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How a New Multi-Stakeholder Partnership Can Help Haitian Kids

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Haiti is the poorest country in the western hemisphere and one of the poorest in the world. It had a per-capita GDP of only $846 in 2014. It’s also a country that witnessed tragedy on a large scale when an earthquake struck in its capital, Port-au-Prince, in 2010 -- killing over 300,000, according to government estimates. One company is now looking to help Haitians better their lives.

That company is Thread, a Certified B Corporation that transforms plastic bottles collected by Haitian and Honduran people into fabric. Thread recently announced its new Clinton Global Initiative (CGI) Commitment to Action to address the problem of child labor in global supply chains. Through partnerships with Timberland, HP, Team Tassy and ACOP (the Plastic Collectors Association), Thread’s commitment will help improve the lives of about 300 Haitians, 200 of whom are children. Through the partnerships, programs will provide educational opportunities, job training and medical care for the Haitian communities of Molea, Menelas and Port-au-Prince.

Thread expects to invest $300,000 in monetary and in-kind donations by December 2019 through partnerships. The money will be used to provide detailed field assessment, wellness exams, healthcare services and building a career support network in Haiti.

Timberland and HP plan to source materials from the collection system in Haiti, in addition to joining the Commitment to Action. Timberland will launch a collection of bags and shoes made with Thread Ground to Good fabric in spring 2017. HP will use the materials to manufacture inkjet cartridges.

“The very bottom of the supply chain is where people are the most vulnerable,” Ian Rosenberger, founder and CEO of Thread, said in a statement. “No longer is it okay to ignore the issue because it’s difficult to talk about. We’re proud to be working with great partners like Timberland and HP to find a solution in Haiti that can change our global understanding of dignified work.”
For the “first few years” Thread worked in Haiti, child labor was not a problem, Kelsey Halling, director of impact for Thread, wrote in a blog post last week. Thread “had a small and close-knit enough collection network” that prevented child labor from entering its supply chain. The company also has a Code of Conduct and Child Labor Avoidance Policy. But Haiti is an extremely poor country, so “these policies don’t always hold up,” Halling wrote. Last year, Thread expanded its supply chain in Haiti, which made it imperative to address child labor and began to partner with ACOP. In April, Thread approached the CGI about making a Commitment to Action -- which requires specific timelines, measurable goals and metrics, and annual progress reports. 

Beyond Thread's supply chain, child labor is a big problem in Haiti. The country has a restavèk system which the nonprofit organization Free the Slaves describes as a “system in which Haitian children from impoverished homes are sent by parents to live with other families and work for them as domestic servants.” The children work as many as 14 hours a day for no pay. An estimated 150,000 to 300,000 children are part of the restavèk system.

The term restavèk in Haitian Creole means “to stay with.” It is now “one of the worst names to be called in Haitian society,” according to the International Labor Organization (ILO). The system began as a way to send children to “live with wealthier relatives in the city” so they could have a better life. But the system deteriorated and is now a “form of domestic trafficking and modern day slavery,” the ILO says. 

Through its Commitment to Action, Thread is highlighting a major problem in Haiti. And through its partnerships, the company is working with families to give children access to education. That is something that can’t come soon enough for Haitian children.

Image credit: Flickr/International Disaster Volunteers

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Searching For a Better Battery Future

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By Dr. David Lee

The energy market is sharply focused on advancing lithium-ion battery technologies -- and for good reason. While many different battery technologies are now available, lithium-ion batteries possess overwhelming advantages over other types of batteries commercially available in the market. First, when compared to existing batteries, lithium-ion batteries have substantially higher energy storage density -- requiring smaller footprint thus minimizing weight and size of the devices.  The ‘memoryless’ nature of lithium-ion batteries also makes them more suitable for use in hybrid vehicles that require constant charges and discharges in stop-and-go traffic. A low self-discharge property also keeps the battery's stored electrical energy longer.

There have been so many breakthroughs over the years that, at the surface, presented viable commercial opportunities to reduce costs. Companies including Leyden Energy and A123 Systems once hailed such promising technologies, only to eventually fail due to cash constraints and an inability to produce results. This has led many within the energy storage and battery development sectors to rethink their strategies entirely, focusing on decreasing cost and increasing efficiency within the proven lithium-ion sector, as opposed to totally new and innovative battery technologies beyond lithium ion.

