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In 1970, renowned economist Milton Friedman pronounced, "The social responsibility of business is to increase profits." And business operated this way for over half a century. Looking to maximize shareholder returns, executives prioritized profit above all else. They bypassed programs that did not result in immediate gains. They cut corners. They laid off employees. They polluted our environment.

It would be logical to assume such ruthless pursuit of profit would bring measurably greater wealth to shareholders. But the data shows the opposite is true. As Forbes reporter Steve Denning pointed out in 2011, rates of return on invested capital are now only a quarter of what they were in 1965.

After years of growth-at-all-costs -- with little to show for it in the long haul -- the business environment is beginning to shift. A yen for social consciousness, authenticity and mutual benefit is creeping into the zeitgeist. Consumers are demanding not only great products, but also companies with values that match their own. As we move into the 21st century, indeed we are witnessing the "evolution of capitalism," Jay Coen Gilbert said at the 2016 Net Impact conference in Philadelphia.

Gilbert is the co-founder of B Lab, the nonprofit behind B Corp certification. As B Corporations, firms commit to a rigorous set of standards with the aim of mobilizing business as a force for good. Nearly 2,000 companies (including TriplePundit) are now B Corp certified. An additional 50,000 used the B Impact Assessment, a free tool provided by B Lab, to measure their impact and make improvements.

Compare these numbers to 2014 -- when only 900 companies could call themselves B Corps -- and it's clear an incremental shift is under way.

"The tectonic plates are shifting beneath our feet," Gilbert said in Philadelphia on Friday. "Sometimes they move so slowly that it’s hard to feel it. But they can shake the earth and transform the landscape nevertheless. We are beginning this change from one form of capitalism to another."

Rather than maximize profit at all costs, some of today's most successful companies look to bring benefit to all of their stakeholders -- from customers and employees to the communities in which they do business.

Gilbert called this transition from shareholder value to stakeholder value "the biggest trend of our lifetimes." And he may very well be right.

"If we can harness the latent power of markets -- the latent power of business, of capitalism -- to a higher purpose than maximizing shareholder value, we can unleash one of the most powerful manmade forces ever created," Gilbert said. "[That force can] create jobs with dignity and purpose, restore the environment, create pathways out of poverty, reduce inequality.

That’s all within our path because we have this incredible tool. We just need to recognize that we can use it to build a house and not just beat people over the head."

So, how can we accelerate this change and mobilize businesses as a positive force in society? The first steps have already happened, Gilbert insisted, but we just need to keep the journey going.

"There is a populist movement around the world in response to this realization that the [economic] system does not work. But that is insufficient," he asserted. "That is a cry to the wilderness that will not be answered. That is hope -- and hope is not a good strategy for social change.

"The bending of history has to come from the creation of viable alternatives and making them visible and easier ... One way that’s happening is through business."

Gilbert went on to suggest two actionable steps for businesses to take in order to participate in the economic sea change under way -- what Fortune dubbed acting "like a B Corp."

"You need to align the interests of your business with the interests of society, and you’ve got to manage your business differently," Gilbert said. "You have to manage your business so that you’re managing your impact with as much rigor as your financials.

"We know not every company is going to be a certified B Corporation ... But everybody can be like a B Corp. And if you want to attract and retain the best talent around the world or the best long-term capital, then you better start thinking like a B Corp and acting like a B Corp."

TriplePundit will be at Net Impact 2016 all weekend. Check back to the homepage for our coverage.

Image courtesy of Net Impact

With a busy week behind you and the weekend within reach, there’s no shame in taking things a bit easy on Friday afternoon. With this in mind, every Friday TriplePundit will give you a fun, easy read on a topic you care about. So, take a break from those endless email threads, and spend five minutes catching up on the latest trends in sustainability and business.

If you haven't heard, the U.S. election is on Tuesday. And most of us probably can't wait for it to be over. While the political cycles that defined our country were typified by a hope that tomorrow can be better than today, a dark cloud seems to have settled over this election. The negative rhetoric about America's supposed fall from grace even prompted our neighbors in Canada to remind us we're not so bad after all.

And amidst all this talk about making America great again, it's easy to forget how far we've come as a society. So, before you go hide under your covers all weekend, take a moment to remember the ways America is already great. Here are a few of them.

1. We guarantee civil liberties under the Constitution (which is actually a pretty big deal)

It's hard to turn on a cable news program without someone warning you that your Constitutional rights are under attack. And while the Constitution does indeed evolve over time (as its 27 amendments prove), the civil liberties guaranteed to Americans have remained more or less unchanged -- if not strengthened.

It's also worth noting that, although we often take our founding principles for granted, they're actually quite unique in the world -- even to this day. Take, for example, freedom of the press. The independent watchdog organization Freedom House began publishing its annual Freedom of the Press report in 1980 to analyze the state of the free press around the world. Last year, it found some disturbing results:

"The share of the world’s population that enjoys a free press stood at 14 percent" in 2015. That means only 1 in 7 people lived in countries where coverage of political news is robust, the safety of journalists is guaranteed, state intrusion in media affairs is minimal, and the press is not subject to onerous legal or economic pressures," according to the group.

