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By Scott Fallon

Automakers face a daunting challenge. To meet new government standards, they must increase the overall fuel efficiency of their vehicles to 54.5 miles per gallon by 2025. That’s up from a 35.5 mpg standard by 2016, a nearly 60 percent increase in less than a decade.

And they must do this while creating affordable cars that people want to buy.

To meet this challenge, automakers are focusing on design efficiencies and increasingly turning to advanced, lightweight materials. These materials include plastics and lightweight composites, such as the carbon fiber-reinforced plastics used in Boeing’s 787 Dreamliner. Why? It’s simple. Carbon fiber-reinforced plastics are up to:

• 10 times stronger than steel


• 50 percent lighter than steel


• 30 percent lighter than aluminum

We already use these lightweight plastic composites for sports equipment (have you seen a wood tennis racquet lately?), as well as prosthetic limbs, fishing rods, bicycle frames, wind turbines, motorcycles, helicopters, passenger jets, race car chassis … The family car is next.

At the recent SXSW Eco conference, I participated in a panel discussion with a former automaker from Ford, a leading energy-efficiency researcher and an engineering school president. We discussed how cars will become substantially greener and leaner in a decade, due in large part to advanced lightweight materials such as carbon fiber-reinforced plastics.

As a “plastics guy,” it is worth noting: While most news reports simply refer to “carbon fiber,” the fibers typically are enmeshed with plastics to form an advanced composite matrix. The combined materials create something much tougher than each could be on their own.

The message we brought to Austin at SXSW Eco: Dramatically increased fuel efficiency will save natural resources, slash auto emissions, cut our nation’s dependence on petroleum and save consumers money at the pump.

The million-dollar question is: Can light-weighting really achieve those benefits? Automakers think so. Here’s Ford on light-weighting (emphasis added): “Few innovations provide a more wide-ranging performance and efficiency advantage than reducing weight. All factors of a vehicle’s capabilities – acceleration, handling, braking, safety, efficiency – can improve through the use of advanced, lighter materials.”

Future lighter-weight cars will accelerate faster, have more agile crash avoidance handling, stop in shorter distances, enhance driver and passenger safety – plus become more fuel efficient, which should reduce emissions and lighten their environmental footprint.

And based on automakers’ recent concept cars using these advanced materials, future cars also will look cooler and just be a lot more fun to drive

Now, what’s interesting is that carbon fiber-reinforced plastic auto components are not new: chassis, spoilers, roofs, hoods, and many internal and external parts have been employed for a while, predominately in higher-end luxury or performance cars due to high manufacturing costs. But as automakers invest heavily in these applications, costs are coming down, and new technologies should allow these components to be produced more quickly.

That’s going to come in handy. To reach 54.5 by 2025, automakers will need to continue to improve drive trains and engine efficiency – and drastically reduce weight. Plastics are helping. Many people don’t know that modern cars already are 50 percent plastics by volume but only 10 percent of vehicle weight. That volume will increase significantly.

We should also see an increase in solutions that involve an intelligent mix of materials, instead of choosing between metals and plastics, for example. Automakers are discovering that hybrid structures with lightweight plastics can be very effective in reducing vehicle weight.

These multi-material solutions with lightweight plastics can improve safety, too, as can carbon fiber-reinforced plastic components, which can absorb up to 12 times more energy than steel and enhance safety in a collision.

As noted, automakers have already used various types of advanced composite materials in cars for some time. But BMW and Ford were the first out of the factory with production volume cars that use the latest carbon fiber-reinforced plastics for major components.

In 2014, BMW introduced the i3 in the U.S., an electric car that sold out immediately. The i3 is the first mass-produced car built on BMW’s LifeDrive architecture, consisting of a carbon fiber-reinforced plastic 'Life Module' that acts as a safety cage for the occupants. BMW declared that carbon fiber-reinforced plastic is “an especially light and high-strength material that provides outstanding protection to vehicle passengers in the event of an emergency.”

The company has announced a joint venture to triple capacity at its carbon-fiber production facility in Moses Lake, Washington, making it the world's largest carbon-fiber facility. It also plans to use “the ultra-lightweight, high-tech material for other model series at competitive costs and in large quantities" as economies of scale kick in.

In March 2015, Ford unveiled the all-new GT: a high-performance, production-volume sports car loaded with carbon fiber-reinforced plastics. The GT’s passenger cell is made from carbon fiber-reinforced plastics, and its front and rear subframes are wrapped in structural body panels of the same composite. Ford says this composite “is one of the world’s strongest materials for its mass – enabling an ultra-stiff foundation for chassis components, while creating a lighter overall package for increased dynamic performance and efficiency.”