Many researchers and financial professionals believe energy capacity improvement with factors of five or more may be possible by advancing lithium–air or lithium-sulfur batteries, ultimately leading to our ability to confine extremely high potential energy in a small volume without compromising safety.

With that in mind, it’s important to note that there are fundamental technological barriers we still have to be overcome. Most scientists agree lithium-air and lithium-sulfur battery technologies will not be commercially viable within the next decade, thus tempering industry expectations and too often, keeping many in the industry focused on the incremental upgrades to lithium-ion battery technology.

A number of industries and markets are spurring the advancement of lithium-ion battery technology. When it comes to energy storage, you may be familiar with some of these common questions: Why can't we use our iPhones for several days without charging?  Wouldn’t it be nice to be able to drive our electric vehicles from Los Angeles to San Francisco without being stranded along the way due to a low battery, or having to pull up an out-of-date map to find the nearest charging station? Why does it have to take more than 20 minutes to recharge my EV? Will we be able to purchase electric vehicles that cost about the same as comparably sized and equipped conventional vehicles, and don’t require frequent battery replacements?

Yes, it would be nice to simply answer these questions – or not have to ask them at all. All existing lithium-ion applications -- including electric vehicles, consumer electronics, battery-powered tools, large-scale grid electric energy storage, the list goes on – will directly benefit from the advancement of lithium-ion battery technologies. Furthermore, advancements in lithium-ion batteries have the potential to create an entirely new set of applications that were previously not technically feasible, e.g., electric airplanes.

The answers to these questions and others come down to battery storage capacity and cost. In other words, the hidden issue isn’t the innovation of the energy production or device/vehicle technology, but the underlying battery capabilities.

Perhaps the most dramatic and relatable example is the electric vehicle industry, as user adoption for the industry hinges on substantially lowering the cost of the battery, which will then help bring down the purchase price of electric vehicles. In addition to the low cost of battery storage, cycle life of the batteries must substantially improve so electric vehicle owners do not have to buy replacement Li-ion batteries every five years or so.

The current cost for storing electrical energy using lithium-ion batteries is above $500 per kilowatt-hour. If we are successful in reducing the cost of electrical energy storage below $100/kWh, the impact to the electric vehicle market will be immediate. This means electric vehicles can directly compete with conventional vehicles in terms of range and cost of ownership. Manufacturers can also guarantee the battery for the lifetime of vehicle use.

So, what will be the real game-changers in the industry? As referenced, the two most important and challenging objectives related to lithium-ion battery technologies are increasing the energy density and reducing the cost. In changing the way we perceive and engineer battery chemistries, these improvements may happen -- and will profoundly impact the future of both current and future consumer applications.

Image credit: Flickr/Brookhaven National Laboratory

Dr. David Lee is the CEO at BioSolar Inc., a developer of breakthrough technology to double the storage capacity, lower the cost and extend the life of lithium-ion batteries.

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More companies getting involved in social issues

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by Vikas Vij — As expectations rise for companies to engage with the communities through communications, advocacy or legal means – and as the implications for business become clearer – more companies are speaking up to influence the discussion on social causes.
 
According to a new study by the Public Affairs Council (PAC), major corporations are facing pressure from various stakeholders, including their own employees and customers, to weigh in on social issues. The study titled “Taking a Stand: How Corporations Speak Out on Social Issues” analyzes the results of a poll of 92 businesses about their growing need to address social challenges.
 
The study reveals that employees have been highly influential when companies have chosen to get involved in social issues. The next most influential stakeholder group has been customers. Companies headquartered in the U.S. were more influenced than their non-U.S.-headquartered peers by advocacy groups (41% vs. 18%), shareholders (39% vs. 9%) and political leaders (22% vs. 9%).
 
The survey of businesses across industries finds that over the last three years, 60 percent have experienced rising stakeholder pressure to speak out on social issues such as discrimination, sustainability, education and human rights. What’s more, 74 percent of the respondents said they expect the pressure to further increase over the next three years.
More than half of the companies surveyed have been involved in efforts to end discrimination and restrictions based on sexual orientation or gender identity.
 
Expectations for involvement are the highest among companies with more than $15 billion in annual revenue. More than 75 percent of these companies said they experienced increased pressure to weigh in on social issues. A large number of companies said they were most involved recently in efforts to protect the environment (74%), end discrimination or restrictions based on sexual orientation (59%) or gender (54%), improve access to quality education (59%), protect human rights abroad (49%) and end discrimination/restrictions based on gender identity (52%).
 
