Topic: business

Aligning Profit and Environmental Sustainability: Stories from Industry

Sarah Parsons — Wed, 27 Feb 2013 10:11:22 -0500

Executive Summary

Many large companies have established sustainability goals and targets, and it is becoming increasingly common for these goals to address significant environmental challenges like climate change. More efficient use of natural resources, like energy, reduces operating costs and therefore makes business sense. In response to consumer preferences, some companies are also taking steps to reduce the environmental impact of their products and services as well as their supply chains. However, despite some progress, strategies that are good for business and good for the environment are not getting to scale.

To begin to understand why this is, WRI interviewed sustainability managers from a cross-sector sample of eight multinational companies. This research showed that using a “sustainability lens” to evaluate business opportunities has helped companies grow revenue and gain competitive advantage. It also identified four main barriers preventing the improved scale-up of environmentally sound business practices. Based on the experiences of the companies WRI interviewed and WRI’s own perspectives, four actions have been identified that could help overcome these barriers and better scale financially-sound corporate investment in environmental sustainability (see Table 1).

Case Study: Aqueduct Informs Owens Corning Corporate Water Strategy

Sarah Parsons — Sun, 10 Feb 2013 10:27:57 -0500

Executive Summary

The World Resources Institute (WRI) Markets and Enterprise Program conducted a global water stress assessment with Owens Corning, a leading producer of glass-fiber reinforcements and residential and commercial building materials. This working paper aims to help Owens Corning and other companies deepen their understanding of external water supply-related threats and inform on how to shape improvements to their corporate water strategy. WRI plotted Owens Corning facilities worldwide on global maps of current and projected water stress using the Aqueduct Water Risk Atlas. WRI concluded that Owens Corning facilities are evenly distributed across areas of high, medium and low stress. The Aqueduct Water Risk Atlas provided new metrics and an improved methodology for Owens Corning to determine water supply-driven risks to its operations. The results also allowed Owens Corning to rank its facilities worldwide based on their exposure to current and projected stress, prioritize areas for additional internal and external investment, and enhance the company’s overall corporate water strategy.

ADVISORY: WRI's Stories to Watch 2013

James Anderson — Thu, 20 Dec 2012 14:03:26 -0500

WRI will host its 10th annual Stories to Watch event on Tuesday, January 15, 2013, at the National Press Club in Washington, D.C. Dr. Andrew Steer, WRI’s President & CEO, will present insights into the big environmental and international development trends and events that will affect people and the planet in 2013.

Topics will likely include: What will the Obama Administration do to address climate and energy? How will China’s new leadership advance its goal of “ecological progress”? What countries will emerge on the forefront of sustainability? And, how will financial constraints impact businesses seeking to shift to a more sustainable pathway?

A continental breakfast will be served.

WHAT
World Resources Institute’s Stories to Watch 2013

WHO
Dr. Andrew Steer, President & CEO, World Resources Institute.

Dr. Steer is a leading expert on economic development and environmental issues. He has three decades of experience working on international development and on the front lines in Asia and Africa, and at a senior level in international policy roles.

WHERE
National Press Club
Holeman Lounge
529 14th Street, NW
Washington, D.C. 20045

CALL-IN INFO
USA (Toll Free): (866) 803-2143
International (Toll): + 1 (210) 795-1098

Access code: “WRI”

WHEN
Tuesday, January 15, 2013
9:00 - 10:30 a.m. ET

Use #STW2013 on Twitter.

RSVP required to press@wri.org

RELEASE: Guide for Business Drives Better Decisions on Forest Products

James Anderson — Sun, 09 Dec 2012 23:06:40 -0500

The World Resources Institute (WRI) and World Business Council for Sustainable Development (WBCSD) today released the third edition of Sustainable Procurement of Wood and Paper-based Products to help businesses buy products from sustainably managed forests and improve forest management.

The full guide resource kit is available online here or at www.SustainableForestProducts.org.

With the third edition of the sustainable procurement guide, WRI and WBCSD continue to support better business decisions by providing information to help them understand the origin, legality, ecological and social dimensions of the wood and paper-based products they purchase and use. The new edition incorporates the most up-to-date developments on the legality of forest products and new technological developments to control wood and paper supply chains and increase their transparency. It includes an expanded chapter on the social implications of forest products.