Ford says it will use this technology broadly across its future lineup: “GT includes innovations and technologies that can be applied broadly across Ford’s future product portfolio … [For example] the all-new GT features advanced lightweight composites, which will help serve Ford’s entire product lineup moving forward.”

And other automakers are pursuing similar advances.

Reaching 54.5 mpg in a decade will be the result of an ongoing collaboration between automakers, government, academia and materials makers. I’m proud that my company is involved in that collaboration. And I look forward to celebrating success in 2025.

Image credit: Pixabay

Scott Fallon is General Manager of the Automotive Segment at SABIC, the world’s third largest diversified chemical company with more than 50 years of experience in the automotive industry. SABIC is a member of the American Chemistry Council Plastics Division’s Automotive Team.

Amazon surprised the Internet last week when it announced the launch of Handmade — an Etsy competitor that will sell handcrafted goods via its e-commerce site. According to the online giant, more than 80,000 products from about 5,000 artisans in more than 60 countries will be featured. Handcrafted wares will debut across several categories including jewelry, home, kitchen, artwork, stationary and furniture.

Making no apologies for its bold entry into the artisanal market, Amazon hit hard at the competition days before the official launch with a poaching strategy that was delivered via email. According to the Wall Street Journal, sellers received invites from Amazon a few days before the official launch, asking them to apply to Handmade.

Through Handmade, customers can shop genuine, factory-free, artisanal products that feel both local and uniquely global. Armed with prime shipping options, a database of 285 million customers and not to mention $75 billion in sales, Amazon's new platform is attractive for sellers looking to expose their business to new audiences.

“We have designed a custom shopping experience for customers looking for handmade items by bringing together many of the best artisans in the world, and they’re adding thousands of items daily,” said Peter Faricy, VP for Amazon Marketplace.

“Knowing an item has a unique story behind it creates a personal experience that customers have told us makes owning handmade items special. Handmade at Amazon offers customers more than 80,000 quality handcrafted items from around the world, and over 30 percent can be personalized by artisans to delight customers.”

Moreover, increased access to artisan goods online uniquely benefits a rising demographic of sellers: women makers. In its annual seller report, Etsy revealed that nearly 86 percent of its sellers are, in fact, women. Women-driven "micro-businesses" powered by the Amazon and Etsy platforms are representative of the rising trend of women launching enterprises as an alternative to the restrictions of a traditional 9-to-5 job.

The report also noted that 26 percent of sellers on the site had no other form of paid employment before selling on the platform, leveraging their online shop as a way to earn additional income. With the low barrier to entry, setting up shop for a stay-at-home mom or homemaker (38 percent of this demographic, according to Etsy), is as simple as completing the seller application and uploading photos.

As American consumers continue to invest their dollars in high-quality, American-made products, the influence of women makers will continue to evolve. Areas of opportunity for e-commerce platforms that make entry into the marketplace simple can begin to offer unique financing models and training to help women scale their businesses. Despite women launching businesses at a faster rate than men over the last decade, barriers to capital and investment for women owners still remain.

Amazon, Etsy and smaller competitors can uniquely develop scalable solutions beyond the platforms themselves to empower and invest in women makers. Providing access to capital could spell long-term adoption of their systems.

Becoming a seller on Amazon's Handmade:

• Register to sell on Amazon to begin the application process.


• Create your Artisan Profile to begin creating your storefront.


• Set up your products. There is no listing fee. (Etsy charges 20 cents)


• For each item sold, Amazon takes a 12 percent commission which includes payment processing, marketing, discounted shipping, fraud protection and no monthly fee. (Etsy's commission is 3.5 percent)


• Email and phone support are guaranteed.


• Associates program allows you to earn 10 percent commission for Amazon sales generated from your personal website.

Image credit: Handmade

Low- and lower-middle-income (LMI) populations in emerging markets – those who make between $2 and $8 per day – collectively spend $3 trillion per year. What this surprising figure means for investors is an unprecedented opportunity to create both social impact and financial return. So concludes a new research report by Omidyar Network entitled Frontier Capital: Early Stage Investing for Financial Returns and Social Impact in Emerging Markets, announced at SOCAP 2015 in San Francisco (Oct. 6-9).

The Frontier Capital report is a follow-up to the 2013 report entitled Priming the Pump for Impact Investing, which argued for a sector-based approach to impact investing. Now, the Frontier Capital report presents a new model for how to segment the enormous impact investing opportunity in emerging markets.