The most common strategies adopted by companies in their social issue advocacy efforts have been to join a coalition, lobby at the state or local level, distribute a press release or public statement, lobby at the federal level, sign a petition, publish a formal policy position or conduct media interviews.
 
The President of PAC, Doug Pinkham, summed up the findings of the survey by saying that many of the pressing social issues are now viewed as business issues. They affect a company’s ability to attract and retain talent and meet the expectations of customers. The involvement of leading companies also demonstrates the belief that it is possible for a firm to be financially successful while protecting the environment and supporting local communities.
 
Source and Image: PAC
 
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Extel’s 14th SRI & Sustainability Survey highlights need to do more 

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by Roger Aitken — This year’s annual WeConvene Extel and UK Sustainable & Finance Association (UKSIF) SRI & Sustainability survey reveals that while almost 40% of asset managers believe sustainability issues have an "important influence on stock prices”, the buy side contends that “only a third” of companies actually take sustainability issues truly seriously in how they operate, and in how they treat investors. 
 
Over 400 investment professionals from thirty countries were canvassed in the 14th and latest Extel SRI & Sustainability survey, the findings of which were unveiled late this July at an event hosted at Schroders Investment Management in London. They provide a current assessment of socially responsible investing (SRI) in the European investment community. 
 
Voting in these European awards to produce this year’s rankings was undertaken from 21 March to 29 April 2016 and received responses from 154 buy-side institutions and 17 brokerage firms/research houses. 
 
Simon Howard, Chief Executive of UKSIF, which partnered in the awards with WeConvene EXTEL, commenting said: “The awards continue to show the depth and range of capabilities across fund managers, banks and corporates.” 
 
He added: "The range of domiciles and areas of activity evidenced confirm that the key investment issues of our time - such as climate change and corporate governance - are generating a material response from finance, which crosses borders.” 
 
Among other key highlights from the current Extel/UKSIF survey, where all the rankings are based purely on weighted votes from the investment community, Thematic Reviews and Ideas were found to be the “most critical SRI/ESG research service” as far as the buyside is concerned. This was closely followed by stock-specific analysis that incorporates ESG metrics. 
 
Turing to the key rankings in survey, Société Générale repeated its number one ranking from 2015 this year in the leading pan-European Brokerage category, followed in second spot by HSBC (8th last time) and Exane BNP Paribas matching its third place from last year. 
 
Among brokerage firms in the SRI & Sustainability (Corporate Governance) category, Exane BNP Paribas top ranked (3rd last time), followed by Kepler Cheuvreux (1st in 2015) and HSBC in third spot versus 11th last time. 
 
In relation to Investment Individuals, SRI & Sustainability (Corporate Governance), Yohann Terry at Exane BNP Paribas took top spoils. He moves up one place from his second placed ranking last year, followed in runner-up spot by Kepler Cheuvreux’s Sudip Hazra (3rd last time) and Erwan Créhalet of Exane BNP Paribas in third (6th in 20150. 
 
Steve Kelly, Head of Extel in London, reflecting in the wake of the survey stated: “The depth of response from all three sides of the equity investment community makes clear the intrinsic value and importance of sustainability factors in the investment decision process; and in the need to embed these factors into the corporate narrative.” 
 
But he added: “It’s also evident that more can be done, and that investment institutions, banks and companies who truly take sustainability seriously, can deliver genuine value for their clients and stockholders.” 
 
Elsewhere in the survey, Unilever was voted the Leading Corporate firm for SRI/ESG - moving up from third, followed by Repsol (6th last year) and Tullow Oil in the third from 22nd in 2015. 
 
Amundi mirrored its number one ranking from 2015 in the Leading Asset Management firm category for SRI/ESG, followed by Norges Bank Investment (3rd in 2015). Blackrock Investment Management (UK) took top spoils in the leading UK asset management firm category for SRI/ESG. 
 
Note: Copies of the complete report can be ordered from WeConvene Extel via: www.extelsurveys.com
 
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Companies alerted to human trafficking by RepRisk report

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by Brian Collett — Companies are told in a new report to investigate their supply chains more robustly so that they avoid profiting from the human trafficking that now locks in nearly 21 million workers worldwide. 
 
