Search

The Shanghai Stock Exchange and China Securities Index have launched China’s first index of carbon efficient companies. Powered by data from Trucost, the new index aims to identify companies with financial performance that matches or exceeds their peers, but with significantly lower carbon emissions.

The SSE 180 Carbon Efficient Index is designed to help financial institutions gain enhanced financial performance that lower exposure to carbon emissions provides. China’s economic development strategy increasingly emphasizes the need for green and low-carbon growth. As a result, Chinese companies are expected to further improve their environmental performance. The new index supports this transition by channelling capital towards better performing, carbon efficient companies.

To create the carbon efficient index, Trucost assessed the carbon intensity of all companies in the benchmark SEE 180 Index using its Environmental Register database of environmental performance by more than 5,000 stock exchange listed companies and their supply chains worldwide. While the sector weighting in the carbon efficient index is consistent with that of its benchmark index, within each sector preference is given to lower emitters. Some highly carbon-intensive companies were excluded.

Liu Zhong, vice general manager of China Securities Index, said: “In today’s China where green growth is the new norm, green indexes such as the SSE 180 carbon efficient index will provide the market with a great tool for green financial innovation, guiding more capital and more resources towards low carbon and green companies and industries, which will in turn accelerate the green growth economy.”

Later this year ministers, scientists, diplomats and heads of state from more than 190 countries will convene in Paris for COP 21 with the ambitious goal of adopting a binding international treaty to limit greenhouse gas emissions from human activity. The enormity of that task can be distilled to one number: two.

Climate scientists warn that a 2 degrees Celsius rise of average global temperatures from pre-industrial levels is a conservative maximum to avoid the most devastating impact of rapid climate change.  The 2-degree limit was set as an aspirational goal in the 2009 Copenhagen Accord of the 15th annual U.N. Conference of Parties (COP15) and officially agreed upon at COP16 in Cancun, Mexico. According to recent reports, we are already halfway there.

As preparatory talks for COP21 wind up this week in Bonn, Germany, officials from the U.N. Framework Convention on Climate Change (UNFCCC) recognize that current emissions-reduction pledges will not be sufficient to meet the 2 degrees Celsius target. This despite a more rapid and aggressive response than expected from nations submitting their proposals.

Officially called Intended Nationally Determined Contributions (INDCs), UNFCCC Executive Secretary Christiana Figueres said in a press release that "on their own, the INDCs received before Paris are not going to keep us below a 2 degrees Celsius rise this century. But they underline a sharp and positive departure from business as usual and will form the essential foundation to reach that ultimate goal if governments agree to clearly ramp up ambition over time."

This departure from "business as usual" is encouraging news, but we remain a long way from meeting the goal of a "2 °C world." And even with a best-case-scenario outcome at the COP meeting in Paris (which has arguably never happened at any prior COP), Noah Deich, a cleantech consultant and founder of the nonprofit Center for Carbon Removal, believes the idea that simply reducing -- or eventually eliminating -- carbon emissions and adapting for what is to come severely limits the breadth of options available to address the climate crisis.

Negative carbon

It is increasingly unlikely that mitigation alone will be enough, at least the way most think of it now. Negative carbon -- the idea of going beyond reducing carbon emissions to actively sequestering or directly removing them from the atmosphere -- may be essential to meet the target of a 2 °C world. But awareness, research and innovation in negative carbon, or carbon removal, remains disorganized and often misunderstood. Noah Deich hopes to change that. 

"The way I see the current conversation in academia is: We can't just stop emitting carbon into the atmosphere," Deich told TriplePundit. "We also have to clean up the carbon that has accumulated in the air over the past several decades -- really a century -- of industrial activity."

As Deich sees it, however, the conversation of cleaning up current and past emissions hasn't penetrated industry or policymaking. "I think this is a real missed opportunity."

"If you're able to think about cleaning up carbon that's already in the atmosphere, you really broaden the set of climate solutions that are available to us," Deich said. "And we have new opportunities to engage industry in a way that we could potentially have more aggressive climate goals and really curtail climate change in a more comprehensive way."

