. Sometimes, essential values of the overarching narrative get lost when there are a number of stories being told. For instance, an operational, boots on the ground leader has a first hand understanding as to why understanding cultural context matters. This becomes a key tenet of the product offering. But the sales team may not understand that, and thus may leave that piece of the story out. If the sales team is talking to someone like a major foundation or a local government and they place no emphasis on context, the story’s value may diminish. It’s not that the piece isn’t there, it’s just that it’s not being told.
We have found that it’s best to have either the head of communications or a consultant (someone neutral / outside of the leadership mix) to interview leaders about the core values surrounding the product. (This is different than the organizational core values, but there may be overlap). That person should collate individual values and integrate them with the broader organizational objective, core values, purpose and operating principles. The concepts that emerge then become points in the story to be told by the individual. There shouldn’t be too many, so the talker can remember them all and artfully integrate them into her/his dialogue.
Closing thought: ITERATE!
The Canvas, the narrative, all should be revisited regularly. Catch yourself if you are pouring over a box on the canvas. Then give yourself permission to let it go, zen style. The truth is, you should be testing, reworking and validating your segments, value propositions — and every other box on the canvas all of the time. The work is never done.
Image credit: Flickr/eric snopel
Nicole Skibola is a principal with Centurion Consulting, a firm dedicated to identifying, addressing, and innovating strategic and operational opportunities around all facets of sustainable development.
Hershey Expands Ivory Coast Cocoa Farmer Program
Earlier this month, Hershey announced the expansion of its cocoa farmer training and community initiatives in the Ivory Coast. The company will partner with Cargill to expand the initiative, called 'Learn to Grow Ivory Coast,' to include seven farmer cooperatives and investments in education and teacher housing. Through the initiatives, 10,000 cocoa farmers will be trained in agricultural and social practices that are certified with the UTZ Certified standard. The farmers will receive higher premiums for the cocoa as a result.
The Learn to Grow Ivory Coast program will accelerate Hershey’s purchase of sustainably-sourced cocoa. Hershey has committed to sourcing 100 percent certified cocoa for all of its products globally by 2020. It is committed to sourcing cocoa certified through UTZ, Fairtrade USA and Rainforest Alliance, three of the most recognized cocoa certification programs.
In 2013, Hershey sourced 18 percent of its cocoa from certified sources. By 2016, the company hopes to increase that percentage to between 40 and 50 percent.
The Learn to Grow Ivory Coast program is part of Hershey’s 21st Century Cocoa Sustainability Strategy, and through its various initiatives Hershey plans to reach over 50,000 cocoa farmers by 2017. Other initiatives include the Cocoa Livelihoods Program, which is a project to double incomes of 200,000 cocoa farmers in West Africa. Over 130,000 cocoa farmers were trained through the program in the first five years.
Cargill already has an established network of farm associations in Ivory Coast where the company sources and processes cocoa. For over a decade Cargill has been participating in cocoa sustainability initiatives. Hershey and Cargill worked in the past on CocoaLink, a program that uses mobile technology to provide Ghanaian cocoa farmers with information about good agricultural practices, labor safety and crop marketing. Cargill will focus on three areas for Learn to Grow Ivory Coast which include good agricultural practices, farmer cooperatives infrastructure and education support.
“Hershey and Cargill combine shared values about community responsibility with an urgent focus on bringing better farming practices and market opportunities to Ivory Coast cocoa farmers,” Terry O’Day, chief supply chain officer and senior vice president for Hershey, said in a statement.
Over a third of the world’s cocoa supply comes from the Ivory Coast. The Ivory Coast cocoa sector is plagued with child labor. A report by Tulane University on the cocoa sector in the Ivory Coast and Ghana found that 25 to 50 percent of the children in households in both countries work on cocoa farms. Children working on cocoa farms are “frequently involved in hazardous work.” Children in the Ivory Coast are “engaged in the worst forms of child labor, many of them in hazardous work in agriculture, particularly in the production of cocoa," stated a 2012 report by the U.S. Department of Labor. There are over 109,000 children working in the Ivory Coast’s cocoa industry under the “worst forms of child labor,” according to the U.S. Department of State, and about 10,000 of those children are human traffickinug or slave labor victims.
Image credit: Hershey
World Leaders Respond to U.N. Call for Climate Change Action
At the United Nations Climate Summit 2014, held at U.N. headquarters in New York City on Sept. 23, Secretary-General Ban Ki-moon called for bold commitments to catalyze climate change mitigation and adaptation actions. In response, leaders spanning government, business, finance and civil society announced new initiatives to reduce greenhouse gas emissions and tackle climate change.
New climate change action initiatives were announced in the areas of finance, farming and forests. New coalitions between cities, businesses and citizens were formed that aim to reduce GHG emissions and strengthen resilience to climate change, according to a Climate Summit 2014 news release.
“Change is in the air. Today’s Climate Summit has shown an entirely new, cooperative global approach to climate change,” U.N. Secretary-General Ban Ki-moon said. “The actions announced today by governments, businesses, finance and civil society show that many partners are eager to confront the challenges of climate change together.”