Victims are lured into their jobs with false promises, and millions of these prisoners are children, says RepRisk, the Zurich-based international business data provider, which has compiled the report. 
 
RepRisk, a data source for global banks, insurers and other corporates, draws much of the information from the International Labour Organisation. 
 
The regions with the highest number of trafficked and enslaved workers are said to be Asia Pacific, Africa and Latin America, and the food and beverage industry is named in the report as the sector most linked to human trafficking. 
 
The report records that in August last year the owner of the KIDCO Farms processing plant near Dawson, North Dakota, was jailed for three months and fined $100,000 (£78,000, €89,000) for employing illegal workers recruited in Arizona. The authorities called his offence “a serious human trafficking crime”. 
 
In October last year migrants as young as 14 were said to have worked up to 12 hours a day in heavy jobs at Trillium Farms Holdings, a leading egg producer in Ohio. Trillium ended its contract with its sub-contractor and in June members of a trafficking ring were jailed for up to 15 years. 
 
RepRisk quotes media and NGO reports last year that workers were trafficked from Myanmar and tricked into jobs on Thai boats catching fish for US supermarket chains.
 
At the same time 2,000 enslaved migrant fishermen were rescued from Thai boats. 
 
The Payson Center for International Development, a university interdisciplinary centre in New Orleans, is quoted as reporting in July last year that 2.1 million children were “in inappropriate forms” of labour in the Ivory Coast and Ghana. 
 
Six former young workers have filed a class action in the US claiming that food and drink companies have knowingly supported Ivory Coast cocoa plantations that systematically use child slaves. 
 
Manufacturers and retailers at the receiving end of irresponsible employers are warned that involvement in trafficking and slavery exposes them to severe legal, compliance and reputational risks. 
 
In a foreword to the report, which gives many more examples of exploitation, chief executive Philipp Aeby writes: “Although human trafficking is often linked to domestic service and prostitution, it is also a supply chain issue. 
 
“Companies that source raw materials and manufactured goods need to be especially vigilant, as trafficking can occur at different stages along the supply chain.” 
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3p Weekend: 7 Companies Making the Circular Economy a Reality

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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 an 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.

The future is uncertain. As the global population is projected to hit 9 billion by 2050, tensions over resources like food, water and energy are likely to swell along with it. Meanwhile, earth has reached what scientists deem the climate tipping point -- and evidence suggests the carbon concentrations in our atmosphere may be permanent.

As these chilling realities set in, thought leaders the world over begin to examine new economic models that can offer solutions. One such model, known as the circular economy, is particularly promising. For business, the circular economy is a system in which there is no waste -- only promise. Waste generated during manufacturing and at end of useful life is recaptured and made into new products. Those products can then be recycled again, keeping the circle in motion and eliminating the need for virgin feedstocks.

A true circular economy is still a long way off. But forward-thinking companies are inching closer to making it a reality. Read on for seven case studies that are sure to inspire.

1. Interface


In 1994, global carpet manufacturer Interface set a bold target: to eliminate its negative impact on the environment by 2020. The company gave itself over 20 years to accomplish this feat, which may have left some skeptical that execs would stick to the task. But heading into the final leg of its journey, Interface is poised to meet the target on time.

Part of Interface's Mission Zero initiative involves "designing and manufacturing sustainable closed loop products." In 2007, it became the first carpet manufacturer to implement a process for the “clean separation” of carpet fiber from backing. The process, fittingly dubbed ReEntry, allows for the maximum recycling of post-consumer material with minimal contamination. The recycled Nylon fibers then return to Interface's supply chain and become new products. A similar process dubbed Cool Blue allows for the closed-loop recycling of carpet backing. And the company also utilizes bio-based materials to clean up its supply chain.

With the zero-impact target well within reach, Interface isn't resting on its laurels. The company now has its sights set on carbon negative products and operations. Through programs like Cool Carpet and Climate Take Back, Interface plans to make sure its products leave the world better than they found it, and helps customers do the same.

"Last December, delegates to the COP21 climate talk in Paris reached a significant turning point in the effort to limit carbon emissions. However, there’s far to go, and we’re committed to get there," the company says on its website. Now that's something we can get behind.

2. Levi Strauss

Levi Strauss & Co. is no stranger to sustainability. From utilizing sustainable raw materials to reducing water waste, the company keeps its green cred sky-high. Now, it's inching ever closer to a closed-loop supply chain.

