Google: Much more than an Internet company

February 22, 2015

google_flat_logoIt’s hard to imagine life without Google–not just the search engine, but Gmail, maps, calendar and cloud storage. I could give up Twitter, Facebook and (reluctantly) Amazon, but Google and Apple are embedded deeply into my life. It’s not just me, of course. Google and Apple are among the world’s most valuable companies.

To its credit, Google has decided to invest some of its vast wealth in bold, world-changing ideas that could take years to pay off. Why? That’s the topic of my latest story for Guardian Sustainable Business.

Here’s how it begins:

In 2008, Google pranked everyone. It was April Fool’s Day and the tech giant uploaded a fake website claiming to be starting the first human settlement on Mars, with a little help from the airline company, Virgin.

Project Virgle had a 100-year development plan and an application for would-be Mars colonists.

Virgle does not sound quite as far-fetched now as it did then. More than any other company, Google has proven willing to support bold, costly and unorthodox projects far from its core business. But unlike the fictional Virgle, a plan to escape the Earth, many of Google’s biggest bets, including its investments of more than $1.5bn in renewable energy, aim to save it.

These efforts are spread across the company – software to track forests at Google Earth Engine, clean tech investments at Google Ventures, and Nest and its energy-saving thermostat, which Google acquired last year for $3.2bn. The most audacious, though, are found in a unit known as Google[x], where inventors, scientists and engineers seek solutions to the world’s biggest problems.

Google[x] is developing self-driving cars, which would make automobile travel radically more efficient, as well as energy-generating kites, self-flying vehicles to deliver goods and high-altitude balloons to provide cheap internet to people living in rural or remote areas.

We’ve come to expect this kind of thing from Google, but no other US company that I’m aware of has shown such boldness:

Imagine if General Motors invested in drought-resistant crops, or Disney decided to build small nuclear power plants, or Microsoft got into the algae business. That is the kind of boundary crashing that has become commonplace at Google.

This is about more than “doing good,” I’m sure. If even one of Google’s big, long-shot projects turns into a real business, the company will do very well for itself. Now, it’s being widely reported, Apple is at work on an electric car. This is all very encouraging.

You can read the rest of my story here.

Filed Under: Climate Change, Energy, Environment, Sustainability Tagged With: , , , ,

Green business, and its limits

February 15, 2015

2015-3-clean-energy-ss-ph1-WBLast week, Sierra Magazine, the magazine of the Sierra Club, published my story headlined The 100% Club, about the impressive commitments that a growing number of big companies are making around renewable energy. The story highlighted Ikea, Intel and Mars, but I could just as easily have written about Apple or Google or Walmart, all of whom are buying lots of wind and solar power. Here’s how the story begins:

Steve Howard, a 49-year-old Brit, has devoted most of his career to fighting climate change. He spent seven years as CEO of the Climate Group, a global nonprofit whose goal is “a prosperous, low-carbon future for all.” He sounds the part: “There is no peak sun, there is no peak wind,” he declares. “We struck sun and we struck wind before we struck oil.”

These days, Howard pursues his climate activism as chief sustainability officer of the IKEA Group, the world’s largest furniture retailer. IKEA has invested $2 billion in wind and solar power to meet its goal of producing as much renewable energy as it consumes by 2020. “We clearly see them as our future sources of energy,” he says.

IKEA is just one of dozens of big companies that are making significant investments in clean energy. In fact, a majority of Fortune 100 companies have invested in solar or wind power or have pledged to reduce their greenhouse gas emissions, or both, according to Power Forward 2014: Why the World’s Largest Companies Are Investing in Renewable Energy, a report from the sustainability advocacy group Ceres. They are doing so because they believe it makes good business sense: The costs of solar and wind are falling, state and federal governments offer generous subsidies, and fossil fuel prices can be volatile. Some see green energy commitments as a way to burnish their reputations. Still others are responding to carbon regulation–Europe, California, nine northeastern states, and British Columbia all tax or cap greenhouse gas emissions, and some business leaders believe that many other governments will, and should, follow suit. Whatever the reasons, these companies are signaling that they accept the reality of climate change and proving that renewable energy is neither a job killer nor a drag on economic growth.