When I expressed my pessimism to Deich that meeting the 2-degree target is still even within our grasp, he was quick to counter that idea. "I think it's certainly possible," he said. "If we were to commit to clean energy, I think we could certainly do it.

What is clear, Deich said, is not a lack of technological or entrepreneurial potential, but of (say it with me) political will. "And that is why carbon removal is so interesting to me right now."

"We haven't really tested how it changes that political dynamic -- if it really can bring more people to the table and if it can get us to actually curtail climate change, which it can. But we just haven't tried it yet, and the same old mitigation story clearly isn't working. There hasn't been any new breath of fresh air -- no pun intended -- in the climate conversation in such a long time."

Business will lead

It's not that changing hearts and minds among the political naysayers is easy. They continue dig in, but Deich suggested it may be to their own political peril. Despite mounting evidence to the contrary, the common argument is that climate action will cripple the economy. Among the many reasons why this logic is flawed is that such thinking actually stifles innovation and opportunity. "There's just too big of a business opportunity," Deich told us. "It will be tough, but I think when it does change, it will change quickly, because business will lead."

"I think what has happened historically is that, without carbon removal, many of the entrenched interests -- some of the big energy, agriculture and mining [industries] -- ... have seen their bread-and-butter be jeopardized by admitting to climate change."

Carbon removal turns all that on its head because it is often the very same companies that have "ironically made the problem" that are best equipped to solve it.

"If you want to remove carbon from the air and sequester it deep underground in geologic reservoirs, that's in many ways analogous to running an oil field operation, just in reverse," Deich said. "That's going to be a big energy company doing it; same thing with agriculture. If you're going to sequester carbon in soils, you're going to have Big Ag playing a large role in that."

It's a new way of thinking that changes the narrative around climate action, focusing more on what business can do instead of what they can't. "This isn't 'hey, you have to stop what you're doing and figure out how to make biofuels or solar panels, or whatever it is,' all of which is a certainly a key part of this equation," Deich told us.

"This is: 'You have to figure out how to transition from taking carbon out of the ground to taking it out of the air and putting it back in the ground.'"

Deich suggested that this is a strategy or political dynamic that hasn't yet been fully explored. "People are doing this today," Deich said. "They're just not explaining it as carbon removal as a whole. People are working on the individual pieces, but nobody is looking at the big picture."

That's exactly why Deich and his team founded the Center for Carbon Removal.

The carbon market

Part of the big picture is looking at carbon as a commodity. In the long term, the best solution could likely be storage and sequestration.  But for the short term, the market for CO2 is "huge," Deich explained. "When it comes to plastics and things like cement, there are potentially huge markets out there."

"These markets are on the order of 100 million tons or so annually, especially if you look at enhanced oil recovery.

"I think the key for those markets is to understand when they are low-carbon versus no-carbon versus carbon-removing and figure out how to credibly commit some of the low- and no-carbon activities to pave that pathway to actual negative carbon. I think it's certainly viable."

Looking at the big picture of carbon removal

There is no one solution or approach to carbon removal. As with climate change or any complex problem, solutions are varied and multifaceted. An ideal technology in one area may not work in another. Some face greater technical challenges than others or may prove more difficult to scale. What is important is to bring all these questions, possibilities and challenges under one roof -- if not literally, then as a strategic approach.

The Center for Carbon Removal Research Working Group (RWG) is a partnership with leading scientists and policy experts working to identify and solve key questions to lower the technical barriers to carbon removal and how to best focus comprehensive research efforts across the broad spectrums of possible solutions. The RWG initiative is a collaborative effort among researchers at University of California, Berkeley, and the Carnegie Institute at Stanford.

The center also partnered with the Aspen Institute Energy Environment Program through the Aspen Institute dialogue on carbon removal, bringing a multi-sector group of experts together to identify early actions for "developing a roadmap for advancing policy and industry-focused initiatives related to carbon removal."

Living in a 2 °C world

If there was ever a time to think "outside the box," it is now. As COP21 approaches, international attention is focused on solutions to climate change, energy and a thriving, sustainable future. Many nations are stepping up and submitting relatively ambitious emissions reductions goals. Advances in renewable energy are accelerating, slowly but surely becoming a mainstay of our energy economy. But all of it is not enough.