I sat down with Paula Goldman, global lead for impact investing at Omidyar Network and co-author of the Frontier Capital report, to dig deeper.

Opportunities for frontier investors

A central idea of frontier investing is that mixed-income models – businesses that serve LMI populations and that are “asset light” – offer both economies of scale and economies of scope for investors. According to the report, such businesses target “significantly larger markets” and are “often able to utilize existing infrastructure to add lower-price products onto existing lines, thus increasing overall profits.”

The Omidyar report rigorously segments the frontier capital opportunity into three parts, in order from most familiar to most creative:

• Replicate and adapt proven business models


• Frontier: Unproven business models that serve both lower- and middle-income populations


• Frontier plus: Unproven models for pioneer investors willing to break new ground for potentially very large impact

Early stage risk capital, or frontier capital, is essential in order for businesses that serve LMI populations to succeed. Omidyar knows whereof it speaks. As of September 2015, it has invested around $850 million in early-stage social impact organizations, including $400 million in for-profit companies, mostly in early-stage businesses and emerging markets. Long-term thinking drives its investing decisions, with $450 million going to nonprofits to support work in infrastructure and ecosystem-building.

Call for creativity and leadership

The Frontier Capital report represents a new way of thinking about how to kickstart growth in emerging markets. “Where we see venture capitalists being most successful is where they are being most creative,” Goldman said in her new SOCAPtv segment. “Venture capital is the art of seeing a wave as it’s growing but before it crests.”

https://www.youtube.com/watch?v=l1Hz3sUzO3w

Omidyar Network would like to see the frontier capital movement take hold and shape the next wave of impact investing. Goldman will be watching for a shifted volume of deal flow, reflected in future EMPEA reports, as evidence of change. “I see this as the impact opportunity of a generation,” concluded Goldman as we wrapped up our conversation.

I agree. The time has never been better and the need has never been greater for long-term thinking, patient investing in infrastructure, and collective action to combat income inequality. Which VCs, impact investors, high-net-worth individuals, development finance institutions, governments and entrepreneurs will leverage these untapped opportunities to lead the way to a sustainable financial and social future?

Image credit: Used with permission of Omidyar Network

Editor’s Note: This post is part of TriplePundit’s ongoing coverage of SXSW Eco 2015. You can read our other coverage here.

By Heidi Travis

It's not just about making cleaning more fun (and all that other environmental stuff); Method is also proving that a company can follow its values. Saskia van Gendt shared Method’s story on community engagement and its new manufacturing facility with attendees at SXSW Eco last week.

Earlier this year, Method opened its new LEED Platinum manufacturing facility on the South Side of Chicago.

“Method is built from a belief that business should play a leading role in creating good society," founder Adam Lowry stated on the McDonough + Partners site.

Not only did the company bring 100 good jobs to the community, but the impact will also have a ripple effect on the area, including the revitalization of homes in nearby neighborhoods.

Method comes to the South Side

How significant is the benefit Method is bringing to the people of Chicago?

Important enough to the Pullman and Roseland neighborhoods that CNI, Chicago Neighborhood Initiatives, along with representatives and the mayor worked hard to win Method’s investment. This was a major accomplishment for the city after being selected from 150 sites.

In order to win the relationship, the city also provided $11 million in tax increment financing and the state contributed $4.6 million for infrastructure. By locating in a low-income area, working with the Illinois Department of Commerce and Economic Opportunity, and creating and retaining 65 jobs, Method will be eligible for $1.1 million in tax credits over 10 years. In addition to partnering with the local community and obtaining grants for training, CNI also helped with job outreach with nearby schools at open houses.

The choice to locate in an urban area like Chicago was multidimensional. The goals included being close to workers who could take public transportation to the site and using railways for shipping in addition to 20 percent biodiesel powered JB Hunt trucks. The spot was ideal with its easy access to water, in contrast to the company's other facility in drought-plagued California.

Engaging employees with a creative environment

Method also designed a better place to work, including ping pong for employee breaks!

Not just a dark, boring factory, Method is filled with daylight, fresh air and colors all over. The interiors reflect the rainbow of product colors. Even the forklifts are different colors. Playful signage also adds to the pleasant feel, such as the messages: “recharging station/SHHHHHH…FORKLIFTS SLEEPING” and “the lab/THOUGHT BUBBLES MADE HERE”

It’s easy for employees to see how green energy is provided to the factory via noticeable rotating solar trees and a tall wind turbine, noted by Ms. van Gendt to provide 30 percent of the energy needed to run the plant.

