Get the best of GreenBiz delivered to you -- GreenBuzz e-news

Newsletter // GreenBuzz Daily, Thursday, April 10, 2014

How a small county in California went grid positive

Published April 10, 2014
How a small county in California went grid positive

California is known for being a leader in solar energy, but a small county in Northern California has taken things a step further. It has become the first county government in the state to not only zero-out its electric bill with renewable energy, but also to become grid positive. Yolo County (population 200,000), just west of Sacramento County, now produces 152 percent more energy from solar panels than it uses.

Terry Vernon, deputy director of Yolo County General Services, is behind much of the solar success. In 2010, the Yolo County government was facing an annual $1.4 million electric bill. Vernon knew there was a better way. In the 1980s, Vernon helped Stanford University put power back into the grid with a cogeneration plant that heated the entire campus. So he was no stranger to innovative energy solutions, and knew that he could help power Yolo County with renewables. The issue he was facing, however, was that Yolo County was, like the rest of the country, in a recession.

"I had to look for a way to do a zero-capital investment because we didn't have any capital funding," Vernon told RMI. "It had to pay for itself the very first day." Vernon said it took a lot of effort; he had to go to the county board numerous times. Fortunately, the board was extremely supportive of the project. Even before board members knew it would produce a positive cash flow, they saw the potential to reduce the county's carbon footprint and greenhouse gas emissions. Once they approved the proposal, the first solar project was under way.

An innovative solar plan 

Working with SunPower, Yolo County installed a 1-megawatt solar power system at the Yolo County Justice Campus in the county seat, Woodland. Yolo County owns the system and associated renewable energy credits, and financed the purchase using multiple funding sources, including a $2.5 million loan from the California Energy Commission, and clean renewable energy bonds and qualified energy conservation bonds available through the American Recovery and Reinvestment Act of 2009. The system produced $162,000 the first year of operation, and is predicted to earn the county $10 million over the first 25 years.

With the success of that project under his belt, Vernon decided to do even more. In 2013, the county installed three arrays totaling 5.8 MW of power as part of its County Wide Solar Project. The first array produces .8 MW for three buildings on the county government campus in Woodland, reducing the campus' electric bill by 75 percent through net energy metering. Two 2.5 MW arrays were installed at Grassland Regional Park in Davis and sell power back to PG&E, the local utility company, through a feed-in-tariff (FiT). These projects also were installed with no upfront capital investment. In partnership with the Yolo County Office of Education, the county secured $23 million in qualified zone academy bonds (QZAB).

The projects not only eliminated the county's electric bill, but also earned just under $500,000 the first year. The county sells electricity to PG&E for 10-cents/kilowatt hour, although when its 20-year FiT contract is over, that price might rise. The county conservatively predicts it will generate $60 million over the next 35 years and avoid 12,000 metric tons of carbon dioxide emissions each year. "We not only did it with zero upfront capital investment," Vernon stated, "we eliminated our electrical bill, and we generate cash, which goes into our revenue stream." 

In July, the EPA recognized Yolo County on its list of green power partners that generate and consume the largest amount of green power on-site, alongside companies such as Walmart and Apple. Although Yolo County came in 14th in the nation (in January, it moved up to 13th) for amount of kWh used on-site (13.5 million), if ordered by the percentage of total electricity use, Yolo County would be first at 152 percent with no other entity even coming close (second place partners only reach 75 percent).

Efficiency first

Even before the solar projects were installed, Yolo County was at the forefront of environmental action. In the 1980s, it adopted an energy plan that was the first of its kind, and built a gas-to-energy facility at the county landfill that generates 20 MWh/year and captures 90 percent of methane emissions. From 2002 to 2004, the county enacted the County Wide Energy Conservation Retrofit Project, through which it replaced lights, boilers, HVAC equipment, chillers, fans, water heaters and motors in all major county buildings.

In 2008, Yolo County approved a plan to change the temperature set points in all county office buildings (3 degrees higher in summer, 2 degrees lower in winter), to change air conditioning and lighting system schedules to the minimum hours per day of operation, and to perform retro-commissioning on all building outdoor air economizer systems, among other actions. These actions annually save the county over $200,000 and reduce carbon emissions by more than 1,200 tons. And in 2011, the county passed the Climate Action Plan, designed to reduce the county's greenhouse gas emissions back to 1990 levels by 2020.

Educating the younger generation

Yolo County officials realized that public education is key to their climate goals. Part of the QZAB education bonds acquired through their partnership with the Yolo County Office of Education, along with a donation from SunPower, financed the construction of seven "solar academies" to bring environmental education to K-12 students. The academies teach school children about climate change, environmental science, renewable energy technologies and energy auditing.

The Qualified Zone Academy Bonds typically are used by K-12 school districts, community college districts and county offices of education to fund capital projects accompanied by an educational component. For Yolo County's solar projects, the bonds were structured as a lease payable from the county's general fund with a term of 20 years. In addition, the bonds required a 10 percent match by a private or nonprofit entity, which came from SunPower. The benefit of using these bonds to finance the county's solar projects is twofold — first, the county benefits from a direct federal subsidy (ability to pay back the bonds at no interest); and second, the County Office of Education benefits from the 10 percent contribution to implement the academies. But "the real winners," explained Vernon, "are the children of California."