The Center for Carbon Removal brings to the table one more important tool for meeting the challenge before us: ensuring that we, our children and theirs can live in a 2 °C world.

Image credits: 1) FrankWinkler via Pixabay 2) Center for Carbon Removal

Them's fighting words, apparently.

A columnist for the Wall Street Journal has taken umbrage with the thumbs-up rating that Consumer Reports gave Tesla last month, accusing the inveterate product reviewer of serving to "prostitute" itself through a top-scoring review.

"Prostitute is not too strong a word," wrote Holman W. Jenkins, Jr., an editorial writer for the newspaper, who points out that the Tesla has been endowed with one other coincidental favor: government subsidies.

"Unfortunately, one product that doesn’t get CR’s withering eye is the public policy of shoveling taxpayer handouts at Tesla," Jenkins wrote last week.

He has a point. Just about every major innovation that has shown to have commercial -- or environmental -- benefit to the United States has been eligible for subsidies of one sort or another: agriculture in Texas; oil and mining in Pennsylvania; aircraft construction in Washington state; cars in multiple states. In fact, some of the most generous selection of subsidies are awarded to film, broadcast and print media corporations, and can be found in 40 of the 50 states in the Union. Successful U.S. innovation is often a public-private partnership that assumes that its success is not only good for the industry sector, but good for the country as well.

And yes, most of us would agree that there is something odd about providing significant subsidies to an industry that caters exclusively to rich buyers (including successful film makers, perhaps) and which is clearly out of reach to the general public. But then, I never expected that I would be entitled to the subsidies Farmer Joe down the road receives for raising cows or irrigating crops, either. And just like wheat once was in this country, electric cars are still a nascent industry that will hopefully excel on the same public-private partnership model that helped other leading industries in this country gain ground.

But back to Consumer Reports, a publication that Jenkins pointed out is known for its "systematic, unbiased product reviews." It's also known for impressive tunnel vision when it comes to consumer interest. When digital cameras first came on the market, Consumer Reports wrote the heck out of them. They sold, and readers wanted the low-down right away. Company subsidies didn't propel that interest. Consumer curiosity did.

What seems to be at the heart of the debate about Tesla's estimated $4.9 billion in subsidies is likely not money, but moxie -- the idea that a virtual nobody can challenge a status-quo industry and, within a decade or two, actually be prepared to compete with the big boys sustainably (with government support, of course). And it doesn't hurt that a magazine that has made a name catering to North America's insatiable love of gizmos and gadgets, actually sees value in promoting that eclectic concept.

Jenkins has a valid point when he wrote about CR's advertisement, suggesting that quotes like "the ratings of this ground-breaking vehicle are too good to keep to ourselves" were overkill. It was also a bit like waving a red flag in front of a line of bulls. WSJ wasn't the only publication that accused CR of being willing to "prostitute" its values. But it's worth noting that the advertisement only lasted as long as CR's free reader access lasted -- which is now gone.

Maybe that's a takeaway for the sustainable consumer market: Too much fanfare makes readers leery of believing the hype and climbing onboard. Great ideas gain momentum not because of flashy reminders, but because backing them makes sense to consumers.

Image credit: Flickr/Steve Jurvetson

By Li Yong

We all know that the world must urgently deal with climate change. This is a very real and growing threat to all of us: a global problem that calls for a global solution. Can we solve this problem, while at the same time securing the inalienable right of millions of people for the sustained and inclusive economic growth that is needed to lift them out of poverty? Can we improve their living standards while minimizing the negative consequences for the environment?

The answer to these questions is yes -- because smart policies and technological solutions demonstrate that, by greening economic growth, we can create prosperity and wealth, while also safeguarding our environment and our climate.

Today, industry accounts for more than a third of global energy consumption and greenhouse gas emissions and will continue to drive growth of global energy demand over the coming decades, particularly in developing and emerging economies. At the same time, structural change through industrialization will remain the main driver of poverty reduction and wealth creation in the post-2015 world.