Regionally, Method’s new facility also plans to do less harm by capturing storm water on-site, recycling water used in the facility, and promoting that zero waste from factory will go to landfill goal. It's also partnering with the Nature Conservancy and Michigan State University to replenish an equal amount of improved quality water to the watershed and promote sustainable farming in the area. In order to create an open feeling with the community, Method plans to keep 17 out of the 22 acres open as restored prairie and plant it with native plants. Rather than using a fence, Method installed a sidewalk around the property to promote their neighborly relationship.

Method is embracing plans to continue to invest in the community and region as a good neighbor within its new Chicago home, thus bringing good jobs to an area of Chicago that needed a little cleanup.

Image credit: Heidi Travis

Heidi Travis is a full-time planner, designer, and lover of being active in the beautiful outdoors. Heidi recently made a move to discover everything Austin has to offer after growing up in Atlanta, enjoying life in the mountains of Asheville, and appreciating the convenience of living in a city like Philadelphia. While in Philadelphia, she earned her Masters in Environmental Studies at Penn and enjoyed biking to work, as well as being involved in many campus sustainability projects.

You can follow her on twitter @heidi_travis15

Editor's Note: This post is part of TriplePundit's ongoing coverage of SXSW Eco 2015. You can read our other coverage here.

By Heidi Travis

How do you reuse a dirty, smelly waste material like the sludgy mess from industrial food production to create bioplastic? One team is doing just that. They're taking advantage of food waste sources that likely have not been previously tapped.

Imagine the mess that is created by the fermented food waste in your garbage can for a second. Was that long enough to smell it?

Who really wants to work with that? Whether driven by the desire to be gold star eco-citizens or because they hope to succeed where others have failed, Brian and Ian with Full Cycle Bioplastics shared their team's award-winning plan with me and at SXSW Eco this week.

One of the partners, Brian, describes the source of their liquid bio-gold: “We use the waste of a waste process; we’re the bottom-feeder of waste. There’s a lot of value in a material no one wants to deal with.”

Brian recalls the first time he saw the process with founders Jeff and Dane in a lab crammed into their home. He described the experience as a bit surreal; it’s crazy going into someone’s house and seeing all this equipment strewn all over the living and dining rooms. But it must have sold him on the business model. That, or perhaps Jeff and Dane’s expertise in wastewater and environmental engineering showed promise as they successfully experimented with PHA (polyhydroxyalkanoate) producing bacteria.

After effectively producing the PHA resin pellets used to create bioplastic, they filled out the team by including another partner, Ian, who during our interview jokingly said, “don’t quote me because I’m not the scientist." He’s the financial brain of the operation.

So, PHA as a bioplastic isn't new: Hasn’t someone tried this before?

Yes, others have tried; the lack of success on previous attempts may be due to economic viability. Listed here are some of the additional potential challenges:

• Previous issues included sourcing a high enough quantity of organic material, thus previous attempts in the market have produced low yields.


• Waste-producing companies that currently pay someone to take this material away may decide that they think they can charge for it once someone can use it.


• How do you ensure there is a good market for PHA to become profitable?


• Our current industrial agricultural model makes use of pesticides and herbicides as discussed in Cornell’s Compost Quality Standards and Guidelines. This may be something to consider as this mixture potentially contains PTEs (potentially toxic elements). PTEs are a concern with compost quality, and since this product comes from composting material, it would be ideal to test these products for toxins as they are intended to go back into the environment after use.

How is this team doing it differently?

Waste: This process is distinctive from previously developed PHA bioplastics because it starts with a zero-cost waste solution rather than by the purchase of and fermentation of expensive and usable crops. They plan to take any food-related waste sludge from: compost, food production and maybe even garbage.

Water: Both Brian and Ian described the process of creating PHA as a benefit in water-constrained regions. The production involves fermentation of materials that already contain at least 60 percent water, so no water needs to be added. Later, water is extracted and can be used like gray water, so luckily it can also be returned back to the environment.

Compost: PHA composts quickly. It should win best-in-class as a plastic that does not contribute to the Pacific Gyre garbage patch. This type of bioplastic can degrade in soil, water or anaerobically. PHA is also shown to degrade much more quickly than PLA.

Closed-loop plan: The team intends to connect all parts of their business. So, in the end, the waste of a processing plant can be used to create something usable and potentially be sold back to the business. It's planning for its treatment structures to exist on-site at many industrial food processors. By collocating a PHA processing setup, which Ian said "looks like a scaled-down water treatment plant," the processing system would be centrally located on-site to collect and transform the waste, thus enabling the quick delivery of the resin to a plastics manufacturer nearby.