The guide provides an overview of the 10 key issues underpinning procurement, including forest management; provides an overview of a selection of tools, initiatives and additional resources; and clarifies and explains the maze of terminology around sustainable forest products.

James Griffiths, Managing Director, Forest Solutions at the WBCSD said: “Every single business uses wood and paper-based products on a daily basis, be that paper for printing and packaging or wood in construction, or as office furniture. As demand for wood increases, and the competition for forest-based products intensifies, business needs to make better decisions on sourcing in order to support and incentivize sustainable forest- management. Our guide will help them do just that.”

Ruth Noguerón, Associate with the World Resources Institute, said, “Forests are important for the global environment, the economy, and the estimated 500 million people that depend on them for their livelihoods. We need to maintain forests for the future, and a key element of that is ensuring that forest products are sustainably produced. If we increase the demand for sustainable forest products, producers are encouraged to improve their management practices to meet that demand.”

José Luciano Penido, Chairman, Fibria and Co-Chair of the WBCSD Forest Solutions Group, said: “Decisions about the purchase and use of wood and paper-based products can have extensive and long-term consequences on ecological, social and economic values of forests and forest plantations. Being able to make informed choices is imperative for all businesses in building and retaining consumer confidence in their product offerings, including the use of paper packaging or timber components.”

Joseph Lawson, Global Director of Sustainable Forests and Forest Products for MWV said: “Since its first release in 2008, the guide has been used by a diverse group of stakeholders and together with them we have been revising and enhancing it on a regular basis. For this edition, the focus was on updating the content, including government procurement and legality verification developments and improving ease of navigation, design and format.”

Riikka Joukio, Senior Vice President, Sustainability and Corporate Affairs at Metsä Group and Co-Chair of the WBCSD Forest Solutions Group, said: “Sustainable forest management means managing our forest resources to meet society’s needs today, without interfering with our future generations’ needs. Forests need to be managed in a way that they retain their growth and vitality, ecological functions and biodiversity. The WBCSD and WRI guide cuts through any confusion about how all business can contribute to using sustainable forest products and maintaining this crucial natural resource.”

To access the guide Sustainable Procurement of Wood and Paper-based Products, please visit www.SustainableForestProducts.org.

For more information please contact:

James Anderson, Press Officer
World Resources Institute
Janderson@wri.org
t: +1 202-729-7608
m: +1 507-301-2385

Sustainable Procurement of Wood and Paper-Based Products: Version 3

Sarah Parsons — Sun, 09 Dec 2012 21:03:53 -0500

Find out more at http://www.SustainableForestProducts.org.

Version 3 of this guide incorporates the most up-to-date developments on the legality of forest products, new technological developments to control wood and paper supply chains and increase their transparency, and an expanded chapter on the social implications of forest products.

Decisions regarding the purchase and use of wood and paper-based products can have far-reaching, long-term impacts on the forests where they are harvested and the people and industries that depend on those forests for their livelihoods and raw materials.

This joint WRI/WBCSD publication provides information about 10 key issues procurement managers might address as they develop and implement their procurement policies:

Origin: Where do the products come from?
Information accuracy: Is information about the products credible?
Legality: Have the products been legally produced?
Sustainability: Have forests been sustainably managed?
Special forests: Have special forests been protected?
Climate change: Have climate issues been addressed?
Environmental protection: Have appropriate environmental controls been applied?
Recycled fiber: Has recycled fiber been used appropriately?
Other resources: Have other resources been used appropriately?
Local communities and indigenous peoples: Have the needs of local communities or indigenous peoples been addressed?

The guide also characterizes a selection of helpful tools and explains the maze of terminology around sustainable forest products.

sSWOT: A Sustainability SWOT

Sarah Parsons — Fri, 07 Dec 2012 17:36:00 -0500

Summary

In partnership with companies in WRI’s Next Practice Collaborative, and through workshops, road tests, and interviews with dozens of companies and sustainability experts, WRI has put a new twist on the familiar SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis. The graphic below conveys our new sustainability SWOT (sSWOT) guide.

