Report Report

Report Report: Food waste, investing, transportation, systems change, plastic pollution

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.

BP Energy Outlook – 2019 Edition (BP) finds that global energy demand will increase by around one-third by 2040. The report also finds that 85 percent of the growth in energy supply will be met by renewable energy and natural gas, with renewables becoming the largest source of global power generation by 2040.

The Business Case for Reducing Food Loss and Waste: Restaurants (Champions 12.3) finds that restaurants saved $7 in operating costs on average for every $1 they invested in reducing kitchen food waste, according to an analysis of financial cost and benefit data for 114 restaurants across 12 countries. The report also finds that 76 percent of the sites had recouped their investment within the first year of implementing a food waste reduction program, and 89 percent of the sites had recouped their investment within two years.

Change the Conversation: Redefining How Companies Engage Investors on Sustainability (Ceres) offers nine recommendations, outlined under three strategies to help companies improve investor engagement on ESG issues:

1. Formalize sustainable business integration

  • Demonstrate accountability for sustainability.
  • Develop the sustainability business case.
  • Cultivate collaboration between sustainability, investor relations and governance teams.

2. Identify what to disclose and where to disclose it

  • Focus investor-directed disclosures on what is material but don’t ignore emerging trends.
  • Disclose decision-useful information, both quantitatively and qualitatively.
  • Disclose sustainability information consistently where investors already are looking.

3. Implement a proactive investor engagement strategy

  • Use language that investors understand and value.
  • Leverage the C-suite and board of directors as key messengers.
  • Diversify investor engagement strategies.

The Clean Technology Fund and Concessional Finance (Bloomberg New Energy Finance) presents keys findings and lessons learned from The Clean Technology Fund’s low-carbon financing efforts in Chile, Kazakhstan, Mexico, Morocco and Thailand. The report also identifies new opportunities for investors to boost the competitiveness of wind and solar PV in developing countries through concessional finance.

Fast Moving Consumers (CDP) assesses 16 publicly listed companies in the consumer packaged goods sector on their business readiness for the transition to a low-carbon economy. Select key findings include:

  • The sector’s key carbon exposures exist in the value chain driving large Scope 3 emissions, which make up 90 percent of lifecycle emissions.
  • Unilever, Danone, Nestlé and L’Oréal received high scores.
  • 56 percent of Food & Beverage companies have no Scope 3 emission reduction targets, with household and personal care companies performing better at 29 percent.
  • 63 percent of companies are investing to advance depolymerization and recycling infrastructure.
  • Almost 60 percent of the top 10 revenue generating brands for each company have failed to deliver low carbon innovations to market in the last 5 years.
  • 75 percent of companies have acquired smaller, environmentally conscious brands to create strategic optionality.

Driving Systems Change in Turbulent Times (Forum for the Future) explores seven global trends that are set to impact our ability to address global challenges:

  • The plastics kickback
  • Migration and the climate crisis
  • Nationalism marches again
  • The "onlife"
  • The rise of participatory democracy
  • Changing consumerism in Asia
  • Biodiversity in freefall

The Future of Transportation: Mobility in the Age of the Megacity (Visa) offers insight from 19,000 consumers into the growing demand for public and private transportation, and the role digital commerce plays in driving sustainable growth. Select key findings include:

  • 46 percent of consumers globally have seen commuting times increase.
  • 52 percent are frustrated with the experience of using public transport.
  • 37 percent expect that their commuting time will increase over the next five years.
  • The personal car is the top mode of transport for both commuting (60 percent) and personal travel (61 percent).
  • 44 percent use public transport as a way to get to work, school or university. 

Global Corporate Green Investment and the U.N. Sustainable Development Goals (Corporate Knights and Climate Bond Initiative) finds that 7,000 of the world’s largest non-financial sector corporations collectively made $611 billion in green investments in 2017. The report also finds that the green component of this collective investment needs to increase from $611 billion (17 percent of the total) to about $1.07 trillion (28 percent of the total) in order to reach "SDG Alignment."

Global Energy Perspective 2019 (McKinsey Energy Insights) provides energy-related demand projections for 146 countries, 30 sectors and 55 energy types. Key findings include:

  • Global primary energy demand will plateau around 2030.
  • Global electricity demand will double by 2050.
  • Renewable energy is projected to account for more than 50 percent of total power generation post-2035.
  • Gas will be the only fossil fuel to grow its share of total energy demand by 2035.
  • Oil demand growth is projected to peak in the early 2030s at a volume of 108 million barrels per day.
  • Global energy-related emissions will peak in 2024 and decline by 20 percent from 2016 to 2050.