The figures are equally grim for religious freedom. From the Pew Research Center: "64 nations – about one-third of the countries in the world – have high or very high restrictions on religion. But because some of the most restrictive countries are very populous, nearly 70 percent of the world’s 6.8 billion people live in countries with high restrictions on religion, the brunt of which often falls on religious minorities."

Do we sometimes fall short of our duty to protect and uphold the civil liberties of our peers? Of course. Do we always live up to our standards? Surely not. But it's important to remember that our standards are high standards, particularly when compared to the rest of the world. It's no reason to stop pushing for an even better quality of life, but don't let the media or politicians make you forget how good you really have it. They're likely only doing so to push their own agenda.

2. And we continue to push for greater equality

The past decade brought even greater equality to the American population, although it's surely still a work in progress.

In 2009, the Obama administration inked the Lilly Ledbetter Equal Pay Act, which prohibits sex-based wage discrimination between men and women performing the same job in the same workplace. Of course, the gender pay gap still exists. But this legislation is inarguably a step in the right direction.

The past decade has also seen a sea change in fair and equal treatment for LGBT Americans, culminating in the nationwide legalization of same-sex marriage last summer. And, sparked in part by the Black Lives Matter movement, conversations around structural injustices and racial equity are beginning to amplify  -- hopefully laying the ground work to continue breaking down these barriers.

3. We now have the highest high-school graduation rate in history

U.S. students are graduating from high school at a higher rate than ever before, according to data from the U.S. Department of Education's National Center for Education Statistics (NCES). The nation's high-school graduation rate hit 82 percent in 2013-14, the most recent year for which the NCES compiled data.

While graduation rates remain lower for students of color compared to white students, that gap is narrowing. Nearly 73 percent of black students and over 76 percent of Hispanic students graduated high school in 2013-14 -- representing a more than 5 percent increase for both groups since 2010. Rates are also lower for students with disabilities (now around 63 percent), but those figures also rose by more than 4 percent in only three years.

4. Poverty is dropping...

Poverty, though still too high, has now fallen to rates slightly below those of the late 1990s (see Table 2 here). Poverty rates hovered around 13 percent for individuals and 11 percent for families last year. Similar levels were last seen in 1997, before the boom of the late '90s and early 2000s drove them down up to 2 percent more.

The poverty rate remains slightly higher than it was before the 2007-2008 financial crisis (12.5 percent and 10.8 percent for individuals and families, respectively, in 2007). But it has fallen by more than 2 percent since its peak in 2010, after remaining relatively stagnant for both 2011 and 2012.

Again, these figures are far different for people and families of color compared to America as a whole. Black poverty was a shameful 23.9 percent for individuals and 22.1 percent for families last year. These figures are down by over 4 percent since 2010, but still far too high for us to consider ourselves an inclusive economy. The numbers are equally grim for Hispanics (21.4 percent and 20.4 percent, respectively). So on this point we've made progress, but there's still much to be done.

5. ... and so is violent crime

With all of this talk about law and order and our cities slipping into chaos, one would think the statistics would show a boom in violent crime. In fact, the opposite is true.

Today, the national crime rate is about half of what it was at its height in 1991, according to New York University Law School's Brennan Center for Justice. Violent crime fell by 51 percent over the past 15 years, and property crime dropped by 43 percent.

Despite the significant decrease in crime, Americans don't seem to feel much safer walking through their neighborhoods. In a 2014 Gallup poll, the majority of Americans said "there is more crime in the U.S. than there was a year ago." This is an ongoing Gallup trend, and the majority seen in 2014 -- 63 percent -- was actually one of the smallest in 10 years.

6. We're quickly transitioning to a clean-energy economy...

The U.S. solar and wind industries continue to grow, driving the country's transition to a low-carbon, clean-energy economy. The U.S. solar market installed 7.3 gigawatts of solar energy last year, up from a mere 1.9 gigawatts four years earlier. The wind energy industry is also on a steady incline and now powers the equivalent of 20 million American homes.

All totaled, renewable energy accounted for 10 percent of total U.S. energy consumption and 13 percent of energy generation in 2015. That's still a far cry from the Energy Department's goal to source 30 percent renewable energy by 2025. But with the accelerated rate of renewable infrastructure deployment over the past three years, the target may very well be within reach.

7. ... causing a boom in green jobs

Renewable energy employment in the United States reached 724,000 jobs in 2014, a 16 percent increase from the previous year. Those figures reached 769,000 last year.

So, what does that really mean? To put it into perspective, the solar energy industry alone employed 35,000 people in 2015, up 20 percent from the previous year. And solar now employs more people than the oil and gas extraction industries.

8. And a drop in carbon emissions

After increasing in 2013 and in 2014, energy-related carbon emissions fell last year to 12 percent below 2005 levels.

In 2015, the U.S. used 15 percent less energy per unit of GDP and produced 23 percent fewer energy-related CO2 emissions per unit of GDP compared to 2005, according to the Energy Information Administration.