Santa Clara County and Orange County already are trying to replicate Yolo County's successes, and Vernon would like to see other counties follow. "Global warming makes me nervous for my children and grandchildren," Vernon told RMI. "Other counties and municipalities can duplicate a piece of this project and achieve the same results. Even if they only did one megawatt, which most cities can do, it would make a big difference."

Lead solar panels photo via Yolo County

Also in The Institutional Acupuncture Blog:


P&G pledges zero deforestation by 2020

Published April 10, 2014
P&G pledges zero deforestation by 2020

Consumer products giant Proctor & Gamble has become the latest company to cave into pressure from Greenpeace, revealing new goals to eliminate deforestation from its entire palm oil supply chain by 2020. Despite the major step forward, the company already faces questions over whether it should have made similar pledges for other products and committed to a date much earlier than the end of the decade.

The maker of products such as Head & Shoulders, Fairy and Pampers has faced a global campaign over its sourcing of palm oil, after a Greenpeace investigation earlier this year accused a number of P&G suppliers of using destructive techniques to clear the Indonesian rainforest to make way for palm oil plantations.

P&G already has pledged to use 100 percent sustainably sourced palm oil by 2015 for use in its soaps, cosmetics and food. However, Greenpeace's investigation suggested it was not on track to meet the target, with just 10 percent of its palm oil being classed as officially "sustainable" last year.

What followed was a typical, high-profile campaign from Greenpeace that sought to raise consumer awareness of P&G's environmental footprint, including protests, petitions and spoof adverts mocking the company's cuddly image and accusing it of fueling deforestation. In response, P&G launched a full investigation into its palm oil supply chain, and this week confirmed it would take measures to eliminate deforestation across its palm oil supply chain by 2020.

The company aims to ensure that all of its palm oil supplies can be traced back to the source by the end of next year, and will ensure that suppliers meet criteria set out by the cross-industry Round Table on Sustainable Palm (RSPO). This means no new development on peatlands or high conservations value areas, no slash and burn to clear land, and adoption of human and labor rights standards.

Len Sauers, P&G vice president of global sustainability, said the new commitment was "unequivocal."

"Our aim is to develop effective long-term solutions to the complicated issue of palm oil sustainability," he said in a statement. "We are committed to driving positive change throughout the entire supply chain, not just for us, but for the industry and for the small farmers who depend on this crop.

"These goals go beyond our current commitments. P&G will continue to work with each of our suppliers, and we will invest in and work directly with small local farmers, where much of our supply comes from, to improve their production practices. This is the most complicated aspect of the palm supply chain, where P&G believes we can make a significant and lasting impact."

Areeba Hamid, forest campaigner with Greenpeace International, welcomed the move, but questioned if P&G could have set a target earlier than 2020. "[P&G's] commitment today is another step towards responsible supply chains and ending deforestation in the world's rainforests," she said. "But the policy is not perfect. It leaves suppliers six more years to clear forests. With global warming and rapid biodiversity loss, we urge P&G to take action against suppliers such as Musim Mas and KLK that have been identified to be clearing forests and peatlands."

She also urged P&G to implement similar zero deforestation targets for other forest products, such as wood pulp. The news comes as the RSPO revealed that sales of certified sustainable palm oil reached a record high in the first quarter of 2014, with a 49 percent increase in uptake compared to the same period last year. The figures also revealed a 54 percent increase in demand for GreenPalm Certificates — which provide financial support for growers attempting to transition to more sustainable plantation models.

"The recent months have seen many more companies committing towards 100 percent RSPO Certified Sustainable Palm Oil (CSPO), most of them with a 2015 deadline," said RSPO technical director Salahudin Yaacob. "We are happy to see these commitments — mainly from large European retailers and consumer goods manufacturers reflecting in real terms on the demand for CSPO."

However, despite the increasing demand for sustainable palm oil, P&G and its peers can expect to face continued public pressure until deforestation is driven from their supply chains altogether.

This story first appeared at BusinessGreen.com. Tree trunks photo by Prezoom.nl via Shutterstock.



The two questions to ask before handing over used electronics

Published April 10, 2014
The two questions to ask before handing over used electronics

We are all curious — and many of us are concerned — about the secret life of used electronics. The level of response I received to "The 3 rules of recycling electronics waste" and the questions it generated showed that there's a hunger for information on this issue. That's the good news. The bad news is that there continues to be considerable confusion about what to do and why things need to change.

Common followup questions followed the lines of: "I've used Company X for years to handle my e-waste. They pay me to take this stuff off my hands. They're obviously making money, so things must be OK, right?"

Not necessarily. The unfortunate reality is that there are many perfectly legal and profitable ways to dispose of your IT assets and electronics, in ways that would turn your stomach. Unless you ask the right questions, you'll never know — and you could be incurring risks that you're not even aware of.

The seamy underbelly of electronics recycling

Unless you're working with recyclers that, at minimum, have either R2 or e-Stewards certifications, here's what happens all too often: Company X pays you to take your electronics. Company X refurbishes and resells what it can, leaving a pile of stuff that doesn't meet what's known as the "tech-cut line." This equipment generally has no value as re-usable products and either will be disassembled for its commodities or Frankensteined together to make new products. Company X sells this pile, usually by the pallet, to the highest bidder.

