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Several times a week,  some of Japan's most affluent restauranteurs gather in an old warehouse in central Tokyo to bid on a commodity that is central to their businesses' success: tuna. Customers and gawking tourists gather on the cold auction floor to observe a spectacle that each year makes international news. Last January's auction of one bluefin tuna garnered more than $30,000; another, in 2013, was sold for $1.76 million.

Still, it isn't just the exceptional size of these fish that is driving sales at the Tsukiji Fish Market. It's the tentative state of global tuna sales.

According to Greenpeace, the fish that sushi restaurants rely upon for their high-priced sashimi dishes is now endangered. Sixty percent of the world's tuna stocks is now harvested from the Pacific Ocean, and bluefin prized for its delicate meat fills a substantial demand in Japan. More than 70 percent of the bluefin that is caught ends up in Japan.

And Greenpeace isn't the only organization that is sounding alarm:

• Scientists from the International Scientific Committee to Study the Tuna and Tuna-Like Species of the North Pacific Ocean warned in 2013 that bluefin numbers were at alarming levels and were, at that time, 96 percent below unfished levels.


• The World Wildlife Fund and the Association of Professional Observers called on the Western and Central Pacific Fisheries Commission (WCPFC) in 2013 to implement "urgent measures" to stop illegal, unregulated and unreported (IUU) fishing.


• A study published by the European Union in 2014 suggested the problems stemming from IUU fishing were multi-factorial, including a "lack of transparency" that allowed international agencies to regulate the problem. According to the report, annual losses from illegal fishing amount to $10  billion to $23.5  billion.

In July of this year, the National Oceanic and Atmospheric Administration published a final rule concerning catch limits of the bluefin tuna in the eastern Pacific Ocean. The limits are among the most current indications that bluefin stocks are at precarious levels. But, as Greenpeace points out, it isn't the U.S. or Canada fishing fleets that are out of compliance, and NOAA regulations do little to set affect IUU fishing by internationally-registered vessels.

It's hard to believe we are at this point again. In the 1980s, entire cities' economies were transformed by the collapse of West Coast fish stocks. San Diego, once a hub for the tuna industry, experienced years of unemployment problems as one cannery after another folded from overfishing. One of my first jobs was serving as an interpreter for one of the city's newly acquired canneries, which employed 700 cannery workers and closed three years after it opened. Unemployment in San Diego skyrocketed as retraining programs went into place, and canneries and supporting infrastructure closed down.

While optimists would likely point out that San Diego's tuna seiners have been replaced by a robust cruise ship industry (and Bumble Bee, Carnation and Sun Harbor docks have been replaced by mom-and-pop fishing vessels), it took decades for the city to recover -- something that Southern California's tuna stocks have not yet done. The loss of the bluefin tuna could spell a much greater loss than a city's historic maritime industry, or the diminishing returns of a fish auction that now trades on affluence and exceptional luck.

Sea Shepherd and Libyan tuna vessel - Simon K Ager; Tokyo Fish Market - David Prasad; San Diego - Port of San Diego

Those beautiful clothes we love to wear may be traced back to environmental and human rights abuses. A new report by Rainforest Action Network (RAN) traces tree-based fabric production back to deforestation and human rights violations risks. Fabrics like rayon, viscose and modals are derived from trees.

In particular, the report implicates 15 popular American brands, which it calls the Fashion 15. Included in the Fashion 15 is fashion giant Ralph Lauren. The other brands are Prada, LVMH, Tory Burch, Michael Kors, Vince, Guess, Velvet, L Brands, Forever 21, Under Armour, Footlocker, Abercrombie and Fitch, GAIAM, and Beyond Yoga.

Mega plantations have expanded globally to keep up with the demand for fabric production. The result is that forest-dependent and indigenous communities are being devastated. Over 20 cases have been documented in an area in Northern Sumatra, Indonesia -- owned by one company, Toba Pulp Lestari (TPL) -- in which community-owned land has been taken forcibly without community consent and then clear-cut to make way for fabric pulp production.

Over 60 percent of the people in the Northern Sumatra community of Pandumaan-Sipithuta, where 800 indigenous Tano Batak families live, earn a livelihood by tapping the resin of the benzoin tree. Five days a week, benzoin farmers tap sap from the trees, and the sap is then sold internationally, where it’s used to make incense, medicine, varnish and flavoring. One hectare of benzoin forest can produce $5,564 a year. For over 13 generations, the community has managed this forest resource, which is locally called tombak hamijon. However, the Indonesian government has not recognized or formally acknowledged the rights of these indigenous people.

In 2009, the Minister of Forests included the land of Pandumaan-Sipituhuta in concessions given to TPL, which wanted to expand its plantations to supply its paper pulp and dissolving pulp mill. The indigenous people had both their land and their livelihood taken away because TPL cleared the benzoin forests. Water-intensive eucalyptus trees were planted which dried up a local river, depriving local communities of clean water.

Human rights and environmental abuse aren’t just happening in Indonesia, but also in South Africa, Brazil and even Canada. This isn’t just something occurring in developing countries alone, but also in North America. It’s a global problem. About 70 million to 100 million trees are cut down every year to make wood-based fabrics, according to the RAN report. The industry is projected to grow about 10 percent, so the impact will increase.

What companies and consumers can do

RAN has a list of recommendations for fashion and apparel companies to address and stop human rights and environmental abuses in the pulp industry:

• Make a public commitment to protect forests and human rights in order to eliminate controversial fiber sourcing from their supply chain.