Thus, the main challenge remains to make economic growth and development more inclusive and sustainable.

Throughout our history, industrialization has been the primary driver of economic growth and development whether we look at the development processes in Europe, the United States, Japan, or in the many fast-growing economies in Asia, Africa and Latin America that achieved rapid growth in more recent times. It was industrial development in these countries that generated wealth and shaped their success. In my view, industry provides greater opportunities for value addition, productivity, capital accumulation, economies of scale and technological progress than any other economic sector.

However, we need to remember that any progress on poverty eradication will be short-lived if we do not succeed in achieving economic growth within an environmentally sustainable framework. We cannot deny that our industries leave a significant global environmental footprint. Indeed, there is no country in the world that is not struggling with the issues of waste management, water purification and greenhouse gas emissions reduction – it remains a major learning and moral process for all of us.

We therefore need to realize that we have no alternative but to rapidly reform our industrial processes toward sustainability. We must promote energy efficiency and renewable sources of energy more effectively. We must reduce our carbon footprints. We need to also work on the constructive inclusion of women and youth – through their economic empowerment and entrepreneurship development -- in order to address inequalities and unlock the full potential of countries and societies to innovate and motivate for solutions. We must use our scarce resources more efficiently and effectively. And lastly, we must also advance our cleaner production abilities.

But let me reassure you, we do not need to choose between prosperity and sustainability. With the right choice of policies, practices, technologies, business models, innovation and partnerships, both can go hand-in-hand. This is the rationale behind our pursuit of sustainable development with lasting prosperity for all, and this is why in, just a few weeks’ time, the United Nations will adopt the goal of inclusive and sustainable industrial development as one of the Sustainable Development Goals to be achieved by the year 2030.

Image credits: 1) Flickr/Vinoth Chandar 2) Li Yong, United Nations International Development Organization

Li Yong is Director General of the United Nations Industrial Development Organization (UNIDO), the specialized agency of the United Nations that promotes industrial development for poverty reduction, inclusive globalization and environmental sustainability. He has had an extensive career as a senior economic and financial policymaker. As Vice-Minister of Finance of the People’s Republic of China and member of the Monetary Policy Committee of the Central Bank for a decade, Li was involved in setting and harmonizing fiscal, monetary and industrial policies, and in supporting sound economic growth in China.

The burgeoning business of tech and food delivery has long offered many of us the 21st-century convenience of kicking the grocery store shopping habit for good. Armed with apps, websites and on-demand couriers, the need for setting foot into the grocery store check-out line is all but becoming obsolete in highly urbanized cities — and the trend continues to expand.

Not surprisingly, the online monolith Amazon has once again claimed dominion over the supply chain nuances of on-demand food delivery with the announcement of its newest business — farm-to-table produce deliveries as a pilot across Southern California.

Working in conjunction with startup company Fresh Nation, Amazon promises to deliver seasonal, handpicked produce bundles within a three-hour delivery window direct from your local farmers market.

Fresh Nation, the brainchild of Tony Lee, a former e-commerce professional turned farmers market manager, launched in 2013 in Lee’s hometown of Danbury, Connecticut. After spending a year cultivating a database of farmers markets and vendors across the country, Lee piloted the back-end supply-chain of the startup through a series of launches in Southern California and parts of the East Coast before shopping the refined product to Amazon.

According to the Los Angeles Times, Fresh Nation orders offer baskets and individual items, available for $39 for small sizes and $59 for large sizes within 36 hours of harvest. Currently, service-area customers must be Amazon Prime Fresh members ($299 annually) and will not have to pay additional delivery fees.

As told to the Los Angeles Times:

"Our mission is to bring fresh local food to millions of people," [Lee] said. "The only way you can do that is partner with a company like Amazon that has millions of customers."

No stranger to the barriers and nuances of click-to-order food delivery, Amazon sharpened its skills with its Amazon Fresh business that launched in Seattle in 2007. It has since expanded to portions of the Los Angeles area, San Francisco, San Diego, New York City and Philadelphia.