So far, so good, right? Not so fast.

Company X can pay more than others will because it doesn't have to meet third-party certification standards and will recycle in the cheapest way it possibly can. This usually means it's heading overseas to places where regulations, if they exist, are rarely enforced, and bad things will happen to people and the environment. Company X is able to pay you what it does because it guarantees itself higher margins by selling its e-scrap by the pallet to whomever will pay the most.

It all works great until you consider the environmental, reputational and social problems it can create. For a good summary of the problems, read The Guardian's story "Toxic 'e-waste' dumped in poor nations, says United Nations."

Protect the world (and your reputation) from e-waste dumping

Given these facts, those involved in making decisions on IT asset disposition needs to ask themselves two questions.

1) Even if what we're doing is perfectly legal, is it ethical for our company to dispose of our assets without assurances that all of it is being handled in the right way in every phase of the recycling process?

2) Along with our ethical obligations to act responsibly, are we putting our company's reputation and data at risk by not knowing where it's all going?

Do yourself a favor. When disposing of IT assets and electronics, work only with recyclers that, at minimum, are either R2 or e-Stewards certified and are in good standing with regulatory agencies. Doing so will mean you won't have to answer these two questions in a way that will create hardship for you and others in your community and across the globe.

This story originally appeared at Environmental InitiativeHard drive image by Michael Hiemstra via Flickr



How enlightened self-interest in sustainable water helps business

Published April 10, 2014
Tags: Water, Water Use
How enlightened self-interest in sustainable water helps business

Water challenges are not just an issue for companies with operations and/or suppliers in developing countries. They are confronting businesses here and now in the United States. And while the current drought in California and the Southwest or last year's Midwestern one get considerable attention, many regions in the U.S. face a chronic imbalance between water supply and demand. These regional imbalances, coupled with a variety of other water-related concerns nationally, present current and future water risks for U.S. business.

This is of one of the key findings of a new study released by the Pacific Institute and VOX Global, "Bridging Concern and Action: Are US Companies Prepared for Looming Water Challenges?" Based on a survey of over 50 companies, it reveals that most participating companies believe water challenges significantly will worsen in the next five years. More specifically, 60 percent of companies indicate water is poised to affect business growth and profitability within five years, and more than 80 percent say it will affect their decisions on where to locate facilities.

Infographic courtesy of Pacific Institute and VOX GlobalThis is a stark increase from only five years ago, when water issues affected business growth and profitability for less than 20 percent of the responding companies.

However, most companies surveyed do not appear to be planning corollary increases in the breadth and scale of their water risk management practices. In fact, nearly 70 percent of responding companies said their current level of investment in water management is sufficient.

For this reason, the study's authors question whether many companies are adequately prepared for the growing number of water risks and challenges they will face. Businesses participating in the study identified two significant internal obstacles that hinder greater companywide action on water: lack of time to raise awareness and buy-in, and that other risks ranked as a higher and more immediate priority.

Low water levels affect the bottom line

That said, the acknowledgement among major U.S. corporations that water is becoming a major business issue is a notable finding in and of itself. There is growing recognition that in addition to being a significant societal problem, water also creates critical challenges for businesses specifically. Insufficient or contaminated water supply, or a lack of infrastructure to reliably deliver that supply, can mean companies may not be able to maintain the volume and quality of their production.

This new reality necessitates that companies' senior management better understand the many ways that water affects their bottom line and that they pursue water stewardship strategies that adequately address these emerging water-related challenges.

The Pacific Institute long has held that sustainable water management is the most viable long-term water risk mitigation strategy that businesses can pursue. There's a business case for bringing long-term water demand into alignment with renewable supply, and for engaging in democratic water governance processes geared toward ensuring that societal needs are equitably met and that aquatic ecosystems continue to function and thrive. It would be great to have more allies from the business community that share an interest in progressing toward the aspirational objective of sustainable water management here in the United States.

This article originally appeared in Pacific Institute Insights.

Water image by jenny downing via Flickr



Mitchell Beer

President
Smarter Shift
Mitchell Beer is president of Smarter Shift, an Ottawa-based firm that specializes in content management, social media strategy, climate and sustainability communications, and conference content capture. He is former deputy director of the Trottier Energy Futures Project, an effort to map a low-carbon energy future for Canada.

PwC: 10 tips to bolster employee engagement

By Ellen Weinreb
Published April 09, 2014
Email | Print | Single Page View
Tags: Corporate Strategy, Employees, More... Corporate Strategy, Employees, Social Responsibility
PwC: 10 tips to bolster employee engagement

We know that employee engagement plays a key role in the success of both CSR programs and company-wide outcomes. After all, staff members who feel valued and productive have higher retention rates, increased productivity and greater motivation to give back to their colleagues, employer, community and the planet.

But is it possible to measure the value of employee engagement? How can corporations quantify their ROI?

PwC has published a report (PDF) addressing these questions and others. The report includes research done by Shannon Schuyler (principal and corporate responsibility leader for the company), Jeff Senne (corporate responsibility operations leader) and their colleagues. It also describes the three-step "Connect-Embed-Improve" plan that PwC has used to promote employee engagement.

