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treeniesg · 2 years

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The Lorax is back!! Speaking on behalf of Biodiversity

For all those who have read the book by Dr. Seuss “The Lorax” to their children know the heartfelt message this book brings. For those who are not familiar with this book – it chronicles the plight of the environment personified by “the Lorax”, who speaks for the trees against the industry, personified by “Once-Ler”. This fable is relevant even more today as corporate greed poses a danger to the environment and society at large.

Says the Once-ler to the Lorax who spoke on behalf of the trees and animals who can’t speak:

And then I got mad

I got terribly mad.

I yelled at the Lorax, “Now listen here, Dad!”

All you do is yap-yap and say, “Bad! Bad! Bad! Bad!”

Well, I have my rights, sir, and I’m telling you

I intend to go on doing just what I do!

And, for your information, you Lorax, I’m figgering on biggering

and BIGGERING

turning MORE Truffula Trees into Thneeds

which everyone, EVERYONE, EVERYONE needs!”

Fourth edition of the Treeni Sustainability for breakfast hosted by Tata Motors at their Worli, Mumbai office on 4th September was on “Importance of Biodiversity and the role of Industry” began with the book reading of “The Lorax”.

Ecosystem and biodiversity loss is linked closely to climate change. The close linkage is symbiotic as Biodiversity loss hastens climate change, and climate change impacts biodiversity loss. Arvind Bodhankar, Corporate Head- Health Safety Environment & Sustainability, Tata Motors, said, “Biodiversity management has become an imperative today, if we have to mitigate the impact of climate change and keep the global temperature rise below 2 degrees Celsius. Large business houses will have to play a major role and support MSME (Micro, Small & Medium Enterprises) sector.” “Biodiversity management has become an imperative today, if we have to mitigate the impact of climate change and keep the global temperature rise below 2 degrees Celsius. Large business houses will have to play a major role and support MSME (Micro, Small & Medium Enterprises) sector.”

The key learnings from this interesting S4B event was:

Is biodiversity a material issue for my enterprise?

If you are a company with large landholdings especially in climate vulnerable areas – biodiversity is a material issue from the sustenance of your operations.

If your company with requires resources drawn directly from flora and fauna such as food, cosmetics and pharma sectors biodiversity is core your supply chain vulnerability.

If your company’s operations have direct impact on air, noise, soil, water and are operate in the vicinity of sensitive sites such as national parks, protected areas and biodiversity hotspots then it is a material issue for you.

Beyond boundary for biodiversity conservation

TCS has demonstrated that though their operations do not have a direct negative impact on biodiversity, they can contribute positively to biodiversity through creation of oasis in midst of urban chaos. The incredible work of TCS on protecting the olive ridley turtles showcases how biodiversity project can lead to deeper employee engagement and societal job creation. The value of such work goes much beyond the boundary of the organisation and stands out like a beacon is an ocean.

Natural ecosystem service

Foresight of Sumant Moolgaonkar created an oasis at Tata motors Pune, which was a scrubby baren land and is now a haven of greenery a natural wetland habitat of 245 acres amidst rapidly expanded Pune. It attracts 150 species of birds and 60 types of butterflies. The habitat was planned at the same time as the manufacturing facility. A dam was constructed to conserve rainwater ensures year-round water availability for Tata Motors and sustains the green cover. This oasis also acts as a natural oxygen generator and safe haven for migratory birds. This provides two vital ecosystem services of clean air and sustained water availability. Conservation efforts by the Tata’s are exemplary and here a list of initiatives by various Tata companies. Godrej that owns the mangrove forest spread across several hundreds of acres in the eastern suburbs of Mumbai. The three vital ecosystem services provided by the mangroves are carbon sequestration, clean air, and protect the coastline from inundation apart from many other services.

How can biodiversity preservation become a part of our culture again?

Indian customs have traditionally worshipped nature and living in harmony has been part of Indian tradition. However lately widespread disregard for nature by young and old alike due to use of disposable plastics, use of POP idols in festivals, noise pollution, thoughtless killing of snakes in townships & farms, fertilizers & human sewage in water bodies and garbage burning etc., have led to air, noise, and water pollution. The role of the citizen and how we can rally for our green spaces, rivers and water bodies, has the potential for transforming our lives and urban and rural spaces. The need for the hour is cultural transformation where we are back in touch with nature. Lately corporate landholdings and green spaces have been opened up for nature walks such as in Godrej with the Soonabai Pirojsha Godrej Marine Ecology Centre. Active citizenry also means establishment of a new breed of citizen scientists who can contribute to efforts of ecologists in terms of bird/animal spotting in various localities. Understanding how human affluence and greed impacts biodiversity and inculcating a culture of protecting our natural habitat is the need of our times. One great example of how such a culture of protectionism helped in saving the whale sharks along the coast of Gujrat is documented in this wonderful movie called the Shores of Silence.

How can Technology be leveraged to enable biodiversity efforts?

Technology is all pervasive and without making it an ally business will be caught in the backfoot. Increasingly Geographical Information Systems(GIS) and drones are being used in context of biodiversity. GIS applications allow mapped data collection, scenario creation and predictions, understanding impact in geospatial context affecting landcover, forests, and human habitats.

GIS: Business’s today have several free GIS repositories at their disposal.

One such free resource is the Atlas of Global Conservation by the Nature Conservancy. It is a fabulous resource for understanding biological diversity. Scientists have divided up the world into more than 1,000 ecoregions and analysed how they compare across dozens of measures. TNC’s atlas offers dozens and dozens of layers of geographic information by terrestrial, freshwater, and marine ecoregion. Dozens of biodiversity metrics can be viewed in this atlas

Another free resource is Global Forest Watch. This WRI initiative uses the most advanced satellite data and crowd-sourced information to track deforestation throughout the world in near-real-time. Global Forest Watch offers the latest data, technology and tools that empower people everywhere to better protect forests.

The India Biodiversity portal has a unique repository of information on India's biodiversity. The Portal aims to provide open and free access to biodiversity information. The portal enables widespread participation by all citizens in contributing to and accessing information on Indian biodiversity.

Drones: Are emerging as a valuable tool for biodiversity conservation. These unmanned vehicles can help monitor protected areas, collect data in inaccessible regions, and even deter poachers and plant trees. In a unique initiative in Burma drones were used for mangrove plantations. First, drones flying 100 meters (328 ft) above the ground take highly detailed, 3D images of the land while sensors record information such as soil type, soil quality and moisture. The data is then used to create a planting pattern, pinpointing the best spots and species to plant in each location. Then a drone uploaded with the mapping information flies 2 meters above the ground, shooting biodegradable seed pods designed to enhance germination success. A drone carrying 300 seed pods can cover 1 hectare in 18 minutes

As mentioned by CEO of Treeni Ankush Patel, “The use of technology to track and monitor industry’s impact on bio diversity has enabled a process for the industry to ensure that a focus on biodiversity is a part of their business operations.” Sustainability performance management and collaboration platforms which enable enterprises to track their biodiversity indicators and share best practices within the organisation across sites are being increasingly used by corporates. In context of sharing platform, it’s worth mentioning about India Business Biodiversity Initiative, which is a business-led initiative which serves as a national platform for business, to promote sharing and learning, and will ultimately lead to mainstreaming sustainable management of biological diversity by business. IBBI was initiated by the Ministry of Environment, Forests and Climate Change (MoEFCC), Government of India, and is supported by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)

The pertinent message from this edition of the S4B event on Biodiversity is same as the message from the book, The Lorax, that “Unless someone like YOU cares a whole awful lot, nothing is going to get better. It’s not.” In this book “You’ signifies the new generation, but it is clear the going forward industries are the ones that will have a care a whole awful lot...and I was glad to see the exemplary work done by Godrej, Mahindra Susten, TCS.

Originally posted by - https://www.treeni.com/

#Biodiversity #Climate Change #Sustainability performance management

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treeniesg · 2 years

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Are Electric Vehicles the Answer to a Sustainable Future?

Solving the urban air pollution and GHG challenge

Urban air pollution and rising carbon footprints are the scourge of Indian cities. One of the key sources of urban air pollution is vehicular emission. In this context, the Indian government's green initiatives are indeed laudable. They deserve a pat on the back for biting the bullet and addressing environmental concerns with new -regulations, policies, frameworks, and audacious goals, especially when the US is backing out of their commitments to The Paris Climate Treaty. There are 3 government initiatives that standout:

The National Electric Mobility Mission Plan: India's National Electric Mobility Mission Plan targets 6 -7 million electric and hybrid vehicles in the country by 2020.

Government's FAME Scheme (Faster Adoption and Manufacturing of (Hybrid &) Electric Vehicles) provides financial support for technology development, creating manufacturing infrastructure and subsidies for purchase. FAME is valid till 2020, by when the government expects the hybrid and electric vehicles market to be self-sustaining.