Image credit: Flickr/Michael Dougherty

Few topics of discussion (with the exception perhaps of the current U.S. elections) receive as much debate these days than how cotton should be farmed and harvested. The lowly gossypium plant, which is cultivated across the world, was once a remarkably hard crop to farm and harvest. The stories of African American cotton pickers’ bloody hands and endemic poverty during the early and mid-1900s became a symbol of the injustices that were equated with an industry that had at that time, neither the technology nor the means to meet the needs of growing demand.

While the mechanical cotton picker of the 1940s addressed some human rights concerns, it has since been replaced today with automated machines that can harvest as much as 190,000 pounds a day.

The introduction of genetic modification to U.S. cotton farming in the 1990s further transformed the conventional cotton industry. Studies have found that genetic modification of cotton seeds not only increased cotton production, but reduced the need for insecticides and some other forms of pesticides in the field. In the U.S., technology has kept up with these changes, creating increasingly faster ways for cotton to be harvested from the field. Even though the U.S. is no longer the largest producer of conventional cotton (third, compared to China and India), it reaps tremendous benefit from the newer innovations that have become a mainstay of cotton production. According to Cotton Incorporated, the conventional U.S. cotton industry (that is, cotton not grown or produced organically), contributes to as much as $100 billion in revenues to affiliated industries.

But those advances continue to spur debate about the best – and safest – way to generate the world’s demand for this much-needed apparel product. Does GM cotton come with secondary health risks? Is GM cotton safe for the environment? Are the pesticides that end up being used with the process risky? Do the benefits of conventional cotton outweigh the concerns that are prompted by pesticide use?

TriplePundit writers have written a fair amount on organic cotton topics, from the nuts and bolts of the global organic cotton industry to the strides  that the organic garment industry has made in recent years. We felt it was time, therefore, to take a deeper look at the processes that are used in conventional cotton production and the points raised by that industry about the benefits of transgenetic cotton farming.

To get the industry’s input on this question, we spoke to Cotton Inc’s Director of Agricultural Research in Entomology, Ryan Kurtz.  Kurtz’s area of expertise is insect resistance management in genetically engineered corn and cotton. Formerly the global lead for traits insect resistance management at Syngenta, Kurtz specializes in North American Bt trait cotton production, a cotton engineered to fight the infamous boll weevil, among other pests. Most of the information below therefore focuses on U.S. cotton production.

Conventional cotton: Not all pesticides are created equally

To really address the debate over conventional cotton production, said Kurtz, it’s necessary to recognize that not all kinds of pesticides can be lumped together. We may think of insecticides, herbicides and fungicides as ‘pesticides’ but in truth, they are vastly different from each other in how they are applied and what they do.

“I think it is always important to be precise at any way you are describing things. Pesticides is a large bucket area. I think people do tend to think of insects more as “pests” than weeds and funguses, because they can relate more to it,” explained Kurtz.

The distinction of insecticide from other types of pesticides is critical, said Kurt, if you want to determine whether GM technology has made a difference in making cotton production safer and whether it should have a role in cotton production. According to information we received from Cotton Inc, GM production has dramatically lowered the demand for insecticide on cotton farms. And that in turn, has made cotton production safer.

But its real coup d’etat may have come in the boost it gave to production yields when it effectively made GM cotton immune to one of the South’s most destructive pests: the boll weevil.

Nicknamed ïn 1903 as America’s “wave of evil,” the tiny insect caused widespread destruction of the country’s cotton yields until insecticides came on the market. In the 1970s, boll weevil eradication began in earnest in a multi-state effort. The evil weevil has largely been eradicated at this point thanks to a systemic approach to strategic insecticide use.   Cotton Inc points out that some 20 years after its introduction in the U.S. South, the impact of transgenic farming can be found in the number of applications of insecticide still used in the U.S. According to data supplied by the organization, "U.S. cotton growers applied insecticide an average of 1.96 times over the course of the season – less than twice.”

Kurtz said that those low numbers are due to farming methods that capitalize on of one of Nature's more ingenious inventions: a bacteria that lives in the soil and is lethal to many insects. By figuring out how to genetically introduce the bacillus thuringiensis (Bt) gene into plants (cotton in this case), scientists were able to make the plant resistant to the bollworm and other destructive insects.

"Through a natural process called agrobacterium mediated transfer (AMT), they figured out how to get the gene from that Bt bacteria that produces the insecticidal protein to put that gene into a cotton plant. So now, instead of having to rely on the bacteria to make the protein that kills the insect, the plant makes the protein that kills the insects. "

GM cotton: the hurdles that still remain

As effective as transgenic cotton farming has been in reducing insect infestations of cotton, however, there have still been some challenges to overcome. The first, note scientists at the Aroian Lab at the University of San Diego, is figuring out just how Bt does what it does.

"[With] 50 [years] of use, you'd think we've got everything figured out about Bt. But the truth is, we don't know much. Most importantly, we don't know how it works," notes the lab in its blog post, bacillus thuringiensis. That question is important because recent reports of insect resistance to the Bt trait have led scientists to realize that they don't know everything about the trait, or how to ensure that more insects don't develop immunity. The Aroian Lab points out that this problem isn't limited to GM farming, either, so it's not a specific failing of GM technology. "For every single synthetic pesticide that is in use today, there are species of insects that are resistant to it." Unlocking how Bt acts could answer why some insects are immune to its toxin.