New Ventures: Voices of the Entrepreneurs

Sarah Parsons — Mon, 12 Nov 2012 18:20:42 -0500

Summary: Voices of the Entrepreneurs

Small and medium-sized enterprises (SMEs) can account for as many as four out of five jobs and more than 29 percent of GDP in developing countries. Environmental SMEs—enterprises that capitalize on commercial opportunities while generating clear, measurable environmental benefits—have an important role in shaping growth that is both economically and environmentally sustainable.

Yet the entrepreneurs behind these environmental SMEs face many challenges that limit their ability to grow their businesses. The main roadblocks highlighted by the environmental entrepreneurs whom we interviewed were: accessing finance, attracting and maintaining quality human capital, tackling limited markets and mind-sets, overcoming unsupportive policies, coping with risk and uncertainty, and distributing their products and services. New Ventures addresses these roadblocks by empowering entrepreneurs to develop solid business plans and skills, linking entrepreneurs to networks of mentors and supporters, and showcasing entrepreneurs to investors.

There is much more to be done. The barriers that prevent environmental entrepreneurs from scaling up their businesses are far from gone, but as Earth’s resources become increasingly constrained, our future well-being will depend more than ever on the success of these entrepreneurs. In addition to accelerators like New Ventures, donors, investors, policymakers, corporations, and international development institutions will need to step up to enable greater success for environmental entrepreneurs.

A Note on New Ventures’ Transition

With strong, distinct New Ventures programs in Brazil, China, Colombia, India, Indonesia, and Mexico, WRI has decided to conclude its role as global coordinator. WRI is immensely proud of New Ventures’ accomplishments and is confident that the program will reach new heights with greater local and regional independence.

Climate Finance

Christine Potochny — Mon, 05 Nov 2012 13:55:16 -0500

Facts and Figures: The Scale of Needed Investment

Developing countries will require new investments of up to $300 billion annually by 2020—growing up to $500 billion annually by 2030—to adequately limit their growing greenhouse gas emissions.
These countries will also require several hundred billion additional dollars to protect themselves from the worsening physical and economic impacts of greenhouse gases already in the atmosphere.
About $900 billion per year between now and 2050 will be needed to address investments in global energy supply and demand technologies (in addition to the roughly $2.6 trillion in annual investments to occur in a “business as usual” scenario.
While developed countries have committed to channeling US$100 billion (from public and private sources) annually by 2020 to developing countries for climate mitigation and adaptation activities, this level of investment is far from what is required.

Global Investment for a Resilient Low-Carbon Economy

Stabilizing the global climate is one of the most urgent challenges in coming decades. Our warming world affects all people and ecosystems, particularly the poor who already suffer disproportionately from climate-change impacts. Major financial investments – from both public and private sources and guided by smart and equitable policies - are required to transition the world’s economy to a low-carbon path, reduce greenhouse gas concentrations to safe levels, and build the resilience of vulnerable countries to climate change.

WRI is addressing how these massive investments toward a low-carbon and resilient economy – which we refer to as climate finance –can be realized.

In developing countries, climate change investment needs are significant. Direct government funding is scarce. And the billions of dollars committed to be marshaled by industrialized countries remain inadequate to the magnitude of the challenge of stabilizing a steep trajectory of greenhouse gases. Additional financial investment should be accompanied by rules, regulations, fiscal incentives and effective markets at international, national, and sub-national levels to shift current and projected “business-as-usual” investments, and mobilize resources at the scale required.

WRI’s Vision of Success

Public and private actors—development financing institutions, governments, and private sector investors, including financiers and project developers—significantly shift and scale-up their investments in sustainable, low-carbon and climate-resilient development. These investments will create new markets, address long-term opportunities and risks arising from climate change, promote wider socio-economic benefits, and minimize social and environmental harm.

WRI Strategy

WRI focuses on climate finance broadly defined, not just international public climate finance but both public and private flows including domestic (within developing countries) and international (to developing countries) finance that support climate-related goals.

WRI focuses its expertise on the technical and institutional aspects of three major questions:

How to SHIFT finance from high carbon to low carbon and climate resilient investments (mainstreaming);
How to LEVERAGE private flows using public climate finance (domestic and international) and
How to ASSESS the impact or effectiveness of climate finance, whether positive or negative.

WRI is pursuing national, international and private sector strategies.

