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Generation Z, the first generation born in the 21st century, is being shaped by a world at risk. They were born into global terrorism, the Great Recession, social inequality, climate change and, too often in the United States, living in a single-parent household. Their combined experiences have made them fiscally conservative, socially tolerant, environmentally aware and urgently engaged.

This is the generation that will collaborate among themselves to demand sustainable solutions from businesses and government using their buying power and votes. Their collective procurement of sustainable solutions, along with their entrepreneurial pursuits, will reshape the world’s economy. They will be the generation that realizes a global Green Economic Revolution by making corporate social responsibility (CSR) a core criteria in deciding what to buy and who to buy from.

Defining Generation Z

The millennial generation is the last generation born in the 20th century, and this year they became the largest employed demographic group in the U.S.

As a reminder: Generation Z is the first generation born in the 21st century. Their ages range from 2 to 19, and they represent about 25 percent of the U.S. population. Today they have approximately $44 billion in annual buying power.  If businesses and governments thought they had to change to adapt to millennials, then they should appreciate this: Gen Z is already working to change their world.

Generation Z’s behaviors are shaped by their digital devices and social media. This is the generation with the Internet in their pocket! Key metrics include:

• The smartphone was their first electric device


• They crowdsource information through their social media


• They spend a higher percentage of their money online than any other generation

They hold a global perspective enabled through digital connectivity. Generation Z members have a high affinity with fellow members in other countries. Generation Z members in Beijing, New York, Mexico City and Paris will typically feel they have more in common among themselves than with members of other generations in their own countries.

They are also highly entrepreneurial with a strong sense of urgency. Pioneering members of this generation are already starting businesses. While the millennial generation was focused on getting a college education to secure a good job, Generation Z plans to take entrepreneurial action to control their own destiny.

Generation Z uses CSR to choose what to buy and who to buy from

As fiscal conservatives, Generation Z views the sharing economy as an efficient utilization of their limited financial resources. They also view it as an environmental solution that “costs less and means more” in terms of less waste and pollution.

This generation questions ownership of things. They ask: Why buy something when access is the desired goal? Their economics is shaped by downloading, renting or sharing. Their procurement path will be a crowdsourcing process that relies on the experiences of others in their generation drawn from around the world.

Generation Z views corporate social responsibility as a core brand identifier for products and businesses. This generation rejects gender, ethnic, or sexual-preference intolerance and discrimination. They expect businesses to deploy green supply chains that prudently use resources to limit environmental and human-health impacts. They expect the products they buy, rent or share to align value with values. These expectations will be global. A business that does wrong on the other side of the world will be exposed via social media through Generation Z’s global connectivity and aligned values. CSR will be this generation’s foundation for evaluating what companies they will work for and do business with.

Ford futurist Sheryl Connelly On Generation Z

Sheryl Connelly is Ford’s futurist. She leads Ford’s publication of Looking Forward With Ford that annually highlights ten future trends. The first trend listed in the 2015 publication is “Make Way For Gen Z.”

This exclusive interview conducted at the Sustainable Brands 2015 conference is a must-watch, three-minute video on how Generation Z has started down the path of reshaping the world -- and your business opportunities.

https://youtu.be/DXdA4Spi8o0

Image credit: Pixabay

This fall, all eyes are on Paris, which will host COP21 - widely expected to be our last chance to set a global commitment to halt climate change. We recently started a new column on TriplePundit dedicated to the "Road to Paris," and the case for the responsible business leader to be involved in the upcoming climate negotiations.

Here's where you can get involved...

Alongside coverage of the latest news concerning COP21, we're hosting a continual conversation on Twitter at #GoParis. Share your questions, concerns, comments, news and ideas at #GoParis. We'll be listening!

Every week, we'll pose a new question of the week (or QOTW in twitter-speak) around COP21, with hashtag #GoParis. The conversation's already begun!

 Previous Weeks' Questions: 

• What do you think are the prospects for #COP21? Feeling optimistic? #GoParis


• Heard of @Novozymes? They've made the biz case for #COP21. Would their strategy work in the U.S.? #GoParis


• Why are science based #COP21 targets so important? #GoParis

This Week's Question: 

• What's your fave off-the-shelf clean tech? #cleantech #GoParis

Check back soon for upcoming #GoParis questions! 

Ready to participate? Head to Twitter today and give us your thoughts at #GoParis. 

Image credit: Akuppa John Wigham, Flickr    

Traditional corporate philanthropy, as the average consumer has come to know it over the past several decades, consists of making donations to charities in order to create positive societal impact, while engendering goodwill among key stakeholders like consumers, shareholders, advocacy groups and employees.