The list of companies that have promised to purchase all of their energy from renewable power by 2020– the so-called 100% club — includes insurer Swiss Re, British telecommunications group BT, H&M, Mars, Nestle, and Philips. Kohl’s, Whole Foods Market, Staples, TD Bank, Herman Miller, REI, and the Philadelphia Phillies are already there, although some are getting there by buying Renewable Energy Credits, or RECs, which may or may not be effective, depending on who you ask.

But here’s the thing: It’s not nearly enough. The most telling data point in the story is this:

The 1,300 companies and nonprofits that have joined the EPA’s Green Power Partnership, a voluntary program to promote clean energy, collectively use 28 billion kilowatt-hours of green power annually. That sounds like a lot, and it is–but total U.S. electricity consumption is 3.832 trillion kWh.

This underscores the limits of voluntary action. Then there’s this: Self-reported greenhouse gas emissions from the world’s 500 largest businesses – which include many of the companies named above — actually grew by 3.1% between 2010 and 2013, according to a Thomson Reuters report released in December.

So while plenty of “good” companies are stepping up to do their part, their efforts are being more than offset by others. That’s why government action to curb GHG emissions, particularly the EPA’s Clean Power Plan here in the US, is so important. Those companies that are serious about climate change will demonstrate it by spending some of their political capital to back the EPA.

You can read the rest of my story here.

Filed Under: Climate Change, CSR, Economics, Energy, Environment, Politics Tagged With: , , , , , ,

Who lobbies for the outdoors?

February 8, 2015

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Increasingly, I’m struck by the power of conservative business lobbies in Washington, including the US Chamber of Commerce, the National Association of Manufacturers and the American Petroleum Institute. They speak effectively on behalf of fossil fuel interests, and often claim to speak for all of business when it comes to the issue of climate change — even though broad sectors of the US economy, notably agriculture and tourism (not to mention coastal real estate), are threatened by rising temperatures and extreme weather.

Last week in the Guardian, I looked at what’s called the outdoor economy — a sector that is big and growing.The Outdoor Industry Association estimates that outdoor recreation, which includes hiking, biking, camping, fishing, hunting, skiing and motorcycling, supports 6.1m jobs in the US. That’s more than fossil fuels, some say, although the numbers are disputed.

What’s inarguable is that the oil, gas and coal industries carry a lot more clout in DC than does the outdoor industry. Here’s how my story begins:

Two small California ski resorts, Dodge Ridge and Badger Pass, shut down in January as temperatures climbed to near-record highs and weeks passed without snow. With the Sierras suffering a historic drought, it’s hard to say for certain if they’ll reopen.

The ski-industry closings are a small but representative setback for what a new report calls the outdoor economy — that is, “the stream of economic output that results from the protection and sustainable use of America’s lands and waters when they are preserved in a largely undeveloped state”.

Outdoor recreation is a powerful economic force. It accounts for “more direct jobs than oil, natural gas and mining combined”, according to the report published by the Center for American Progress, a progressive think tank, in January.

But in the political arena, those businesses that depend upon nature are decided underdogs when they battle adversaries, such as the fossil fuel industry, which would like to see more exploration for oil and gas on federal lands.

If you’ve ever visited one of the big national parks out west, you can see why the outdoor industry is outgunned (pardon the expression) in your nation’s capital. Typically, the hotels, motels, restaurants, fishing outfitters and the like on the perimeter of the  parks are small businesses. They can’t hire lobbyists or make meaningful campaign contributions.

One company that has done a fine job of promoting the outdoors is The North Face. They ran a great Internet and TV ad campaign last year, encouraging more people to spend time in beautiful places. As more Americans spend more time outdoors, it seems likely that they will want to see this nation’s most beautiful places protected. Admittedly, that’s a slow and indirect way to build a constituency for climate action.

Take two minutes and enjoy this North Face commercial, set to the music of Woody Guthrie, performed by My Morning Jacket. And is it just me or did Jeep steal this idea for its Super Bowl ad?

You can read the rest of my story here.