National Strategy: Strengthen institutions for effective climate finance mobilization, management and monitoring

SHIFT

Facilitate building national public institutions and capacity to access, manage, program, deploy and monitor climate finance in an effective and transparent manner.
Empower non-governmental institutions and actors to engage and participate in climate finance processes in order to ensure more effective outcomes.
Related projects: Open Climate Network, Electricity Governance Iniative, Measurement & Performance Tracking in Developing Countries.

LEVERAGE

Ensure development financing institutions and finance ministries catalyze a shift in public and private investments toward climate-friendly development through the strategic use of international climate finance.

ASSESS

Help create efficient and accountable financial systems. WRI aims to help national governments and their domestic stakeholders develop systems through which they can wisely generate, access, disperse, and track finances for adaptation.
Related work: Vulnerability & Adaptation
Maximize the impact and effectiveness of climate finance by aligning national mechanisms for receiving, allocating and disbursing international climate finance with the country’s planning, budgeting, programming and monitoring procedures and systems.
Related project: Open Climate Network
Related publication: Summary of Developed Country ‘Fast-Start’ Climate Finance Pledges

International Strategy: Build a robust, effective and equitable climate finance architecture

SHIFT

Promote more effective and legitimate governance of international climate finance by bringing to bear developing country expertise and experience to inform discussions on governance and operation of international climate finance.
Related project: International Financial Flows & the Environment (IFFE).
Related blog posts: the Green Climate Fund.
Ensure mainstreaming climate change in international development finance by encouraging public international financial institutions to adopt and implement ambitious, internationally recognized standards. Such a significant investment shift will support low‐carbon and climate‐resilient development, while ensuring high environmental and social standards.
Related project: International Financial Flows & the Environment (IFFE)
Related publications:

ASSESS

Create an enabling environment for investment by ensuring that international climate finance includes long-term support for conducive policy environments and addresses non-financial barriers to investment. WRI has developed a framework to guide governments and their international partners in selecting pre-investment activities to support and inform the providers of public international climate finance.

Private Sector Strategy: Leverage private sector flows from public climate finance

Related project: Climate Finance & the Private Sector

SHIFT

Provide robust research and analysis to determine what tools and approaches are the most effective at leveraging private climate investment, including detailed mapping of financing instruments used by public and private institutions to finance climate-relevant projects.
Related publications:
Moving the Fulcrum: A Primer on Public Climate Financing Instruments Used to Leverage Private Capital
Public Financing Instruments to Leverage Private Capital for Climate-Relevant Investment: Focus on Multilateral Agencies

LEVERAGE

Help leaders in the public sector seize the opportunity to leverage private investment in a low-carbon future. The public sector can expand its role in effectively unlocking private investment by reducing risk, directing investment and maximizing public and private benefit through the appropriate mix of policies and finance.
Related resources:
Moving the Fulcrum: A Primer on Public Climate Financing Instruments Used to Leverage Private Capital
Climate Finance and the Private Sector brochure

ASSESS

Mobilize WRI’s strong external ties with private sector financial institutions to bring a private sector perspective to climate finance, and help translate the complex languages of private sector investors and public sector policy makers.

Case Study: Aqueduct Informs AU Optronics Corporate Water Strategy

Sarah Parsons — Wed, 17 Oct 2012 13:31:54 -0400

Executive Summary

The World Resources Institute (WRI) Markets and Enterprise Program conducted a global geographic water risk assessment with multinational electronics manufacturer AU Optronics (AUO). WRI plotted AUO’s fabrication plants worldwide on global maps of water risk using Aqueduct’s Water Risk Atlas. This assessment aims to identify which AUO fabrication plants are located in areas and draw from sources that face potential water risks. From this assessment, WRI concluded that: (a) the majority of AUO’s fabrication plants are located in areas facing relatively low current water risks, including water stress; (b) by 2025, the majority of AUO’s fabrication plants will face medium to high increases in water stress; and (c) the source reservoirs for AUO’s fabrication plants face similar levels of water risk.

This case study allows AUO to better prioritize resources and develop risk mitigation solutions. It is important to note that the scope of this case study is limited to the identification of geographic water risks; it does not aim to develop specific facility-level risk reduction strategies and solutions. In this document, WRI provides some high-level recommendations to AUO on how to move forward in developing corporate water strategy. This case study is intended to help other companies understand how they can use Aqueduct’s Water Risk Atlas to inform corporate water strategy.