GUTS scheme for low carbon transformation through unique financing aimed at government owned vehicles

But are Electric Vehicles (EVs) all they are made out to be in combating pollution? Have we looked far enough into the future to understand their long-term impact? Are there guidelines and regulations in place to ensure that this medicine has no adverse side effects? What are the mechanisms in place to help the automotive value chain to ramp up to supply components and parts for vehicles that do not have engines in the first place. What is in it for the end user? How affordable it is going to be. What is the life cycle emission of electric vehicle vs normal vehicles? Are electric vehicles charged with coal fired power environmentally sound?

To switch to EV or not!

There are many compelling reasons to make the switch and it is happening faster than you may think. Governments in France, England, Norway, Netherlands and India have committed to switching to EVs (Time scales vary – 2025 – 2040). Mayors of various major cities are determined to take steps to block diesel vehicles from cities.

No Tailpipe Emissions

The India government's proposed switch to EVs would reduce carbon emissions by 37% by 2030. EV rollout has to be for all types of vehicles plying on Indian roads. Carbon emissions apart – diesel and petrol are killers due to the fact it spews dangerous air pollutants. EVs have zero tailpipe emissions as compared to cars using fossil fuel, which release harmful air pollutants including carbon monoxide, nitrogen oxide and particulate matter. According to the World Health Organization, 13 of the top 20 global cities with highest air pollution are in India. With EVs in place cities will definitely be able to breathe easier. With cleaner grid energy EVs appear to be promising solution for urban environment.

The Silent Vehicle

EVs run more silently than their petrol or diesel counterparts. Switching to EVs would reduce noise pollution to a certain extent (if we Indians learn to stop blowing our horns!).

Safer?

EVs tend to have a lower centre of gravity than conventional vehicles. This makes EVs more stable and less likely to roll over. Also since they do not contain flammable fuel there is a lower risk of fire or explosion.

India's Dependency On Fossil Fuels

India’s oil import bill has been rising, and is pegged at Rs 4.7 lakh crore in 2016-17, 3% of GDP. India imports 80% of its crude oil needs, making it hugely dependent on global supplies and vulnerable to global shocks. India is the world's third largest oil importer and vehicles contribute one-third of its oil demand. Switching to electric vehicles would save the government $60 billion in imports by 2030.

Lighter On The Pocket!

Electric cars are a big advantage both in terms of running and maintenance. The price of electricity to charge and run an electric car is less than 25% of the cost of driving a petrol car for the same distance.

Moreover maintenance cost of electric vehicles is low because there are less moving parts than in a petrol or diesel vehicle. The only substantial cost is that of replacing batteries, after 8 to 12 years of running.

Downside or is it?

As clean as the power that charges it:

Unless clean energy is used as a source to charge electric vehicles, we will just be relocating atmospheric pollution from the place of use of vehicles to the place of power generation. As per Indian BS-IV emission standards, gasoline cars cannot emit more than 1 g Carbon Monoxide, 0.1 g Hydrocarbon and 0.08 g Nitrogen Oxide per running kilometre. But when we use thermal electricity to charge an electric vehicle apart from the mentioned pollutants we also end up releasing sulphur dioxide as the source for thermal electricity is coal.

“Electric vehicles are only as green as the energy sources used to charge them.”

YES Bank report prepared in association with The Energy and Resources Institute (TERI)

But thermal electricity generated to charge an electric car running 1 km, emits 0.44 g nitrogen oxide and 0.72 g sulphur dioxide. Hydrocarbon and Carbon Monoxide is not produced from coal powered plants as there is no incomplete combustion. Therefore, charging an electric car would create more nitrogen oxide than running a gasoline car, as well as produce harmful sulphur dioxide if the energy source is thermal power. 67% of India's energy is generated in thermal power plants, and 88% of thermal power is generated by highly polluting coal fired plants.

Change in energy mix and switch to cleaner fuel and air pollution control/mitigation is therefore is important consideration in fuelling the EV revolution

However, in terms of well to tank energy efficiency, calculations undertaken by the E2O community clearly show that:

A small electric car is more than 2.5 times efficient than an equivalent petrol car.

An electric SUV is more than 1.8 times efficient than an equivalent diesel SUV.

An electric scooter is more than 2 times efficient than an equivalent petrol scooter.

With renewable energy in the grid mix over a period of time the grid emissions are expected to reduce. However, the future of renewable energy in India presumably rests on achieving the ambitious solar power target set by the country. In its Intended Nationally Determined Contributions (INDC) under the Paris Agreement, India committed to increase the amount of electric power from clean energy resources to 40% by 2030. Electrification of the automobile industry will take the solar bet to the next level. It will at once help India tackle its oil import bill, secure its energy needs and cut down vehicular pollution. While one can argue about EVs causing displaced pollution one must bear in mind the nature of pollution source – point source air pollution control is relatively easier Therefore, India needs more ambitious and rapid distributed renewable energy RE adoption. There are examples of EV enthusiasts setting up solar charging stations (www.pluginindia.com), however these efforts are in pockets, and there needs to be focussed effort on the RE and non-RE-charging infrastructure from the government, as well as automotive majors such as Mahindra and Mahindra, Tata motors and companies like ABB and Tata Power.

Pressure on the Grid

Another concern was the charging of EV will put pressure on the grid – however did you know that is possible to set up EV charging stations on solar without touching the grid. Also, if you were to charge using the grid as I do– it is during night-time when the load is less and therefore does not have any impact on manufacturing or business activities.

Lithium mining Impact

Most mining operations are accompanied by various forms of environmental degradation. Lithium, a key component in batteries of electric vehicles, is typically found in salt flat regions with water paucity. Lithium mining uses large quantities of water as well as toxic chemicals for the leaching process. The result is further water scarcity in the region accompanied by water contamination. Nickel and Cobalt, mined for use in the production of lithium ion batteries, add additional environmental risks. To mitigate the negative impact and added focus on battery recycling is going to be critical.

Recycling Woes

Take back programs by car manufacturers will ensure high rates of recovery, besides providing opportunities for circularity. Recycling of used lithium-ion batteries is an uneconomical process. These batteries have a variety of metals and minerals in each battery cell, making it difficult and expensive to isolate and extract single elements. Without progressive regulation to ensure recycling, valuable metals and minerals will be lost in land-fills of non-recycled waste. Added efforts on setting up lithium ion recycling facilities will be required as well to provide end of use take back. In a recent movement ISRO and BHEL have tied up to develop low cost batteries for EVs and envision take back for such batteries! Bearing in mind that cost of Lithium ion batteries is coming down, and falling 8% per year: Total cost of battery per Km - (lifetime depreciation, interest, maintenance and charging of battery) compared to rising petrol costs and maintenance costs of petrol and diesel vehicles); innovative solutions like battery as a service, and initiatives such as ISRO and BHEL’s there seems to be solutions for some of the bottlenecks for EV adoption.

Battery swap too is the solution!

In 2014, while Indian electric vehicle manufacturer Gayam Motor Works (GMW) was designing and developing electric three-wheelers for a Japanese firm, they realised that key to electric vehicle adoption in India was to make charging as simple as going to a fuel station.

GMW India came up with battery as a service model! In the swapping model, the manufacturer owns the batteries and charges drivers for the service provided based on the usage. This model will help in keeping all Lithium Ion batteries as producer responsibility ensuring 100% recycling and recovery.

Electrified: Charged and surging ahead

The government's most important role in combating pollution and promoting sustainability is to rapidly ramp up power generation from clean sources and make electrical charging stations as popular and profitable as petrol and diesel ones. Without clean energy, EVs are as harmful to the environment as petrol and diesel vehicles, just in a different location (as the generation is happening elsewhere). However, over a period of time the grid power in India will be increasingly cleaner due to the focus on solar and wind. The International Solar Alliance established by India, is an alliance of 120 countries between the Tropics, is looking at massively ramping up solar. This movement is a pioneering movement in the right direction.

Overall EV married with clean energy opens a huge opportunity for innovation, job creation in context of clean power and EV (Total funding to private electric vehicle (EV) companies surged from under $200 million in 2013 to over $2 billion in 2016), cleaner air, and reduced carbon emission.

However, bearing in mind the pace of change, due thought must be given to pivoting the auto component value chain, recycling and take back setup, regulations to assure proper transportation and handling, recovery and take back of batteries, green charging infrastructure (both grid and off-grid), all of this would go a long way for a bright future for electric vehicles. India seems to have really stepped up to take leadership in EV, and appears fully charged for an electric future. This will truly put India at the top of global economies with not only aggressive, fast-paced growth, but also, one that reimagines sustainability to provide benefits to people, profits and the planet!