• Develop and implement a fabric/forest products sourcing policy that eliminate controversial fiber and companies that contribute to deforestation.


• Set measurable time-bound performance targets and outline auditing and independent verification measures for implementing the company’s responsible forest fabrics policy.


• Develop and implement due diligence procedures, elimination criteria and evidence based verification requirements as part of the time-bound plan.


• Work with peers and other stakeholders to advocate for wider actions that address underlying causes of controversial fabric, reduce adverse environmental and social impacts from supply chains, and support enabling laws and regulations in both producer and consumer countries.

There is something consumers can do. It’s really simple. Don’t buy clothes from the Fashion 15. That adorable blouse from Forever 21 might be cheap to your wallet, but it likely comes with a high cost to the environment and indigenous people. It's just not worth buying.

There’s one more thing consumers can do. It’s as simple as a virtual signature. Sign RAN’s petition to Ralph Lauren, urging the fashion giant to implement more sustainable fabric sourcing policies. Imagine if Ralph Lauren became an industry leader in preventing environmental and human rights abuses in fabric production? Maybe, just maybe, it could be stopped.

Image credit: Flickr/crustmania

Editor's Note: This post originally appeared on Unreasonable.is. 

By L Hunter Lovins

We stand on the cusp of the biggest transformation of our lives.

Humanity is in a horse race against catastrophe. The bad news is all around us from loss of species to global warming, social fragmentation, and growing inequality. The good news is that we’re in the race.

And we might just be winning. The speed with which renewable energy, especially solar, is growing means we can solve the climate crisis, create jobs, reinvigorate manufacturing and buy the time needed to do the more fundamental work of implementing the Regenerative Economy – an economy in service to life.

Solar

In the last year, the chronology of change has been inspiring. In June 2014, Citi Group released its Energy Darwinism report, warning of the “alarming fall in the price of solar.” Alarming to whom? Citi stated that this was now the Era of Renewables, predicting that within 10 years solar, even without subsidies, would be the cheapest way to generate electricity.

The September 2014 report by the CDP (formerly Carbon Disclosure Project) reaffirmed the business case for sustainability that Natural Capitalism Solutions pioneered. Its Climate Action and Profitability study showed that companies that integrate sustainability into their business strategies outperform those who fail to show such leadership. Companies that are managing their carbon emissions and are planning for climate change enjoy 18 percent higher returns on their investment than companies that aren’t, and 67 percent higher than companies that refuse to disclose their emissions.

In January 2015, Deutsche Bank analyst, Vishal Shah, predicted that rooftop solar will be the cheapest electricity option for everyone in the U.S. by 2016.

Only one month later Agora Energiewende, a German think-tank, reported that solar electricity was already a low-cost renewable energy technology in many regions of the world and stated that by 2026 it will be the cheapest form of electricity everywhere. It described how large-scale photovoltaic installations in Germany fell from over 40 cents per kilowatt-hour (c/kWh) in 2005 to 9 cents per kWh in 2014, with even lower prices reported in sunnier regions of the world.

Even with no technological breakthroughs, the report concluded that there is no end to cost reduction, with costs of 4 to 6 cents per kWh (competitive with just the running cost of a natural gas plant) expected by 2025, and 2 to 4 cents per kWh by 2050. At that price, solar will compete with energy efficiency. The study warned, “Most scenarios underestimate the role of solar power in future energy systems.”

That price was achieved for utility scale solar four months later when Austin, Texas, announced that the utility had “received offers for 7,976 megawatts of projects after issuing a request for bids in April. Out of those bids, 1,295 megawatts of projects were priced below 4 cents per kilowatt-hour.”

Change is happening fast

In March 2015, Bloomberg Business reported that, from 2013 to 2014, California went from utility-scale solar installations supplying 1.9 percent of its electricity to 5 percent. The National Bank of Abu Dhabi issued a report stating that solar energy is on track to achieve grid parity in 80 percent of countries within the next two years.

In April 2015, Michael Liebreich of Bloomberg New Energy announced: “Fossil fuel just lost the race with renewables … The world is now adding more capacity for renewable power each year than coal, natural gas, and oil combined. And there’s no going back.”

In June, 2015, The Institute for Energy Economics and Financial Analysis warned of slowing demand for coal and rapidly rising investment in renewables. Tim Buckley, the Institute’s director of energy finance stated: “Globally, 2014 was the year of the renewable energy installation juggernaut … Wherever you look around the globe, be it China, India, Europe or the U.S., the trend of a rapidly-expanding renewable energy industry is the same. 2015 will inevitably see this gather pace.”

He’s right. South Africa is using solar and wind to meet its capacity shortfalls cheaper and faster than new coal or nuclear facilities could. This saved the country $69 million in 2014, created jobs and increased local industrial capacity. With proposed coal plants on hold because of soaring costs, South Africa commissioned 79 renewable energy projects, totaling more than 1 gigawatt. That is roughly a nuclear power plant-sized chunk of capacity, but a new nuclear plant would take 10 years to build and would cost $6 per watt, according to one recent estimate. Coal, long thought of as dirt cheap, comes at $2.30 per watt. Top Chinese manufacturers are producing solar panels for 42 cents per watt.

South Africa’s renewable capacity will hit 5.24 GW in 2015, up from nothing in 2012, with another 6.3 GW to be commissioned in 2015. No fossil technology can scale this quickly.

Across the Atlantic, Brazil’s commitment to biofuels and hydroelectricity made it independent of imported oil in 2006. Since 2009, Brazil has added solar and wind energy, contracting 14 GW of wind power at prices below any other option. In 2014, at prices only a bit higher, Brazil also brought on almost 1 GW of solar energy. As a severe drought drives Brazil’s electricity prices higher, industries eager for access to reliable and affordable power are turning to renewables that do not require dams and abundant rainfall.