While such contributions are well-intended and not to be dismissed, this approach brings with it certain risks -- namely that a promising project relying upon a company’s donation can go by the wayside if and when the funding runs out and there are no resources or people left on the ground to maintain it. The corporate philanthropy of tomorrow seeks to be more strategic and focused on issues material to the business – where brands are highly engaged, so as to create lasting, collaborative partnerships and generate impact that can stand the test of time.

https://player.vimeo.com/video/140175174

KOMBIT: THE COOPERATIVE from Impact Farming on Vimeo.

"Kombit: The Cooperative," a film by Found Object, documents how one company, in partnership with a local nonprofit, sought to test whether this type of engagement could truly be successful in practice. The film shares the journey of a five-year collaboration between Timberland and the Smallholder Farmers Alliance (SFA) to reforest Haiti. This creative private-public partnership has not only reached its original goal of planting 5 million trees, but it has also transformed into a 3,000-member smallholder farming cooperative that is now entirely self-financed and self-sustained.

When a massive earthquake struck Haiti in 2010, just as this project was getting underway, Timberland questioned whether it should continue on with the plan as is, or put its resources toward immediate disaster relief instead.

Two-thirds of Haiti’s working population subsists on small-scale agriculture, and the earthquake had put many smallholder farmers’ land in shambles. This was adding insult to injury, as Haiti was already facing serious challenges including deforestation, soil erosion and lack of local farming infrastructure support many Americans take for granted (think: agricultural extensions). Haiti also has only 1.5 percent of tree cover left, making it one of the most deforested countries in the world.

Trees are crucial to farmers’ livelihoods because they provide a living border and shade for their crops. So, Timberland decided that by rebuilding the landscape through the restoration of tree cover, farmland productivity would increase along with household income over time. With long-term earthquake recovery in mind, Timberland stayed the course.

Paying it forward, farmer style

The next question became: How do the partners get small-scale farmers to plant trees? SFA co-founders Hugh Locke and Timote Georges addressed this question during a Q&A session and viewing of the documentary at SXSW Eco 2015, saying the organization realized it needed to devise a way to give trees value in order get the farmers invested.

“When Hugh and Timote came to us with their idea, it was based on paying the farmers to plant trees," said Margaret Morey-Reuner, director of strategic partnerships, business development and values marketing at Timberland. "We said, 'That all sounds well and good, but what happens when the funding runs out?' If we could develop a sustainable model, then we would be on the right path to address the deforestation problem in Haiti and other places throughout the world."

This led Timberland and SFA to focus efforts on providing a way for farmers to earn high-quality seeds for their crops, farming tools and training.

“Farmers have a lot of opportunities ... But there is no structure to help them use what they have. We need to teach them what to do and why,” Georges said.

How it works

Farmers volunteer to manage a network of 19 nurseries that grow a million trees per year. In exchange, farmers are given training, crop seeds, seedlings and tools needed to restore tree cover, while increasing their own crop yields and profit. Seeds are returned to the seed bank, and proceeds are used to train and provide seeds and tools for even more farmers during the next planting season.

This sustainable agroforestry model produces tangible results. Since 2010, 3,200 farmers have increased their farmland productivity by an average of 40 to 50 percent, thereby increasing household incomes by up to 40 percent. Associated benefits have also come about, including increased access to healthcare and education; it’s estimated that an additional 3,400 school children of families who are SFA members have been placed in schools since the program began.

Morey-Reuner cautioned companies exploring this type of collaboration to do so thoughtfully:

“You must be in it for the long-haul because you may not see return for your business in the short term.”

Next on the horizon

Timberland, SFA and the Clinton Foundation are teaming up to develop a sustainable export model for moringa, a little known 'super food' plant. Through U.S. brand Kuli Kuli, a SFA women’s cooperative in Haiti will process the leaves into powder, which will then be exported to the U.S., made into Moringa Green Energy Shots and sold at Whole Foods stores starting in January 2016. Timberland is also exploring replicating the Kombit model with projects around rubber and cotton, both commodities key to Timberland's supply chain and that of its parent company, VF Corp.

“’Kombit’ is a Haitian Creole word for ‘a community working together toward a common goal,’” Georges explained. “This is exactly what happened over the last five years in Haiti as a result of Timberland’s vision. The farmers have found their voice; they have renewed their passion; they feel completely empowered and are eager to continue building the cooperative. I personally can’t wait to see what we do next.”

Visit www.KombitFilm.com to view the film. All net proceeds from the film will go to Impact Farming to benefit SFA in Haiti.

Image credits: Timberland, used with permission

By Scott Huntington

With climate change cementing its hold on our planet, we are seeing stronger storms. The destruction these acts of nature bring is similar to that of a forest fire. The devastation is terrible, but in its wake it brings the potential for new growth. Cities that have faced these storms are taking whatever advantages they can, including rebuilding their homes to be greener and more environmentally friendly.