Filed Under: Climate Change, Economics, Energy, Environment, Politics, Sustainability Tagged With: , , ,

Impact investing with The Nature Conservancy

February 3, 2015

B88tMs3IIAEAUpPImpact investing is said to be a growth business. Loosely defined, impact investing is the practice of putting money into a business or nonprofit, with the expectation of generating social or environmental change, along with a financial return. It’s somewhere between a purely mercenary investment and a donation.

Last week in The Guardian, I wrote about a unit of The Nature Conservancy called NatureVest that was set up last year to attract impact investments. Here’s how my story begins:

Even for the Nature Conservancy, which attracts more money than any other US environmental nonprofit – revenues were $1.1bn last year – buying 165,000 acres of land in Washington’s Cascade Mountains and Montana’s Blackfoot River Valley for $134m is, quite literally, a very big deal.

To raise the money in a timely manner and to negotiate the acquisition, which closed last week, the conservancy relied on NatureVest. Launched last spring, NatureVest is a division of the conservancy that functions much like a bank, albeit a bank whose purpose is to protect nature.

NatureVest raises money from institutions and high-net-worth individuals who care about the environment but want to get their investment back, perhaps with a modest return. It then invests that money in conservation projects – land acquisitions, sustainable ranching, green infrastructure or eco-tourism – that can generate money so it can pay back its investors.

This strikes me as a smart idea, if not a new idea. Ten years ago, I wrote Social Investing That Hits Home, a brief story for FORTUNE about community development financial institutions, including the Calvert Foundation, my neighbor in Bethesda, MD, that practice what would now be called impact investing. But there’s momentum behind the concept now. Impact Alpha, a website that tracks impact investing, run by a former Wall Street Journal reporter David Bank, has a database of more than 2,000 “impact deals.”

Impact investing should have special appeal to foundations because they should, in theory, want to align their investment portfolios with their programming goals. It doesn’t make a lot of sense for a foundation that gives environmental grants to invest in coal companies, for example.

On the other hand, isn’t all investment a form of impact investment? For better or worse, all of our investments have impact. A shareholder in, say, Apple is backing a company that delivers a great deal of social good (pleasure, efficiency, etc.) without sacrificing return.

The term “impact investing” reminds me a little of “social entrepreneur.” As opposed to what? An anti-social entrepreneur? Just asking.

You can read my story about NatureVest here.

 

Filed Under: Climate Change, Environment, Investing, NGOs Tagged With: , , ,

A modest proposal for big green NGOs

January 29, 2015

da9cdecb-7922-49b2-b8a2-3ff0969881e4-1020x612Here’s an idea for big environmental NGOs that work with corporate partners: Kindly recommend to those partners that they raise their voices in Washington in support of the EPA’s proposed coal plant rules.

The coal plant rules are the cornerstone of the Obama administration’s climate change policy. Yet they are being strongly opposed by mainstream Washington business lobbies like the US Chamber of Commerce and the National Association of Manufacturers (NAM).

The big corporate partners of the green groups could make a difference. They could support the rules on their own–few have done so–and, just as important, speak up inside the halls of the chamber and NAM, asking them to halt their opposition to the rules.

No climate issue matters more, Mindy Lubber of Ceres told me, for a story posted the other day at Guardian Sustainable Business, which we’ll get to in a moment.

In a report on corporate engagement [PDF], WWF lists more than a dozen “corporate engagements with an annual budget greater than US$250,000.” Partners include Avon Products, Bank of America, The Coca-Cola Co., Domtar, Ecolab, Google, Johnson & Johnson, Kimberly-Clark, Mars, McDonald’s, Procter & Gamble, Sealed Air, Sodexo and Toyota.

The Nature Conservancy says on its website that “the private sector has an important role to play in advancing our conservation mission” and publishes a long list of partners, including 3M, Alaska Airlines, AT&T, Avon, Bank of America, BHP Billiton, Boeing, BP, Bunge, Cargill, Caterpillar, CH2MHill, Coca-Cola, CSX Transportation, Delta, Disney, Dow Chemical, EcoLab, General Mills, Goldman Sachs, Harley Davidson, IBM, JPMorgan Chase, Kimpton Hotels, Lowe’s, Macy’s, Monsanto, Mosaic, Patagonia, PepsiCo, Rio Tinto, SABMiller, Shell, Target, TDBank, Uber and Xerox.