But immunity isn't the only problem that has surfaced regarding Bt GM farming, says Melody Meyer, who serves as the vice president to Policy and Industry Relations for United Natural Foods Incorporated and as the executive director to the UNFI Foundation. As so often happens in Nature with unintended outcomes, the dramatic reduction in insects has added consequences.

"It may have reduced insecticide use but not herbicides," said Meyer. In fact several studies in the last decade have confirmed that the use of GM technology hasn't reduced herbicide use. It has increased it.

And that's where farmers have found the greatest proof to the maxim, "to every front there's a back." For every organism that may be reduced through scientific farming methods, there may be another that can capitalize on it. Since 2004, farmers have been finding "superweeds" that have acquired an intolerance to the herbicide Roundup (glyphosate).  Reports of Roundup-intolerant weeds such as amaranth have been known to destroy thousands of acres of cotton crops.

Recent studies on glyphosate toxicity in the environment and the food chain is another issue of debate concerning the methods used to produce conventional cotton. Kurtz said that while some studies have suggested that glyphosate may be a "probable" carcinogen, "there is very little evidence, if any to support that and there has been a long, 30+ year history of safe use in the U.S. Kurtz said the fact that it is considered a "general-use pesticide" is indicative that it is safe. "Most reputable organizations highlighted early on that there is a long history of safe use of glyphosate and the concerns about cancer are unwarranted.

In fact, the debate over this issue has persisted for years, as Kurtz stated. The United Nations Food and Agriculture Organization and the World Health Organization stated in May that it was "unlikely" that the chemical would pose "carcinogenic risk" from exposure through diet. The statement contradicts the International Agency for Research on Cancer, which stated in 2015 that there was a likelihood that the pesticide is carcinogenic. It has stood by its claim, even though two other agencies, the Environmental Protection Agency and the European Food Safety Authority contradict its position. More research is underway.

Cottonseed oil and questions of pesticide residue

Cotton that is manufactured in the U.S. is used not only for clothes but for food. Cottonseed oil has been manufactured from the plant's seed at least since the early 1900s. Today it is  the unsung hero of today's conventional food manufacturing systems due to its shelf stability.

The the two questions commonly raised are how much pesticide residue is left on the fibers and seed after the harvesting? How much residue is in the final product?

"Because of the way cotton is grown and the amount of time that it is in the field, the use of pesticides in cotton [production] is well before the fiber is developed. So you actually can set the goal of using pesticides to protect the plant that produces the fiber. Once the fiber is there, most pesticides aren't applied any more," said Kurtz, who said the organization monitors studies on pesticide residue through its membership in Bremen Cotton Exchange, an economic organization concerned with advancing the global cotton trade. So the fibers that make their way into the apparel supply chain are unlikly to bring pesticide residue with them.

He added that because cotton oil is a food product, the Food and Drug Administration regulates what and when pesticides can be added to the growing plant. "They look at cotton just like it were a vegetable," with a set criteria that limits the use of insecticide and other toxic substances.

Still, there are a considerable number of researchers and activists who question this data. Alliance of Women Scientists and Scholars, for example, maintains that "[conventional] cottonseed oil may be highly contaminated with pesticide residues" and that the cottonseed oil's natural toxin, gossypol, is also a common allergen. [Gossypol] poisoning is common and may be deadly for dairy cows and other livestock." However, the site offers limited data to back up this claim. Gossypol is generally removed during the oil refining process, so what might hurt cows in raw form should be harmless for humans who consume the oil.

While pesticide residues have been found in cottonseed oil in India, it is not clear if those pesticides were applied the same way as in the U.S., where workers must be trained and labeling is enforced by the EPA. And not all studies of pesticide use in India have found residues, either. One study found plenty of examples of residue contamination in fruits and vegetables in India, but none in cotton fibers.

But a University of Missouri newsletter offers the best explaination as to why cottonseed oil manufactured in the U.S."rarely" show residues of pesticides in lab tests. The issue isn't just when the insecticide is applied, but where the cotton grown.

"[Cotton] raised for oil is grown mostly in Iowa, Nebraska, and the Dakotas, not in the South.  The shorter growing season there prevents maturation of the fiber-producing cotton boll," explains the writer. (The USDA offers a more comprhensive list of states where cotton is grown).  This shorter season requires precise control, as Kurtz suggests, so pesticides are applied only up until the boll is about to open. After the cotton is picked and the seed processed into oil, the oil goes through a "deodorizing" stage in which it is subjected to hot steam in a vacuum setting. The cleansing is supposed to remove any residue of insecticide or other unwanted compounds.

Meyer from UNFI suggests however, that with the broad disagreement on this issue, skeptics will continue looking for third-party data to prove that cottonseed oil is completely free of pesticide residue.