PwC found that the value of its campaign to improve the employee retention ROI of corporate responsibility was $165 million. This has driven a 5 percent higher retention rate among employees who participated in the company's CSR programs.

I was intrigued to hear Schuyler speak about these findings at GreenBiz Forum 2014 in Phoenix, Ariz. As she said at the forum, employee engagement has long been a "nebulous" concept best characterized by anecdotes and stories. "Nothing was tangible, and it was really hard to go into your C-suite and say this is something that's valuable. … It feels good to do good things, but to really be able to put numbers around it brings this whole area to a different level."

Impressed by the company's success in measuring ROI, I reached out to Senne to help create this list of 10 ways to value and improve employee engagement based on PwC's journey.

1. Quantify employee participation in CSR activities

As a basis for comparison, the team categorized employees into three groups based on their involvement level with CSR activities at PwC: no involvement in CSR, participation in one activity, and engagement (defined as participating a number of times).

2. Calculate tangible figures  

By keeping track of things such as hours spent or dollars donated, you can identify which activities are high motivators, and which are not. 

3. Measure impact

Impact can include the number of students or educators reached, the impact on an NGO's mission and deliverables. It is crucial to measure impact beyond just dollars and cents.

4. Correlate with staff retention

The PwC report cites a 2010 study by the Corporate Executive Board (CEB), which found that employees with the highest levels of commitment to an organization were 87 percent less likely to resign. At the forum, Schuyler said that CR lets employees "realize it's not just about them, but that they can take their skills and knowledge and interest, leverage the firm, and then go out and do it. … People want to stay because then they see the other value that they have."

5. Correlate with improved ratings

Years ago, the highest performers were not the most active in CR programs. But after further engaging staff to better understand where they were finding value in CR, PwC discovered a correlation between engagement and higher employee ratings. In her forum talk, Scuyler said it was important for these highest performers "to realize and figure out how to balance utilization [of work hours unrelated to CR] with spending time during the work day engaged in something around CR."

6. Correlate with productivity

CSR activities that engage employees help them to learn new skills and sharpen existing ones. This can lead to more meaningful, positive and productive lives, thereby increasing their productivity at work as well. "People want to have a purpose," Schuyler said at the forum. "They want to figure out 'What does my job mean?' The 2010 study by CEB showed 57 percent greater effort among the employees who were most committed to their organization."

7. Correlate with client satisfaction

Improving employee productivity and performance also can improve customer satisfaction, allowing for a positive feedback loop that reinforces itself. "People are performing at a higher level when they're more engaged at the organization," Schuyler said. "They actually provide better service to our clients, which leads to more loyalty from our clients, which leads to more satisfaction from our people. So it really becomes this loop."

8. Analyze nuances of employee roles

By offering opportunities that better meet the needs of the staff, you can improve the use of employees' unique talents and skills in CSR programs, thereby promoting engagement. One-size-fits-all approaches should be avoided, but authentic leverage of core competencies can be a critical way to connect staff to a larger sense of mission. 

9. Examine generational differences (and similarities)

PwC has found significant correlations in the need for personal purpose among milennials and baby boomers. For example, a project teaching financial literacy in Belize has had great success among both the newest employees and the retirees of the company. While there are some differences between generations that are worth noting, many similarities exist as well. And these can help build a connection among employees.

10. Track employee satisfaction and feedback

Schuyler said that employees "see what the company can do, but there's so much more that they can do when they're actually involved. … They want to make sure that their fingerprints are part of it and that they're not just being told, 'This is what you need to do.' They want to be a part of those decisions." Giving employees the opportunity to provide input helps them to feel more valued and engages them at a deeper level.

Watch Shannon Schuyler discuss more insights and tips on employee engagement at GreenBiz Forum 2014 below:

Colored pencils photo by Andrey_Kuzmin via Shutterstock

Tweet
Also in The Talent Show Blog:


Tweet

More institutional investors consider ditching fossil fuel stocks

By Glen Yelton
Published April 09, 2014
Email | Print | Single Page View
Tags: Finance, Risk
More institutional investors consider ditching fossil fuel stocks

This article originally appeared at IW Financial.

Investors have been continuing the trend toward environmental activism during the current proxy season, with more shareholder resolutions on environmental issues being filed in 2014 than any previous year.

Shareholder support for these initiatives has also been rising, showing corporate managers that they will ultimately need to address environmental, social and governance (ESG) issues one way or another, whether they take a proactive approach or wait for the relevant decisions to be made for them by investors. Over the last decade, the number of sustainability-related resolutions receiving at least 20 percent support has more than tripled.

As a result, some corporations seem to have become more open to meaningful engagement on ESG issues. The recent announcement that ExxonMobil, the largest American energy company, has agreed to publish a "Carbon Asset Risk" report is particularly noteworthy.

However, despite the signs of progress being touted by members of the engagement camp, activist investors and organizations continue to make the case for divestment from fossil fuel companies, arguing that it sends a much more powerful message about the need to start taking action on environmental issues.

The Carbon Tracker Initiative has identified the top 200 fossil fuel companies, ranked by the size of their carbon reserves. Many advocates of divestment point to this list as the best place to start. However, there are plenty of other questions remaining for investors considering divestment.