Originally Published by - https://www.treeni.com/

#environmental risks #carbon emissions #ESG Performance Management

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treeniesg · 2 years

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Role of Technology Solutions for Monitoring SDGs

On September 25th 2015, countries adopted a set of goals to end poverty, protect the planet, and ensure prosperity for all as part of a new sustainable development agenda. Each goal has specific targets to be achieved over the next 15 years. For the goals to be reached, everyone needs to do their part: governments, the private sector, civil society and individuals. The theme of ‘India and Sustainability Standards: International Dialogues & Conference (ISS 2016)’ 16th -18th November, 2016 at India Habitat Centre (IHC), New Delhi, revolves around the UN Sustainable Development Goals (SDGs) – especially around enterprises and their potential to contribute to these ambitious goals. Treeni Sustainability Solutions is a support partner for the ISS 2016 conference. We are a software product company and core to us is ‘resustain’ our sustainability data management and analytics platform is built by sustainability practitioners and architected on open technologies.

Technology enabling the achievement of Sustainable Development Goals will potentially be one of the most powerful drivers of change in modern economies going forward. The explosion of digital technologies and the shift towards sustainable development, both require us to rethink the nature of goods and services; both have the capacity to transform the relationship between governments, companies, consumers and the community. Sustainability technology will have to scale and accommodate a different data sources and formats, as well as functionality, ideally by a platform offering to monitor, track and measure key performance indicators (KPIs). From a strategic perspective, material issues and their associated key performance indicators need to be aligned to SDGs. Performance management in context of goals thereby become tied to measurable and quantifiable indicators.

While organizations across the globe are identifying material aspects/ topics and aligning to one or more SDG goals, it is important for organizations to prepare to monitor and measure KPIs across the value chain.

Foresight is the key to survival. Leadership and managers should be provided with technology and systems that help them perceive trends and weak signals, where others might only see noise or chaos. At Treeni we are capitalizing on this need and through our relentless pursuit for ‘reimagining sustainability’, we are finding innovative ways to help clients evolve in practicing sustainability the right way. We would like to highlight certain benefits of incorporating SDGs in a technology platform which we believe will bring in a paradigm shift in how businesses view Sustainability. Such technology solutions must have:

1. The ability to manage the entire inventory of 17 Goals and 169 indicators along with corresponding Business Themes as defined in the SDG Compass (https://sdgcompass.org/), which will direct a wide variety of stakeholders to track the performance of their initiatives & projects

2. Enable tracking and data modelling capabilities, but will help visualize the data around SDGs achieved based on the projects implemented

3. Map each SDG goal with the widely accepted frameworks & standards like GRI, SASB, CDP, DJSI, thus providing the organizations to interlink various frameworks against which they have been tracking progress

4. Further the platform should make report generation and communication of progress to all stakeholders easy, inbuilt functionality should generate insights and periodic reports that help organizations, investors, governments and wide variety of participants to assess risk & opportunities and act promptly

Originally posted by -

https://www.treeni.com/

#sustainability #Sustainability Solutions #sustainability strategy #sustainability reporting #sustainable supply chain

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treeniesg · 2 years

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Is India Ready for a Circular Economy Revolution?

It was an eventful day at the Mahindra & Mahindra “Waste to Wealth” Seminar, I was invited to speak about waste management best practices in 3 sectors – automotive, IT and hospitality. The audience from various group companies had folks with experience ranging from 3 months to 35 years! I felt I was in an ocean of practitioners who had a wealth of knowledge to share.

In my talk I introduced the concept of “circular economy” wherein the thrust is to move away from “Take, Make, Dump” to more restorative material and biological cycles that mimic how nature works. Circular models please the environmentalists as well as the economists, since it identifies new ways of doing business while reducing resource consumption. I cited examples from the Ellen MacArthur foundation and CE 100 companies.

What I learnt, from my visits and interactions with various industries which have adopted great housekeeping practices, process orientation, lean systems, or 5S and supplier engagement, is that they are on the threshold of a great circular economy revolution. However at present no industry in India has looked at true circularisation of its business. While waste management within the boundaries of the factory has been institutionalized, I would really like to outline what is required to circularise more broadly the Indian industry.

It is heartening to note that there exists an intention to explore the opportunity circularisation offers, however as with any new “concept” industry is wary of it. To understand what is circular economy, companies need to look at two key indicators - materials procured and wastes generated. Then identifying how one can drastically reduce its resource consumption by reconsidering its design, processes, reuse and repurpose. With this in mind I have outlined 5 major areas where companies can initiate steps in circularisation of their business operations thereby leading to job creation and societal value.

1. Authorised vendors: Responsibility of the company does not end when waste is handed to an authorised pollution control board vendor. It is important that each company does not take consent of waste vendors at face value. Trace where your waste goes beyond company boundaries and whether the vendor has the required permits, processes and has done exactly what he has said to the waste taken from your site. That way your waste will not come back to bite you as in the example of Unilever and mercury dumping in Kodaikanal. Visit your waste vendor, request for their EHS audits, if required do the audit of their processes to be convinced that leakages are nil.

2. Recycled content: What I learnt through the day, as well as through numerous industry visits, most companies have integrated management systems and processes in place for waste minimisation and recovery. Indians being frugal (a virtue now disappearing) anything of value is recovered and sold – what companies need to do is to use more recycled content instead of virgin material. That way the closure of loop is ensured. Virgin material has higher embodied carbon! It definitely makes business sense to check how you can work with various dealers and write off your scrap against material obtained from the vendor. What needs to be done is to diligently measure and monitor this to increase recycled material in the product

3. Design: Waste in manufacturing primarily occurs due to process – there is huge potential for improvement in product design where all players across the value chain work on design improvisations which cut wastes. Products that are designed to last instead of designed to use and throw will be game-changers, there is a growing dissatisfaction with too much stuff and products that lose value in a very short time. Products can be reused, repurposed, upcycled after end of life instead of recycled. Great design and quality go hand and hand, products can be designed for the dump or planned obsolescence, and high quality well designed products last a lifetime and are handed down through generations!!

4. Regulations: India’s E-waste rules and plastic waste management rules are focusing on extended producer responsibility, but I have seen very little action by OEM producers on setting up collection and recovery mechanisms – this needs to be strengthened with guidance to companies to ensure that what the rules state are implemented.

5. Collaboration: One industry’s waste is another industry’s resource. Cross industry collaborations for purpose of managing its resources more effectively in local as well as scalable fashion is need of the hour. Waste exchange platforms can be strengthened, we are already seeing such platforms in India. In real terms collaboration is also about networking to find out synergistic progress areas for diverse industries. Example of synergies between construction waste and road industry is well known. One well known case of collaboration is co-processing of high calorific value hazardous wastes in cement industry furnaces. Geocycle initiative of the Lafarge group is housed at ACC plant in Thane and provides solutions for many industries. We need more such options which are viable and familiar to industries.

In my view Indian Industry is poised to take a leap in exploring this new thinking. I say this based on the fact that as Indians, who used to hold dear everything of value, as opposed to what we has now become “take make dump” economy, it’s time to mimic natural cycles of circularity and give nature its due. What is needed is leadership commitment, strategic thinking and reassessment of business models.

Originally Published by - https://www.treeni.com/

#Circular Economy Revolution #ESG #ESG risk and performance management #ESG Performance Management

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treeniesg · 2 years

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Climate Change & New Business

Climate change has been identified as the top global risk in Global Risk Report 2016 by World Economic Forum. Failure to mitigate and adapt to climate change is closely linked to natural catastrophes, extreme weather events, water and food crisis which in turn will result in large scale social migration and social instability. Without ensuring growth in employment rate, protection of labour and human rights, social inclusion and responsible economic growth, low-carbon economy will not be enough to mitigate long-term risks and ensure the long term survival of the human race.

With Paris agreement being ratified, by more than 55 countries that contribute more than 55% of global carbon emissions, effective from 4th November 2016, we can expect new mechanisms and understanding of co-operations among different countries. These new mechanisms should not only strive for zero carbon or carbon neutral economy but provide a path-way for holistic green economic growth.

The INDCs (Intended Nationally Determined Contributions) submitted by each of the countries are to be reviewed every 5 years. Each government will create strategies to achieve the INDC targets and the target will be broken down to industrial sectors and subsequently to different enterprises. New business strategies need to be created, to analyse the anticipated macro-economic changes in political, economic, social, technological, environmental and legal scenarios due to climate change agreement:

Political: New standards related to increase in renewable energy generation and procurement, usage of renewable material, increased energy efficiency and operational efficiency is expected. The policies should strive for low-carbon not only in direct carbon emissions but also ensure carbon reduction in all phases from cradle to grave. Automotive industry shall need more investments in electric vehicle due to air pollution regulatory requirements. In India, as per Electricity tariff policy 2016, renewable purchase obligations (RPO) have been increased from 3% by 2019 to 8% by 2022 and all states are given targets on solar power implementation. Ten of the large corporates in India are entering into direct power purchase agreement with renewable power producers such as Re-New Power, CleanMax and First Solar.