Conventional cotton and organic processes

One question we asked Kurtz was why, given the growing interest in organic cotton, conventional cotton industry didn't consider transitioning toward an organic production model. If there was public pushback against GM foods, why not take the steps now to help farmers adopt organic processes.

"I think it is a matter of feasibility," said Kurtz. "Organic production works quite well for certain growers on smaller acreages. The ability to scale that up would just be too expensive because of the cost of labor. Some of the organic practices just prohibit some of the more mechanized means that we are using today  and there just wouldn't be a way to produce enough fiber to meet the demand through organic means. It would just cost too much to produce."

Given the world's increasing dependence on cotton for clothing, food and medical products, it's a perspective that makes sense. With 7 billion people on the planet, and a demand that exceeds that of any other fiber in existence, transitioning from GM methods may seem impractical on the surface.

Meyer agreed that "the demand for organic cotton isn't as high as the total production of cotton worldwide," but she argued that this was largely because "people don't understand the long-term effects to the environment and to society and health in general that this poses down the line. There are unintended consequences that you pay for later," she said.

Data: The final benchmark in cotton production

If there were one lesson to draw from the endless debate over how cotton should be grown and processed, it might be that it is quantifiable research results that tell the true story about pesticide use in cotton production. Is there really widespread insecticide residue in cotton products? Does glyphosate have unintended consequences? Answers to either or both of these questions may in coming years, alter our view of GM produced cotton.But what those answers won't do, is change the impact that conventional cotton production with all of its problems and remarkable concepts, has had on the world as we know it.

Images: Cotton harvest - Flickr/Kimberly Vardeman; Two young cotton pickers, 1937 -Flickr/Kheel Center; Boll weevil on cotton plant - Flickr/USDA; Cotton bud - Flickr/USDA; Cotton field - Flickr/Kimberly Vardeman

Today, the Paris agreement officially entered into force. The international climate accord calls for limiting global temperature rise to "well below" 2 degrees Celsius. And experts say we'll need around $17 trillion worth of investment by 2030 to make it happen.

"That number looks large," conceded Gireesh Shrimali, director of climate finance for the Climate Policy Initiative, at BSR 2016 this week. "But when you compare it to the size of [the global financial and capital markets] — around $300 trillion — it’s not that large ... It’s pretty clear that we have the science, but we have to scale up investment and we have to scale it quickly."

Luckily, change is already brewing. Around $400 billion was invested in climate technologies last year, $57 billion of which went to developing countries, Shrimali said. "That’s a very interesting number because there is an agreement that $100 billion must flow to developing countries [for climate mitigation by 2020]," he said. "So we are on the way to that target."

That $400 billion in climate finance is a surge compared to prior years. And that's largely because renewable energy makes better business sense with every passing day.

"Renewables are today the best solution to provide fast energy in the best way and at a low cost," said Andrea Valcalda, head of sustainability for Italian multinational utility Enel. "From a utility perspective, we are in the middle of an energy transition. It is a great challenge but also a great opportunity if you are brave enough to see the new model and to rethink completely and drastically your plan and the way you invest."

For its part, Enel did a 180 on its business model in order to support renewables and reduce carbon intensity. The company plans to invest 9 billion euros over the next five years to expand renewable energy deployment, and it will deliver at least 60 renewable energy projects over the next two years. Meanwhile, it will soon decommission over 20 fossil fuel power plants.

Of course, not all utilities are so forward-thinking, which can put the financial community in a tough spot.

"The theory is that banks have a choice about the funds in the energy sector they’d like to support. But in real life it doesn’t happen like this," said Laurence Pessez, head of corporate social responsibility for French multinational bank BNP Paribas. "I wish all of our clients could be like Enel," she said with a laugh. "It would be very simple. But unfortunately we have lots of clients who have many kinds of energy strategies which are not always compatible with our broader goals."

At COP21 in Paris, BNP Paribas committed to significantly alter its business model in response to these realities -- by financing the energy sector in accordance with a 2-degree scenario. So, for example, 40 percent of the world's energy now comes from coal. That number must be cut in half in 20 years to stay within 2 degrees, so BNP plans to reduce its funding of coal by 50 percent over the same time period. The same is true for renewable energy financing, which the bank committed to double to $15 billion by 2020.

"It’s a new way of engaging dialogue with our clients in the energy sector," Pessez said. "It’s not always welcome everywhere. But we think that we have an active role to play in this transition, to use our leverage with our clients and help them move forward."

"We’re seeing a lot of mechanisms that are out there to finance [clean technology] infrastructure, and corporations are looking to participate in the shift in enterprise from a climate perspective," added Hilary Irby, head of the Investing with Impact program at Morgan Stanley. "I feel optimistic about the role that capital markets can play. But I think many of these other aspects — in particular the policy environment — really need to make progress in order for us to be more successful in delivering solutions."

What we need to move forward

BNP, Morgan Stanley and over a dozen other multinational banks found themselves in hot water this fall, as American consumers discovered their backing of the controversial Dakota Access Pipeline.