The biggest user of energy, China, is becoming the world’s renewable energy powerhouse. Growing its installed solar capacity by 20-fold within only four years, China went from a capacity of 0.30 GW in 2009 to 13 GW by 2013 and is now preparing to install 17.8 GW of new solar energy for 2015.

China burns a lot of coal, but its Green Horizons program has committed to clean the air in its cities and cut carbon intensity by 40 to 45 percent from 2005 levels within the next five years.

The IEEFA study agrees: “While real economic growth in China exceeded 7 percent, electricity demand grew by less than 4 percent.” Rapid supply diversification saw China’s coal consumption decline 2 percent and coal imports fall by 11 percent in 2014. China’s coal demand will permanently peak by 2016 and decline thereafter, the report predicts. In the first three months of 2015, Chinese coal imports fell by 42 percent from a year before.

Profound global transformation

The transformation has only begun. The 2015 China 2050 High Renewable Energy Penetration Scenario and Roadmap study found that renewable energy could economically provide China the majority of its energy by 2050. In July 2015, Wang Yimin, representing the State Grid Corporation of China, told the United Nations Global Compact meeting on pricing carbon that by 2050 China would be 80 percent renewable.

Tesla is now valued at half the market capitalization of General Motors, despite selling 300 times fewer cars. Why? Tesla is not a car company; it’s a battery company. With cheap and ubiquitous batteries, solar and wind become firm power and can replace all fossil power plants. This is, in part, why over 100 companies have already committed to go 100 percent renewably powered.

Traditional utility companies face the Death Spiral. Their old business model of building large fossil plants is no longer a viable model. Secretary of Energy Stephen Chu stated: “The utilities are in danger of getting ‘Fed-Exed’ just like the Post office got ‘Fed-Exed’ as roof-top solar modules drop in price." In Europe, where feed-in tariffs allow farmers, cooperatives, communities and citizens to make money from installing renewable energy, RWE and Eon, two of the biggest European utilities have divested of ownership in fossil and nuclear facilities, declaring themselves to be distributed renewables companies, after losing 60 percent and 91 percent profits respectively in the first nine months of 2014.

Most utilities, however, still fight the transition. And fossil energy is still heavily subsidized. The recent IMF figure puts annual support for energy at $5.3 trillion or 6.5 percent of global GDP. This amounts to $10 million a minute and exceeds all spending in the world for health care.

What can you do?

Your daily choices say what your values truly are. Have you invested in solar for your home? Companies from Sun Edison to SolarCity to Sungevity will install it on your home — no money down. Or if you have the ability to finance it, own your own electricity system. It’s what I have done at my ranch.

Get active politically. Although the dramatic progress in renewable energy has required entrepreneurs and companies working in the private sector, good public policy is essential if we are to implement what we know how to do in energy efficiency and renewable energy fast enough to escape the worst ravages of climate change.

Germany, hardly the country you would first think of to be a leader in solar energy, became so because advocates like Hermann Sheer and politicians like Ernst Ulrich von Weizaecker formulated and implemented Germany’s feed-in tariff and Energiewende. Without such policy, Germany, the same latitude as Labrador, would not now occasionally get up to half of its energy from the sun. It aims to get 45 percent from renewablesfull time by 2050. Similarly, the Chinese clean energy surge is driven by the government’s commitment to clean its air, deliver abundant affordable energy for development, and support domestic industry.

Much of the best renewables programs in the United States are run by municipal utilities, with the investor owned utilities having to be dragged kicking and screaming into the solar age. In Boulder, Colorado, the citizen’s voted to become their own utility so that they could move away from Xcel Energy’s commitment to coal and implement 100% renewable power.

Divestment matters

Perhaps the most powerful thing that you can do personally is to divest. The Boulder, Colorado-based financial advisory company, Principium, has built what may be the first truly fossil fuel free portfolio, using the principles of the Regenerative Economy to pick companies in which people concerned about building a finer future would want to invest.

The Union of Concerned Scientists study, The Climate Deception Dossiers, showed that for decades the oil and coal companies have conducted a coordinated campaign to spread climate disinformation and block climate action to protect its profits.

How can you fight such power and money? You can take yours out.

As John Fullerton puts it, all investment has impact. His description of the risk of carbon bubbles and stranded assets sets forth fundamentals that should guide investors in the age of climate crisis.

How money is invested — whether by companies, by colleges, or by you — determines whether we trash the planet or save it.

The Oxford’s Stranded Assets Programme’s report concluded: “Divestment outflows, even when relatively meagre in the first wave of divestment, can significantly and permanently depress stock price of a target firm if they trigger a change in market norms.”

Peabody Coal’s recent filing with the SEC warned that, “Divestment could significantly affect demand for our product.” One analyst observed, “Shares in Peabody, the world’s biggest private-sector coal company, have sunk 84 percent since 2010. Its debt has slipped to three rungs below investment grade. The company lost $525 million in 2013 and hemorrhaged $787 million in 2014.”

Bank of America stated in May 2015 that coal mining companies pose an increasingly risky investment: “Going forward, Bank of America will continue to reduce our credit exposure to coal extraction companies.” It also committed to increasing lending to renewable energy, energy efficiency, and carbon capture and storage. The spokeswoman said the bank’s renewable energy portfolio was currently more than three times as large as its coal extraction portfolio.