Rate the Raters 2019 (SustainAbility) offers perspectives from corporate practitioners on the quality and usefulness of 11 of the most widely used ESG ratings. Key findings include:

  • Survey respondents identified RobecoSAM (the underlying assessment for the Dow Jones Sustainability Index) and CDP as leaders, with MSCI and Sustainalytics receiving favorable reviews. Respondents consider these four ratings a distinct top four compared to all other ratings covered in the 2018 survey.
  • Trustworthiness and transparency of data sources, along with robustness of methodology, are viewed as the key factors that determine the quality of an ESG rating.
  • Around two-thirds of respondents use ESG ratings to inform decision-making. In open-ended responses, sustainability experts most often mentioned using ratings for internal assessments and strategy, to help inform what data to disclose, identify trends and support stakeholder engagement.
  • Respondents’ top priority for the future of ratings is better comparability and consistency across the landscape, followed by continued improvements on disclosure, quality of methodologies and greater focus on material issues.

Safer Materials in Food Packaging (Safer Made and Forsythia Foundation) provides examples of companies actively advancing the adoption of safer materials that reduce or eliminate the use of hazardous chemicals in food packaging. The report also identifies innovation and investment opportunities in food packaging among multiple stakeholders, including brands, suppliers, investors, innovators and start-up companies.

Solving Plastic Pollution Through Accountability (WWF) finds that overall CO2 emissions from the plastic lifecycle are expected to increase by 50 percent, while the CO2 increase from plastic incineration is set to triple by 2030. The report argues that virgin plastics will continue to be at an advantage to more costly recycled material unless all players across the entire value chain are held accountable for the social and environmental costs of plastics.

Sustainable Energy In America Factbook 2019 (Bloomberg New Energy Finance and the Business Council for Sustainable Energy) finds that renewables (including hydropower) accounted for 17.7 percent of total U.S. power generation in 2017 — a 5.1 percent increase in absolute terms from last year. Additional key findings include:

  • The most new gas-fired power-generating capacity was added in 14 years, propelling it to a record 35 percent of U.S. power generation.
  • New PPAs signed between buyers of clean energy and generators spiked to a record 8.6 GW in 2018 — up from 2.8 GW in 2017.
  • Total electricity consumed in the U.S. rose 2.2 percent in 2018, while CO2 emissions from power plants rose just 0.6 percent.
  • Energy efficiency, renewable energy and natural gas sectors employed 3.4 million Americans in 2017.
  • Electric vehicles accounted for 3 percent of total vehicles sold in the U.S in the fourth quarter of 2018. 

Sustainable Share Index (NYU Stern's Center for Sustainable Business) finds that sustainability-marketed products delivered 50.1 percent of market growth in consumer packaged goods (CPG) from 2013 to 2018, while representing 16.6 percent of the CPG market in dollar sales in 2018 — up from 14.3 percent in 2013. Additional key findings include:

  • Across all categories, sustainability-marketed products delivered $113.9 billion in sales in 2018 — a 29 percent increase from 2013 levels.
  • Products marketed as sustainable grew 5.6 times faster than conventionally marketed products, and 3.3 times faster than the CPG market.
  • Sustainable products have more than 20 percent category share in many food categories, including cheese, salty snacks and coffee.

Sustainable Signals: Growth and Opportunity in Asset Management (Morgan Stanley Institute for Sustainable Investing and Bloomberg) explores how asset management professionals are delivering sustainable investing solutions to clients and offers insight into where they see growth and opportunity. Key findings include:

  • 75 percent of U.S. asset managers say their firms offer sustainable investing strategies, up from 65 percent in 2016.
  • Asset managers agree that sustainable investing is no longer a fad, with 89 percent saying it is here to stay and 63 percent expecting it to continue to grow in the next five years.
  • 82 percent think strong ESG practices can lead to higher profitability and that companies with such practices may be better long-term investments.
  • 62 percent believe that it’s possible to maximize financial returns while investing sustainably.
  • 89 percent of respondents report their firms will devote more resources to sustainable investing in the next two years. Common strategies for developing in-house skills and capacity include employee training (41 percent), dedicating more employee time (36 percent) and specialist hires (34 percent).
  • Seven in 10 asset managers agree that the industry lacks standard metrics to measure nonfinancial performance of sustainable investments.

Thinking Strategically: Using Resource Revenues to Invest in a Sustainable Future (World Economic Forum) explores how the global shift away from carbon-based energy will affect the revenues and economies of fossil-fuel-rich nations. The report also explores how these nations could use policy-linked, private sector investment techniques to address these challenges.

Tracking Progress of the 2020 Climate Turning Point (World Resources Institute) assesses progress against six milestones in energy, transport, land use, industry, infrastructure and finance that would need to be met by 2020 to put the world on a pathway consistent with the Paris Agreement. The report finds that in most cases, action is insufficient or progress is off-track across all six milestones.