Analyst: Divestment advocates focus on long-term value

In a recent article for Responsible Investor, independent analyst Paul Hodgson called attention to two of the most important questions facing the divestment movement today: how can institutions be convinced to divest and how will the process of investors moving their money out of fossil fuel stocks actually work?

The Fossil Free campaign advocated by 350.org urges city and state governments, educational, religious and other types of institutions that "serve the public" to immediately freeze new investment in fossil fuel companies and sell any shares they currently own within five years. With university endowments alone controlling hundreds of billions of dollars in investments, it is clear that this action could put a significant amount of pressure on major fossil fuel companies.

However, Hodgson concedes that for most institutional investors, the process is rarely as simple as it may sound. For starters, these organizations have to sell their constituents on the idea that investments which have proven to be highly profitable in the past will start to decline in value and become unacceptably risky in the relatively near future. This may be a challenge, but as 350.org advises, stakeholders simply need to "do the math."

Fossil fuel companies' valuations are based in large part on their possession of about $20 trillion worth of carbon reserves. However, a large portion of these assets will likely be rendered "unburnable" at some point, due to governmental efforts aimed at limiting global warming to 2 degrees Celsius. The International Energy Agency has previously calculated that, in order to meet the 2-degree target, which has been agreed to by nearly every country on Earth, the energy industry will have to write off up to 80 percent of its fossil fuel reserves. Recent research suggests that even more aggressive limits on carbon consumption may be required to sustain a reasonable chance of achieving the international community's climate goals.

The latest report from the Intergovernmental Panel on Climate Change (IPCC) indicated that, given current trends, climate change will likely exceed the 2-degree threshold and cause more severe effects on ecosystems and economies than previously anticipated. As these impacts become more clear over time, it could galvanize political support for stricter emissions limits and hasten the devaluation of fossil fuel reserves.

If governments follow through on their commitments and $16 trillion in assets become stranded, it seems inevitable that fossil fuel stocks will tumble in value. It is a slippery slope for investors to stand on. Even faced with these facts, it is still difficult for institutions, particularly larger ones, to move forward with divestment initiatives. Hodgson looked at a few current examples to highlight the challenges divestment advocates face in building momentum at their organizations.

Despite challenges, divestment initiatives gaining momentum

After the Board of Supervisors of San Francisco City and County passed a resolution urging the San Francisco Employees' Retirement System (SFERS) to divest from fossil fuel stocks, the SFERS board opted to slow down and gather more information before making any decisions. Specifically, the retirement system board said it would review its approach to ESG issues and analyze relevant proxy voting strategies.

At the University of Maine at Orono, there are 40 different managers involved with the school's endowment. The sheer number of decision makers involved is a sign that it could take years just to get an institutional commitment to divestment, let alone actually carrying out the process.

For Unity College, a small liberal arts school that focuses on environmental science with a $15 million endowment, the process was somewhat simpler. However, the college still faced issues. With its endowment invested in exchange traded funds (ETFs), Unity could not guarantee that it would have zero exposure to fossil fuel stocks. It set a goal of reducing such holdings to less than 1 percent of its portfolio by focusing on non-energy ETFs. The school's CFO told Hodgson that there has not been any substantial impact on the fund's performance since it began divesting in 2012.

Despite the challenges it faces, the divestment movement has a growing number of advocates and successes. Hodgson notes that nine colleges, 22 cities and towns, two counties, 22 church foundations, 25 private foundations and a variety of other organizations have committed to going fossil free. Divestment is also gaining attention abroad, with 350.org's campaign seeing "substantial expansion" in Europe, Australia and New Zealand.

Is there room for a nuanced approach to divestment?

Beyond the hurdles to broader acceptance of divestment, there are also complications that will emerge within the divestment process once commitment reaches a critical mass. For example, those institutions that are planning to divest could see their holdings devalued if other investors begin divesting en masse. It is also difficult to predict what would happen if the market was suddenly flooded with fossil fuel shares.

As clients contemplate next steps in their approach to reducing the carbon content of their portfolios, it is becoming increasingly clear that there may be a need to develop more nuanced strategies. For many clients, practical considerations may be seen as additional hurdles to implementing the straightforward approach to divestment advocated by 350.org and other similar organizations. Tax implications, diversification, portfolio risk profiles, and fiduciary responsibilities must all be taken in to account in the implementation of any divestment strategy.

Some clients are choosing to approach the divestment of these companies in an incremental, phased approach, similar to the strategy used by Unity College. Such an approach allows for the sale of targeted companies under appropriate market conditions with the end goal of achieving divestment benchmarks in a longer timeframe, while addressing the practical considerations outlined above. However, as also noted earlier, such an approach could become a liability if broader acceptance of the divestment strategy emerges.

These uncertainties will create challenges for advocates of divestment, but it seems clear that a growing number of capital market participants would prefer to deal with these potential issues as they arise, rather than face the certain risks of remaining invested in fossil fuel companies' unsustainable business models.

IW Financial is currently preparing a report that provides a closer look at how investors are quantifying financial risks associated with owning fossil fuel stocks. Additionally, our firm works closely with clients to design and implement divestment plans using any of the above concepts — from complete divestiture to incremental portfolio realignment.