The Environmental Defense Fund, for its part, works with AT&T, Caterpillar, DuPont,  KKR, McDonald’s, Ocean Spray, Starbucks and Walmart, among others.

I could go on but you get the point. Now contrast those lists with the challenges faced by Mindy Lubber and Ceres, as they try to line up companies to back the EPA rules. That’s why my story is about, and here is how it begins:

As the US political fight over climate change moves from Washington DC to 50 state capitals, companies that are serious about sustainability need to support theEPA’s proposed rules to curb carbon pollution from existing power plants.

So, at least, says Mindy Lubber, the president of Ceres, a nonprofit that brings together companies, investors and public-interest groups to advocate for sustainability.

“Companies have the strength and power – the footprint to make a huge difference,” Lubber told me at a lunch earlier this month. Ceres celebrates its 25th anniversary Tuesday.

It’s hard to overstate the importance of the proposed power plant rules, which are the cornerstone of President Barack Obama’s climate agenda. Power plants account for nearly 40% of all US greenhouse gas emissions.

What Ceres has found, Mindy told me, is that it’s hard to get big companies to support  the EPA and the president, and overcome their habitual, instinctive resistance to government regulation.

Last month, as I wrote in the Guardian, Ceres released a statement supporting the rules that was signed by more than 200 companies but most were small or midsized. Big firms to sign on included Ikea, Kellogg, Levi Strauss, Mars, Nestle, Nike, Novelis, VF and Unilever. They are to be commended.

Ceres’s list would carry a lot more weight if other NGOS like WWF, The Nature Conservancy and Environmental Defense persuaded  most or all their corporate partners to sign on.

Until they do, conservative trade associations like the US Chamber, NAM, the National Mining Association and the American Farm Bureau Federation, which have joined together to oppose the EPA rules, will speak for business in Washington. I’ve never understood why so many companies that profess to care about the environment — and, in my view, actually do care about the environment — have allowed that to happen.

You can read the rest of my story here.

Filed Under: Climate Change, CSR, Energy, Environment, NGOs, Politics, Sustainability Tagged With: , , , ,

Brainstorm Green: What’s next?

January 11, 2015
Bill Clinton at Brainstorm Green in 2009

Bill Clinton at Brainstorm Green in 2009

In 2007, Andy Serwer, the managing editor of FORTUNE, where I was then a senior writer, asked me to work with the magazine’s conference division to create a conference about business and the environment. His timing was excellent. Presidential candidates Obama and McCain had promised to act to curb climate change. A global climate agreement seemed possible. A wave of clean technology startups were attracting attention and investment in Silicon Valley. And big companies like General Electric and Walmart had put sustainability squarely on their corporate agendas.

On Earth Day in 2008, the inaugural Fortune Brainstorm Green was held at the Ritz Carlton Huntington hotel in Pasadena. Speakers included Michael Dell, Doug McMillon (who’s now the CEO of Walmart), venture capitalist Vinod Khosla, David Crane of NRG Energy, Gov. Jerry Brown (then the attorney general of California), Dave Steiner of Waste Management, Stewart Brand, Mark Tercek (then at Goldman, now head of The Nature Conservancy), Gary Hirshberg, Janine Benyus,  J. Craig Venter, Andy Karsner, Hugh Grant of Monsanto, Ursula Burns of Xerox, Fisk Johnson of SC Johnson, and Shai Agassi, the founder of electric-car company Better Place. Some of America’s most important environmental leaders–Fred Krupp, Frances Beinecke, Peter Seligmann, Mike Brune, Mindy Lubber and John Passacandanto–spoke. Chuck Leavell played keyboards and Shawn Colvin sang. It was too much fun to be called work.

In 2009, Brainstorm Green moved to the Ritz Carlton in Laguna Niguel, CA, where it has remained. The theme of the event never changed: How can business profitably solve the world’s most important environmental problems? I’ve been co-chair of Brainstorm Green for these past seven years, and it has been, for the most part, a rewarding experience.