Indeed there's no argument that the financial services sector is still heavily entrenched in fossil fuel interests. The same is true, by and large, for the utility industry. But the sustainability heads of these sometimes embattled companies offered solutions that could help them turn the corner -- and they'd probably know better than anyone else. These three items topped their wish list:

An international carbon price: "A carbon price is something that was massively asked by businesses at COP21 and still hasn’t happened," said Pessez of BNP Paribas.

Shrimali of the Climate Policy Initiative agreed: "In [global] markets, we have a negative externality with carbon: We are not pricing carbon appropriately, and carbon pricing is a very simple solution which hasn’t happened. So work needs to be done on that."

Public-private partnerships: We already know the government commitments made under the Paris agreement will not bring us close to the 2-degree target. In fact, the best-case scenario under those commitments is closer to 3.5 or 4 degrees. That's a huge gap, and expecting the private sector to fill it alone isn't exactly reasonable.

"These investments are usually long-term investments," Pessez said of renewable energy finance. "They are risky. Sometimes they rely on public policies which are subject to change. And being able to partner with a [governing body] would give us in private finance some comfort." Valcalda agreed, saying simply: "For sure, we need more partnerships."

Bringing ESG into the business context: One of Morgan Stanley's most significant climate-related undertakings as of late, Irby said, is beginning to integrate environmental, social and governance (ESG) metrics into its equity research model.

Over the past few years, the bank often heard from execs who made strides to improve ESG at their companies, only to be discouraged because financial analysts never asked about it. "For all of us, what’s important is to keep talking about it and to keep putting it in a business context," she said.

The bottom line

"The 2-degree challenge is not just a natural challenge," said Emilie Prattico, who heads up BSR's climate change work in Europe, Africa and the Middle East. "Perhaps the survival of the species was one of your concerns, but now there’s a new concern: a regulatory one. We don’t really have a choice at this point ... We have to do this, and we have to do this fast. And I surmise we have to do this together."

Whether or not it's really feasible to move upwards of $1 trillion a year into climate mitigation and sustainable development remains to be seen. But hopes are running high heading into COP22 in Morocco -- where the conversation moves from theory to implementation -- so there's surely cause for cautious optimism.

Image courtesy of the author

In a world where people are becoming both tired and wary of mass-produced products, more retail chains are finding opportunities in sourcing “artisan made goods.”

Rather than dull products made offshore in a soulless factory, these items -- generally furniture and other home goods -- often come with a story and offer consumers something unique. The movement has gained traction here in the U.S., the United Kingdom and other countries. And in exchange for that handmade product, people making everything from furniture to baskets and housewares are treated with dignity and paid a fair salary.

Or are they? The risk of buying an 'artisan' product is akin to purchasing a 'natural' product at the supermarket. Artisan could mean anything – or nothing.

At most risk are the artisans themselves, especially women. In many developing countries, the making of artisan products is often cited as the second largest employer of women and girls, ranking only behind agriculture. The problem, however, is that many of these women and girls are employed within the informal economy, where working conditions are not regulated and payment structures are opaque.

On that point, the NGO Nest says it is trying to make the global artisan goods market more transparent. And it has an ally in West Elm, a subsidiary of Williams-Sonoma that specializes in contemporary furniture and housewares.

This is a huge step for West Elm, which revamped its product line in recent years to showcase more goods that are handcrafted, are often Fair Trade Certified and are largely made with organically-grown materials. According to the retailer, these products are made across 15 countries, engage 35 artisan groups and employ 5,000 people.

Those statistics, and their collective impact, sound encouraging. But of course they raise the question of whether all workers really benefit from what are presented as unique, sustainable and responsibly-made products. Although abuses in factories are often the focus for labor rights advocates, the fact is that many products are made, or partly assembled and crafted, in people’s homes. And when it comes to goods manufactured outside of a factory’s walls, there is little oversight. Add the fact that many workers are not paid an hourly wage, but are often compensated by the item, and it is easy to see how abuse could occur within this sector.

Hence the Nest Artisan Advancement Project, which seeks to ensure ethical compliance addresses the work done in smaller settings, including within workers’ homes. The NGO worked with several brands to create a body of so-called Ethical Compliance Standards to ensure that people working in such environments are visible and have the same protections as factory employees.

Rather than a simple pass-or-fail system that would risk economic devastation for many families, Nest insists such procedures are designed to educate and improve workers’ standard of living. Furthermore, these standards are designed to be more proactive than reactive: Auditors and suppliers will be advised what to look for on a bevy of challenges, including child labor, record keeping, artisans’ rights and overall well-being.

With the U.S. State Department, along with other organizations, estimating that the global artisan market is worth $34 billion and growing, watch for more retailers to source from workshops and cooperatives. These companies do not really have a choice, as more consumers are eschewing factory-made goods are often bored by what’s offered in brick-and-mortar stores. Companies such as West Elm are smart to ensure that their supply chains are as ethical as possible, since they are ripe for abuse with far too many suppliers quick to cut corners in the quest to make more sales.

Image credit: West Elm

The 22nd U.N. Conference of Parties (COP22) will begin later this month in Marrakech, Morocco. Following the much touted COP21 in Paris, hopes are high that the conference will keep up the momentum.