Coal stocks are an increasingly risky investment. Bloomberg New Energy Finance estimates coal stocks have lost 50 to 90 percent of their value since 2005. Trading at $60 a share in 2011, Peabody Coal traded 1 July 2015 at $1.68.

“Coal companies’ underperformance against the global equity market is unprecedented,” said IEEFA’s Tim Buckley. “A more than 50 percent decline in coal prices has seen most listed coal companies globally lose 80 to 90 percent of their equity market value in the last four years. While the sun will undoubtedly rise for renewable energy in 2015, for coal, there remains a lot further to fall.”

Oil has not performed much better. A Financial Times article from 2013 described the performance of international oil and gas companies as “lamentable from a shareholder perspective” over the last decade. Since June 2014, big oil has lost $200 billion.

Not surprisingly, evidence is pouring in that fossil-free portfolios have been outperforming fossil heavy ones. FTSE’s North American fossil fuel-free index has consistently outperformed the conventional benchmark index. In an analysis earlier this month, the stock market index company MSCI found that fossil-free funds have earned a higher return than conventional ones in the last five years.

Ellen Dorsey, founder of the divestment movement hits it on the head when she says, “If you own fossil, you own climate change.”

That also means you own all of its impacts — from fires and floods, melting glaciers and droughts, rising sea levels and acidifying oceans, to failing crops. Investors now realize that they stand to lose trillions of dollars from the value of their holdings if climate change continues unchecked.

Lead, follow, or get out of the way

Whatever you do, understand that getting involved is key to crafting a finer future. The International Energy Agency reported in early 2015 that the world’s efforts to limit carbon emissions has begun to work. For the first time in 40 years, global carbon emissions from the energy sector stalled and began to decline.

We can save the planet from the scourge of climate chaos, but only if we act. What will you do?

Image credits: 1) Flickr/h080 2) Flickr/The Open University

Hunter Lovins is the President of Natural Capitalism Solutions and Chief Insurgent for the Madrone Project, a global effort to bring sustainability education to students. She is the author of Natural Capitalism, a founding professor at Bard MBA, and the Millennium TIME Magazine Hero of the Planet.

A new set of guidelines to help companies source palm oil more responsibly has been published by the Consumer Goods Forum. It's the Forum's first foray into the palm oil debate and developed by CGF retailer and manufacturer members, with input from standard setting organisations, NGOs, banks and suppliers. 

The CGF says the guidelines are an important step in helping the consumer goods and retail industries to achieve zero net deforestation by 2020, as outlined in its Deforestation Resolution.

Ignacio Gavilan, director of sustainability at the CGF said, “The publication of the ‘Sustainable Palm Oil Sourcing Guidelines’ is another important step forward for our industry, and it’s a testament to what can result from effective cross-sector collaboration. This isn’t just a document from The Consumer Goods Forum, it’s a document that is built on a global industry’s commitment to achieve zero net deforestation by 2020, and several stakeholders have been involved in getting it to this point”.

Palm Oil is the most widely used vegetable oil in the world. Malaysia and Indonesia are leading producers accounting for 86% of global production. Although potentially one of the more sustainable vegetable oils, there is serious concern that rapid expansion of palm oil plantations has on occasions resulted in loss of valuable tropical forests and social conflict.

You can download the guidelines here. 

Global smartphone sales reached 1 billion in 2013 and 1.2 billion in 2014. By comparison, television sales may fall to below 200 million this year. There are profound trends in the works in the IT industry as our gadgets become increasingly mobile and sophisticated, with users demanding huge energy efficiency gains.

"The more mobility you want to have, the longer-lasting energy storage systems you have to install, and this is definitely a little behind in innovation compared to IT and semiconductor developments," Constantin Herrmann, principal sustainability consultant for Thinkstep, told TriplePundit. "The batteries are far behind the speed of the innovation cycle. The IT industry is hard at work on this to make better, more efficient power systems to ensure longer mobility and independence of the user."

The IT industry is scrambling to meet consumer demand, which in turn pushes the energy efficiency of our gadgets. Enormous strides have been made, which are fueled by the market.

"We have seen higher density of data per power usage, and CPUs have dramatically lower consumption per action," Hermann said. "Market demand continues increase functional requirement which runs in opposition to the efficiency curve. There is a huge efficiency increase, but the counter effect is that people consume more and more of these things. It’s called the rebound effect."

This brings up the question: When will these enormous leaps in technology and efficiency dramatically reduce our energy consumption? As the capabilities and opportunities that technology have to offer seem like an endless frontier, the market demands more.

This does put a natural pressure on the IT industry to constantly innovate to be more energy efficient, as greater mobility requires increased energy efficiency. Batteries are not able to provide all that we want them to with today's technology, requiring energy efficiency innovation.

The issues around energy efficiency in the IT industry are changing, as our use of gadgets shifts. Vampire power from standby use was a big issue and a focus of green innovation, as many corded electronics continuously use wattage when plugged into a power outlet just to have the ability to use a remote control or be in standby mode. Although big strides were made to minimize this, the issues in energy efficiency are shifting as technology gets increasingly mobile. The way technology functions is shifting on certain devices, with electronics not always being on, off or in standby mode.

"You cannot even quantify vampire power in a smartphone, for example," Hermann told us. "Is it standby, idle, in use or running apps?"

Beyond consumer demand fueling green innovation in the electronics industry, government regulation can certainly play a role. Some regulations have gone into effect that may have addressed one particular issue, but didn't take a big-picture view on issues. If one material is banned in electronics, for example, it is important to first determine if there are safer and viable substitutes. Ideally regulations will be based on a collaborative process that takes a broad triple-bottom line look at issues with multiple stakeholders involved.