Begin with low-cost products to grow the business: Products within the agricultural industry may include shipping palettes and landscaping film for crop fields. Resin can also be used to create more readily-compostable utensils and other plastics not requiring a high purity at this time. By keeping costs low, the company is more likely to get broader product reach and acceptance.

Helps achieve zero-waste goals: As we move toward achieving zero-waste goals in many cities, these initiatives create a strong incentive for cities to partner with groups that are using waste that would typically end up in the landfill.

Scaling up slowly: This group is beginning their pilot in 2016 with the San Francisco Bay Area and is planning to start small with the production of 15 pounds of plastic resin per day. After confirming the success of this process, they see the potential to scale up quickly into several tons per day.

--

As humans, we create a pretty limitless supply of agricultural waste. Full Cycle Bioplastics has the right idea by upcycling this waste into a usable material. The best part is that this plastic’s end of life includes the potential to recycle it into right back into the same products or you can toss it directly into your compost bin. Congratulations to this team for innovating with PHA and winning a startup showcase award at SWSW Eco 2015!

Image credit: Heidi Travis

Heidi Travis is a full-time planner, designer, and lover of being active in the beautiful outdoors. Heidi recently made a move to discover everything Austin has to offer after growing up in Atlanta, enjoying life in the mountains of Asheville, and appreciating the convenience of living in a city like Philadelphia. While in Philadelphia, she earned her Masters in Environmental Studies at Penn and enjoyed biking to work, as well as being involved in many campus sustainability projects.

You can follow her on twitter @heidi_travis15

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

Over the past few weeks, the headlines often centered around Volkswagen, which found itself mired in an emissions scandal that culminated in the resignation of its CEO and a free-fall in its stock price.

But what exactly is the scandal, and why is it such a big deal? Spend a few minutes consulting our cheat-sheet, and you'll have all the information you need to keep up with those conversations at the water cooler.

So, what is the scandal?

About three weeks ago, Volkswagen halted the sales of many of its diesel-powered automobiles. That decision came after the Environmental Protection Agency (EPA) accused the company of rigging its vehicles with software that “cheated” mandated U.S. emissions testing.

After inquiries from the EPA and the California Air and Resources Board (CARB), Volkswagen originally admitted to the installation of so-called 'defeat devices' on approximately 482,000 vehicles. But only a few days later, information was revealed indicating as many as 11 million vehicles could have been affected by the fraudulent software.

What is a 'defeat device,' anyway?

The EPA and CARB accused Volkswagen of installing defeat devices in four-cylinder Volkswagen and Audi automobiles from model years 2009 to 2015, which really just means they installed software to manipulate information transmitted during vehicle emissions testing.

The EPA’s investigation alleges that Volkswagen’s software algorithm could detect when an automobile was undergoing an emissions inspection. The software would turn on the vehicle’s full emissions controls only during such a test; otherwise, it would shut off such mechanisms when the car was driving in normal street or highway conditions.

For drivers, the benefit would be greater performance, especially on torque and mileage. For the environment, however, the EPA charges that Volkswagen’s software trick resulted in nitrogen oxide (NOx) emissions spiking as much as 40 times more than acceptable EPA levels.

Who discovered the problem?

While accusations from the EPA and CARB broke the news, neither organization was the first to discover the discrepancy in VW vehicle emissions. The sleuths who caught the problem? A team of researchers from the International Council on Clean Transportation and West Virginia University.

Peter Mock, Europe managing director of the council, and John German, a senior fellow, teamed up with researchers from WVU to test Volkswagen vehicles for the U.S. market. Their aim wasn't to blow the whistle on the automaker, but rather to convince European regulators to tighten up their emissions standards. If VW could make clean diesel for America, why couldn’t it do the same for Europe?

The researchers were stunned by what they found: The made-for-the-U.S. VW diesels scored acceptably low for emissions during tests but spewed noxious pollutants on long road trips. The researchers made their study public at a forum in San Diego in May 2014, with officials from the EPA and the tough California Air Resources Board present -- leading many to wonder why it took so long for the regulatory bodies to act. Many also pointed to the automaker's recent corporate social responsibility (CSR) reports, saying the absence of data on emissions should have been a tip-off.

Why does it matter?

Okay, so Volkswagen fessed up to intentionally engineering its cars to trick emissions testing. But why is this such a big deal?