Oil drum image by Iaroslav Neliubov via Shutterstock

 

Tweet


Tweet

How Cargill cultivated greener soybean production in the Amazon

By Arlin Wasserman, Bruce Hull and Barbara McCutchan
Published April 09, 2014
Email | Print | Single Page View
Tags: Agriculture, Forestry, More... Agriculture, Forestry, Standards & Certification
How Cargill cultivated greener soybean production in the Amazon

This is the second part of a three-part series from Virginia Tech examining the sustainability in the global soy market. Read the first part here.

Since Amazon forests are cleared to make way for soybean farming and cattle grazing, these land uses have been at the center of the ongoing debate about deforestation. In April 2006, Greenpeace published "Eating Up the Amazon," asserting that multinational agricultural companies financed such deforestation. The report also targeted the U.S. and European retail food industries, saying their consumers were complicit because they purchased soy-based animal feed. It further criticized the Brazilian government for lack of governance and a failure to protect the Amazon rainforest.

These concerns were legitimate and the damage to forests and brands was clear. Luckily, strategic responses were already being developed. Back in 2000, Cargill, then and still the leading global producer and marketer of agricultural products and services, began constructing a port facility in Santarém, Brazil. The new port would allow soybeans and other commodities to be shipped down the Amazon river rather than along crowded, potholed roads in trucks that sometimes waited days in long lines for their haul to be unloaded at existing ports onto ships bound for China and Europe. Licensing the new port was controversial because it was seen as the tip of the spear for rapid expansion into the rainforest. This prediction proved right — today, at least 10 more new ports are in various stages of licensing and construction.

In 2004, The Nature Conservancy (TNC), a global conservation organization, began discussions with Cargill in Brazil and with the Cargill Foundation in the U.S. to develop strategies for responding to environmental and social changes that the new port would bring to Santarém. Here's how three measures the organizations worked together to develop — standards, capacity building and landscape coordination — helped mitigate issues with soybean cultivation in the Amazon.

Standards 

Early discussions between TNC and Cargill focused on developing standards for a "Forest Friendly Soy" certification. But these efforts soon were abandoned when both TNC and Cargill joined the Roundtable for Responsible Soy (RTRS), an effort led by WWF International and Unilever that began two months later. The RTRS standards require best management practices that include limits on soy-driven deforestation.

But it was unclear to TNC and Cargill what type of certification would remain relevant given that the largest increases in global consumption over the next 40 years likely would come from rapidly developing countries in Asia and the global south. Certification standards developed for European Union markets, where most soy exports had gone, might not be relevant in emerging markets where most soy exports would go. Moreover, TNC and Cargill collaborators realized that RTRS certification would not happen soon enough, and it might not be sufficient to address concerns raised by the potential explosion of public scrutiny on the new port in Santarém. So in addition to working with RTRS to abide by its standards, they also developed and pursued strategies of building capacity and adding value.

Capacity building

Brazil's Forest Code is one of the most progressive environmental laws in the world. But compliance has proven difficult for several reasons, notably the limited technical capacity to map a property and to measure changes in forest coverage. Beginning in 2005, TNC built a GIS database system, funded by Cargill Foundation, to map properties and monitor deforestation. The resulting geo-referenced producer and farm database used satellite images and allowed Cargill, TNC, government agencies and producers to check exactly what was happening to the vegetation cover. It also enabled Cargill to check the compliance of the soy it bought. The long-term aim of these efforts was to build technical capacity among all partners to collect, analyze and monitor land-use change, in order to comply with the forest code and other social norms and environmental laws. 

Another obstacle to Forest Code implementation was the lack of practical and affordable means for farmers to become compliant, or receive benefits for doing so. So TNC and Cargill provided free or heavily subsidized technical assistance for best management practices, and helped arrange financing for their implementation. In addition, Cargill adopted a policy of only purchasing soybeans from producers compliant with the Forest Code. Even though Cargill offered no price premium, the confidence of having a buyer assured farmers of a steady revenue stream, making it less risky to invest in becoming compliant. Cargill likewise benefits from steadily increasing production and productivity.

Landscape coordination 

Key stakeholders can collaborate proactively to reduce risks and capture opportunities that create shared value. For example, TNC-Cargill's experience in the trial region of Santarém was taken to the Paragominas municipality to provide a practical solution to the federal government's demands that municipalities bring their deforestation under control. This in turn led to the creation of the Green Municipalities Program by Pará state, to which Santarém municipality later became a participant. The program provides support and incentives to municipalities that commit to bringing illegal deforestation under control. It also increased access to loans and other resources for farmers and directed land development to where it can be most productive and least damaging to regional watersheds, agricultural production and other ecosystem services.

This strategy has been the most complicated and slowest to gain traction. Stakeholders in Santarém are only now beginning to realize how to reduce risks and add value through coordinating actions across the landscape in order to manage water, erosion, infrastructure, climate, species migration and other production qualities that ignore property lines and require cross-boundary coordination. Although there are not yet plans to do so, this strategy has the potential to help producers adapt to changes in both climate and global markets, making soy production more resilient and less risky.