Climate Summit 2014 action pledges
The wide-ranging climate change initiatives announced during the U.N. climate summit “will have a profound impact on global financial markets to more local actions that will reduce the emissions of smallholder farmers,” the U.N. commented. Renewable energy initiatives in southern Africa and Small Island Developing States (SIDS), for examples, are to be increased in scale and rolled out across these regions.
Secretary-General Ban was encouraged by the response of world leaders and delegates:
“Today shows that the world is finally waking up to the economic and social opportunities of taking action on climate change,” he was quoted in a news release. “The Climate Summit is showcasing a level of ambition not seen before and producing actions and new initiatives that will make a significant difference.”
Following is a summary of the climate change action initiatives related to climate finance, forests, cities and climate-smart agriculture announced during the U.N. Climate Summit 2014:
Finance
- An initiative to mobilize more than US$200 billion in financial resources from public and private sources by the end of 2015. This includes new pledges for the Green Climate Fund, the decarbonization of investment portfolios (moving assets out of fossil fuel-based investments), the continued efforts of national banks to invest in new climate activities, and wide support for putting a price on carbon emissions.
- A coalition of institutional investors has committed to decarbonizing $100 billion in institutional equity investments by COP 21 (December 2015) and to measure and disclose the carbon footprint of at least $ 500 billion in investments.
- Commercial banks will provide $30 billion in new climate finance by the end of 2015 by issuing green bonds and other innovative financing instruments.
- The national, bilateral and regional development banks of the International Development Finance Club announced they are on track to increase their direct green/climate financing to $100 billion a year for new climate finance activities by the end of 2015.
- The insurance industry has committed to double its green investments to $84 billion by the end of 2015 and announced that it would increase the amount placed in climate-smart investments to ten times the current amount by 2020. Developed and developing countries have started pulling together to capitalize the Green Climate Fund, by pledging several billion dollars.
- A group of developed countries announced a commitment of $2 billion to be channeled to the developing countries during 2014-2015 with strong focus on adaptation.
- Three major pension funds from North America and Europe announced their ambition to accelerate their investments in low-carbon investments across asset classes up to more than $31 billion by 2020.
- More than 70 countries and 1,000 companies endorsed the need for developing mechanisms that would adequately reflect the true costs relating to polluting and emissions; and over 30 leading companies endorsed the Caring for Climate Business Leadership Criteria on Carbon Pricing, which include setting an internal carbon price high enough to materially affect investment decisions to drive down greenhouse gas emissions.
Forests
Calling for cutting deforestation in half by 2020 and ending it completely by 2030, more than 150 organizations, including 28 governments, eight sub-national governments, 35 companies, 16 indigenous peoples groups, and 45 NGO and civil society groups, signed the New York Declaration on Forests.
Government, the private sector and civil society groups pledged to back up the declaration with resources and actions. According to Climate Summit 2014:
- The Declaration reaffirms and stretches commitments to reforestation and halting deforestation. Supporting this are a basket of strong commitments by the private sector, including palm oil companies and food companies, indigenous peoples, and governments -- from local through national -- to financial support for REDD+, deforestation programs at scale, and deforestation-free supply chains for commodities on which we all rely.
- More than 20 global food companies committed to deforestation-free sourcing policies of palm oil. Three of these -- the world's largest palm oil companies, Wilmar, Golden Agri-Resources and Cargill -- committed additionally to work together in Indonesia on implementation with governments and indigenous peoples.
- Taken together, the share of palm oil under zero deforestation commitments has grown from 0 to about 60 percent in the last year, with potential to reduce 400 to 450 million tons of CO2 per year by 2020, or 2 billion tons in the period through 2020.
Cities
"Cities," Climate Summit 2014 highlights, "are currently responsible for about 70 percent of global greenhouse gas emissions and can play a critical role in reducing these emissions and strengthening resilience." At the Summit:
- Mayors from around the world, including New York, Seoul, Paris, Johannesburg, Bogota and Copenhagen, announced the signing of the Mayor’s Compact that will harmonize their members’ targets and strategies.
- Among the over 2,000 in the Compact, 228 cities have voluntary targets and strategies for greenhouse gas reductions, which could avoid up to 2.1 billion metric tons of greenhouse gas emissions per year.
- City networks also announced a harmonized, transparent approach and platform to reducing city emissions which will help coordinate efforts and make them more transparent.
Agriculture
A series of “climate-smart” agricultural initiatives are intended to help some 500 million smallholder farmers reduce GHG emissions, enhance resilience to climate change and adapt to changing climate conditions. They include:
- A newly launched Global Alliance for Climate-Smart Agriculture was supported by more than 40 governments, organizations and companies. Countries joining represent millions of farmers, at least a quarter of world cereal production, 43 million undernourished people and 16 percent of total agricultural greenhouse gas emissions.
- An Africa Climate-Smart Agriculture Alliance will help some 25 million farming households across Africa practice climate-smart agriculture by 2025.
- Fortune 500 companies, including Kellogg Co., McDonald's and Walmart, committed to increase the amount of food in their respective supply chains produced with climate-smart approaches.