An analysis by the Guardian found that those U.S. VW vehicles “would have spewed between 10,392 and 41,571 tons of [nitrogen oxides (NOx)] into the air each year if they had covered the average annual U.S. mileage.” Complying with the EPA’s standards would have meant those vehicles would only have emitted 1,039 tons of NOx per year.

NOx contributes to ozone and fine particulate matter (PM2.5) pollution, which are both linked to smog and human health problems like asthma and other respiratory ailments. Now that the company has been caught with its hand in the proverbial cookie jar, it said it would set aside half a year’s profits of about $7.3 billion to fix the cars, pay fines and settle customers’ lawsuits.

Volkswagen will feel a huge pinch in the pursestrings, as well as a crippling blow to its reputation. But defrauded customers will feel the pain, too. As Philip E. Ross of Spectrum magazine wrote, “Even after VW pays the multibillion-dollar bill to refit its diesel cars to meet EPA standards, its customers will have to pay a price, too. Because their cars will get worse mileage, they will command a lower resale price.”

What's the fallout?

Volkswagen will have to pay billions to rectify the situation, but that's far from the only fallout of this scandal. The company's CEO resigned a few days after the scandal broke. Since then, Volkswagen and Audi agreed to return “Green Car of the Year” awards bestowed upon their 2009 and 2010 “clean diesel” models.

The U.S. Justice Department’s Environment and Natural Resources Division is opening a criminal investigation, which means that FBI agents will soon be flashing badges at VW plants in the U.S. and asking their counterparts for help at the company’s main office in Wolfsburg, Germany.

This week, two high-ranking U.S. senators announced that they would initiate a separate investigation to determine if Volkswagen intentionally deceived the Internal Revenue Service out of more than $50 million in tax credits its vehicles would not have qualified for without fraudulent emissions results.

Things got worse for the company on Thursday, when German prosecutors raided its headquarters in Wolfsburg in the hopes of learning the origin and use of the defeat device. The raid was further bad news for VW shares, which continue to drop.

Is Volkswagen alone?

Volkswagen isn’t the only company that is under the microscope for allegedly deceiving consumers about vehicle emission results, says the Europe-based organization Transportation and Environment. According to road tests conducted by the organization, a number of Mercedes, BMW and Peugeot vehicles guzzled, in some cases, as much as 50 percent more fuel than was stated in company-run lab tests.

“The gap between official and real-world performance found in many car models has grown so wide that it cannot be explained through known factors including test manipulations,” Transportation and Environment concluded in a new report.

The bottom line

As information continues to emerge about Volkswagen and other automakers falsifying emissions results and essentially defrauding consumers, the auto industry -- and indeed business as a whole -- will need to ask some tough questions.

How is it that what appears to be a few rogue executives could tarnish the reputation of what was once considered one of the world's most environmentally friendly automakers? When did companies decide that lying to customers was worth the risk? And how did Volkswagen escape the watchful eye of regulatory bodies, while winning environmental performance awards and topping rankings like the Dow Jones Sustainability Index?

The scandal may be just as much an indictment of the current state of CSR as it is a commentary on the inner-workings of Volkswagen. The conversation will likely continue in the coming weeks, and we'll have our eyes open.

Image credit: Flickr/Dave Humphreys

Ethiopia’s famine, which vaulted the country into global headlines 30 years ago, has left much of the world with stubborn images of a dry, desolate and inhospitable country in which to live.

While that is very true of the Danakil Depression, and the country east of its capitol, Addis Ababa, is remarkably arid, the truth is that much of the country is green and lush. It is because of this rich land that as one of the planet’s oldest societies, Ethiopia has made many contributions, culturally and economically, to the world. One notable example of Ethiopia’s impact on our global economy and culture is coffee. Arabica coffee beans trace their origins to Ethiopia, and now coffee is the country’s largest foreign export.

But coffee, farms and livelihoods throughout the region may suffer from climate change's long-term effects. According to a report issued by Columbia University’s Earth Institute, Ethiopia, along with its neighbors on the Horn of Africa, Djibouti and Somalia, have become drier the past 100 years, and these trends may lead to even less precipitation in the foreseeable future. Less rain, paired with warmer temperatures, could spark increasing tensions in a corner of the world that has already seen its share of conflict.

Somaliland, which has functioned as a separate state since cutting off ties with Somalia in the early 1990s, is relatively stable but receives little international aid since it is not internationally recognized as an official nation; Djibouti already has its struggles due to having few natural resources while a high percentage of its population lives in poverty; and although Ethiopia’s poverty rate has fallen significantly since 2000, tensions with Eritrea still result in conflicts along their disputed border. Add the lawlessness in the strategically important Gulf of Aden, and climate change could wreak havoc throughout a region that has been on the steady yet slow road to social healing and economic recovery.