Economic: Due to the change in political environment, the economic environment is bound to react to climate change. Investment in renewable energy generation, low-carbon technologies, efficient technologies and mass transit systems is likely to increase. It is to be expected that economic environment shall be more conducive to investment in these areas. Carbon markets in different regions shall see a boost, and taxes on use of fossil fuel may be introduced and implemented. Luxembourg Stock Exchange has introduced the world’s first exchange which is to trade only green securities and it predicts issuing $71.8 billion climate friendly bonds in the year 2016.

Social-cultural: Social inclusion is critical in successful mitigation and adaptation of climate change. Social pressure for low carbon product and sustainable product is constantly increasing and will continue to increase. A climate change conscious society will lead to more scrutiny of the enterprises, as well as governments on the issues related to climate change including social, environmental and technological sustainability. In early 2016, hundreds of activists protested to stop the exploration of oil and gas field in Utah followed by protest against fossil fuel exploration at Wyoming. With increased social vigilance on climate change, increased flow of interested talents and social awareness on health issues related to climate change is also expected.

Technology: All sectors shall have to increase R&D for new low carbon and energy saving technologies to meet the low carbon goal. New business models, such as circular economy and shared economy, will be used by various industries for resource optimization, recycle and reuse, thereby reducing ultimate carbon footprint. ‘Internet of Things’ enabled digital platforms will also increase, and enable overall resource optimization and improving efficiency through real time information. Auto giants like Ford and General Motors have already invested in sharing economy. Followed by GM’s investment of $500 million in Lyft, GM plans to deploy its own self-driving cars within Lyft’s ride-sharing service in the future, according to GM’s CEO.

Environment: Understanding overall environmental impact, other than carbon emissions, of the product is also necessary for ensuring environmental sustainability. For example, nuclear power generated electricity has carbon emission factor almost equal to renewable energy, and the average lifecycle GHG emission is 29 tCO2/GWh, however, the acceptance and usage of nuclear power for reducing GHG emissions from power generation is debatable.

Forest degradation, pollution and waste generation has direct impact on climate change. The policies and standards around environmental issues such as air pollution, afforestation and reforestation and waste management will be strengthened. CAMPA (Compensatory Afforestation Management and Planning Authority) has been implemented at national and state level in India in 2016 to compensate for the diversion of forest.

Legal: Increased enforcement in implementation of rules and regulations are likely. Due to the policy changes and resulting implementation of policy, regulations around energy, waste management and pollution will be tightened to meet the long-term goal of climate change mitigation and adaptation. Strong implementation of penalty structure for failure to meet the stipulated regulations is likely. The upcoming Law, Justice and Development Week at Washington DC, from 5 – 9 December 2016, having the theme of ‘Law, Climate Change and Development’ will play an important role in development of legal and regulatory framework to achieve target from the Paris agreement.

Understanding and analysing the macro-economic changes anticipated due to the climate change agreement will provide enterprises an advantage in adjusting to the upcoming changes in the economy. Digital platforms, enabled with ESG related big-data and data management, will help companies to stay ahead of the curve during the time of transition.

Originally Published by - https://www.treeni.com/

#ESG #ESG Performance Management #ESG Risk #ESG risk and performance management #esg data

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treeniesg · 2 years

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Is it time for ‘Reimagining Sustainability’?

Last week I met a good friend for breakfast, after that he was to spend the rest of the day in a leadership workshop with a global industrial enterprise, on business strategy, innovation and digital transformation. I asked him if he ever met executives that wanted to talk sustainability, sadly he responded that he rarely did. This reminded me of another conversation with a friend who was recently at WEF in Davos, representing a company respected for their ability to partner with innovative companies around key business initiatives. He had also shared that the CEOs he met at Davos didn't particularly want to talk about sustainability.

This got me thinking, people are fatigued with the endless talk of sustainability and the seemingly limited framework or are approaching it the wrong way. For most enterprises sustainability has meant energy efficiency programs and writing sustainability reports, reports that very few people read and care about. This process is effort intensive, manual, inefficient and frustrating for most people involved and leads to reporting fatigue. This is a poor way to engage with employees that are passionate about sustainability and does a disservice to their skills, time and intellect. Keep in mind that most of these employees are millennials, and understand more than anyone else what is happening around sustainability and care deeply that the company they work for is truly making an impact.

At the same time the sustainability landscape is changing rapidly, Post COP21 the world of sustainability is busy figuring out its implications. Some of the most well known business leaders including Paul Polman, Richard Branson, Michael Bloomberg are pushing global businesses to do more, they are talking about opportunities from sustainability, low costs solutions and the need to 'price carbon'. We Mean Business is driving a coalition of organizations to engage with some of the largest global businesses and investors to create a platform for businesses to discuss and plan the transition to a low carbon economy. The Ellen MacArthur Foundation is driving businesses to move from a linear economy to a circular economy, a transition that will create an economy that is restorative and regenerative by design.

Why then isn't sustainability a Boardroom conversation, is the time right for 'Reimagining Sustainability'. How do enterprises focus on real stuff, how can they get ahead of the curve and focus on what is really important and respond to changing market dynamics.

From my perspective one of the most important things an enterprise can do in terms of 'Reimagining Sustainability' is for leadership to step back and first consider what is most important to them. Every enterprise is unique, is it the Circular Economy, is it Societal Valuation, is it employee engagement or something else. Perhaps it's all three, in which case how can existing investments in enterprise resources - people, cloud applications, buildings, infrastructure, supply chain be aligned to what is most important. Where are the gaps, where do additional investments need to be made and what technology solutions need to be picked. How will this help you connect the dots and extract the essential data from across the enterprise and relevant external sources, build the big data and analytics to help make decisions, budget, plan, and launch transformational initiatives, who will lead these initiatives and identify the KPIs, that will help you tell all your stakeholders the impact you are having in the areas that are most important to you and them.

This will be competitive advantage going forward.

Originally Published by - https://www.treeni.com/

#Enterprise sustainability #sustainability #sustainability strategy #Sustainability reporting

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treeniesg · 2 years

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Sustainability Means Business

Investigating how sustainability directly impacts financial performance

Most decisions in business are directly or indirectly linked to the finances of the company. While many lines of business and business practices can easily be linked to the revenues and the bottom line, sustainability is a function that has a powerful effect on the long-term success of the business, but the benefits are not apparent in the short term. A substantial body of research from academic institutions like the University of Oxford and financial institutions like Deutsche Bank confirms that ESG factors are correlated with superior risk-adjusted returns and better operational & stock performance.

ESG considerations in investment valuations and assessments can be linked to the building of sustainable competitive advantage and a positive societal impact. ESG risks are broad-based and cover major aspects of business operations. They include risks related to climate change, environmental management practices, work and safety conditions, human rights, anti-bribery and anti-corruption practices, and compliance to relevant laws and regulations.

Stakeholders led by institutional investors are demanding transparency in the disclosure of sustainability performance alongside financial performance. Investors have demonstrated their need to understand the sustainability practices of a company before deploying any capital investments; this is seen in the large community of investors, including the Rockefeller Foundation, exiting fossil fuel based business and other unethical businesses over the past decade. More than 80% of 320 institutional investors surveyed by Ernst & Young agreed that “Companies have failed to consider ESG risks and opportunities as core to their business”, and 71% would reconsider or rule out investing in companies where there is a “lack of direct link between ESG initiatives and Business Strategy”. Stakeholders are increasing their focus on the way companies are assessing ESG risks and the related opportunity analysis and the financial impact of these risks, before making decisions on buy-outs and acquisitions. This pressure from stakeholders is driving sustainability into board rooms. The need for businesses to focus on sustainability is clear. It is no longer just a way to be a responsible, mindful brand, but a reliable method to identify and manage risks to the long-term viability of the business.

This change has made it crucial for the real time capture, management and analysis of ESG data to identify short, mid and long-term business risks. Technology intervention in sustainability has made it easier for companies to track and monitor sustainability parameters on a real time basis giving the much-needed business clarity to C-level executives of a company. ESG supports creation of lasting value for an organization. Long-term value creation is not possible for companies entangled with ESG controversies. One of the most compelling examples of ESG risk is the Deepwater Horizon explosion and oil spill in the Gulf of Mexico in 2010, which led to decline of share prices of BP by 50%. The total cost to BP considering fines and cleanup costs exceeded more than $50 billion. ESG is an important factor from an investment point of view. If things go wrong, the economic consequences can be devastating and leave a lasting impact on the stakeholders connected to the business, including investors, employees, and communities. At the same time, those organizations that can identify ESG Risks and view them as opportunities for sustainable competitive advantage will thrive over the long term.