Carbon Offsets 101: A Simple Guide to Buying Quality
Carbon offsets used to be maligned as a way for individuals to assuage their eco-guilt or for companies to falsely promote a green image without changing their behavior – a system no better than the Catholic Church’s sale of indulgences during the Middle Ages. But the market for carbon offsets has come a long way in recent years, and now, with more regulation and oversight, carbon offsets are a valid way to reduce your individual or company’s carbon footprint, as long as they’re accompanied, of course, with measures to green your personal lifestyle or business operations.
As TriplePundit launches its new series this week – a business buyer’s guide to carbon offsets – we thought we’d start with the basics, reviewing what exactly a carbon offset is, how the market works and how companies can go about purchasing offsets.
The basics: Carbon offsets and markets
At the simplest level, a carbon offset represents a reduction of greenhouse gas emissions that compensates for an emission produced somewhere else. There are two major markets for carbon offsets; the first is the compliance, or “cap-and-trade,” market, where a government agency places a limit on greenhouse gas emissions from certain businesses. Businesses comply with the greenhouse gas cap by reducing emissions from their operations -- retrofitting their facilities or replacing their fleets with cleaner-burning vehicles, for example. If a company slashes its emissions below what the law requires, it can sell credits, or “allowances,” for these additional reductions to businesses that find it challenging to cut their own emissions to meet the regulations. California currently operates its own cap-and-trade program that regulates greenhouse gases from 350 businesses in the Golden State, and nine Northeastern and Mid-Atlantic states joined together to form a multi-state cap-and-trade system, the Regional Greenhouse Gas Initiative.
The second type of market for carbon offsets is a voluntary one and allows any individual or business the opportunity to balance out their carbon footprint by funding projects that reduce greenhouse gases. A carbon offset project might capture and store greenhouses gases, preventing their release into the atmosphere – by planting or maintaining forests, for example – or it can generate clean, renewable energy, eliminating the need to produce that energy from fossil fuels – such as establishing a new wind farm or solar array. Or an offset project might capture and destroy a greenhouse gas that would have been released into the atmosphere – by capturing methane gas at a landfill, for instance.
How can a business purchase a carbon offset?
There are three ways for a company to purchase a carbon offset, says Gary Gero, president of the largest voluntary offset registry in the U.S., the Climate Action Reserve. The business can have a direct relationship with the individuals coordinating the offset project: perhaps a dairy farmer considering installing an anaerobic digester to capture and destroy methane released from cow manure or the owner of a forest that needs restoration or ongoing maintenance. The company looking to offset its emissions can enter into an agreement with the project owner and directly fund the project’s startup costs, Gero says.
Because carbon offsets operate in a market exchange, the second way that companies can buy offsets is through market traders and brokers, Gero says. A business can approach a broker, let him or her know the amount of credits the company wishes to buy and for what price, and the broker will locate offset credits accordingly.
The third – and most typical – avenue for a business to purchase carbon offsets is to go through a company that develops the offset projects and sells the emissions credits to companies and individuals, Gero continues. These project development firms, including companies like Carbonfund.org and TerraPass, make things easier by offering a portfolio of greenhouse gas-reducing projects that allow businesses seeking offsets to choose projects based on cost, type of project and amount of emissions.
Tips for businesses considering purchasing offsets
One criticism of early carbon offset schemes was that they didn’t achieve the greenhouse gas emissions reductions they promised. To make sure your business is funding a successful offset project, Gero recommends taking “extra due diligence” when researching credits – especially if you are entering the voluntary market.
Make sure offset credits are enrolled in registries that have a long-standing reputation for allotting reliable emissions credits, he advises, such as the Climate Action Reserve, which has been approved by the state of California to participate in its cap-and-trade program.
“Companies need to know that there is an expert body overseeing the issuance of the credits -- and that those credits haven’t been sold to anyone else,” he says.
And there are other registries out there, including the Verified Carbon Standard and American Carbon Registry – both of which the Golden State has also endorsed for its cap-and-trade program.
Businesses should also scrutinize the standards on which the offset credits are based, Gero advises. Look for standards or certification programs that have a long history and have been recognized by regulatory bodies or the marketplace, he says. The Climate Action Reserve, for example, has developed a unique standard to ensure offset projects achieve 'additionality' – that is, to make sure the emissions that the project reduced wouldn’t have happened if the project hadn’t been implemented. The Reserve itself doesn’t carry out the validation process, Gero says, but oversees independent, third-party verifiers.
But before considering purchasing voluntary carbon offset credits, Gero urges businesses to inventory their greenhouse gas emissions and see how much they can reduce by implementing simple sustainability programs.
“First, take a look at yourself, see where your emissions are coming from and then reduce all of the emissions you can reasonably and cost-effectively,” he says. “Once you’ve done that, you can legitimately go into the voluntary carbon offset market to further reduce your carbon footprint.”
Image courtesy Terrapass
Passionate about both writing and sustainability, Alexis Petru is freelance journalist based in the San Francisco Bay Area whose work has appeared on Earth911, Huffington Post and Patch.com. Prior to working as a writer, she coordinated environmental programs for Bay Area cities and counties. Connect with Alexis on Twitter at @alexispetru