It is in the Gulf of Aden where Earth Institute researchers conducted research and arrived at their conclusion that climate change could result in a long-term decline in rainfall within the region. The team of scientists extracted sediment from the gulf’s pirate-ridden waters and analyzed the core to determine past changes in aridity and temperatures. Cross-referencing information they could glean from this sediment with climate data dating back to the 20th century, researchers have posited that the weather will continue to become drier and warmer in Ethiopia, Djibouti, Somaliland and Somalia.

This assessment contrasts sharply with what had been largely accepted by the scientific community: that climate change, by adding even more moisture to the earth’s atmosphere, would actually create more precipitation and create a wetter climate, therefore potentially benefiting this region both environmentally and economically.

Africa’s past history also nudged the Earth’s Institute researchers to ascertain that the Horn of Africa is a on course towards a drier climate. Additional analysis of Gulf of Aden sediment, according to a 2013 study, suggests that the desertification of the Sahara 5,000 years ago occurred relatively quickly, in 100 to 200 years — not gradually, as was the assumption of most researchers who have studied Africa’s climatic patterns.

These conclusions add to what many experts are already saying about climate change: the gradual but steady warming of the earth will have a far more devastating impact in poorer countries. Such forecasts are why a self-described alliance of vulnerable nations, or the V-20, held an inaugural meeting yesterday in Lima, Peru, to discuss how they will cope with the brunt of social upheaval and economic losses. Ethiopia, incidentally, was one of the first nations to disclose its climate plan in the buildup to the COP21 talks next month in Paris.

The Horn of Africa is already home to what many describe as the world’s first “failed state.” While Somalia’s neighbors have made a valiant effort in ensuring that they would not suffer the same fate, these nations are now likely to face even more challenges in the years ahead as they strive to lift more of their citizens out of poverty.

Image credit: Leon Kaye

Two years ago, it seemed like an unbeatable company with an environmental track record that could only grow stronger. But as Volkswagen Group of America CEO Michael Horn took the oath before Congress yesterday, it became clear that those days were probably over. Volkswagen's global enterprise is now fighting to stay in business.

Wednesday, two high-ranking senators announced that they would initiate an investigation to determine if Volkswagen intentionally deceived the Internal Revenue Service out of more than $50 million in tax credits.

Senate Finance Committee Chair Orrin Hatch (R-Utah) and ranking member Ron Wyden (D-Ore.) say they are responding to news that consumers who purchased certain VW models received as much as $1,300 in tax breaks between 2009 and 2010, racking up a tally of more than $50 million in breaks for 2009 and 2010 models (tax breaks continued following those years, but were less after 2010). According to Hatch and Wyden, 60,000 such vehicles were sold in the U.S. during that period.

Thursday morning, Congress began the lengthy process of trying to determine how defeat devices had become routine mechanisms in some of VW's higher-priced diesel models, who had made the decision to include them, and why.

Two of the more interesting pieces of information shared by Horn was that it was "a couple of engineers" who were independently responsible for the world-wide deception, and that the device was installed allegedly in response to emission standards being tightened. It isn't clear how two engineers would have been able to implement such changes, particularly in light of the fact that VW, by its own admission, maintains fairly stringent oversight of its technology and its production processes. The automaker's Chattanooga, Tennessee, plant has gone to lengths to demonstrate that such oversight is a company-wide concern.

But it's also not clear why two engineers would feel that they should act arbitrarily to fool emissions tests that were put in place to address global warming concerns, particularly given the company's established environmental focus. At what point do such national environmental mandates become acted upon by design engineers?

There likely will be many more questions to be answered in coming weeks as VW attempts to address the investigations that have been launched across the globe. Yesterday, German prosecutors raided the company's headquarters in the hopes of learning the origin and use of the defeat device. The raid is further bad news for VW shares, which continue to drop.

Recovering from those losses will likely be challenging for VW. It's facing mounting costs and still has not come up with a clear answer as to how it will address the emissions problems of the some 11 million affected vehicles worldwide. According to Horn, it's a task that will likely take a few years to fix.

That isn't sitting well with some members of Congress, who suggested that VW should consider buying back all of the affected vehicles -- at their original sales prices. It's unlikely that the automaker will do that, but it is offering $2,000 to "returning Volkswagen owners" who are willing to stay loyal to the brand and purchase a new vehicle. It will be interesting to see how that turns out.