With the new Fresh Nation model, “shoppers” pick up and package food orders into individual tote bags at each market based on the pre-ordered demand. Bags are then transported via refrigerated trucks to the Amazon distribution center in San Bernardino, California, where they are sorted and sent out for delivery.

Amazon isn’t the only tech company actively connecting busy consumers with the modern conveniences of click-to-order healthy groceries without a fuss.

The birth of Instacart, Postmates and long-time competitor Fresh Direct prove that the multi-channel structure of doorstep service is not only a viable business model, but also one that continues to grow.

Consumers seeking to forgo the faithful walk down the grocery aisle are willing to pay a premium for the service, which can add an extra 15 to 30 percent to grocery bills.

For instance: A $40 grocery spend from Whole Foods in downtown Atlanta equates to roughly $57 when factoring in a $10 service fee and a 15 percent tip for your courier to fetch and deliver the items — a small price to pay for convenience for those less price-sensitive. Not to mention, grocery deliveries are a viable side income for contract workers willing to put in the leg-work.

The world of on-demand service and products delivered at a break-neck pace is surely nothing new. Moreover, companies are expertly building brands that make the model efficient and less expensive to operate.

Consequently, as models continue to improve, food delivery can have direct implications in solving much larger issues such as getting healthy food to immobile senior citizens, helping to increase fresh food consumption tethered to the goal of reducing food waste and serving as a blueprint for food pantries delivering food to clients in need.

Image via Wikimedia Commons

The advocacy group Carbon Washington is attempting to add a carbon tax to the 2016 Washington state ballot. The initiative would tax fossil fuels at $25 per metric ton of carbon dioxide. That’s 25 cents per gallon of gas (3.78 liters).

There’s been unexpected backlash though ... from environmentalists. Shocking, I know. Dems and their allies have long argued that we need to curb carbon emissions by taxing carbon. So, what gives?

The rub occurs when deciding what to do with the revenue from the carbon tax. Should it go to government programs, or be given back to companies and people as a rebate?

The Washington state bill says most of the revenue generated would go toward reducing the sales tax by 1 percent. A smaller part would lower taxes on manufacturing companies. Some of the revenue would also fund a tax rebate up to $1,500 for low-income working families.

The end result of this particular carbon tax would be revenue-neutral. In other words, the government wouldn’t get a dime. All the money gets refunded to companies and people. This makes Republicans cheer but some Dems cough and sputter.

Why? Dems think money from a pollution tax should be spent on environmental and other government programs.

However, environmentalists desperately need Republicans to agree to a carbon tax. So, should they really require a carbon tax to be married to more dollars for Uncle Sam? An article in the New York Times says no.

The author of the article, N. Gregory Mankiw, professor of economics at Harvard, says: “There is no good reason to marry these policies. If the goal is to build a political consensus to tackle climate change, there is good reason not to.

“The size of government is an issue that divides the political right and the political left, and it will most likely always do so. The same need not be true of climate change.”

Environmental economist Yorman Bauman is one of the Washington state leaders trying to pass a carbon tax. He has a warning for environmental activists: “I am increasingly convinced that the path to climate action is through the Republican Party. Yes, there are challenges on the right — skepticism about climate science and about tax reform — but those are surmountable with time and effort. The same cannot be said of the challenges on the left: an unyielding desire to tie everything to bigger government …”

It's valid to argue that a carbon tax should be revenue-neutral to get Republicans on board. However, the income distribution in Washington state seems like it might not actually lower emissions. Using the revenue to reduce the sales tax seems like it would increase consumerism, which is bad for the environment. Similarly, giving manufacturers a rebate could also increase consumerism if manufacturers lowered prices. Rebates like these are potentially self-defeating.

A better revenue-neutral plan would give tax breaks to companies and individuals who are taking other green initiatives. Alternatively, the revenue could be given as grants to environmental nonprofits.

Image credit: Flickr/Rob Pongsajapan

The headlines are rife with puns this week. The American Egg Board is scrambling to explain why some of its members used background channels to try to prevent an eggless competitor from being sold on grocery store shelves.