WRI Annual Report 2011-2012

Sarah Parsons — Mon, 01 Oct 2012 14:20:00 -0400

RELEASE: WRI Welcomes Andrew Steer as New President

Michael Oko — Wed, 22 Aug 2012 10:50:35 -0400

Today, WRI welcomes its new president Dr. Andrew Steer. Steer is a visionary and dynamic leader who brings a wealth of international experience to the Institute. He becomes just the third president in WRI’s 30-year history.

On taking the helm of WRI, Steer said: “Never has it been more important to understand the links between resources – water, soil, atmosphere, climate, biodiversity, energy, minerals – and human activity. And never has it been more imperative that economic decisions fully reflect the true value of these resources. It is only by so doing that we will succeed in eliminating poverty and enhancing lives and livelihoods permanently.”

Most recently, Steer was the Special Envoy for Climate Change at the World Bank, where he helped guide the Bank’s climate change activities in over 130 countries. He also served on UN Secretary-General Ban Ki-moon’s High Level Group on Sustainable Energy for All and on the B20 Board on Green Growth (the private sector wing of the G20).

Former World Bank President Robert Zoellick said, Steer “brings deep technical, policy, and political experience in the field of sustainable development.”

Steer joins WRI at a time of rapid growth for the organization. Over the past several years, WRI has expanded its global reach and is now working in 50 countries, including China, India, and Brazil. Since 2008, WRI’s staff has grown from 160 to 225 people and its operations have expanded from $26 million to $45 million.

James A. Harmon, WRI’s Chairman of the Board, said, “Andrew is a dynamic and gifted leader, with a deep knowledge of sustainability issues and on-the-ground experience in the world’s most rapidly developing economies. As these issues become more urgent, Andrew is ideally suited to lead WRI in achieving its mission.”

Steer is a energetic leader, who brings with experience working in Indonesia, Vietnam and other countries. From 2007 to 2010, he was Director General for Policy and Research at the UK’s Department for International Development (DFID). Steer has a PhD in Economics, and has taught and lectured at several universities.

–

Read Andrew Steer’s welcome message.

Watch a video of Steer talking about sustainability and his vision for WRI.

Glossary of Financing Instruments

Sarah Parsons — Tue, 14 Aug 2012 13:17:08 -0400

This document is drawn from Appendix II in WRI’s working paper, Moving the Fulcrum: A Primer on Public Climate Financing Instruments Used to Leverage Private Capital. This working paper demonstrates how the public sector can employ different types of public financing instruments — whether loans, equity, or de-risking instruments — alongside policy and technical support to scale-up private sector investment in low-carbon markets.

Moving the Fulcrum is part of WRI’s Climate Finance series, which tackles a broad range of issues relevant to public donors, intermediaries, and recipients of climate finance. A subset of this series, including this primer, examines how public climate finance providers—whether governments, development finance institutions, or international finance mechanisms like the proposed Green Climate Fund–can meet the significant investment needs of developing countries by mobilizing private sector investment. It focuses on how the public sector can finance and mobilize investment into private sector projects, but also acknowledges the importance of overarching support for complementary low-carbon policies. Low-carbon sectors specifically considered include renewable energy, energy efficiency, and related infrastructure and services, though lessons may equally apply to other climate change-relevant sectors like sustainable agriculture, transportation, and water infrastructure.

Current Initiatives Focused on Using Public Climate Finance to Leverage Private Capital

Sarah Parsons — Tue, 14 Aug 2012 13:09:11 -0400

These tables are drawn from Appendix III in WRI’s working paper, Moving the Fulcrum: A Primer on Public Climate Financing Instruments Used to Leverage Private Capital. This working paper demonstrates how the public sector can employ different types of public financing instruments — whether loans, equity, or de-risking instruments — alongside policy and technical support to scale-up private sector investment in low-carbon markets.

Moving the Fulcrum: A Primer on Public Climate Financing Instruments Used to Leverage Private Capital

Christine Potochny — Wed, 25 Jul 2012 15:11:56 -0400

Executive Summary

The Problem: Projected climate change mitigation investment needs in developing countries–including for low-carbon sectors–are significant, growing, and may not be met. Experts estimate new investments of up to $300 billion annually by 2020, growing up to $500 billion annually by 2030, are required to mitigate developing countries’ greenhouse gas emissions to levels in line with global targets. While industrialized nations have committed to mobilizing new funds of $100 billion annually by 2020 to meet these needs, this level of funding is far from what is required.