A decade ago, when certification was beginning to gain acceptance, few people spoke of capacity building or landscape coordination for creating shared value. Today these strategies are being replicated all over the world, including by SAB-Miller in Colombia and South Africa, and Starbucks in Mexico, Indonesia and Brazil. Lessons learned hold promise for increasing soy production, developing a local economy, feeding the world, and conserving world heritage rainforests and ecosystem services.

Soy sprout photo by viphotos via Shutterstock

Tweet




Fighting Deforestation

How Cargill cultivated greener soybean production in the Amazon
By Arlin Wasserman, Bruce Hull and Barbara McCutchan

By teaming up with The Nature Conservancy, this leading agricultural company has helped to mitigate deforestation in Brazil.

...Read More


P&G pledges zero deforestation by 2020
By Jessica Shankleman

The company has caved to pressure from Greenpeace to source palm oil sustainably. But does its vow go far enough?

...Read More
Sponsored Content

NAEM Trends Report: Planning for a Sustainable Future


Drawn from more than 25 interviews with corporate EHS and sustainability leaders, as well as recognized experts in the environmental business movement, the NAEM Trends Report offers a unique look at how leadership companies are managing corporate EHS and sustainability today, and the thinking that will drive program development tomorrow. Download your copy of the report


Next-Gen Buildings

Los Angeles, Washington, Atlanta top Energy Star ratings
By Elsa Wenzel

These cities are leading the way when it comes to the EPA's energy efficiency rankings.

...Read More


The world's first net-zero energy skyscraper rises in Indonesia
By Sustainable Business News

The Pertamina Energy Tower's curved façade is precisely calibrated for Jakarta's proximity to the equator to mitigate solar heat gain year-round....Read More

Sponsored Content

Can You Save Millions with Sustainable Packaging Design?


That’s just what we helped Puma and Kraft do. Check out our expert advice in this free white paper - Five Steps to Sustainable Packaging. PE INTERNATIONAL has worked with some of the most innovative brands to create award-winning, customer-engaging packaging, including Puma’s ‘Clever Little Bag’ and the Kraft ‘YES pack’ Download your free whitepaper now.


Focus on Water

How enlightened self-interest in sustainable water helps business
By Jason Morrison

As water becomes scarce, managing it becomes a bigger piece of the business profit puzzle. A recent PI and VOX Global study examines the trends....Read More

 
Sponsored Content

Interpreting Pre-Consumer Recycled Content Claims: Philosophy and Guidance on Environmental Claims for Pre-Consumer Recycled Materials


There is a great deal of debate within the environmental and manufacturing communities about which materials can be claimed as pre-consumer recycled content. UL Environment encourages an end to this debate and has developed this document to provide clarity on interpreting existing guidelines to validate claims of pre-consumer recycled content and to serve as a reference for manufacturers. Download the free whitepaper here.


White Papers

  • Creating Healthier Furniture and Building Materials by Minimizing Chemical Emissions
  • Driving Performance and Transparency in Green Building Products
  • Interpreting Pre-Consumer Recycled Content Claims: Philosophy and Guidance on Environmental Claims for Pre-Consumer Recycled Materials
  • Transparency and the Role of Environmental Product Declarations
  • 2014 The Product Mindset
  • 2014 Energy and Sustainability Predictions
  • Can You Save Millions with Sustainable Packaging Design?
  • LEED v4 for Product Manufacturers—Complying With New MR Credits
  • NAEM Trends Report: Planning for a Sustainable Future
  • The Sleeping Giant: When Energy Prices Awake
  • Selecting an EMIS Top 10
  • EHS Management Information Systems (EMIS) - Getting Started
  • EMIS Design
  • Environmental Health & Safety (EHS) Data Management in a Post Merger and Acquisition Environment
  • E2's EMIS Return on Investment (ROI) Approach
  • A Tactical and Practical Approach (TAPA) to Developing a Defensible and Manageable Sustainability Program
  • Why create an EMIS Strategic Plan?
  • Automating Global Regulatory Compliance
  • Build vs. Buy
  • Project Financing Cheat Sheet
  • Guide to Energy, Carbon and Sustainability Software
  • Six growing trends in corporate sustainability

  • April 11, 2014
    GreenBuzz
     
     
     
    Upcoming Events
    Solar Summit
    Mon, Apr 14 - Wed, Apr 16
    Litchfield Park AZ

    World Green Economy Summit
    Tue, Apr 15 - Wed, Apr 16
    Dubai

    Solar Procurement Templates & Tools for Higher Education
    Wed, Apr 16
    Online webinar

    Symposium on Cleantech Innovations in the Commercial Building Sector
    Wed, Apr 23
    San Francisco CA

    Title 24 Commercial Building Standards Workshop
    Wed, Apr 23
    Redwood City CA


    » Post An Event
    » More Events
    Green Jobs & Careers
    Residential Outreach Specialist
    San Diego, CA

    Deputy Director
    Oakland, CA

    Senior Field Services
    Technician Sunrise, FL

    Education Director
    Ann Arbor, MI

    Marketing & Development Assistant
    Plainfield, MA

    » Post A Job
    » Browse All Jobs
    » Green Career Resources
    Talk to GreenBiz: Have a story idea, insider tip, favorite resource to share? Send it to us
    Become a Sponsor
    Reach tens of thousands of businesses every month by placing your ad here. Contact us to receive more information.