The sordid tale was unveiled after the owners of the egg-free vegan 'mayo' product Just Mayo filed a Freedom of Information Request with the U.S. Department of Agriculture. The result was a souffle of innuendos and offbeat inferences to Just Mayo's "misleading" brand and a litany of sometimes comical exchanges.

"You want me to contact some of my old buddies in Brooklyn to pay Mr. Tetrick a visit?" wrote one board member to another. He was referring to Just Mayo's founder, who had refused to stop selling his product or to change its name. Worse, Just Mayo was taking the vegan market by storm and had actually prompted the outgoing AEB chair to express her concern about its competitive streak.

Some pundits have tried to suggest that the AEB's increased media efforts against Just Mayo and its owner, Hampton Creek, constituted lobbying against a competitor, which the board is forbidden to do by law. Marketing its product -- the egg -- is okay. Slamming or allegedly blocking products it sees as competitors is not.

But perhaps the true ethical issue here really isn't the fact that the emails suggest an open warfare against a competitor. It's that there's an actual need for products like Just Mayo -- a need that companies like Hellmanns failed to meet as well for years.

Products like Just Mayo, and Vegenaise, and other similar labels don't just appease the vegan consumer base. They allow people with food allergies and awkward autoimmune diseases like Celiac disease to enjoy a palatable diet.

Some 15 million people in the country suffer from food allergies. The most prevalent and life-threatening cases afflict children, who make up the lion's share of the statistics when it comes to egg and soy allergies. As many as 3.5 percent of young children are at risk of anaphylactic shock if they eat eggs.

And while corn doesn't get as much attention as egg, wheat, milk, nuts or shellfish, it is often shown to be an added problem for people with Celiac disease, who have challenged immune systems and may present with more symptoms than an intolerance to gluten. So, having a 'mayonnaise' that doesn't contain eggs or corn -- and complements a gluten-free, restrictive lifestyle -- makes sense.

Just Mayo's claim to fame comes from the very thing that is taking industries by storm these days: advanced technology. Who would have thought that lives could be transformed by the lowly pea? And as unappealing as things like desiccated pea and garbanzo bean may sound, those options have expanded the potential of the vegetarian/vegan food industry even further, by allowing products to be made without potentially life-threatening ingredients.

Sadly, the American Egg Board's emails overlook the motivator that has always made U.S. innovation great: the desire and willingness to work harder to best the accomplishments of yesterday's products. Creating a better, healthier and more innovative answer to consumer dilemmas will often trump the palate, even when it comes to quintessential American heroes like the egg.

Image credit: Flickr/Patrick Hurley

Jessica Alba’s Honest Co. is sweating right now.

Someone just filed a class-action lawsuit against Honest claiming it isn’t, in fact, honest. The plaintiff says there are unnatural and ineffective ingredients in the company's products. Uh-oh.

Honest says its products are 'natural,' meaning there are no artificial ingredients. The plaintiff said "nope" and pointed to the unnatural additives: methylisothiazolinone, cocamidopropyl betaine, phenoxyethanol and sodium polycrylate. Surprisingly, no one has said they thought they were buying alphabet soup.

The complaint goes like this: “Honest’s conduct harms consumers by inducing them to purchase and consume the products on the false premise that they are natural and effective, when in fact four of the five products contain ingredients that are not natural, and one of the five products is ineffective.”

The plaintiff says Honest puts additives in its hand soap, dish soap, surface cleaner and diapers. Additionally, he’s upset because he paid 10 to 20 percent extra for these 'natural' products. Now he wants his money back … and a little more: a minimum of $5 million in damages to be precise. The money wouldn’t just be for him. It would also refund other customers who bought these products.

The item he accuses of being ineffective is sunscreen. The lawsuit references numerous tweets by customers saying they got sunburns and blisters after slathering on the sunscreen. Some people even posted photos of their sunburns. Not only does getting fried burn like hell and put a damper on beach day, but it's also associated with aging skin and skin cancer risks.

Alba and co-founder Christopher Gavigan responded to the protests on Twitter by emphasizing their commitment to providing effective products: “Protecting our loved ones and yours is the reason we founded the Honest Co. As parents, it pains us to hear that anyone has had a negative experience with our sunscreen,” reads the message. “We develop and use Honest Sunscreen to protect our own children – Honor, Haven, Luke, Evie and Poppy – at the park, in the pool, outside, every day. As with everything we do, we take sun protection seriously here at Honest.”