Hurricanes do come and destroy people’s lives. They also fill up landfills with the waste brought by their destruction. When you’re sifting through the wreckage of a home that once held your family, your hopes and your love, recycling is the last thing on your mind. Understandably, most of that wreckage goes to the dump.

It also makes sense that when the rebuilding happens, people make an effort to make things better. Wind and solar energy are both falling in price, and it looks like they will just continue to get cheaper. This is in opposition to natural gas. Currently, wind and natural gas are tied, but since gas will eventually start being shipped overseas, the prices will probably go up. Similar to traditional oil, natural gas is likely to be an unpredictable, volatile market.

The new, New Orleans

It only makes sense that when people started rebuilding New Orleans after Hurricane Katrina, they decided to go green. The Make It Right Foundation has pledged to build 150 new homes, all with a Platinum LEED certification – the highest sustainability certification available. The organization also put in some community gardens and a solar-powered playground. Its goal is to make the neighborhood it's working in a safe, sustainable place for generations.

This works to everyone’s advantage because not only is this kind of building good for the planet, but it also allows homeowners to cut costs. The foundation is working to rebuild the Lower Ninth Ward district, which was demolished by the hurricane. It’s slow going, and much of the neighborhood is still gone. Part of that is because this was one of the hardest-hit areas. There was standing water left in the town for weeks – in some places it was 12 feet deep. It was the last place to be pumped dry, and it’s the last place to be rebuilt.

It’s getting there, however. Plans for a new high school have been drafted, and some people are moving back in. With the help of the foundation, they should have an easier time affording gas to get to the grocery store – since there isn’t one in town yet.

Changing times

How people are building greener homes is always changing. Now, with the effort of having to rebuild after a storm, people are putting a greater emphasis on safety. Of course they have things like solar panels and counters made from recycled materials, but they also have to have different foundations and storm-ready garage doors.

Kim Erle was one of the first innovators to address these new safety concerns, while still making sure her home was built with green technology, after her original one was washed away during Hurricane Sandy in 2012. Her enterprise, the Sunset Green Home, is designed to be a jumping point for new development. It’s expected to encourage builders to make green homes a priority, and to plan for the worst while building them.

Part of what Erle had to do was bend to new protocols regarding what a safe coastal home looks like. She needed to have a higher foundation, since Sandy caused regulations that change the law. Homes must now be 12 feet above sea level, whereas before they only needed to be 5 feet higher. Because the house had to be so much higher, Erle made use of all that space and added a garage to the house.

A traditional garage isn’t very safe from flooding. A simple garage door doesn’t even keep rain out very well, let alone a flood. This is why she installed garage doors that can withstand powerful storms. Triple-layered insulation can withstand more pressure from debris, the material won’t rot, crack or warp like wood, and it has a battery backup, so it can work during a power outage.

Make a difference

In addition to working to make sure new homes are more secure against flooding, Erle also tries to spread the word about other green initiatives. Green buildings in New Orleans done by Global Green USA have also worked to bring life back into the Lower Ninth Ward. The devastation wrought by Hurricane Sandy also encouraged people to build new, green homes. The tornados that rip through the Midwest don’t bring the same kind of water damage, but they do bring the same opportunity to make a greener future.

No matter what your opinion is on climate change, doesn’t reducing waste sound like a good idea? It sounds great to pay less for a renewable resource. After all, we’re not going to run out of wind or sun for the next 500 million years, so it can’t hurt to tap into it. Everything else will disappear. Homes and lives might not survive all the storms Mother Nature can throw at us, but at least we can leave a better world for future generations.

Image credits: 1) Flickr/DVIDSHUB 2) Sunset Green Home via Facebook

Scott Huntington is a writer and blogger. Follow him on Twitter @SMHuntington. 

By Jessica Oaks

It’s 2015, and planet earth ain’t what it used to be. With extreme weather conditions like hurricanes, heat waves, droughts and polar vortexes becoming the norm, people are started to take these signs of significant global warming a lot more seriously.

The leaders of the economic world, aka businesses, are leading the rest of society into saving the planet by practicing corporate responsibility and sustainability. Here are five brands that have focused on doing their part to help the environment.

H&M

As one of the world’s largest clothing retailers, H&M has made something of a 180 -- going from a oft-maligned, fast-fashion company to a veritable pioneer in making the fashion world green-friendly.

The retail company has prioritized investment in sustainability not only to benefit its future, but also for the communities it operates in. Upon entering an H&M store, any shopper can notice the brightly-lit, often massive, store lined with clothes. More than 80 percent of the company's energy footprint comes from H&M stores, which is why the brand understands that energy usage needs to be a main consideration.