Earlier this year, the retailer partnered with textile technology startup Evrnu to create a pair of its iconic 511 jeans from post-consumer cotton waste. The pilot pair was made from approximately five T-shirts, the companies said. The emerging alternative recycling technology is a “game-changer,” Evrnu founder Stacy Flynn told 3p.

“We can take your old jeans, break them down to the molecular level, [and] build them back up into beautiful sweaters that feel good and hold color beautifully,” she explained. “When you are done with that sweater and it’s been reused and recycled, we can break it down again and convert it back into premium jeans.” Evernu hopes the product can be on store shelves by next year.

Levi Strauss and its retail chain Levi’s also help customers reduce their own footprints by accepting clothing and shoes of all brands for recycling. Through its recycling partner I:CO, clothing is sorted for resale, reuse and recycling — ensuring nothing goes to waste.

3. Nike

Nike certainly has come a long way. Only a few decades ago, the company was up to its ears in boycotts, protests and bad media attention amid child labor and sweatshop allegations. In 1998, then-CEO Phil Knight promised change. And the footwear and apparel giant delivered.

In 2005, Nike was the first company in its industry to demonstrate transparency, when it published a complete list of its contract factories. In the same year, it also published its first version of a CSR report — detailing pay scales and working conditions in its factories and admitting continued problems, 3p's Andrea Newell reported last year.

Now, the company continues to increase the sustainability of its supply chain. That includes huge strides in waste reduction. A whopping 71 percent of Nike footwear is made with materials recycled from its own manufacturing process. And the brand recovered 92 percent of its trash last year.

“By creating low-impact and regenerative materials, we can continue to move toward a high-performance, closed-loop model that uses reclaimed materials from the start,” Mark Parker, Nike’s president and CEO, wrote in its 2015 CSR report. “Coupled with smarter designs, we can create products that maximize performance, lighten our environmental impact and can be disassembled and easily reused.”

4. Dell

It's hard to cover the circular economy without mentioning Dell. The electronics company is outspoken about its quest for a closed-loop supply chain, and each year it only grows closer to this goal.

Last year, the company took another significant step forward with its OptiPlex 3030 All-in-One computer. The model contains at least 10 percent repurposed plastic from recycled electronics and set a new closed-loop standard for the industry.

A few months later, the company announced it would do even more to boost plastics recycling and the reclamation of carbon fiber materials. The revamp includes 35 products and will recapture millions of pounds of plastic and carbon fiber material, Dell said. The company already recycles plastic components from over 30 flat panel-monitor models and three desktop models.

5. Patagonia

On Black Friday in 2011, Patagonia caught shoppers' attention with a compelling message: "Don't buy this jacket." It seems an odd thing to say about one of your best-selling items on the most lucrative shopping day of the year. But for Patagonia, the message is more of the same.

Since its founding, Patagonia encouraged customers to repair their worn garments to extend their life, shop used instead of buying new, and think twice before heading to the store at all.

The company now boasts the largest garment-repair facility in North America, in Reno, Nevada. It also provides instructions on repairing Patagonia gear for customers who want to take on the task themselves, and collects and resells unwanted garments through its Worn Wear program.

6. H&M


Once lambasted as one of the worst offenders in the fast-fashion industry, H&M is making moves to clean up its act. Last year, 3p Editor-in-Chief Jen Boynton headed to Stockholm to check out the company's operations and was pleasantly surprised by what she found.

In addition to spearheading efforts with the Sustainable Apparel Coalition to create the Higg index and set strong standards across the industry, H&M is taking things into its own hands. The company says it is actively seeking a closed-loop system where the inputs — cloth fibers – come from a renewable source, aka old clothes.

H&M collected 20,000 tons of clothes through an in-store recycling partnership with I:CO. For World Recycle Week this year, the retailer launched a social media campaign to encourage customers to recycle more clothing at their local H&M store.

The apparel giant's quest for a more sustainable supply chain came to a head in April, with the launch of its Conscious Exclusive collection. The ultra-luxe collection, made in collaboration with Conscious Commerce co-founders Olivia Wilde and Barbara Burchfield, is made entirely from sustainable materials. From cat-eye sunglasses made from plastic bags to a pair of high-fashion flats made of eucalyptus bark, the products are beautiful and prove that closed-loop duds can be high on style. The collection follows a line of jeans made from recycled cotton debuted by H&M in 2015.