"A great example of a multi-stakeholder approach is the use of energy-efficient bulbs in electronics, which are based on the technology in fluorescent lamps, but smaller," Hermann explained. "These lamps use mercury. The question was, then, how using mercury compares to reducing energy consumption of light bulbs for the market, the environment and the consumer. There was a need to investigate this first with a lifecycle approach, and that brought together all the stakeholders (OEMs, the NGOs, analytics from a lifecycle analysis, additional investigations, and government regulators) to answer what is economically stable, best for the consumer, and the environment. This shows what is necessary today to have good regulations to reduce energy and education for consumer with an easy-to-understand label showing a rating."

The EU Energy Label clearly demonstrates to consumers how a specific product ranks against others, assisting in informed purchasing choices. As technology gets more and more advanced and environmental issues are increasingly complex, it is important to help consumers navigate issues and make informed decisions without needing to do in depth research.

Ultimately, technology is in our lives to provide a service and fulfill a need. We don't want the washing machine. We just want to have clean clothes. Hermann suggested that consumer-friendly information would also be helpful in making optimum purchasing decisions that could result in energy savings.

"If you go into an electronics store, and you want to buy something, you probably have a product in mind. At the end of the day, you should have a need in mind. Currently, if you just go into a shop with a need in mind, you probably won‘t find the right product. There needs to be more information and education about what a product can provide and what it provides beyond your needs so you don’t unknowingly consume more power than you need."

Image credits: 1) Flickr/r. nial bradshaw 2) Flickr/Japanexperterna.se

The California drought's impacts on agriculture, water systems and infrastructure are well known. Now new research demonstrates that there is a negative carbon impact too – and that this may continue for several years.

William Anderegg is an ecologist at Princeton University. He and his colleagues examined tree-ring data from more than 1,300 sites around the world. And by comparing the rings with known drought records, they found that trees don't simply kick back into gear as soon as rains return.

That drought 'hangover' causes tree growth to lag 5 to 10 percent below normal for several years following the dry spell.

Tree growth is, of course, what removes carbon dioxide (CO2), the air trees breath, from the atmosphere. If trees grow 5 to 10 percent more slowly, it means that they are using 5 to 10 percent less CO2, meaning a significant carbon sink is being lost, and more CO2 is being left in the atmosphere as a greenhouse gas. California, which has huge swaths of primary and secondary forest, is one of the most important carbon sinks in the United States, thus this will affect America's overall carbon emissions picture.

There is little, if anything, we can do to stop this now. The drought has already been going on for more than four years. California's trees will likely suffer for some time to come in order to recover from such a long period of limited rainfall and high stress.

What this does do, though, is demonstrate the continued importance of investing in, and maintaining, healthy and resilient ecosystems. Unfortunately, years of intensive water usage by farms and cities reduced the natural water flows into nature, which made many of our forests more vulnerable to drought – hence the already rampant wildfires across the state, which experts expect to get much worse before they get better.

So, what can we do to reduce the future carbon impacts of California forests? Simply, we can invest in forest preservation in other parts of the world. Deforestation is a major problem in countries like Indonesia, Brazil and Russia, where it is a top source of carbon emissions. The impacts of losing these vast carbon sinks is incredibly complex and has not been studied enough, but is thought to play a significant role in global climate.

Because carbon mixes uniformly in the atmosphere, reducing carbon elsewhere will mean less CO2 in our air here. Thus, we can mitigate, at least, one impact of the drought. This is the reason that carbon credits exist: They allow us to invest in preserving carbon stock elsewhere and get benefits globally.

In the long-term, this just shows that we need to think more holistically about climate, nature and our impact on it. Now, at least, we have a better understanding of the role that trees play in regulating carbon. Hopefully that will help us better value the regenerative nature of forests and plan more effectively for future droughts.

Image credit: Pixabay

By Nicole Neghaiwi

Overcoming decades of hostility, Iran and six nations led by the United States reached an historic accord this month to limit Tehran’s nuclear ambitions in exchange for the lifting of economic sanctions. The deal has sparked significant debate amongst supporters and opponents alike, who question the impact the agreement might have on the region’s stability and future relations with the West. But the deal may also offer a surprising boost to the international divestment campaign, a growing social movement that seeks to persuade investors to sell their stocks in fossil fuel companies.

With an estimated production capacity of roughly 3.5 million barrels a day, the lifting of economic sanctions against Iran opens the way for a flood of new oil to hit global markets -- this at a time when production is already estimated to exceed demand by approximately 2 million barrels. Spurred by fears over falling oil prices, investors responded to the news by selling their futures in crude, causing prices to slump to their lowest in three months within days of the announcement.

The slump will likely spark renewed calls from divestment campaigners, who have long cited price volatility in the fossil fuel markets as an argument for divestment. Since 2013, environmental organizations like the Carbon Tracker Initiative have been pushing investors to consider the financial implications of the so-called carbon bubble on their long-term investments. The term refers to the risk that, if the world’s governments meet their agreed upon target of limiting global warming to 2 degrees Celsius, at least two-thirds of proven fossil fuel reserves would be rendered stranded.

But steep declines in oil and coal prices have strengthened the argument that the world may not need to wait for international governments to come to a global agreement before fossil fuel assets are rendered stranded. Over the past five years, U.S. coal prices have dropped nearly 76 percent due to a combination of stricter environmental regulations in the U.S., weakening demand from abroad and the introduction of cheap shale gas. During that same period, over 25 U.S. coal companies were forced into bankruptcy, including once major players like James River Coal and Patriot Coal Corp.