    © 2014 GreenBiz Group - GreenBiz.com® is a registered trademark of GreenBiz Group Inc, Oakland, CA USA
    © GreenBiz Group Inc. All rights reserved.
    Grid Progress

    How a small county in California went grid positive
    By Laurie Guevara-Stone

    Through an innovative push to embrace renewables, Yolo County produces 152 percent more energy from solar panels than it uses.

    ...Read More


    4 steps to keep the grid from freezing up in extreme cold
    By Mauricio Gutierrez

    Extreme winter and cool logic dictate a smoother transition to renewables. Here's how we can keep the lights on, from the COO of NRG Energy.

    ...Read More
    Sponsored Content

    EHS Management Information Systems (EMIS) - Getting Started


    Should my IT group be involved in my EMIS project? What should I expect in terms of strategic planning and design costs? What is the best way to implement my system successfully? Learn the answers to these questions and how to successfully implement an EMIS in this informative white paper. Download the free whitepaper here.


    Better Transport

    Facing May deadline, carmakers invite action on conflict minerals
    By Tanya Bolden

    In May, auto companies from Chrysler to Toyota and beyond must report to the SEC about known conflict minerals in supply chains.

    ...Read More


    Maersk Line cruises to lower shipping emissions levels

    Optimization, upgrades and more fuel efficient vessels helps one of world's largest emitters cut its footprint....Read More

    Sponsored Content

    NAEM Trends Report: Planning for a Sustainable Future


    Drawn from more than 25 interviews with corporate EHS and sustainability leaders, as well as recognized experts in the environmental business movement, the NAEM Trends Report offers a unique look at how leadership companies are managing corporate EHS and sustainability today, and the thinking that will drive program development tomorrow. Download your copy of the report


    Focus on Recycling

    The two questions to ask before handing over used electronics
    By Leo Raudys

    Uncertified recyclers can pervert the idea of recycling, putting humans and environments at risk. Put your e-waste to better use (and re-use)....Read More

     
    Sponsored Content

    Interpreting Pre-Consumer Recycled Content Claims: Philosophy and Guidance on Environmental Claims for Pre-Consumer Recycled Materials


    There is a great deal of debate within the environmental and manufacturing communities about which materials can be claimed as pre-consumer recycled content. UL Environment encourages an end to this debate and has developed this document to provide clarity on interpreting existing guidelines to validate claims of pre-consumer recycled content and to serve as a reference for manufacturers. Download the free whitepaper here.


    White Papers

  • Creating Healthier Furniture and Building Materials by Minimizing Chemical Emissions
  • Driving Performance and Transparency in Green Building Products
  • Interpreting Pre-Consumer Recycled Content Claims: Philosophy and Guidance on Environmental Claims for Pre-Consumer Recycled Materials
  • Transparency and the Role of Environmental Product Declarations
  • 2014 The Product Mindset
  • 2014 Energy and Sustainability Predictions
  • Can You Save Millions with Sustainable Packaging Design?
  • LEED v4 for Product Manufacturers—Complying With New MR Credits
  • NAEM Trends Report: Planning for a Sustainable Future
  • The Sleeping Giant: When Energy Prices Awake
  • Selecting an EMIS Top 10
  • EHS Management Information Systems (EMIS) - Getting Started
  • EMIS Design
  • Environmental Health & Safety (EHS) Data Management in a Post Merger and Acquisition Environment
  • E2's EMIS Return on Investment (ROI) Approach
  • A Tactical and Practical Approach (TAPA) to Developing a Defensible and Manageable Sustainability Program
  • Why create an EMIS Strategic Plan?
  • Automating Global Regulatory Compliance
  • Build vs. Buy
  • Project Financing Cheat Sheet
  • Guide to Energy, Carbon and Sustainability Software
  • Six growing trends in corporate sustainability

  • April 10, 2014
    GreenBuzz
     
     
     
    Upcoming Events
    Solar Summit
    Mon, Apr 14 - Wed, Apr 16
    Litchfield Park AZ

    World Green Economy Summit
    Tue, Apr 15 - Wed, Apr 16
    Dubai

    Solar Procurement Templates & Tools for Higher Education
    Wed, Apr 16
    Online webinar

    11th North Carolina Sustainable Energy Conference
    Tue, Apr 22 - Wed, Apr 23
    Raleigh NC

    2014: The Year of the Battery - Taking Batteries from Bottleneck to Breakthrough
    Wed, Apr 23
    Fremont CA


    » Post An Event
    » More Events
    Green Jobs & Careers
    Education Director
    Ann Arbor, MI

    Marketing & Development Assistant
    Plainfield, MA

    Senior Manager, C&I
    Portland, OR

    Brand Manager
    New York, NY

    Communications Associate
    New York, NY

    » Post A Job
    » Browse All Jobs
    » Green Career Resources
    Talk to GreenBiz: Have a story idea, insider tip, favorite resource to share? Send it to us
    Become a Sponsor
    Reach tens of thousands of businesses every month by placing your ad here. Contact us to receive more information.

    © 2014 GreenBiz Group - GreenBiz.com® is a registered trademark of GreenBiz Group Inc, Oakland, CA USA
    © GreenBiz Group Inc. All rights reserved.
    Syndicate content