Image credit: Bruno Kussler Marques

It is said that California often leads the U.S. on policy, whether it is on tax rollbacks, car insurance reform and now, clean energy.

Gov. Jerry Brown already signed legislation during his first term that mandated California generate 33 percent of its energy from renewables by 2020. Following his landslide re-election, the septuagenarian governor has been on fire, from pushing the state to find new ways to conserve water to setting new climate change goals for California.

When Brown was one of the youngest governors in state history during the 1970s, his advocacy of solar power was considered so far out of the mainstream that his affinity for renewables contributed to his nickname, “Governor Moonbeam.” Now California’s oldest governor ever, his promotion of clean energy barely turns heads. Therefore, few took any notice when he signed Senate Bill 350, which aims to boost energy efficiency and renewables even further in the Golden State.

Signed during a ceremony this week at the Griffith Park Observatory in Los Angeles, the law mandates that California produce 50 percent of its electricity from renewables such as solar and wind power by 2030. The law also requires a doubling of energy efficiency in buildings statewide by the same year. The bill was authored by Senate President pro Tempore Kevin de Leon of Los Angeles.

As the COP21 talks in Paris draw even closer, S.B. 350 is an example of how local and regional governments can make a difference, even if next month’s climate conference will be held by national and international leaders.

Not all of California’s action on renewables and climate change is based on legislation, however. For example, last month the state’s Air Resources Board reenacted its controversial Low Carbon Fuel Standard (LCFS), which will require a 10 percent reduction in the carbon intensity of transport fuels by 2020.

Long supported by environmentalists but despised by energy companies, that regulation is in part behind why S.B. 350 was not passed in its original form. Earlier drafts of the legislation included language that would have required the state to slash its total petroleum use by 50 percent by 2030. Some state lawmakers and energy lobbyists raised objections to that provision, so the bill’s authors removed that segment from the final bill.

Although many environmental organizations praised the bill’s passage, the removal of the petroleum consumption section has proven to be a sore point. The Natural Resources Defense Council, for example, called the California legislature’s refusal to confront the oil industry’s “fearmongering [sic]” as “deplorable,” but lauded the legislation’s goals despite what the organization described as the energy companies’ “smokescreen.”

Gov. Brown’s political opponents attacked what they described as the future consequences of this legislation. Senate Republican Leader Jean Fuller of Bakersfield, claiming that S.B. 350 would lead to higher utility bills and job losses for California’s families, said in a written statement: “Senate Republicans share the goal of clean air and reduced emissions in California. But we have to get there in a way that is still affordable for California families and small businesses.”

Considering the state’s political tilt and Brown’s determination to press on with his agenda as he will most likely retire from public life after leaving office in 2019, it is clear that while he may not leave office popular, his second governorship will be far more consequential than many had imagined after his 2010 election.

Image credit: Kit Conn via Wikimedia Commons

What do Twitter sensation @MarnieTheDog, actor Leonardo DiCaprio and President Barack Obama have in common? If you thought climate change, you’re right. A viral social media campaign, #ClimateChangeIsReal, launched on Earth Day this year and discussed at a SXSW Eco workshop this week, taps into people’s fascination with celebrity culture and memes to raise awareness about climate change and make climate action mainstream.

Organized by Here Now, a project of social cause agency Purpose, the #ClimateChangeIsReal initiative reached about 235 million tweets within two weeks of its launch in April, and continues to see about 500 new posts on Twitter each week.

Pop culture icons as diverse as Brad Pitt, Richard Branson and Paul McCartney – and corporations such as Nike, Ikea and Unilever – have joined the climate conversation using the viral hashtag. Everyday people are tweeting as a way to do their part, too.

The initiative builds a new framework for climate change storytelling. Rather than share doom and gloom statistics, #ClimateChangeIsReal leverages humor (we are talking about memes here, after all). And rather than being publicly led by a single organization, more than 200 nonprofit organizations, 75 artists, 50 corporate partners, and a slew of celebrities and individuals have been empowered with messaging and tools to lead the social dialogue and become digital influencers.

The result has been a dynamic global exchange that has taken a life of its own. Beyond memes, people are getting creative and using the hashtag to make a point. Even more, the social campaign has driven more conversation than media or public relations could achieve combined.

According to presenters at SXSW Eco this week, the secret-sauce of the campaign’s success is combining a culturally relevant, trending topic with a climate change concept, such as Obama’s three-point game and climate change or #TheDress and climate change.

Above all, authenticity is key. And laughter.

Image credits: 1) Courtesy of #ClimateChangeIsReal; 2) @BarackObama via Twitter