With stakeholders now focused on ESG performance of companies and specifically on ESG risks, CFOs and Chief Risk Officers have started engaging and collaborating at a deeper level with sustainability teams in their companies. The hesitation of investors to deploy capital without ESG data, the business impact of ESG issues, and the alignment of sustainability and business performance has made it evident that sustainability practices of a company affect the bottom line. Or should we say, the triple bottom line. Originally Published by - https://www.treeni.com/

#ESG #ESG Risk #ESG risk and performance management #esg data #Enterprise sustainability #Sustainable supply chain management #sustainability

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treeniesg · 2 years

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The Road Towards Circular Economy

The concept of Circular Economy promises a new way of doing business. Such a framework provides very innovative perspectives to various industries. Currently it is a challenge. It may seem unattainable. But over a period of time, it can be seen as an emerging opportunity, as a secure and more profitable way of doing business, with the designs, biological and technological cycles sorted out. As the future unfolds, the circular economy appears to be a solution.

It is amply clear that the business success of tomorrow will come with only a focused & collective push towards a single goal. Across the world, community action has driven change, and it seems to be the case this time as well. Especially when it comes to sustainability, the entire value chain must be mobilized; from policy makers to business leaders, to the last person in the chain. We have already seen positive action through our S4B events, and we took the conversation on to a public platform to spark more discussion. Mr. Anirban Ghosh, Chief Sustainability Officer, Mahindra and Mahindra Ltd. and Ms. Namita Vikas, Group President & Global Head, Yes Bank helped us with this first step. Not only are they frontrunners in the field of sustainability, they are known to drive change at every step, through their organizations as well. The conversation has begun well. It is now our responsibility as a community to drive it to impact.

Originally Published by - https://www.treeni.com/

#sustainability strategy #Enterprise sustainability #Sustainable supply chain management #Sustainability Consulting Services

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treeniesg · 2 years

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Understanding E, S and G in the ESG Story

ESG as a concept is still evolving, hence understanding of ESG, i.e., Environment, Social, and Governance, is yet to occur. However, undoubtedly the past year has been disruptive and concerns around climate change and the environment have united us in more ways than one. COP26 was one such event that helped people to come together and protest about climate while putting the environment and sustainability on center stage. This in turn has led businesses to act with immediate actions; yet, there is a need for more action to be taken for major societal and global change. A growing number of listed conglomerates are incorporating ESG strategy within their annual report to track and illustrate corporate progress on key issues. We must still acknowledge the fact that it is no longer about the results of the bottom line. For the change to be more realistic, there needs to be a deeper understanding of the Environment, Social, and Governance. Businesses need to embrace ESG as a corporate initiative rather than just a box-ticking exercise.

“When sustainability is viewed as being a matter of survival for your business, I believe you can create massive change.” — Cameron Sinclair, Architect and CEO of the World changing Institute.

The above quote strongly emphasizes the need for businesses to give more importance to people, planet and prosperity. Also, the financial performance of ESG stocks has recently drawn investor attention.

So, what does ESG stand for?

The E in ESG - Environmental criteria: includes the actions taken by corporates or governments to mitigate climate change through activities that reduce greenhouse gas emissions, along with waste management and energy efficiency. Given renewed regulations to combat global warming, cutting emissions and decarbonizing have become more important.

S - Social criteria: includes human rights, supply chain labor standards, any exposure to illegal child labor, and more mundane issues like workplace health and safety. A social score also rises if a company is well integrated with its local community and therefore has a ‘social license’ to operate with consent.

G – Governance: refers to a system of rules or principles that define the rights, obligations, and expectations of various stakeholders. A well-defined corporate governance framework can be used to balance or align stakeholder interests, as well as to support the company's long-term goals.

We are facing a number of global challenges: climate change, transitioning from a linear economy to a circular one, supporting diversity and balancing economic needs with societal needs. Various stakeholders for example investors, regulators, as well as consumers and employees are now increasingly demanding that companies must also concentrate on natural and social capital along with financial capital. Also, more investors are incorporating ESG elements into their investment decisions.

In recent days, ESG is broadly thought of as a reporting framework, however, initially it was a framework developed for investors to evaluate companies' sustainability related disclosures and now with demand for ESG related information is rising, the ESG framework has become synonymous with reporting.

The US Business Roundtable released a press release in August 2019 strongly affirming businesses’ commitment to a broad range of stakeholders. ESG-oriented investing has experienced a significant rise and worldwide sustainable investment now tops $30 trillion—up 68 percent since 2014 and tenfold since 2004.

Indicators and Significance of E, S and G –

Graphical representation of the underlying Indicators within (a) the environmental domain; (b) the social domain; (c) the governance domain (ESG Indicators as Organizational Performance Goals: Do Rating Agencies Encourage a Holistic Approach? – MDPI)

Paper published by Mckinsey, 2019 shows that a strong environmental, social, and governance (ESG) proposition links to value creation and helps the companies to attract B2B and B2C customers with more sustainable products, also attracts the right talent inside the company who are passionate towards sustainable development. It further helps the companies in cost reduction, to achieve strategic freedom and avoid the regulatory and legal interventions. Also, a strong ESG proposition helps in better and responsible allocation of capital for the long-term (e.g. More sustainable plant and equipment) that benefits in investment and asset optimization.

Conclusion –

Once your company has determined the relevant criteria for its ESG framework, next steps are to establish metrics, monitor and measure them on a regular basis and share the progress publicly, otherwise, companies will be accused of "greenwashing." And greenwashing is going to become harder to get away with, as many institutions are increasingly calling for companies to file CSR and Sustainability reports.

Investors have a number of tools or criterions to determine whether companies are greenwashing or thoroughly integrating ESG policies in their business activities. Companies that are committed to executing their ESG policies will inculcate this aspect in their core values, and they voluntarily disclose their ESG goals, and more importantly they will communicate the same to all stakeholders via the annual report/sustainability reports, internal corporate communications, etc.

-Suhas works as a client relationship executive and is a part of the sales department at Treeni.

Originally Published by - https://www.treeni.com/

#ESG #ESG strategy #ESG Risk #ESG risk and performance management #esg data

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treeniesg · 2 years

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Lets Make Sustainability An Attitude, Not Just a Function

Sustainability needs to come from inside the heart and soul of a company, and not just a forced reporting function

It is true that sustainability reporting has become increasingly prevalent amongst Indian companies. While the top 100 listed companies, as per market cap, are mandated to, under section 32(2)(f), to include a business responsibility report in their annual reports by SEBI, there are companies voluntarily reporting on sustainability due to pressure from their stakeholders and global customers. It is great to see the increase in awareness of sustainability reporting amongst Indian companies, but isn’t reporting only a functional task, and shouldn’t the more important and imperative need be the focus of companies on sustainability?

Even SMEs and mid-size companies are understanding the need for sustainable reporting owing to stakeholder and customer pressures, but for the true impact of a sustainable approach, it is not the reporting which is key, but the approach towards a sustainable future. A sustainable future for people, planet, and profit! Apart from playing a risk management function and serve as a demonstration of responsible practices, sustainability can unlock new opportunities and result in cost savings. Reports show that 41% of the companies truly embracing sustainability achieve key cost savings, and more importantly, embracing sustainability has fueled innovation in companies to unlock new business opportunities.

Sustainability reporting encapsulates any company’s economic, environmental and social impact through the running of its business. But before we report, we need to implement sustainability. Only if sustainability is an attitude and embraced at the highest levels of any company will it deliver social, environmental and business impact and results. If it is a mere functionary measure, it will only remain as an annexure to most annual reports, without getting the focus it deserves. When sustainability is only a response to regulatory pressures, customer needs and activist stakeholders, we will never be able to unlock the potential and impact sustainability can have. It is evident that while sustainability reporting is growing, the same cannot be said for a sustainable approach of companies. If we take a closer looks at the business responsibility reports submitted by companies in their annual reports, there are key indicators that many are doing it only because they have to, not necessarily because they believe in it. Many reports address materiality and its impact in their responsibility reports, but only a few define it for their company, sector and stakeholders. The reports are filled with strategic priorities and initiatives for sustainability, but are missing timelines for the roll out of these activities. Any business leader would never accept any plan without a timeline for its implementation, they why do business leaders often turn a blind eye to the lack of timelines in their business responsibility reports. These observations, amongst others, make a strong case that sustainability, majorly, is still just a tick on a company’s To Do List rather than a truly integral part of their business and vision.

This is not to say that there are not companies, which truly embrace, and give the importance sustainability deserves, but they are unfortunately a minority. Companies such as Godrej, Mahindras, TATAs, Wipro, Infosys etc. truly understand the meaning of sustainability, but there needs to many more for a paradigm change to be seen in the approach towards sustainability of Indian businesses. 90% of the businesses are SME/mid-size, but it is important for the larger MNCs and conglomerates to set the right example for the Indian business environment they lead. Sustainability needs to be at the heart and soul of the company, and then only, will it be able to deliver the true impact it is capable of. It is time that we as, Indian businesses, look beyond mere reporting, and focus on action. A focus to embrace and reimagine what sustainability really means and the long-term positive impact it can provide, if taken forward as an attitude not just a function.