Dr. Jonathan Pershing, the U.S. State Department’s special envoy to the meeting, held a press conference on Thursday to share his thoughts going into the event. Pershing was joined by John Morton, director for energy and climate change for the White House National Security Council.

In his brief remarks, Morton noted what a historic year for climate action this has been already. Two major agreements closed just in the past two months, in addition to the Paris agreement entering into force today.

The first was the amendment to the Montreal Protocol adopted in Kigali, Rwanda, incorporating hydrofluorocarbon reduction. As we noted last week, this agreement alone could potentially eliminate half a degree of warming. The other agreement, reached in Montreal, was the aviation accord. The accord was signed by 191 countries under the umbrella of the International Civil Aviation Organization. The accord will be voluntary, based on offsets, and will begin in 2020. But major players are vowing to put real muscle behind it. Environmental groups are less than excited, though they concede that it’s a start.

Pershing went on to say how world leaders finally managed to wrestle a framework into place at COP21 after roughly eight years of wrangling (for this administration) going back to Copenhagen. From here we turn the corner toward implementation, he explained. And it won’t happen overnight. Many discussions will be required to develop specific rules for the various provisions and guidelines for transparency.

At COP22, we can expect lively debates on key topics such as energy, agriculture, oceans and cities. In other words, there will be lots of nitty-gritty, Pershing said.

Still the Moroccans, who have committed to a 42 percent share of energy from renewables by 2020, promised a “COP of action.”

Pershing noted that the “political dynamics” going into COP22 are positive, particularly with the U.S. and China both taking leadership roles. They are going into the conference with a goal of accelerating the target timetable from 2020 to 2018. This is in response to the fact that our understanding of climate change impacts has grown even more dire since COP21, even as more severe storms and droughts continue to set records.

Not surprisingly, when he opened the floor for questions, several reporters asked about the impact of a Trump victory next week. To this, Morton had the following comment:

“There is a great deal of interest not just domestically but internationally in terms of what the election outcome will be ... The candidates have very different views on climate.

"I think what we have seen in recent months and in fact in recent years is a recognized now-inevitability of the transition to a low-carbon economy. And so the international community – the international business community, the international policy community – is moving forward and will continue to move forward. And there’s no questioning anymore about the commitment at both the government and policy levels to the ... letter and the intent and the spirit of the Paris agreement.

"So, we will see countries continuing to move forward at a fast clip irrespective of what happens next Tuesday."

One reporter noted: “China’s lead climate negotiator on Tuesday criticized Donald Trump’s vow to back out of the Paris agreement, saying it was out of step with global consensus.”

Morton concurred with this, underscoring just how critical the U.S.-China relationship on climate is.

When another reporter asked about comments made by Brazil’s environmental minister, expressing nervousness should Trump win, Pershing offered the following.

“… There’s an Article 28 in the agreement that provides for procedures for countries that would seek to withdraw. But, at the moment, I don’t think that’s very likely.

"My sense, frankly, is that there are going to be huge domestic advantages to staying in this agreement and to doing the work that we’ve agreed to do. And that largely has to do with the opportunities that I think the agreement creates ... That’s where the new investment policy is, and Americans are doing very well in that investment environment ... So, I expect us to want to stay in the discussion [and] stay active in the negotiation."

He also noted the increasing visibility of climate risks in the U.S., such as Superstorm Sandy, the recent flooding in Florida and ongoing droughts in the American Southwest.

"In my view, the issue of long-term dynamics here continues to play in favor of the U.S. staying deeply engaged," he concluded. "We’re a leading country. We’ll continue to be a leading country. I think that’s the likely outcome and that’s the message that we’re going to be passing on to the global community.”

Will his theory hold up if Trump enters the Oval Office? Only time will tell. But we can be sure the world is watching.

Image credit: Mad-Loïs: FlIckr Creative Commons

We have often discussed last year’s COP21 proceedings, and this month’s COP22 in Marrakesh will generate its fair share of headlines, but many other United Nations “Conference of the Parties” fly under the radar. One of them is COP7, which will convene delegates from across the world at the upcoming World Health Organization Framework Convention on Tobacco Control (WHO FCTC).

COP7 will be held next week in Delhi, India, to move forward on measures that aim to reduce tobacco consumption worldwide. As with much of language surrounding the United Nations’ declaration, COP7’s agenda is largely focused on how it is “undergoing a period of change,” which roughly translated means that delegates at this six-day meeting will try to find agreement on ways they can reduce tobacco consumption in developing countries.

And according to Reuters, some within COP7's leadership just realized that it would benefit next week’s meeting if delegates who work within, or have ties to, state-owned tobacco companies are barred from attending the proceedings.

As of press time, such a ban has not yet become official. Nevertheless, the internal memo leaked to Reuters shows that some delegates are concerned that the FCTC, which is billed as the world’s first international public health treaty, could be drafted with the global tobacco industry’s influence if too many industry reps participate. Past FCTC conferences have declined entry to private citizens and the media if they were suspected of having any ties to tobacco companies, but employees of state-owned companies were not subjected to such scrutiny at previous gatherings.