One Solution: Redirect the private sector’s growing investment in developing countries to help fill the growing climate finance gap. McKinsey estimates that the financial stock—that is, the total value of outstanding stocks and bonds—of developing countries grew by $11 trillion in 2011. By intervening to improve the investment attractiveness of climate change-relevant markets, the public sector has a significant opportunity to harness and redirect these significant private sector capital flows away from fossil fuel-driven sectors and toward low-carbon development.

The Challenge: Mobilizing private sector investment will require better targeted public support that improves the risk-reward calculus of lowcarbon markets. The private sector seeks markets that exhibit (i) attractive returns relative to associated risks over an appropriate investment timeframe (“attractive risk-reward calculus”) as well as (ii) adequate size, liquidity, and transparency. These conditions are often absent in developing countries due to the nascent natures of both low-carbon and financial markets in these geographies.

Recommendation: To improve the risk-reward calculus of investments—arguably the most fundamental barrier to leveraging private capital—the public sector can complement support for low-carbon policies with direct finance that manages the following risks:

Political and macroeconomic risks. Political risk guarantees, interest-rate/currency exchange products, and local currency loans can help investors and project developers financially manage political (for example, political instability) and/or macroeconomic (for example, exchange rate volatility) risks. As these financing instruments are not easily accessible in poorer countries, by providing these instruments, the public sector can catalyze low-carbon investment in geographies where access to finance is most challenging.
Low-carbon market risks, including policy, technology, and operational risks. These risks, which range from unexpected policy changes to technology failures, can affect both new and mature low-carbon markets. In newer low-carbon markets, public financing instruments like first-loss equity and debt investments and concessional loans can be instrumental in encouraging early investment. Projects in more established low-carbon markets—like solar, wind, and energy efficiency—can benefit from flexible loans, partial risk and credit guarantees, and risk sharing facilities.

Given the varied investment conditions across developing countries and their respective low-carbon markets, each market will require a unique combination of finance and policy support to scale-up private sector investment. Future WRI publications, drawing on private sector perspectives, will delve deeper into how public climate finance providers—whether governments, development finance institutions, or export-credit/aid agencies—can tailor direct finance to scale-up private sector investment in different markets.

STATEMENT: Rio+20 Wraps Up with "More of a Whimper Than a Roar"

Michael Oko — Fri, 22 Jun 2012 09:09:12 -0400

The UN Conference on Sustainable Development (Rio+20) comes to a close today. In total, more than 100 heads of state and tens of thousands of representatives from government, business, and civil society came together over two weeks to advance solutions on sustainable development in Rio de Janeiro.

[Editors’ note: You can find WRI’s experts’ analysis on specific issues and outcomes here.]

Following is statement by Manish Bapna, Acting President, World Resources Institute:

“Rio+20 closed with more of a whimper than a roar. Expectations for the conference were understandably low, but the outcomes were even more modest. The agreed upon text was simply not forceful enough to meet the environment and development challenges of our times. This was a missed opportunity to re-energize the global conversation and importantly drive greater action around sustainability.

“There were a few bright spots— the advancement of Sustainable Development Goals, support for better governance around environmental issues, and progress on sustainable transport, among others. But, still, that is not enough.

“Certainly, there are reasons why the conference fell short: economic and political crises on the global stage; the challenge of taking on complex issues; and the struggle of coming to a unanimous decision among the diverse views. These challenges are real, but they should not be an excuse for inaction.

“So then, what comes next?

“We cannot lose sight of the big picture. It would be a mistake to conflate the outcome here with what’s happening on the ground around the world. Real action is taking place on national and local levels in many countries. Just look at Germany’s shift to clean energy, Niger’s efforts to re-green its landscape, or Rio’s just launched bus rapid transit system.

“We understand the challenges. We know the solutions. What we need is to build the political will for bolder leadership.

“As we leave Rio and return to our homes around the globe, we must not give up on the vision of a more sustainable pathway. Given the urgency of the challenges, we must continue to push forward with ambitious solutions that will create a more sustainable future.”

–

Read a summary blog by Manish on where to look for key areas of progress at Rio+20.