Originally posted by - https://www.treeni.com/

#Sustainability reporting #Sustainability #ESG #Enterprise sustainability

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treeniesg · 2 years

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ESG: From Business Necessity to a Business Barometer

In today’s world, the dynamics of everything around us, right from our ideologies and socio-political systems, to weather patterns, melting ice caps and rising sea level, rapid advancement in technology are evolving at a lightning speed. This has also translated into the rising global socio-political instability and the way businesses respond to the same. Considering how these transformations are forcing us to respond, ESG (Environmental Social and Governance) investment has become imperative. It is essential for businesses to focus on ESG for a sustainable future and long-term impact.

ESG has gained popularity in recent years, and this has enabled investors to assess the organisations they are investing in even further. These assessments are based on the present risks that these companies face and take future opportunities into consideration. Businesses simply cannot ignore ESG, and it blends perfectly with the increased environmental and social awareness, be it climate change, societal issues, or deforestation. In some case important stakeholders are also joining hands and responding, to ensure a better future for coming generations. A recent example is the European Union joining hands and working on a framework collectively that will coordinate efforts towards socially responsible investment.

The evolution of ESG has come about as corporates move to include sustainability in their attitude and thinking. Being sustainable on the environmental, social and governance front means that companies are securing the long term by addressing ESG Risks. By allocating funds to companies with impressive ESG scores, investors are motivating businesses not only have a positive impact on the society and environment but also perform well on the financial front. According to John Duncan, Head of Responsible Investment, Old Mutual, “Businesses that respond to the ESG challenge earlier than their peers show stronger resource efficiency, lower cost of capital, better staff retention, a more robust social license to operate, and better labour relations. These factors combine to produce a stronger competitive advantage, and consequently, higher valuations in the market.”

Increasingly Oil & Gas companies are repositioning themselves as ‘energy’ companies and touting their ‘renewable’ focus, they are still likely to get into trouble. Investors, thus, are either pressing for greater transparency while operating in this sector or moving away. Exxon Mobil and BP are the laggards who have witnessed plunging stock prices due to lack of focus and transparency around ESG. In the year 2017, the majority of Exxon Mobil shareholders consistently insisted on ESG disclosures which the company failed to comply, would Exxon Mobil shares have done better if they had acknowledged this broader shareholder shift. ESG Risks are not just relevant to fossil fuel-centric industries, the F&B industry is also being impacted. According to a news report in Morning Star UK in March 2018, Coca-cola has a low score on ESG due to its high spending on lobbying. A Sustainalytics report also suggests that excessive sugar intake is hazardous and corroborated by shifts in the consumer’s preference and consumption.

While many businesses are lagging, others have proactively embraced positive change and doing phenomenally well on ESG risk disclosures. A recent report by CDP said that 120 organisations including Danone, Infosys, Wipro, Klabin and Microsoft received an ‘A’ grade for their actions on climate change. Other global companies have also left a positive impact on all three categories of climate change, water security and deforestation. This can also act as an inspiration for other organisations to take care of the ecology that we are intimately entwined in. A recent report by IPCC suggests that the next decade is going to be crucial environmentally, and corporates can be the real change makers to bring about economic and ecological stability.

As urgency increases, and immediate action to implement ESGs is apparent. 2019 has already defining changing trends in ESG reporting. While a wide variety of issues have been covered, the end goal remains the same: Acting today can make a difference tomorrow. MSCI Research LLC reports that China has already begun a global war on banning 24 kinds of solid waste exporting countries. For decades, China was a major polluter due to improper handling and treatment of waste, and also the global leader in waste import. But looking at the current environmental conditions, it took the bull by its horns to clean up the mess. This has sent a shockwave throughout the world. Countries exporting solid waste are scrambling to devise innovative solutions and policies to reduce plastic and other non-degradable waste.

F&B organizations who rely on plastic as a primary component for packaging have also been affected by this. Sustainable packaging solutions in F&B are opening new doors to disruptive innovation, and winners are sure to emerge. Packaging through bio-degradable material is only one example. According to the MSCI ACWI index, companies with innovative paper-based packing have witnessed a steady growth in revenue as compared to companies in plastic packaging. Such solutions have also garnered the attention of investors all around the world. Another important trend of 2019 so far is that regulatory development around ESG investment will escalate as compared to ESG disclosures. The narrow and thematic point of view approach towards ESG investments or theme-style offerings won’t be available anymore. This year will focus on measuring the roles of investors as well as approach ESG holistically as an investment related risk.

The big data revolution has taken the world by storm, and the ESG investment domain has greatly benefited through this revolution. Investors are emphasizing on data patterns /data signals as compared to just data proliferation. New data sources have facilitated the understanding of investors portfolios and factors driving their performance. Big data has helped investors to understand the companies’ performances and their latent & future risks as compared to voluntary corporate disclosure. But data alone is not going to answer all these questions, to go deeper into this understanding, investors should be able to extract and understand relevant signals from the data.

Some investors focus on understanding and identifying ESG risks and opportunities, while others focus on the impact companies have on society and the environment. Tech solutions that deploy AI are also making it easier for investors to find complex patterns in ESG data and leading to a better understanding of organisational performance.

The discussion above is just the tip of an iceberg. The current social and environmental conditions we live under are not favourable for the long-term sustainability of humankind Strengthening ESG frameworks and integrating innovative investment metrics along with technology is going to be the key to a sustainable future. Corporates and investors have the power to turn the situation around and make ESG not just a business necessity but a business barometer.

Originally posted by - https://www.treeni.com/

#ESG Performance Management #ESG RISK #ESG Data #ESG risk and performance management

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treeniesg · 2 years

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Building Responsible Supply Chain

Supply chains are highly diverse and crucial to the success of businesses as a source of value creation and innovation. Socially responsible supply chains seek to combine both financial return and social good that creates the need for investors to make strategic decisions beyond financial logic and accept responsibility to protect human rights and the environment through all phases of their value chain, including manufacturing and outsourcing. The COVID pandemic has imitated the risks that are associated with diverse and complex supply chains. According to Dun & Bradstreet report, 938 of the Fortune 1000 companies have a tier 1 or tier 2 suppliers so it did not come as a shock that as the pandemic crisis deepened and nations begun instituting lockdowns, supply chains started experiencing a systemic demand shock that stemmed from weaknesses in their sourcing strategies.

The pandemic has tested companies on their operations and highlighted the importance of formulating an action plan for ESG practices, which needs to be integrated within corporate values and disclose supply chain information beyond stand-alone reporting mechanisms to provide insights on constraints of multiple suppliers and get a clear picture of their sourced sub-assemblies. A study cited by Samantha White (2015) found that adopting a socially responsible supply chain led to a reduction in supply chain costs by 9% - 16%. In a recent report, the World Economic Forum found that a company can achieve 20% more product revenue and 15-30% more brand value by focusing on the social aspect of their supply chain. The report also found that emphasizing the importance of a socio-environmentally beneficial supply chain can lead to a reduction in carbon emissions by 13-22%.

Companies can build a responsible supply chain through-

The Long-Term Approach: Experts recommend aiming for long-term relationships with vendors, suppliers, contractors, and other members of the supply network. A longstanding collaborative partnership can encourage the supply chain to uphold standard codes of practice. The approach has successfully been demonstrated by big brands like Toyota and Nike.

Social Compliance Auditing: Investing in a good compliance audit can be key in tracking ethical supply networks. The audit must be conducted by trained industry specialists who can hold the supply chain to internationally employed standards. A strategy should also be in place to address any policy violations immediately. An excellent auditing strategy is currently in use by Patagonia, who uses a 4-fold social compliance auditing approach.

Ensuring Living Wages and Human Rights: Paying a living wage to workers throughout the supply network and ensuring no practice of child labor or other Human rights issuers is important for companies looking to improve social responsibility. A company can do so by establishing its own benchmarks or by collaborating with a consultancy to set one according to international standards.

Establish Ethical Standards: It is suggested that companies officially document their ethical standards, practices, and principles. The core principles must be simplified, emphasized and consistently complied with. Once made clear, companies should communicate the importance of their ethical supply chain with stakeholders and customers to increase transparency.

Environmental Responsibility: One of the last links to building a socially responsible supply chain is encouraging environmental stewardship. Encouraging participants in the supply chain to curb carbon emissions and reduce environmental footprints can increase the integrity of the network. This can be achieved by encouraging the use of renewable energy sources and using sustainable transport options. Suppliers should start disclosing their carbon and GHG footprints that can further help larger companies to understand their Scope 3 emissions.