Environmental activists and financial experts alike have warned that depressed oil prices could render many current exploration projects worthless. Most easy-to-access oil wells like those in Iran have already been discovered and are under the control of national oil companies, forcing Western oil majors to look to increasingly unconventional sources such as tar sands, the Arctic, or politically challenging environments. This inevitably raises the costs of exploitation, further increasing the possibility that new oil resources could become stranded if prices continue to sink.

Already, some investors have started to advocate in favor of divestment not just as an ethical imperative but also as risk management measure. Earlier this year, the Government Pension Fund of Norway, the world’s largest sovereign wealth fund, announced its decision to sell off over US$8 billion of coal investments in 122 companies, marking the biggest divestment from coal in history. The decision was followed a month later by another divestment announcement by a major Norwegian pension fund and life insurance firm, Storebrand, which cited the fact that the stocks would soon become “financially worthless” as a major reason for its decision. Similarly, while not going so far as to specifically advocate for divestment, HSBC warned in a private report to its clients that there is "an increasing risk that fossil fuel companies could become economically non-viable."

“It is still a relatively fringe movement,” explained Max Horster, financial industry director at the South Pole Group, a company that works with investors to analyze climate change risks in their portfolios. “But we are seeing increasing interest from institutional investors, particularly pension funds and endowments, who worry about long-term financial risks associated with their holdings in fossil fuel companies. For many of our clients, divestment is also an opportunity to align their investment strategy with their underlying ethical values.”

Whether it aligns with their own ethical values or not, investors will need to reckon with an increasingly vocal divestment movement in the future. The recent wave of investors committing to sell their shares in coal companies may have been inspired by environmental concerns, but it was equally driven by financial concerns over declining coal prices. With cheap Iranian oil now threatening to flood the global market, western oil majors should take note. The rules of the game are changing.

Image credit: Pixabay

 

Nicole Neghaiwi is specialized in dynamic environmental, social and governance (ESG) risk analytics and metrics. Through her work, she provides key support to the financial industry in order to help them realize their carbon reduction goals. Nicole has sound experience in working with risk management as well as the assessment and optimization of the climate impact of investment portfolios. Nicole is a frequent speaker at leading industry events and conferences.

By Kevin Lawrence

Having recently read the report about Accenture scrapping its annual  performance review process and replacing it with something far more ‘fluid,' I find myself reaching for my skeptic’s hat.

I am not a fan of the ‘annual review’ but am skeptical as to the underlying drivers for this change in the large corporate sector.

One of the advantages of the performance review (if conducted well) has been the practice of managers having career and performance discussions with their team members, using what should be consistently and objectively applied measures.

What has always been an issue is the antipathy toward the amount of paperwork and preparation needed to undertake this significant bureaucratic task (and attitudes toward it) – especially in organizations where people seem to believe a manager can effectively manage more than eight direct reports. Historically in the corporate world (and the private sector) unless something has gone wrong and been immediately ‘managed by exception,' discussions about performance tend to be few and far between -- hence part of the rationale for some sort of annual review cycle, often with six monthly interim reviews, with which to make judgements about performance, contribution capability levels, skills shortages, potential, etcetera.

The rationale for the change at Accenture and other large corporates has been well stated, though I can’t help but wonder if the change will add any real value, for a number of reasons.

Communication issues

Taking away the annual and/or six monthly reviews will not resolve the underlying issue: A lot of managers seem to find it incredibly difficult to integrate iterative and objective, effective discussions about performance into their everyday dialogue with team members (regardless of seniority or professional status).

Yes, the paperwork and form-filling disappears (to a large extent) – but what we are left with is a group of managers who already find it challenging to talk honestly and objectively about individual contribution on a regular basis, being asked to do so ... on potentially an even more regular basis.

Is it really about resource?

I wonder if an underlying motivation (sure to be denied) in larger organizations for adopting this model is the freeing up of time and resource, not enhancing the performance-management and people-development process. In an organization of 1,000 people, where all employees have an annual and interim review, the time saving (if a rigorous process is utilized and assuming a 43-hour week) will be conservatively between 8,000 and 9,500 hours – that’s between 186 and 221 weeks of labor saving. In a company of 330,000 people, with just one review per annum, that must be in the region of 46,000 working weeks -- the equivalent of approximately 1,000 people. Sure, there will be some time spent on the new process, but I would imagine very little compared with the traditional one.

(I hope I’m wrong, and that this is a significant breakthrough in workplace management practices, rather than a way to free up resources, and because ‘we just can’t get the current process right’!  Only time will tell.)

Make people development a meaningful objective for managers

If I am correct, perhaps the issue is deeper than managers’ willingness or ability to have effective real-time (or the annual retrospective) performance management conversations with the people they have a duty of care for (for whatever reason).  That, seems to put the full onus on the manager and can easily give way to a ‘pull your socks up’ culture in which performance management is highly subjective and, in value terms, meaningless.

Managers, like most employees, tend to focus on what they are being measured against and/or rewarded for. Few organizations genuinely evaluate and focus on managers’ effectiveness in developing the talents of their people. This is far more than just counting the number of training hours that a manager has authorized and well beyond whether a manager has successfully groomed a successor.