The international tobacco lobby is already rankled that their representatives may not be welcome at COP7, which starts Monday. The CEO of the International Tobacco Growers Association complained in an email to Reuters that it was “unthinkable for a United Nations agency” to draft an international public health treaty without input from tobacco companies.

Despite the evidence suggesting that only six massive multinationals control most of the world’s tobacco industry, the WHO says that state-run monopolies generally dominate the tobacco market in much of the Middle East, North Africa and Asia. With smoking long on the decline in North America and now even much of Western Europe, tobacco companies have set their marketing crosshairs on emerging markets. State-run tobacco companies in turn have had a role in boosting tobacco’s popularity in nations such as Vietnam, Thailand and China. According to Bloomberg, China Tobacco, which by some accounts is the world’s largest tobacco company, alone manufactured an astounding 2.5 trillion million cigarettes in 2013.

As a result, 80 percent of the world’s estimated 1 billion smokers live in low- and middle-income nations. The WHO, which often touts that statistic, also asserts that tobacco is a leading cause of impoverishment in poorer nations. In addition to shouldering the expensive burden due to smoking’s negative health affects, many of these emerging economies lack funding for public education about tobacco’s health, are slow to conduct the surveys needed to track tobacco’s popularity within their countries – and in some cases, even have many children working on tobacco farms.

Plenty of research demonstrates that poorer countries are subjected to the most relentless tobacco marketing, which is why companies profiting off such a product should not be anywhere near discussions on how to manage this ongoing public health crisis. The fact that the UN and WHO are just figuring this out now adds to their reputation as organizations that are excellent at flying the well-connected around the world for lavish meetings, but lag when it comes to making progress on the well-being for the world’s citizens.

Image credit: Nagarjun Kandukuru/Flickr

This upcoming election is in the hands of millennial voters. Millennials are the second largest generation in America. But they have never voted in numbers representative of their population size. If they do vote in numbers, they will swing this election's direction.

So, as much as who will win, the question is: What will it mean for America's future if millennials vote?

What happens when millennials do not vote?

Millennials did not vote in any numbers in the mid-term 2014 elections. Their lack of participation was a major reason why only 33 percent of eligible voters actually voted. The hallmark of the 2014 election was that “none of them” won the most votes due to voter non-participation.

2014 voters elected Republican Party majorities in both the House and Senate. This Republican majority Congress did not pass any milestone pieces of legislation. It was characterized by these two actions:

1. House Speaker John Boehner (R) retired in response to a rebellion among the most conservative House members.


2. An unwillingness to vote on President Obama’s Supreme Court nominee.

The 114th Congress did achieve one historical milestone. Its membership was the most diverse in history. This Congress had 96 racial minority members and 104 women. Fifty-nine percent of House Democrats were women, minorities or LGBT.

How millennials may vote on Nov. 8

In terms of this election, these four key attributes distinguish millennial generation voters:

1. Diversity. Millennials are the most diverse generation in American history. Comparatively, they embrace diversity throughout their lives, whether in friends or food choices.


2. Economics. Millennials are just beginning to form households. Forty-four percent of moms are millennials. This generation is finally overcoming economic ground lost to starting careers during the Great Recession. They also continue to slowly but surely retire their school debt.


3. Global warming. Seventy-five percent of millennials believe global warming is happening and human-caused. It is estimated that climate change will cost the millennial generation $8.8 trillion, or approximately $130,000 per millennial. This generation sees solutions like renewable energy, autonomous automobiles and smart tech as keys to slowing or stopping climate change.


4. Change. Millennials were born in the Information Age. They were raised to expect their technologies to be continuously improved. This generation embraces social change and individual freedoms. They use social media to determine the authenticity and transparency of products in determining what to buy and who to buy from.

Based on these attributes, millennials are likely to vote for candidates who align with diversity and the economics of being a millennial. They are also likely to seek out candidates who believe in science. Their elected candidates should have higher receptivity to social equity issues, reducing taxes on the lower and middle class, and reducing the burden of college debt. Their elected candidates should be willing to explore climate change solutions like a carbon tax and increased clean tech incentives.

This generation thirsts for political change. They were the generation that fueled Sen. Bernie Sanders' presidential primary run. Their Nov. 8 challenge will be to determine if either leading presidential candidate aligns with their quest for change.

Will Nov. 8 launch the millennial age?

The millennial generation is taking over the U.S. economy. They already hold more jobs than any other demographic group. By 2017, they are projected to be the generation with the largest buying power.

But this generation still has little political power because they don't vote. If millennials vote in numbers representative of their population size, the Nov. 8 election could very well launch the millennial age in America.

However, if millennials repeat their behavior in 2014 and do not vote, our country will continue to be dominated by the boomer generation’s agenda.

The question that may be more telling than who wins is whether the millennial generation show up in numbers and vote.

Will this be the millennials' first election where they make the hard decision to vote for candidates who do not capture their enthusiasm but still offer more hope for change than the alternative? Or will millennials again choose “none of the above” and default on their future?

Either way, the future course of America, and the millennial generation, hangs in the balance on Nov. 8.

Image credit: Flickr/Theresa Thompson