The company made a public commitment to get all of its electricity from renewable sources wherever available. And by 2020, H&M plans to cut electricity use by 20 percent per square meter. The retail clothing giant is also the world’s No. 1 user of organic cotton.

Unilever

Global consumer goods company Unilever has worked diligently on its carbon footprint. It has reduced energy consumption across its manufacturing network by 20 percent, which has resulted in 1 million metric tons of carbon emissions saved since 2008.

Unilever provides products globally and has created a new business model that focuses on the well-being and health of people around the world. It utilizes sustainable resources and drives sustainability in every corner of the business — with the constant goal to hold a positive social impact. Taking a holistic approach, the business is innovating its products to require less water for instance and forming partnerships to tackle global issues like deforestation and improving sanitation, hygiene and access to water.

Ford

Within the automotive industry, Ford is leading the pack in minimizing environmental impact. It’s implemented a science-based strategy to reduce greenhouse gas emissions from its products and practicing operations geared toward stabilizing carbon dioxide concentrations in the atmosphere.

The automaker has a 2016 goal to reduce waste sent to landfills by 40 percent per vehicle (from 2011), and it's working to improves fuel economy through sustainable technologies and alternative fuel plans. The company has introduced six electrified vehicles already and is facilitating mass adoption and use of this sustainable auto alternative.

Ketel One

The word alcohol triggers a connection with water in many ways. Aside from rehydrating from a rough night, water conservation is a huge concern in this consumer beverage category.

Spirit labels like Ketel One Vodka, under the Diageo umbrella, are majorly cutting water usage in production. Diageo has made a commitment to reduce water use through a 50 percent improvement in water efficiency, return 100 percent of wastewater from operations to the environment in a safe manner, and replenish water-stressed locations with the same amount of water used in their final products -- all by 2020. It also has formed an initiative to provide safe drinking water and sanitation to those in need as part of the water conservation program.

Heinz

Agriculture and food are integral to the earth’s ecosystem. Heinz is one company practicing sustainability in all aspects of the food chain. It practices quality control in sustainable agriculture, overseeing that the health of the land in which so many of Heinz-branded products are farmed from are safely grown. Furthermore, supply chain management is at the forefront — reduction in factory production emissions and packaging waste is a key goal.

The aforementioned businesses are just a few of the many that are starting to take big action in protecting the environment. In the years to come, they will be hitting their targets and continuing to grow and save the planet with even more preventative measures.

Image credit: Ford Motor Co.

Jessica Oaks is a freelance journalist who loves to cover technology news and the ways that technology makes life easier. She also blogs at FreshlyTechy.com. Check her out on Twitter @TechyJessy.

Swedish furniture giant IKEA has become the first major retailer to use sustainably-sourced cotton across its entire products range. 

Steve Howard, IKEA Chief Sustainability Officer, IKEA group said: “For over a decade we have been working towards an ambitious goal: to have 100% of the cotton we use in our products come from more sustainable sources. Today, we are delighted to announce that we have reached our 100% target and we not stopping here. We are committed to creating positive change throughout the entire cotton industry.”

Cotton from more sustainable sources includes cotton grown to the Better Cotton Standard, by farmers working towards Better Cotton, and sustainable cotton from the USA. From September 2015 onwards, all the cotton used in IKEA products is from these sources (although a small volume of products produced using conventional cotton prior to this time will still be on shelf until they are sold out).

Richard Holland, director, WWF Market Transformation Initiative commented: “Cotton from more sustainable sources across all IKEA products is a potential game-changer for the global cotton market because it demonstrates the clear business case for sustainability. We need more companies to follow IKEA’s lead but this milestone shows what’s good for people and nature is also good for business.”

Cartons, cups and bags at McDonald's are now made from wood fibre coming from recycled sources or sustainably-managed forests.

Indeed, all centrally-sourced packaging for the burger chain giant - distributed across its 38 European markets - is now chain-of-custody certified.

Keith Kenny, vp sustainability – Worldwide Supply Chain, McDonald’s, commented: “This step represents a key milestone in McDonald’s European sustainable packaging strategy to source 100% wood fibre from recycled or certified virgin sources by 2016, as well as providing credible evidence to our customers that the packaging products we use come from well-managed forests.

"The achievement has involved collaboration across the length and breadth of our supply chain in all 38 European markets, from those that supply our restaurants right back to the family-run businesses that own the forests.”

McDonald’s has achieved significant sourcing milestones in recent years, both globally and in Europe. Since 2008, McDonald’s European markets have sourced 100% of their coffee (excluding decaf) from farms certified by Rainforest Alliance or Fairtrade for their sustainable practices. In addition to this, all of the fish used in McDonald’s Filet-o-Fish sandwiches in Europe is certified by the Marine Stewardship Council.
 