They also explained that the sunscreen was tested (according to FDA standards) by an independent third party and given the thumbs up. It also received the highest score possible from the Environmental Working Group.

However: “That said, what matters most to us is your trust and confidence. We’re passionate about living up to your expectations as much as our own. We’ve personally picked up the phone to speak with many of you who have called our customer service hotline. Our team is reaching out to everyone who has posted on social media to assure you that we’re committed to your safety and satisfaction. For those who have expressed concerns about our Sunscreen Lotion, we want you to know that we hear you and we’re here for you. As always, we’ll do what it takes to make it right.” Honest to goodness.

To be continued.

Image credit: Flickr/Carissa Rogers

Lise Kingo has taken up her role as executive director of the UN Global Compact, the world's largest corporate sustainability initiative.

Kingo, who was appointed by UN Secretary-General Ban Ki-moon back in June, was previously chief of staff executive vp and member of the Executive Management at Novo Nordisk A/S for 12 years.

At Novo Nordisk, she oversaw the company’s participation in the UN Global Compact from the earliest days of the initiative and led the way to integrate sustainability into the heart of the business by collaborating with key external stakeholders and engaging employees internally.

Kingo also has experience across a range of business functions including human resources, business assurance, corporate communications, branding, public affairs and innovation culture. 

There is always a competitive edge to sustainability ratings and rankings and the Dow Jones Sustainability Index (DJSI) is no different, writes André Veneman, Corporate Director for Sustainability & HSE, AkzoNobel. However in the race to earn the highest scores and become an industry leader it is easy to lose track of the real value and purpose of the index.

While the Dow Jones Sustainability Index (DJSI) provides scores and enables companies to benchmark their performance against industry peers, the actual process of responding can provide enormous business benefits. For AkzoNobel, this globally respected ranking system is a highly effective management tool to manage sustainability and business performance.

Let me explain further. The DJSI covers the issues that matter to companies looking at economic, social and environmental topics that drive long-term financial performance. It covers key environmental issues such as how companies reduce carbon and become more eco-efficient and social concerns such as how they invest in local communities. But crucially it also looks at core business areas for example supply change and customer relationship management.

RobecoSAM, the organization that develops the DJSI questionnaire, focusses on topics that are relevant to a particular industry. In fact over 50 percent of the criteria are focused on industry-specific risks and opportunities that contribute to a company’s long-term success. This gives companies a guide for where to improve their business – all tailored to their particular industry.

For AkzoNobel this means we have a roadmap for where to drive improvements helping us to advance our business in many ways such as in the areas of innovation, resource efficiency, product safety, customer focus and commercial excellence.

The actual process of completing the DJSI submission is also positive. It promotes internal collaboration helping to start conversations across different departments and functions that might not otherwise have happened. This involves leaders and experts coming together from across the business to exchange ideas, helping to spark new ideas for sustainable solutions.

All participating companies to the DJSI receive a Company Benchmarking Scorecard. This scorecard covers all criteria assessed and shows the company's sustainability performance compared to the industry average and the industry's best-in-class company on a global basis.

It is important to take action, because if companies don’t make progress and adopt a continuous improvement mindset, they’ll drop down the list or fall off it altogether. For example, in 2014, talent attraction and retention and operational eco-efficiency were identified as areas where AkzoNobel could do better. So since last September, we’ve been working hard to improve in these areas.

In fact, we attach so much importance to a strong performance on the DJSI that our ranking is tied to remuneration packages for our top 600 executives. That’s a clear indication of how sustainability is driving our business, and how our business is driving sustainability.
Responding to the DJSI is no simple task. The process involves considerable time and effort from many people across a business.

However it is well worth it. At AkzoNobel we have a clear vision for what we want to achieve. We are committed to delivering more value from fewer resources as part of our Planet Possible sustainability strategy and our DJSI performance is a barometer for measuring the level of our success.