Practice local sourcing: Local sourcing of raw materials adds as a mutual benefit to both the company and the supplier. For the company, it results in decreased transportation costs and less lead time, and for the local suppliers, it generated employment and improves the living conditions. Local sourcing of raw materials economically boosts the economic status of a country. COVID pandemic has highlighted the benefits of localized sourcing of goods and services.

Recent incidences and expert-led reports have shown that adopting a socially responsible supply chain allows a company to gain a competitive edge in the market. With consumers becoming increasingly more inclined to let the ethical aspect of a company affect their purchase, businesses must begin investing in developing a simplified, scrutinized, enforced, and transparent set of principles for a socially responsible network.

Technology can play an important role in building responsible supply chains. Treeni’s resustain™, a modular SaaS-based platform automates and manages sustainability data for ESG risk and performance management, Corporate Social Responsibility, and Sustainable Supply Chains. The resustain™ platform is helping corporates to streamline its supplier data and get a handle on all the essential parameters that go a long way in defining and aligning their business strategy.

-Pallavi Singh is a Principal Consultant at Treeni. She has more than 11 years of experience in Sustainability Consulting. She has worked in the field of climate change, energy and environment, and enterprise sustainability to manage end to end sustainability for corporates starting from maturity assessment to helping create sustainability strategy and roadmaps, and performance management to sustainability reporting.

Originally Published by - https://www.treeni.com/

#Sustainable Supply Chains #Sustainable supply chain management #ESG risk and performance management #ESG Performance Management #ESG data #ESG

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treeniesg · 2 years

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Sustainability Means Business

Investigating how sustainability directly impacts financial performance

Originally Published at - https://www.treeni.com/

#ESG #ESG Performance Management #ESG Risk #ESG risk and performance management #ESG Data

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treeniesg · 2 years

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Addressing Supply Chain Risks Through the ESG Lens in a Post COVID Era

The COVID -19 pandemic has brought to the fore, a host of unprecedented ambiguities for societies and businesses at large. The last few months of social isolation and quarantine have impacted not just people’s well-being and health, but also industries and overall world economy. The global economy has come crashing down tremendously, giving us a bitter reminder of the 2009 recession, and that’s not all. The worldwide lockdown affected the global supply chain operations in particular and executives are confronted by serious business risks never seen before.

The impact of the pandemic has only served to add on to pre-existing economic inefficiencies, and further deferred specialized production and inventories. How do we then mitigate these risks effectively? With this thought in mind, we at Treeni Sustainability Solutions conducted a webinar recently on the topic ‘Addressing Supply Chain Risks through the ESG lens in a Post COVID Era’, with an elite panel of speakers comprising of Jyotsna Belliappa, Head - CSR Inspections, BlueSky Sustainability Solutions and Martin Neuretier, President, The CSR Company International with Ankush Patel, Founder and CEO, Treeni Sustainability Solutions as the moderator.

The key takeaways from the event included:

Need for better preparedness:

To create a sustainable future for ourselves and future generations, we need to accept the present situation and figure out a way to deal with it effectively and with speed. However, the current trends show that the world is not fully equipped to handle the havoc COVID-19 has caused. This notion holds especially true for the business and the political leaders, who have a confined view of the overall operations. Due to the coronavirus crisis, many enterprises and businesses in Europe and the American continents are suffering a huge loss as the Asian markets remain shut. Perhaps this is the right time when companies should be focusing upon developing local or nearer-to-home supply chains that can help revive the business units. Does your ESG policy account for risks associated with pandemics? If not, now would be a good time to revise it.

Restoring supply chains while accounting for migrations, loss of life and business uncertainty

Over the last two months, India has been a witness to millions of laborers migrating across the country. This has exposed serious supply chain vulnerabilities and has put the leaders and SCM executives in a fix. With the supply chain being broken from both ends, exploring alternatives has become a necessity.

“This migration comes the closest to what India witnessed in 1947. Mapping the social aspects of supply chain management to ISO 26000 guidelines for social responsibility will go a long way in ensuring better risk management avenues and setting compliance measures for enterprises. The social cost of this migration ties into issues of human rights and labor practices, and that’s what we need to fix first.”

- Jyotsna Belliappa, Head - CSR Inspections, BlueSky Sustainability Solutions

Strengthening existing compliance policies for better risk mitigation

Economic markets all over the world are shifting dynamically and will continue to evolve rapidly in the post COVID era. While charting out more efficient compliance policies, enterprise leaders will also have to keep in mind the expectations of the end consumer. This is the time when companies need to invest more in innovation and technology for their production and logistics management processes. Previously, compliance was mostly focused upon the Environmental factors of the ESG. However, with the changing scenario, social and governance aspects play an equally important role. Tougher legislation can be anticipated once the operations are restarted.

“I’d love for businesses to self-enlighten when it comes to sustainable operations, and that’ll be a revelation on its own! Using ESG to chart out strategic CSR criteria can add greatly to a business’s bottom line. We just need to begin thinking of the bigger picture and keep pace with this change that COVID has brought - this will lead us to the new normal.”

- Martin Neuretier, President, The CSR Company International

The role of tech to address sustainability challenges

Ever since the world entered the lockdown, corporates have been sustaining themselves via extensive use of digital mediums. Work from home has become a new normal and the use of technology tools for B2B collaboration has scaled up in the past few months. Amidst the COVID 19 pandemic, auditors have become more conscious and are leveraging technology to their advantage. In the coming months, a shift can be anticipated from normal audits to an IT platform / systems-based audit scheme. Technological innovations such as AI and machine learning can abundantly help suppliers to shift towards sustainable production and ensure cost-effectiveness. Sustainability Data Management platforms are increasingly becoming the top priority for businesses to assess their supply chains.

“Today, it is not possible to create a sustainability roadmap for your enterprise without a data and analytics backed approach. Without baselining this data, all you have are plans to scale up, but no way forward. The luxury of choice no longer exists. Either you move with it, or turn obsolete. Technology will be the biggest enabler to redefine sustainability parameters. It will also define ESG frameworks, in terms of addressing and embracing the changes in the post COVID era”

- Ankush Patel, CEO and Founder, Treeni Sustainability Solutions

While the impact and consequences of this pandemic have been no less than tragic, one cannot lose all hope. The present situation can be leveraged to act as a catalyst and help corporates adopt sustainability into their practices for a future of better preparedness in anticipating and mitigating such events. Corporates can remodel their approach towards sustainability following the ESG framework. Treeni’s resustain™, a modular SaaS-based platform automates and manages sustainability data for ESG risk and performance management, Corporate Social Responsibility, and Sustainable Supply Chains. The resustain™ platform is helping corporates to streamline their sustainability data and get a handle on all the essential parameters that go a long way in defining and aligning their business strategy.

Originally Published by - https://www.treeni.com/

#Enterprise sustainability #Sustainable supply chain management #ESG Performance Management #ESG risk and performance management #Sustainability Strategy #sustainability solutions

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treeniesg · 2 years

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Curious Case of Supply Chain Sustainability: How and Why?

In today’s world, organisations cannot thrive solely based on product offerings and bottom lines. We’ve moved into a space where a holistic approach towards the community and environment plays a very important role in building and maintaining a brand’s reputation. Sustainability is catching up within individual communities and is quickly shaping up to be an important target sector for businesses and government as well. While organisations continue to focus on major social and environmental causes as a part of their brand culture, the focus needs to be streamlined even further.

According to McKinsey, more than 1.8 billion people are expected to join the global consuming class by 2024, a 75% rise compared to 2010 reports. Contributing to this growth is rising disposable incomes and increasing budgets towards consumer goods. With growing concerns over environmental issues, consumers are demanding more from organisations to act with more sustainable practices, adding pressure on their supply chain. Supply chain sustainability is becoming increasingly important for the future of an organisation.

A supply chain is responsible for far more social and environmental costs than just what the end retailer reports. If not taken care of, greenhouse gas emissions may rise by 80%, directly impacting the natural and geological resources as well. Organisations focussing on a sustainable supply chain reduce total emissions while also building a stronger brand reputation. Focusing on more than just emission reductions, supply chains focus on other factors like water conservation, deforestation, and social rights. Compared to 2018, Forbes reports 69% more suppliers are now continuing their efforts of water conservation in Cape Town. To show the value of reforestation, According to the Carbon Disclosure Project (CDP), many global companies have reported on their use of timber, palm oil, and soy to emphasize the value of reforestation.

And it’s not just us saying this.

A report titled Cascading Commitments: Driving Upstream Action Through Supply Chain Engagement by CDP revealed that a company’s supply chain contains almost 5.5 times as many greenhouse gasses (GHG) emissions as its operations. In 2018, 115 of the world’s largest corporations requested environmental information from more than 5,500 suppliers, reporting emission reductions of 633 million metric tonnes of CO2, which is more than the emissions of the entire country of South Korea. The reduction of emissions resulted in a cost savings of 19 billion USD.