In a recent conversation with Novozymes CEO Peder Holk Nielsen, we asked: If he had a few minutes alone with one of the delegates at COP21 in Paris, what would his elevator pitch be? His response, without hesitation, was that we already have most of the technology we need.

Referring to the McKenzie Abatement Curve, which examines the cost of various carbon abatement measures, he said: “Actually two-thirds of those technologies are available. Of those, one-third has been shown to be economically advantageous, while another third is roughly neutral. Then there is one-third where it’s complicated, and expensive, which means, we really don’t understand how to do it yet.”

What was clear to Nielsen that many people do not yet realize is how many tools we now have for dealing with carbon emissions in a cost-effective manner. Many of them are already in widespread use with costs continuously dropping as they achieve scale and continue to be refined. Many others are highly promising and are at various stages of development. Let’s take a moment to consider some of these.

Renewable Energy World recently ran a story with a similar theme, naming five key technologies that “would go a long way in supporting implementation of that agreement,” if indeed an agreement is reached. They included:

• Onshore wind: A total of 369.6 gigawatts of wind was installed as of the end of 2014. That includes enough wind power in China to power 110 million homes. In 2014 alone, wind power avoided 608 million tons of CO2.


• Offshore wind: A more recent development, offshore has been deployed in Europe since 1991 and is now beginning to find application in the U.S. Given the large proportion of people living in coastal areas, there is a lot of potential. Recent developments in floating platforms in Japan support very large turbine sizes, which could ultimately reduce cost. The U.K. is becoming a major player as well.


• Biofuel is mostly being used to produce a supplemental vehicle fuel, but new processes based on the Organic Rankine cycle, using organic fluids with lower boiling points than water, could help improve the electricity output of combined heat and power plants that run on biomass.


• Concentrated solar power: Improved efficiency is being achieved through cooling measures and integration with combined-cycle thermal power plant technology originally developed for fossil fuel generation. Highly efficient Stirling engines are also being developed for this purpose.


• Energy storage: The report mentions adiabatic compressed air energy storage (CAEE), which includes heat recovery, though many other viable storage solutions are now available including a wide variety of batteries -- purpose-built for various applications ranging from cell phones and electric cars, to home energy storage (where lithium-ion still rules), to utility-scale power storage using flow batteries.

This list was compiled by the Global Sustainable Electricity Partnership (GSEP), a group of executives from “the world’s leading electricity companies,” which explains the fact that rooftop photovoltaic technology, which is among the most significant developments in the energy picture, is absent from the list.

We think solar PV should be added. While solar PV is still catching up with wind, it is gaining rapidly. There is now more than 20 GW worth of solar electricity installed in the U.S., a number that is expected to double in the next two years. The U.S. produced a total of 4 million GW of power in 2014 -- so renewables need to be ramped up substantially, but it is now cost effective to do so.

Worldwide solar PV installations have reached 177 GW, a tenfold increase since 2008. This growth should continue as Asia, Africa and the Middle East all are beginning to ramp up in earnest. Not only have costs come down, but efficiency also keeps improving -- and a number of innovative financing options now make it possible for people to install solar on their roofs with no money down. Another important advance is the advent of community solar, which allows inner-city residents, even renters, and those whose rooftops are shaded, in poor condition, or face the wrong way, to purchase solar power from an installation in their neighborhood. The installations are often public-private partnerships that could utilize vacant lots or other available land.

Without getting into things that are still in the R&D phase, the list of technologies that are available is truly breathtaking. On the demand side, we see things ranging from higher efficiency devices including lighting, appliances, computers and just about everything with a plug, smart buildings, boosted by cutting-edge design tools, smart cities using the Internet of Things (IoT), smart-metering, and lots of apps designed to track and help you save energy. Demand-management programs, including energy storage as well as deployment of fuel cells), are designed to flatten out peaks which saves cost and improves the efficiency of the grid. These technologies will reduce the total volume of electricity we need without reducing performance.

While not exactly a technology, the restoration and preservation of forests is another key factor in the climate equation. What is it that forests do? Trees pull carbon out of the air and store it in their trunks and branches. Can that be done artificially? Attempts at utility-scale carbon capture and storage (CCS) attached to coal plants have proven quite expensive, though there is at least one working example. Meanwhile, other, more modest methods are emerging.

Bayer, for example, is now using recovered CO2 as a feedstock in its production of polyurethane for mattresses. A Swiss company called Climeworks has developed a system for pulling CO2 out of the air, to be used commercially for such things as boosting plant growth in greenhouses. Other advances in agriculture, such as vertical farms, can locate food supplies closer to where people live, reducing transportation-related emissions. Speaking of transportation, we have everything from car-sharing, to various forms of e-bikes, to re-engineering of cities to enhance bike-ability, walkability and transit options, to EV charging stations, to apps that quickly find you a parking spot thereby saving gas.