7. TerraCycle

Almost everyone knows they should recycle that plastic bottle or aluminum can rather than toss it in the trash. But some materials are tougher to recycle, meaning their recovery rates remain abysmally low. One company, TerraCycle, is out to change that by making it easier for people and businesses to recapture hard-to-recycle material and put it to good use.

Through its brigade programs, TerraCycle collects hard-to-recycle waste ranging from office staples like energy bar wrappers and snack food bags to niche items like juice pouches and instrument strings. It even has a brigade for cigarette butts, which remain America's most littered item and have few recycling options.

The company partners with other conscious firms, such as Clif Bar and Colgate, to make the programs free for the user. Folks who recycle through TerraCycle can even earn rewards, which translate into money for their school or a favorite nonprofit. The company also offers paid bulk recycling solutions for businesses that recapture "almost every form of waste."

Image credits: 1) and 7) Brian Ach/Getty Images for H&M (used with permission); 2) Interface; 3) Evernu; 4) Nike; 5) Dell; 6) Flickr/Hajime NAKANO; 8) TerraCycle

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Earth May Have Passed the Carbon Threshold -- Permanently: What It Means for Business

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As global leaders prepare to gather for COP22 in Morocco and build upon the momentum gained from last year’s climate talks in Paris, a new milestone should give everyone a sense of urgency.

Carbon dioxide in the earth’s atmosphere surpassed the 400 parts per million (PPM) mark last year. And research suggests these elevated levels may be permanent.

That threshold, which measures the concentration of carbon in the atmosphere, is more of a symbolic figure than the “tipping point” often suggested by many analysts over the years. But passing 400 PPM is significant for several reasons.

Last year’s readings at Hawaii's Mauna Loa Observatory concluded the average CO2 concentration was 399.4 PPM. But what is more important than the raw numbers is to look at the steady increase of carbon concentration in the atmosphere: a consistent 1 or 2 PPM uptick annually. That continued rise in carbon is linked to the world’s increasing temperature -- which in turn causes the loss of ice sheets, a blow to diversity as more species become extinct and higher risk to human health.

NASA long advocated global climate change policies that target a CO2 concentration of 350 PPM, last seen during the mid-20th century. Pre-industrial society lived in an era where carbon concentration was about 285 PPM.

Scientists who monitor atmospheric carbon levels at the Mauna Loa Observatory measure these levels in September -- the observatory’s “low point,” or the time of year when atmospheric carbon levels reach their lowest levels, explained Ralph Keeling, a scientist with the Scripps Institute for Oceanography.

As vegetation in the Northern Hemisphere reaches its highest amount of growth, the amount of CO2 that is absorbed also reaches its highest point. That trend then starts to reverse in the early fall, as more carbon dioxide is released by the soil. Although Mauna Loa and Scripps have not yet released official data, Keeling said recent measurements hovered over 400 PPM and have almost reached 401 PPM.

Even if October reveals a lower carbon concentration than this month (which does happen occasionally), that historic average decrease -- about 0.45 PPM -- most likely will not push carbon dioxide levels below 400 PPM. “It already seems safe to conclude that we won’t be seeing a monthly value below 400 PPM this year,” Keeling wrote, “or ever again for the indefinite future.”

The Mauna Loa Observatory has been measuring atmospheric data for 60 years. The research center on Hawaii’s Big Island is often touted as one of the best locations to collect such information because of its remote location away from the world’s largest continents, its pristine environment (even lacking vegetation that could have an impact on CO2 measurements), and its location above the earth’s inversion layer.

The bottom line is that whether we are living in a world of 398 PPM or 402 PPM, the rate at which these levels are increasing should be a wake-up call to the business community. The very raw materials on which most businesses rely in the furthest reaches of their supply chains, such as wood, food crops and seafood, will be more difficult to produce in a world increasingly stressed by climate volatility.

And as more countries continue to seek ways to cap their greenhouse gas emission targets, they need the cooperation of businesses, which are the largest such contributors in the first place. Whether the tactics involve more responsible ways to grow foods such as palm oil or cattle, or finding cleaner and more efficient ways to manufacture and transport goods, the businesses that many environmentalists assail for causing these problems also have the capacity and potential to solve them. In the end, taking greater, faster and genuine action will only protect these businesses’ assets in the long term.