It is about giving managers a meaningful objective that focuses their effort on facilitating the growth of the capabilities of all their people; and, making that objective just as important as ‘hitting the numbers.'  Unless organizations are serious about that, they can’t realistically expect their managers to give serious time, effort and energy to forward-looking performance management practices that are focused on growth rather than corrective performance management -- which is focused on actions in the ‘rear-view mirror.’ If senior management is not serious about making this change, then perhaps all those self-congratulatory “people are our most important asset” statements in annual reports should be erased.

Image credit: Flickr/Images Money

Kevin Lawrence is Managing Director at the Odyssey Group. He specializes in leadership and management development, change, executive team development and organizational development strategy.

By Darcy Hitchcock

Organizations usually go through phases when implementing sustainability practices. Understanding where your organization is in the process can help you foresee upcoming challenges and avoid overstating your progress (i.e., greenwashing).

Three phases of organizational sustainability

Phase	Sustainability 1.0: Eco-efficiencies & Risk Reduction	Sustainability 2.0: Competitive Advantage	Sustainability 3.0: Reinvention & Regeneration
Description of phase	Identify impacts of operations Reduce costs through eco-efficiencies	Integrate sustainability as an enabler of corporate strategy Use sustainability to inspire performance improvements and new products/services	Question the business model Reinvest in social, environmental and economic capital Determine your unique contribution to solutions to world problems
Typical actions	Reduce waste, water or energy through process improvements and green building practices Identify sustainability-related threats (eg, chemicals, labor issues, climate impacts)	Design a green product line or green up all offerings Collaborate with suppliers to be more sustainable Develop a long-term sustainability plan with metrics Produce a sustainability report	Identify serious local and/or global problems which could be addressed by your core competencies Re-imagine what business you’re in long-term. Develop a transition strategy.

 

Sustainability 1.0: Eco-efficiencies and risk reduction

The first phase, Sustainability 1.0, is mostly about cleaning up messes: reducing impacts, dealing with any public relations debacles and assessing risks. Nike, for example, got interested in sustainability after it was embarrassed by damning articles about the labor practices in its suppliers’ factories. Company management wanted to know what other problems might be flying under the radar. Sustainability gave Nike a lens to consider threats. While the current public relations problem was a social sustainability issue, the next would likely be environmental. The company began to see how everything was connected.

Most organizations, however, start pursuing sustainability simply to save money. They may not even realize they are doing projects related to sustainability. They think of it as trying to save energy, reduce waste and cut back on water. But this is an important foray into the field of sustainability. As they gain recognition about their efforts, their own self-image as environmentally-aware companies often spurs them on. In this phase, social issues often take a back seat—unless they were at the center of a public uproar—since environmental issues tend to be more tangible.

If you’re in this phase, be careful about going public about your sustainability efforts. Wait until you have more to show for it. That said, this is a good time to start reaching out to all of your suppliers and service providers. They often have more sustainable options to offer but the default, unfortunately, is usually to give their clients the business-as-usual, less-sustainable offerings unless you ask.

Sustainability 2.0: Competitive advantage

In Sustainability 2.0, sustainability becomes a source of competitive advantage and an enabler of other objectives: improved image, a source of innovation and improved shareholder value. A number of studies show that leaders in sustainability (environmental, social and governance) tend to better financial performance. In a 2013 report titled, Linking Climate Engagement to Financial Performance: An Investor’s Perspective, CDP (formerly the Carbon Disclosure Project) found that:

"… Superior climate engagement, as measured by the difference between Q1 industry leaders and Q5 industry laggards on CDP disclosure scores, portends a 'quality premium' equivalent to +5.2 percent return on equity; +18.1 percent cash flow stability and +1.6 percent dividend growth. Further, there is no observable valuation premium for Q1 industry leaders, presenting an attractive opportunity for investors: superior climate change engagement and superior profitability with negligible valuation premium."

In this phase, many organizations begin to focus on product design and market opportunities. If they had a greener product or service, would they attract a new market segment or uncover other opportunities for competitive advantage? Social issues filter into their consciousness. They start to tout themselves as ‘sustainable’ (without realizing that an organization can’t be fully sustainable in an unsustainable system.)

If your organization is in Sustainability 2.0, build a plan with full sustainability as the ultimate target. (We recommend the backcasting process associated with The Natural Step, a science-based sustainability framework.) Do not claim you’re a sustainable company, but instead speak honestly and publicly about what you’re doing as well as your challenges. Think carefully about how to roll out sustainability in your offerings: Do you want to have a sustainable line or will that only make your traditional products or services pale in comparison?

Sustainability 3.0: Reinvention and regeneration

At some point, though, organizations experience a major epiphany, realizing their efforts within their existing business model are clearly never going to be enough to achieve full sustainability. Think of Interface's late Ray Anderson and his 'spear through the chest' when he realized what his company did (making carpet from oil) should be illegal.

Sustainability 3.0 involves challenging the business model and taking responsibility for a serious world or community problem that an organization is well positioned to help solve. Organizations in this third phase broaden their focus from just serving customers (making quality products and services) to solving the serious challenges (social, economic and/or environmental) in the larger community (local or global).

It was always energizing to help our clients begin to envision their role in Sustainability 3.0. Marsha Willard, my former business partner, was facilitating our sustainability planning process with an engineering firm that specialized in waste water treatment facilities. When the engineers examined the impact of their services, they got into a conversation about the natural water cycle, which has nothing to do with funneling water through concrete pipes to a centralized facility. There was a moment when they realized that their approach to their core service was unnatural and unsustainable. What if people didn’t need pipes and pumps and waste water treatment facilities? Their entire body of work would go away! They’d be out of business!