On the supply side: Commercial wind turbines up to as much as 7 megawatts are now being deployed. Not only has their size increased, but their efficiency and capacity factor have as well. Capacity factor is the percentage of the time that a wind turbine actually produces the amount of power it’s rated for. While that used to be around 25 percent, improvements in design have increased it to 50 percent, which is the “new normal.”

Various types of utility-scale solar projects, from thermal to photovoltaic, are also being installed. That sector grew by 38 percent last year. Meanwhile, rooftop residential solar grew by 51 percent driven by the combination of factors noted above.

Microgrids can reduce demand and cost, and by tailoring to the specific needs of its subscribers, be more efficient as well. Putting solar panels in water to help cool them and provide more area is another idea that’s catching on. Passive tracking for solar panels can improve output by up to 30 percent without consuming additional power.

The fact is: Both wind and solar are already less expensive than coal or gas in Europe, on a levelized cost of energy (LCOE) basis. This is not true everywhere, but it will be as solar and wind prices continue to fall. Geothermal systems are also growing with about 13 GW currently installed. That is expected to grow to 17.6 GW by 2020. A water injection process called EGS is currently being evaluated which could reduce costs and increase demand.

Meanwhile, hydropower, the first renewable, exceeded 1,000 GW in 2013 and continues to grow at 3 percent per year. Despite the lessons of Fukushima, there is a significant groundswell of support for the so-called “meltdown-proof” molten salt reactors. A recent report highlights a number of active efforts across the globe with a prototype from the Shanghai Institute in collaboration with Oak Ridge National Lab expected in the next few years.

Finally, the 2015 U.N. Climate Solutions Award winners were just announced. Among these are:

•      Solvatten Solar Safe Water Heater, Kenya: Reducing emissions while securing access to safe drinking water


•      Fostering Cleaner Production, Colombia: Reducing emissions in manufacturing


•      Harvesting Geothermal Energy, El Salvador: Generating income with geothermal waste-heat


•      Planting Trees to Save the Mangrove, Guinea: Establishing women-led groups that protect forests and generate income


•      SELF’s Solar Market Gardens, Benin: Empowering women farmers through solar drip irrigation


•      Azuri PayGo Energy, Africa: Innovating pay-as-you-go energy systems for rural homes


•      Deforestation-free Cocoa, Peru: Using a carbon-asset-backed loan to protect forests and produce cocoa


•      Microsoft Global Carbon Fee, Global: Transforming corporate culture by putting a price on carbon


•      ChargePoint Electric Vehicle Charging Corridors, U.S.: Building a network of electric vehicle express charging stations


•      Mobisol Smart Solar Homes, Rwanda and Tanzania: Powering homes with solar energy

These are just the tip of the iceberg. Any comprehensive list of available tools to combat climate change would fill a book.

The point that the delegates need to understand is this: The technology is not the problem. A multitude of technologies are already here, and many more are on their way. What is needed now is the commitment to use them and to quickly make the transition to clean energy, which will be painful for some, knowing that all of us, including generations to come, will be better off when we do.

Image credit: Flickr/Steve p2008

As you read this, enormous fires are burning on the Indonesian side of Borneo, and on Sumatra. And the resulting haze is creating a environmental catastrophe throughout the region, putting the health of tens of millions at risk. These are, quite possibly, the largest fires in human history.

Many are blaming El Nino, which is causing dry conditions through much of Southeast Asia as it brings much-needed rain to California. But the truth is that the fires were caused by humans, and historically, such fires have directly benefited two of the world's biggest industries – palm oil and pulp/paper.

Palm oil travels on a vast supply chain all the way to America, where it is the most consumed food oil. You'll find it in your bathroom, in your snack foods. Companies that purchase palm oil from Indonesia are directly responsible for the climate disaster we're seeing right now.

Here why: Fires don't occur naturally in the tropics, as they do in California. Similarly, palm oil is not native to Indonesia, for a reason. Much of Sumatra and Kalimantan are peatlands, naturally wet and swampy. Before palm-oil cultivation arrived in Sumatra, brought as a cash crop by the Dutch, local people never planted on peat, living instead alongside rivers and farming swidden, rotational agriculture on higher ground.

Because palm plants require dry land to grow, palm oil plantation owners drained the peats, leaving the land in an unnaturally dry state.

Now, here's the problem – Indonesia's peat lands contain some of the densest carbon stock in the world. Peat forms a critical component of the natural carbon-sink in Southeast Asian forests, regulating climate globally. When a peat fires starts, it can be nearly impossible to put out. That is why, despite millions in firefighting, fires continue to rage in Indonesia and haze continued to billow into Malaysia, Singapore and Thailand.