Image credit: Rick Sharloch/Flickr

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Wells Fargo Faces DOJ Investigation for Bending Military Lending Laws

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The bad news keeps on coming for Wells Fargo and its embattled CEO, John Stumpf, and the once most valuable bank in the world now confronts another scandal.

The U.S. Department of Justice could fine the company millions for the improper repossession of automobiles owned by members of the U.S. military, a Bloomberg investigation revealed on Thursday. The news comes a year after the bank settled a legal case for millions of dollars after it was accused of foreclosing on homes of military families without going through the procedures required by U.S. military law.

Such actions run afoul of the U.S. Servicemembers Civil Relief Act (SCRA), which offers several legal and financial protections for members of the U.S. military who are called to active duty.

Wells Fargo’s alleged aggressive treatment toward its military customers comes at a time when the company is already reeling over its $185 million settlement with the U.S. Consumer Financial Protection Bureau (CFPB). The CFPB imposed the penalty after investigations revealed thousands of bank and credit card accounts were opened for Wells Fargo customers illegally and without their knowledge. Wells Fargo fired over 5,000 employees in recent years. Now, some are filing class-action lawsuits saying they lost their jobs while Stumpf and other Wells Fargo executives benefited handsomely due to the company’s robust stock performance.

One would think that after two long, expensive and devastating wars that imposed a huge burden on military members who served abroad – as well as adding to what their families endured while they were deployed in Afghanistan and Iraq – a company with the gravitas of Wells Fargo would have cut these families a break. After all, companies accused of mistreating military members often find themselves in the middle of public relations nightmares and long-term harm to their reputation.

U.S. air carriers such as Delta and American Airlines were exposed to public scorn after it was revealed they offered no flexibility on their baggage fees to service members. And outrage over homeowner associations (HOAs) foreclosing on military members while they were deployed overseas led the Texas legislature to pass bills that put the brakes on how fast HOAs could take a home’s title away from military families.

As the Bloomberg report revealed, banks' response to the problem with asset repossessions is that employees often do not understand the legalities that are involved when a military family falls behind on housing or car payments. Nevertheless, Wells Fargo’s latest mishap reveals executive leadership that was tone-deaf and quick to pass the buck when the actions of its employees landed the company in legal trouble. The bank has branches on eight U.S. military bases, though its genuine commitment of “making banking easier” for military service members will long be in doubt.

Watch for Wells Fargo to struggle as consumer backlash forces large institutions to re-evaluate their relationship with the San Francisco-based banking giant. California’s Treasurer, John Chiang, recently sent a letter to the company asking, “How can I continue to entrust the public’s money to an organization which has shown such little disregard for the legions of Californians who have placed their financial well-being in its care?”

California began to sever its relationship with Wells Fargo, starting with the cessation of purchasing any more of the bank’s debt securities, an end to using Wells Fargo as a broker-dealer. It will also no longer engage the company when it underwrites bonds, a National Public Radio report revealed.

Meanwhile, Stumpf was subjected to more grilling by the U.S. House Financial Services Committee, with members of Congress unleashing on him for what they called violations of the public’s trust. As far back as Stumpf’s “clawback,” which could cause him to lose as much as $41 million in compensation, Rep. Maxine Waters, (D-Calif.) retorted, “Let me be clear, it’s not enough.”

And the humiliation was bipartisan in tone, as Rep. Roger Williams (R-Texas), a Wells Fargo customer, bellowed: "I’m amazed at what you don’t know about your business. I’ve heard more 'I don’t knows' from a CEO than I think I ever heard in my life. When are you going to resign?”

Watch for this scenario to repeat itself again, if Wells Fargo's military foibles are even larger than originally suggested by Bloomberg.

Image credit: Screen Capture from House Financial Services Committee/YouTube

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Global Cartels, Food Prices and Poverty: What's a Bit of Dirt Worth to You?

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Are you one of those people who worries about mass conspiracies when it comes to our food prices and ready access? Do you eye your tomatoes suspiciously when the vine-ripened fruit jumps in price? Do you catch yourself in the vegetable aisle muttering under your breath that some day you will figure out how to get to the bottom of all these price hikes?

Well, good news -- we think. Two researchers did the dirty work themselves and figured out why global vegetable and fruit prices -- actually, the prices of everything that is grown in soil -- have the suspicious habit of jumping when you least expect it. The research was funded by the German and Polish science foundations.