The Hershey Company has taken up a sustainable supply chain strategy, investing half a billion US dollars by 2030 to foster a sustainable cocoa supply chain. This plan includes planting more than 900,000 trees and satellite mapping 50,000 farms across West Africa by the end of 2019. The company is supporting more than 1,000 farmers in the supply chain through acquired land documentation, as opposed to sourcing from natural parks. Their initiatives are exceeding those of other MNCs (Multi-National Corporations), showing these efforts as an example for others.

How to get where the champs are?

Understand the social impact of the pre-existing supply chain:

Many companies do not have a comprehensive understanding of the environmental and social impact of their pre-existing supply chain. Identifying these impacts and challenges through inventory suppliers is the first step towards sustainability. The more you know, the more you will understand what needs attention. It is important that businesses are aware of every critical issue in the supply chain, whether it is local or global.

For example, consumer electronic goods depend heavily on mineral mining, often involving illegal trade, slavery and child labour. In 2017, Hewlett-Packard (HP) set an example by reporting that 97% of their smelting operations ensure ethical sourcing of materials. All their suppliers use sustainability as the basis of mineral mining, encouraging recycling from scrap. This, in turn, enhances the overall operational efficiency of the supply chain and ensures minerals are mined from outside conflict zones.

Supplier code of conduct:

Communicating with your suppliers is key, and the value this simple communication promises is unparalleled, leading to a long-term end impact. The United Nations Global Compact Publication’s Supply Chain Sustainability-A Practical Guide for Continuous Improvement describes the guidelines and steps for writing and adopting suppliers code of conduct.

Performance evaluation and benchmark-setting:

Keeping track of local and global competition and benchmarks may make or break your supply chain strategy. Most companies now align their assessments with the Global Reporting Initiative (GRI) or CDP guidelines and questionnaires. These assessments focus on factors like emissions, environmental performance, workplace equality, energy and water usage, waste generation, carbon footprint generation, and employee welfare. Once all parameters are mapped, identifying opportunities in terms of partnering with suppliers and advancing business practices becomes simpler while allowing for more transparency in sustainability reporting, like in the GRI and other reporting initiatives.

Training and capacity building:

Sustainability is a behavioural-led change, and the only way long-lasting impact can be created is through knowledge transfer, making more people aware of the current scenario. Online modules and annual conferences for suppliers are two relatively simple ways of sharing this. Propagating success stories through the practical benefits of sustainability initiatives is a good way of showcasing real impact. A prime example is HP's Supply and Peer Educator Run Program that has provided training to 155 second-tier suppliers with the help of their first-tier supplier. It has tackled real-world problems like anti-discrimination, energy efficiency, and labour rights, increasing positive consumer brand reputation.

Performance audits:

Regular audits over time help companies assess hits and misses. Corporate groups such as Human Resources, Corporate Social Responsibility (CSR), Environmental, Health and Safety (EHS), Marketing and Procurement departments can help with these self-assessments. Once the audit is implemented and findings are clear, corrective action plans can be developed for the suppliers. This also helps companies identify successful supplier relationships.

Industry-wide collaboration:

All battles are not won alone. An industry-wide collaboration and integration is the way forward. Companies in the same sector can collaborate and set best practice standards for sustainability performance. This also enables them to provide a playing field where suppliers are evaluated on the same metrics. Zero Discharge of Hazardous Chemicals, an industry collaboration initially founded by six brands (Adidas Group, C&A, H&M, LiNing, Nike Inc. and Puma SE) finally led into a bigger coalition including Esprit, Gap Inc., Levi Strauss & Co., and United Colors of Benetton. This coalition is working towards the integration of higher standards and best practices for the industry by eradicating 11 hazardous chemicals from textile production by 2020. By changing industry demand and setting clear timelines, significant and sustainable change is more achievable than going alone.

The greening of supply chain models holds tremendous value for all kinds of organisations today. It essentially increases the business’s functionality, efficiency, reduces resource costs, and opens up doors for innovation. This increases business' resiliency, making the business strong enough to address the hits of climate change in a continuously transforming world. The only difference is the level of understanding which drives such behavioural change, and the sooner organisations realize this, the better they will thrive.

Originally Published at - https://www.treeni.com/

#Enterprise sustainability #sustainability strategy #Sustainable supply chain #Sustainability Consulting Services

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treeniesg · 2 years

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ESG Based Funding in the Finance Industry

The crisis that began some time in the February of last year is still not over. Covid 19, which first came to light in 2020 is still affecting millions across the globe, and India especially seems to be in a fix. Although it has been more than a year, the uncertainty of this pandemic still looms, and businesses and enterprises all around the globe have been trying their best to get back to the usual. Many unusual yet interesting collaborations have also come through, all in the name of leaning on each other to take a step forward.

While adapting to the new normal has not been easy, most organisations have taken to the path of recovery, through one route or the other. As supply chains start to rebuild, customer expectations are transforming rapidly. Businesses are past the point where only products or services matter - in a global crisis like this, humanization matters most. Customers, thus, are analyzing company offerings through an additional lens - that of humanization itself. In line with this, it is not surprising to see that most successful enterprises have taken a more people focused approach rather than one that solely targets profits. This is true for investors and shareholders as well - they would rather invest in a business that accounts for proper ESG (Environment, Social, Governance) measures, rather than one that does not give it any importance.

The finance industry has seen some of the most radical shifts in terms of ESG strategies in the last fifteen months or so. In some developing countries, economies have crashed completely, some have fragmented and some are trying to reset and rebuild to handle a global health crisis better. The flip side to this is that the entire world has now been presented with an opportunity to build improved, resilient economic systems that can be proved stable and sustainable in the long run. Getting ESG right is a crucial part of this entire challenge for the finance industry, as economic health cannot be built in isolation, and the finance industry is the backbone of all development.

Before the pandemic hit, ESG factors were considered a choice between impact returns and investing goals, but in the last one year, many ESG funds have outperformed their traditional counterparts. The reason for this is renewed investor interest, improved returns and the promise of long term value. Morningstar research says that 70% of responsible funds performed significantly better in the first quarter of last year. Investors and financial experts have also become vocal about the need for greater adoption of ESG for the move towards a low carbon economy, since that is the only tangible step that will make for a better planet. There is thus immense pressure on financial firms to embed ESG practices within their day to day.

It is important to remember that ESG investing is not just about aligning investment strategies with investor values but also the general principle that ESG-negative behaviors impact investment returns. This is especially true for the banking industry, where professionals deal with customers one on one. People now want to bank with institutions who understand their views and beliefs - this is true typically of younger customers and especially the millennial generations, for whom a brand image speaks more than its offerings. In fact, a KPMG survey states that more than 75% of banking CEOs all across the world believe that their future growth would be determined largely by sustainable policies. This is where ESG needs to come in and help banks and other financial institutions make the move towards greener investments.

Of course, Rome wasn’t built in a day, and this shift will also take time. The first step is to identify the magnitude of the risk that exists if this transition were to come into force. Loans and other financial instruments will have to be revamped to balance green investments, otherwise it will be very easy for the balance scale to tip. But leaders like Goldman Sachs and Bank of America have already taken this leap and made commitments to sustainable investments in 2021. More than that, it is the leadership of these 2 industry giants that are falling in with this approach and understanding its mettle. Now is the time for other leaders to step up and analyse this risk, take a shot and incorporate ESG smartly into their growth plan. New products and developments can wait, but this is the need of the hour, and a critical one at that.

We will see a lot more of trends like green underwriting, carbon neutral banking and sustainable ETFs come into the market. They have already made their presence felt to wealth managers and investors, and we are not far from a time when these will become deciding factors for potential investors to invest in financial businesses. Commercial banking is also set to re-route through proper ESG and sustainability linked deals. Responsible Banking and Finance now has a new meaning, and climate related risks have made their way into the finance industry. One could argue that the need to find specific solutions for climate change related challenges has existed for over a decade now, but better late than never.

ESG risks cannot be managed off the side of a desk. It requires banks to develop a robust strategy that is integrated into the overall business strategy for the organization. While the strategy must retain a level of flexibility, it must also be actionable and measurable. This is where technology and automation can aid business leaders drive strategic decision making. Smart platforms and a panel of experts who know the sustainability domain in and out can be highly beneficial to drive both, people and profit based strategies. Treeni Sustainability Solutions has been analysing and monitoring risks, devising foolproof sustainability strategies and creating new age reports for global clients to lead them on the ESG path. In a digital first world, data and tech can be a key differentiator for finance and investment based decisions. It’s time for enterprises to become more mindful of their impact on communities, employees, customers and suppliers to ensure a better future for us all.

Originally Published by - https://www.treeni.com/

#ESG #ESG Performance Management #Enterprise sustainability #sustainability strategy

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