After a stunned silence, the engineers broke through the limitations of their existing business model. They decided to develop expertise around on-site treatment technology that would more closely mimic nature. They knew that demand for their existing services would not disappear overnight, but this gave our client an insight into a more sustainable business model that they could evolve into. This insight put them ahead of their competitors, a powerful differentiation.

If you’re approaching Sustainability 3.0, it can be unnerving. But it’s always better to foresee the need to evolve your business model rather than to get blind-sided by a disruptive technology. In my experience, employees already know they’re in an unsustainable industry. They may feel trapped, needing to make a living but feeling a bit guilty about their work. Talking about these issues openly can unleash excitement and innovation. These steps may help:

1. Describe your core competencies in simple terms, something a fifth-grader would understand. (For example, oil companies know how to drill really long holes to precise geologic formations.)


2. Brainstorm how those competencies might be used to enable sustainability rather than undermine it. (For example, oil companies could build expertise in geothermal energy.)


3. Once you get those ah-ha’s, build a realistic long-term strategy to get there.

This article was adapted from "Great Work: 12 Principles for Your Work Life and Life's Work."

Images courtesy of the author

Darcy Hitchcock is the author of a number of award-winning business books including "The Business Guide to Sustainability" (now in its third edition). In her latest book, "GREAT WORK: 12 Principles for your Work Life and Life’s Work," Darcy shares what she has learned about finding a calling, making a difference and leading organizations. It’s available in print and also three e-books: "Finding Your GREAT WORK," "Designing Organizations for GREAT WORK," and "Leading Others to GREAT WORK." Learn more at Darcy.Hitchcock.wordpress.com.

By Rachel Odenweller

From their the love of the outdoors and a dream to create a more sustainable world, Warren Neilson and Joel Cesare created StokeShare: a marketplace that allows you to experience any outdoor activity you can think of without the expensive cost of gear.

I had the pleasure of sitting down with Neilson to talk about how StokeShare came about, as well as his goals for the future. When most business-minded people are focused on how to get the most return, Neilson has a genuine desire and passion for empowering people to protect the outdoors.

He and his business partner recently hosted an event with the LAPD to teach at-risk youth to surf, an opportunity they may have never gotten otherwise. His philosophy is: “People protect what they love, love what they know, and they know what they experience.” Not only was his laid-back attitude refreshing, but it was also  inspiring. He shows us all how you can use your passion to create a business to share what you love with the public.

Rachel Odenweller: First off, I want to hear from the horse's mouth how the idea of StokeShare came about.

Warren Neilson: My background is in sustainable consulting. I work for a firm where we help buildings and companies reduce their environmental impact. My business partner, Joel [Cesare], does the same thing. We both have a passion for the environment and for doing the right thing, and we’ve dedicated our careers to making that happen.

We met in San Francisco, through colleagues; I was previously living in Sydney, Australia, for several years and Joel was in Santa Barbara. We went out to surf a couple times, and one time we were in the lineup and we started talking about how we wanted to go spearfishing, in particular, but neither of us had the gear or knew someone who did. We knew that someone in the city had to have a spear gun and the gear, knew just where to go, what the best spot was and the best time of day. So, we said, "Okay, we have this problem that we need to find a solution for." So, that’s how StokeShare sort of began.

RO: I’m interested, did you choose San Francisco because it’s just a tech-centric city or were there other reasons for that?

WN: I moved to SF from Sydney because I was planning on moving back to the states. When I knew I was coming back to the U.S., I knew it had to be California, and without a doubt it had to be on the coast. I knew I wanted to be at the forefront of sustainability and the environmental movement, and that is San Francisco.

RO: So, how did you come across Near Me, and why did you choose our platform to bring your brainchild to life?

WN: Part of what you do when you’re trying to start a business is you try to focus on your skill-set and really leverage that with each person on your team. Also, understand your weaknesses early on, and neither Joel nor I are coders or developers or extremely savvy in that world; it’s not the world we come from. We spent some time online to find a partner that we could work with, and that’s when we found Near Me. Near Me was the only one that we felt was actually a partner versus a subcontractor. We knew if we really wanted to dive into the deep water and make this happen we needed a partner; we needed someone that was in it with us for the long-haul, and that was going to help us succeed.

RO: What advice would you give people on how to build a successful marketplace?

WN: We’re much less interested in the personal financial impact of the company, and we’re far more interested in the wide array of positive impacts on the world. It’s an audacious thing to say, but that is the viewpoint we’re taking. We’re really trying to leave a mark and change the world and make it a better place.

I feel like the successful business leaders moving forward will be trying to make the world a better place, not just trying to make their lives better. So, I guess what I’d tell people is to follow their passion and not worry about the rest so much because it will all come together.

RO: I think this sets you apart from the pack: You don’t come off as someone who is money-driven, which turns people off a little bit, so I think people will really pick up on that.

WN: Thanks, I really appreciate that. Joel and I are calling it our hidden agenda, which is not to say that creating this marketplace and connecting people with the outdoors is absolutely what we’re trying to do, but we really want to protect the outdoors as much as we can. It’s our playground; we want to protect the wild places that we like to play in.

We feel that people protect what they love, love what they know, and they know what they experience. So, in order to really get a larger mindset of protecting these wild places that we love, is actually getting people to experience them. We’re building a nonprofit that’s an arm of StokeShare, where we can bring in underprivileged kids out camping and surfing and kayaking to experience places that they wouldn’t have access to if it weren’t for StokeShare, and the people that list their gear on the site.

Image credits: 1) Flickr/David Cobbin 2) StokeShare

Rachel Odenweller is a marketing intern for the Near Me Blog.