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Environmental Review of 2006

December 20, 2006

	Go Green: Follow the Money Capital markets, where companies and governments raise long-term capital, are currently ill-equipped to determine which companies will thrive in a carbon-constrained economy. In 2006, Citigroup Investment Research, in partnership with WRI’s Capital Markets Research Team, looked at risks and opportunities that climate change is creating for business. When Citigroup talks, investors listen. Companies are now hearing from investors who are paying attention to the global warming effect on the bottom line.
	A World Standard for Measuring GHG Emissions Measuring greenhouse gases is critical for companies and governments looking to reduce their greenhouse gas emissions. The Greenhouse Gas Protocol (GHGP), created by WRI and The World Business Council on Sustainable Development, is becoming the global standard for measuring GHG emissions. In 2006 the International Organization for Standardization (ISO) formally adopted the GHG Protocol. The common standard promotes cost reduction, improves comparability, advances corporate understanding of their emissions “footprint” and thus strengthens their ability to reduce their emissions.
	Transforming European International Aid Traditional strategies for reducing rural poverty often ignore the environment. The World Bank, the United Nations Environment Programme (UNEP), and the United Nations Development Programme (UNDP) joined WRI to develop a new ecosystems-based approach that shows how effective environmental and social resource management can result in improved living standards. The idea was proposed in the report World Resources 2005: The Wealth of the Poor: Managing Ecosystems Fight Poverty. Many governments and non-governmental organizations in Organisation for Economic Co-operation and Development countries are now committing to the sustainable ecosystem model in their rural poverty reduction programs and investments.
	Green Power: The U.S. Corporate Response to Climate Change 2006 was a year for major corporate actions on climate change from several directions. For instance, Whole Foods Market and Wells Fargo completed the largest green power purchases in U.S. history to date. Wells Fargo bought 550 kilowatts-hours (KwH), the equivalent of 75,000 cars annually. Whole Foods Market bought 458 million KwH per year from wind farms with help from WRI’s Green Power Market Development Group, enough electricity for 40,000 homes. Collectively, Green Power Group members are the largest corporate users of renewable energy in the U.S. For example, Starbucks, Johnson & Johnson, and IBM support wind power, while DuPont and General Motors (GM) are the country’s largest landfill biogas users. And Johnson & Johnson, Staples, and GM are among the top users of solar power.
	Public Participation in Environmental Decision-Making in Indonesia Off all countries in the world, Indonesia ranks 4th by population, and possibly 1st in biodiversity. Environmental and development choices in Indonesia have consequences far beyond its borders. In 2006, Indonesia joined the Partnership for Principle 10 (PP10). PP10 is a growing coalition of governments and organizations committed to giving people an “environmental voice.” In Indonesia this means increasing public involvement in the Environmental Impact Assessment process, which promotes public participation and transparency in the making of environmental regulations and issues. The Indonesian Ministry of Environment is incorporating its PP10 commitments into the country’s revised Environmental Management Act.
	Using Markets to Reduce Poverty in Latin America 70 percent of Latin Americans live on less than $3 a day. That’s 360 million people with a combined purchasing power of $510 billion a year, a huge opportunity to reduce poverty while creating new markets. The Inter-American Development Bank (IDB) is one of the largest development aid agencies working in Latin America, and in 2006 it launched a 5-year, multi-billion dollar poverty reduction initiative. Building Opportunity for the Majority supports private-public opportunities to create economic empowerment for the poor, the largest such commitment to date, and hopefully the beginning of many such initiatives.

	Democratizing the Electricity Grid in Thailand Electricity production accounts for one-fifth of global CO2 emissions, so policy changes in the electricity sector have significant environmental consequences. It’s important that electricity policy be made through transparent and accountable practices. The mission of the Electricity Governance Initiative (EGI) is to support such practices. For example, some groups in Thailand have been trying to privatize its electricity sector for over a decade. Good governance is of course essential to make such a transition successful. But a report by EGI partners highlighted a lack of regulatory policies to balance public and private sector interests in Thailand. In 2006 Thai courts agreed, and stopped the privatization.
	Mapping Better Protection in the Amazon Complex natural resources like the Amazon can be affected by multiple human pressures, but traditional assessments look at only one or two. WRI and its partner Imazon developed a new set of Amazon forest maps that show the effects of multiple factors, including construction, settlements, fires and mining. Does better information lead to better decisions? In 2006, Brazil and the Brazilian state of Para enacted measures to protect a land area covering more than 16.5 million hectares, an area larger than England.
	Corporations Greening the Supply Chain Many corporations are now creating internal GHG reduction targets, but Time Inc., the world’s biggest magazine publisher, is taking it one step further. In 2006, Time announced it is also setting targets for its paper suppliers (free subscription required). In other words, the target applies to “upstream” emissions, which occur in a company’s supply chain. Time is a member of WRI’s Climate Northeast group, which develops strategies for corporations to thrive under carbon constraints. The company’s groundbreaking move sets a new standard for such corporate strategies. In the other direction, General Electric announced its Ecomagination campaign which, among other things, will double its sales of environmentally friendly technologies. In other words, a “downstream” target to reduce emissions from GE products.
	Better Forest Management in Russia Responsible forest management requires top-flight decision-making tools, and in 2006, the forest toolbox made some significant steps. WRI’s Global Forest Watch (GFW) network now maps 90 percent of the world’s primary forests. The maps are used by governments, corporations, and many non-profit organizations. The maps are essential for balancing conservation and development priorities by identifying primary forest areas. For example, the Russian environmental group SPOK, and logging company Karellesprom used these maps to spare an unprotected section of one of Europe’s last remaining primary forests. Logging companies and forest groups, such as the Forest Stewardship Council, are starting to use the improved tools to make better environmental decisions worldwide.