Hinnerk Gnutzmann of the University of Hannover, Germany, and Piotr Śpiewanowski, of the Polish Academy of Sciences tracked the price of fertilizer during a particularly unstable period in food prices, 2007 to 2008. What they found suggested the food price spikes during that time weren't connected to OPEC oil prices as initially suspected, but the one ingredient that makes it possible to grow food (apart from air and water, of course): fertilizer.

The authors point out in their abstract that the price of fertilizer is directly associated with the price of natural gas, which is used to make fertilizer. Therefore when natural gas prices drop, so should fertilizer prices. But that isn't what happened during the food crisis of 2007 and 2008.

"Fertilizer account[ed] for 44 percent of food commodity cost, far exceeding the importance of direct energy," the researchers wrote. In other words, during the food shortage crisis, fertilizer prices increased noticeably while fuel prices remained relatively weak, leading the researchers to conclude, "Shocks to fertilizer markets may thus have a far wider economic and social impact than so far acknowledged."

The researchers tracked the disparity between oil and gas prices and compared it against that of food and fertilizer. They were then able to determine that it was the price of fertilizers that caused long-term hikes in food prices in both 2008 and 1974, a previous period when the tripling of fertilizer prices coincided with sharp increases in food shortages.

The end result, the researchers speculate, was devastating food shortages and unmitigated price hikes, which drove some 44 million people into poverty and caused endemic food crises in many developing nations in 2008.

Gnutzmann and Spiewanowki pointed out that while many markets are determined by competition as well as supply and demand, the price of fertilizer on the global markets is ruled by a kind of gentleman's agreement, or cooperation between providers. So there generally isn't the kind of tension between competitors that there is, say, in the oil market. Nor is there any kind of consistent oversight when it comes to ensuring against unforeseen price hikes.

"Fertilizer is known to have 'changed the world," say the researchers, "by making rapid population growth possible, but its economic role for food prices has scarcely been acknowledged." Having a better understanding of the fertilizer market and possibly establishing some "regulatory intervention against cartelization" may be necessary to avert another food crisis in years to come.

Images: 1) Flickr/Soil Science; 2) Flickr/SuSanA Secretariat; 3) Flickr/Manhhai

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Norway's Capital Aims to Cut Carbon Emissions in Half by 2020

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As the vice mayor told Reuters in a recent interview, “We’ll count carbon dioxide the same way as we count money.” To that end, government is counting on businesses to partner with the city in order to reduce emissions from almost 1.4 million tons in 2013 to 600,000 tons at the start of the next decade. The current administration is aiming for a zero-emissions Oslo by 2030.

Much of this plan involves a rework of the entire transportation infrastructure for this city of 620,000. Oslo’s government wants to add almost 40 miles of new bicycle lanes as it eliminates more street parking spaces and increases tolls for automobiles entering the city center. The result would be the removal of at least 1 in 5 cars from the city’s streets by 2020. Public transportation would also score a makeover, as the budget intends to develop a bus fleet fueled by only renewables.

The shift away from oil and gas to clean energy would also occur within Oslo’s utility sector. In a city where average winter temperatures stay below freezing and plunge into the teens at night (in Fahrenheit), the largest city in an oil-rich nation is nudging homes and offices to switch to heating systems that use sources other than fossil fuels. In fact, a ban on using any such fuels, including kerosene, is on target to take effect in 2020. City leaders are taking applications for grants from housing associations now in order to switch to Oslo’s district heating system.

In addition, the government is also hoping to reduce its emissions by making investments in carbon capture, a technology touted by many but others say is unproven and is far too expensive. The city currently has a waste-to-energy plant that it wants to retrofit with carbon capture technology, but scaling up that project could cost as much as $250 million -- and that is one of many line items in the city’s carbon budget that it needs to fund in order to make a “warmer and greener city” the reality.

How far Oslo’s government can go on its quest to become a climate-neutral city in 14 years depends on its relationship with the national government. The mayor’s office says it can make these changes over the next four years in part with grants and fund provided by Norway’s central government. But whether the city’s 1-year-old alliance between liberal Labor Party and Socialist Left politicians can score buy-in from the conservative party, which has run Norway since 2013, is a huge question mark.

Image credit: Dion Hinchcliffe/Flickr

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