For years, fire was used to clear land to turn into plantations, and that palm oil ends up in corporate supply chains. This is even the case for palm oil certified by the Roundtable on Sustainable Palm Oil, whose industry-crafted, weak and rarely-enforced guidelines have left even those plantations susceptible to fire.

Fires are probably the worst way to clear forest. But they are also the cheapest, and serve another function – a de-facto land grab. Pristine forest is difficult to convert into palm oil or pulp plantations. But recently burned forest and peat? Welcome, palm. Haze and smoke are merely externalities, a cost passed on by palm and pulp producers to the entire region -- and, through massive CO2 emissions expected this year to be greater than that of Germany, to the world.

It is easy to blame Indonesia's President Joko Widodo, or farmers in Sumatra and Kalimantan, for Indonesia's fires, but this is not just an local problem. It is a global problem, connected by supply chains and transnational corporations. This is global, multibillion dollar business, run by giant companies and thousands of smallholders along a long, complicated supply chain. Any effort to stem fires needs a stronger push for sustainable supply chains and accountability on the demand side as well, beyond the headlines-making but ineffective zero-deforestation pledges.

We are seeing signs of this in Singapore, the country closest to Indonesia and facing dangerous haze levels, which has begun removing products from companies connected to the fires from its grocery stores. If more countries did the same, this could have a powerful effect of forcing companies to think twice before letting fires encroach on their land, or from purchasing palm oil or pulp from those companies.

We also need to focus on prevention. Fires wouldn't have happened if restoring ecosystem and returning Indonesia's tropical forests to an healthy state had been a priority for government and the palm oil industry. The millions being spent on firefighting now – not to mention the billions in negative economic and tourist impacts that Greenpeace estimates – could have been better used in prevention through ecosystems restoration. This means a greater recognition that stopping fires is more than just firefighting, but a larger social and economic problem.

This is key. All the rhetoric about holding those responsible for the fires accountable will mean little if the incentives to burn remain in Indonesia. Changing this will be a tall task, but the current crisis just might be the right catalyst. The first step – companies like PepsiCo, which still source palm oil from risky sources, need to come clean and commit to supply chain transparency. They should also take the lead in helping restore Indonesia's forest ecosystems. This is a global crisis, and it requires a global solution.

Image credit: NASA via Wikipedia

By Don Shaffer

What will it take to build a thriving social enterprise sector that can lead the way to the next economy?

That’s a question that’s always on our minds at RSF Social Finance, and we’re convinced that one essential step is to challenge the dominant funding model. In that compartmentalized approach, venture capitalists aim to make as much money as they can in the shortest possible time, philanthropists give money to donation-dependent nonprofits, and early-stage investors — even in the impact sector — look for the hockey-stick growth graphs typical of tech pitches.  (“Growth Financing for Social Enterprises: 5 Options and How to Make Them Work for You” provides an analysis of funding options.)

We need to rethink the purpose of capital for social enterprises and adopt an approach that crosses conventional boundaries — a model RSF calls integrated capital. Integrated capital is the coordinated and collaborative use of different forms of capital (equity investments, loans, gifts, loan guarantees, and so on), often from different funders, to support a developing enterprise that’s working to solve complex social and environmental problems.

Integrated capital addresses the funding challenges social enterprises face in a number of ways. It allows for longer development times by including some types of investment that don’t need to make a large return (or any return). It gets enterprises through the “valley of death,” where they have a promising business model, technology, product, or service, but need more capital to realize its potential and don’t qualify for traditional financing. And when community foundations and local investors participate, it creates a community commitment to the enterprise’s success.

Testing shows the model works

We know this model can succeed. In 2012, we launched the RSF Local Initiatives Fund, in collaboration with lead donors, to pilot an integrated capital approach to financing regional food systems. (See “How Can We Fix Our Broken Food System? Start With the Base of the Supply Chain” for context.) In the first two years, the fund deployed $2 million to 40 early stage sustainable food and agriculture enterprises, with a focus on technical assistance grants, loan guarantees, convertible notes, and place-based Shared Gifting circles. Those investments have leveraged well over $10 million in additional financing to date.

For example, a $200,000 loan guarantee from the Park Foundation made possible RSF’s $1,150,000  mortgage loan to Regional Access, a wholesale food distributor focused on creating a sustainable regional food system in New York and expanding access to quality food for underserved urban and rural residents. The mortgage loan and a $200,000 line of credit, supported by a $50,000 Local Initiatives Fund guarantee, allowed the company to consolidate debt and expand its reach and operations. That translates to more ecologically responsible and locally grown food for more people (Regional Access currently serves 600-plus stores, restaurants, and institutions) and improved economic viability for local farms—all for a small, low-risk investment.

