Report Report: Circular, leaders, weather and renewables

Report Report

Report Report: Circular, leaders, weather and renewables

The Report Report is a monthly wrap-up of recent research on sustainable business and clean technology, produced by Corporate Eco Forum, a by-invitation membership organization comprised of large, global companies that demonstrate a serious commitment at the senior executive level to sustainability as a business strategy issue.

2018 Information and Communications Technology Benchmark (KnowTheChain) scores the top 40 companies across the Information and Communications Technology industry based on their actions to mitigate forced labor in the supply chain. The report gave the highest score to Intel, followed by HP Inc., Apple, and HPE.

2018 Sustainability Leaders Survey (GlobeScan and SustainAbility) asked thousands of sustainable development experts and practitioners to list companies that are leaders in integrating sustainability into their business strategy. The most frequently cited companies include:

  • Unilever
  • Patagonia
  • Interface
  • IKEA
  • M&S
  • Tesla
  • Nestlé
  • Natura
  • Danone
  • Apple
  • Walmart

The Circular Economy: A Powerful Force for Climate Mitigation (Material Economics) explores how building a more circular economy for the four largest materials in terms of emissions (steel, plastics, aluminum and cement) and two large use segments for these materials (passenger cars and buildings) could deliver emissions reductions globally. The report estimates that a more circular economy for these materials could cut global emissions by 3.6 billion metric tons annually.

The Effects of Weather Events on Corporate Earnings Are Gathering Force (S&P Global Ratings) analyzes public corporate research updates and earnings call transcripts from April 2017 to April 2018 (FY2017) to identify if weather events had a material impact on earnings of S&P 500 companies. Key findings include:

  • In FY2017, 73 companies (15 percent) on the S&P 500 publicly disclosed an impact on earnings from weather events. However, only 18 companies (4 percent) quantified the impact.
  • The average impact of weather events on S&P 500 companies’ earnings was 6 percent.
  • Climate risk is an important topic of discussion for the CEOs of publicly traded companies, and management teams are becoming increasingly accountable for understanding and mitigating the impact of climate risk.
  • Evidence of the impact of climate risk is found across all sectors, geographies and seasons.
  • A review of the earnings call transcripts of S&P 500 companies in the past 10 years revealed that "climate" and "weather" combined were among the most frequently discussed topics among executives, even more common than "Trump," "the dollar," "oil" and "recession."

Investing in the global green economy: busting common myths (FTSE Russell) states that the "green economy" is worth about $4 trillion, representing 6 percent of the market capitalization of globally listed companies. The report also finds that about 3,000 global, listed companies have exposure to the green economy — up about 20 percent since 2009.

The New Big Circle (WBCSD and The Boston Consulting Group) provides insight into current circularity trends in companies, as well as best practices on how leading companies are implementing circular business models. Select key findings include:

  • 97 percent of respondents said that the circular economy drives innovation to help make the company more efficient and competitive in areas such as sourcing, product development and production processes.
  • 96 percent of respondents believe that the circular economy is important for their company’s future success.
  • 61 percent of the surveyed companies fund their circular projects internally.
  • 51 percent of respondents state that circular economy activities already add to company profits.
  • 50 percent of respondents stated that customers are the most influential external group. 

Renewable Heating and Cooling for Industrial Applications: Guidance for Carbon Accounting (Ecofys, Renewable Thermal Collaborative and Mars Inc.) recommends a primary methodology for calculating emissions impacts of six thermal energy project types.

Renewables 2018 Global Status Report (REN21) finds that a record 178 gigawatts (GW) of renewable power capacity was added globally in 2017 — up 9 percent from 2016 levels. Select key findings include:

  • Renewable power accounted for 70 percent of net additions to global power generating capacity in 2017.
  • More than two-thirds of investments in power generation were in renewables in 2017.
  • China, Europe and the United States accounted for nearly 75 percent of global investment in renewables in 2017.

Sustainability Clauses in Commercial Contracts: The Key to Corporate Responsibility (EcoVadis) analyzes the impact of sustainability clauses in buyer-supplier contracts and provides recommendations to improve current practices. Key findings include:

  • 70 percent of buyers analyzed include a CSR clause in their contracts.
  • 80 percent of suppliers analyzed have signed contracts that include a CSR clause, and more than three-quarters are in favor of them
  • 41 percent of suppliers said contractual CSR commitments have raised their awareness of environmental, social and ethical issues.
  • More than 50 percent of suppliers have come across CSR requirements that were impossible to achieve.
  • 38 percent of clauses extend to tier two suppliers and beyond.​
  • 25 percent of buyers adapt CSR clauses depending on the sector and size of the supplier. 

Win-Win-Win: The Sustainable Supply Chain Finance Opportunity (BSR) explores how global companies — such as Puma and Levi Strauss & Co. — are leveraging supply chain and trade finance mechanisms to reward and incentivize their suppliers to adopt sustainable and responsible behaviors. The report estimates that the sustainable supply chain finance market will reach $660 billion, representing a $6 billion opportunity in sustainable supply chain finance revenue.