Fair Food, an enterprise dedicated to bringing locally grown food to market and promoting a humane, sustainable agriculture system for greater Philadelphia, is another great example of growth through integrated capital financing. In early 2014, RSF provided a $100,000 line of credit for working capital that enabled Fair Food to maintain timely payments to farmers and producers in the long-term, and bridge immediate cash flow needs in the short-term. Guarantees were crucial to making the loan work: Fair Food requested support from community members and raised $50,000 in RSF Social Investment Fund accounts to back the loan, and RSF provided an additional $20,000 guarantee from the Local Initiatives Fund. Then in September 2014, Fair Food participated in a food and agriculture–focused Shared Gifting Circle and received a $9,900 grant to train and assist farmers with Group GAP (Good Agricultural Practices) certification—a cooperative approach to farm food safety that addresses the needs of small and midsize farms.

Four new funds are on deck

Building on the success of the Local Initiatives Fund, RSF is preparing with core donors to launch four new Integrated Capital Funds: the RSF Fair Trade Fund, RSF Biodynamics Fund, RSF Soil Health Fund, and RSF Women’s Fund.

These philanthropic funds will provide loan guarantees, equity investments, grants, and other types of capital that position social enterprises—for-profits, nonprofits, and hybrids—to obtain additional equity or debt financing and give them time to develop. We expect to recycle about two-thirds of the money into new financing (we’ll consult the lead donors in each fund on the exact target ratio).

The focus for each fund is based on needs our community identified. The Biodynamic and Soil Health funds grew out of regenerative agriculture advocates’ search for the next step beyond organic. The Women’s Fund provides capital to women-led social enterprises, which tend to be underserved. The RSF Fair Trade Fund will initially provide loans to our fair trade borrowers’ suppliers when existing sources don’t meet those suppliers’ financing needs. Initial partners include Guayakí, a beverage company that sells organic, fair-trade yerba mate tea leaves and drinks; Indigenous, a clothing company that pioneered Fair Trade certification for apparel and linens, and also developed the Fair Trace Tool™ to show consumers how a garment was made; and Equal Exchange, a worker-owner cooperative that sells fair trade coffee, tea, chocolate and other foods.

Collective action is needed

Our goal, which we hope others will join us in, is to use low-interest loans, loan guarantees, equity investments, and other instruments from philanthropic funds to leverage significant amounts of market capital for social enterprises. We intend to support catalytic enterprises, and we know that not all of them will succeed—but it’s worth the risk. If philanthropic funders start using their money fearlessly where it has the greatest chance to spur sustainable social innovation, we could collectively fill the funding gap between seed money and growth capital for social entrepreneurs.

One key aspect of making this work is recalibrating our thinking around gift funding. Our purpose with these funds is to be nimble, agile, and opportunistic, so that we can get the right capital to the right entrepreneurs at the right time. To that end, we’re requiring minimal reporting. Philanthropy has developed a compliance culture that puts a lot of focus on layers of reporting and calculating return on investment. But making a true gift rightly involves releasing control. We think the whole movement to measure every little thing is a waste of people’s time; recipients should be able to just get to the work. It’s not about being sloppy or undisciplined. It’s about reestablishing a more human-centered sense of accountability.

Bold funders can move the field ahead

As our work with Regional Access and Fair Food illustrates, RSF has the advantage of being able to draw on a diverse mix of both investment and philanthropic funds under one roof to support organizations that are models for systemic change. We see ourselves as a laboratory for the integrated capital approach, and we’re taking on that challenge by reorienting our entire funding operation around the concept. We’re finding that it requires us to break down the internal walls between investing and philanthropy—a reflection of the need to break down the walls between these sectors generally.

It’s encouraging to see that others are thinking along the same lines. Integrated capital shares collaborative and creative aspects of Nonprofit Finance Fund’s complete capital approach, which brings together financial, intellectual, human, and social capital to help nonprofits succeed, and Pacific Community Ventures’ catalytic capital concept, which recognizes that grants, guarantees, and seed funding can trigger additional financing that otherwise would not have been available to an enterprise. Activist community foundations are also considering an integrated capital approach.

The fact that we’re seeing this fresh focus on the uses of capital to achieve social benefits tells us that there is a real opening now for vastly greater collaboration between impact investors (individuals, networks, and firms), foundations (community and private), and community banks. As the holders of capital, it’s up to us to create a finance infrastructure that enables social enterprises—and the communities they serve—to thrive.

Image credit: Juan Carlos Castaneda, Indigenous Designs 

Don Shaffer is president and CEO of RSF Social Finance, a pioneering funder of social enterprises based in San Francisco, and is a B Lab board member. He welcomes inquiries into using the integrated capital model.