About a year ago, I decided that I no longer wanted to co-chair Brainstorm Green, for a variety of reasons. I liked programming the conference and I enjoyed moderating interviews and panels, but the process of recruiting speakers year after year, which requires the patient massaging of corporate egos, had become tiresome. What’s more, a good deal of the excitement that had gathered around corporate sustainability during the event’s early years has since faded. Unhappily, the politics of environmentalism turned bitterly partisan, dooming Obama’s cap-and-trade plan. The financial crisis dampened corporate enthusiasm for all things green. Clean tech slumped, and Better Place flamed out.

Last fall, Fortune rebranded Brainstorm Green as Brainstorm E: Where Energy, Technology and Sustainability Meet.  It will be held on September 28 and 29 in Austin, Texas. The powers-that-be at the magazine decided that selling a “green” event to corporate sponsors had become too difficult. Perhaps they’re right.

The best thing about Brainstorm Green, I daresay, were the relationships forged there. A deal or two came out of the event — one year, Bill Ford met Zipcar chief executive Scott Griffith, and later Ford Motor bought a stake in Zipcar — and I know a couple of people landed new jobs there. That’s typical of conferences. But, at least for me, Brainstorm Green felt like more than just another “networking” event. For a few days every spring, a community of sorts formed around a shared belief that business could do good. Collectively, we were trying to make that happen. I’m going to miss many of the Brainstorm Green regulars (yes, that means you, Dhiraj Malkani) as well as the Fortune colleagues with whom I worked so closely over the years, particularly the incomparable Tony Hansen.

These days, I’m spending most of my time writing for Guardian Sustainable Business. But stepping away from Brainstorm Green will give me time for other pursuits. I’ve got a new project in mind (watch this space) and I’m also hoping to moderate at other conferences and corporate events. To that end, I’ve put together these excerpts from my moderating work.

Filed Under: Climate Change, Environment, Media, Sustainability Tagged With: ,

Some reason for optimism on climate change

December 8, 2014

photo (18)Not since the ill-fated UN climate talks in Copenhagen in 2009 has there been as much optimism as there is now about curbing the risks of climate change. Government negotiators converged this week in Lima, Peru, to lay the foundation for a possible global climate agreement next year in Paris. Veteran reporter Andrew Revkin has a typically excellent and thorough post on the state of play at his Dot Earth blog.

In hopes of learning a bit more myself, I went to the Council on Foreign Relations in Washington today to hear Jim Yong Kim, the president of the World Bank, discuss the climate negotiations, in conversation with Mark Tercek, the CEO of The Nature Conservancy.

They, too, sounded hopeful.

“The agreement between the US and China is an extremely important milestone,” Kim said. “We’ve made a lot of progress. I’m much more optimistic than I was a year ago.” The bank’s commitment to driving economic development in poor countries, he argued, can be aligned with the goal of moving the world toward a low-carbon economy.

But how? Kim’s presentation was short on specifics and, to be honest, a bit disappointing. He arrived nearly half an hour late, citing security concerns around a visit to the World Bank by Prince William, of all things, and then read a wonky speech, without showing much passion or even a sense of urgency around the climate threat.

To be sure, Kim said all the right things. He called for the regulation of carbon pollution and the elimination of fossil fuel subsidies. He didn’t put it this way but it’s bonkers to allow people (all of us, not just the fossil fuel industry) to emit carbon pollution into the atmosphere for free, while providing hundreds of billions of dollars in government subsidies that encourage people to burn more oil, coal and natural gas. That’s a recipe for disaster.

“All countries should commit to put a price on carbon,” Kim said. “It’s a necessary if not sufficient step on the road to zero net emissions.” The Canadian province of British Columbia, he noted, enacted a carbon tax that has grown from $10 CN to $30 CN, and “British Columbia’s GDP has outperformed the rest of Canada’s since implementing the tax.”

Meantime, he said, “removing harmful fossil fuel subsidies is long overdue.” This will harm the poor in some countries by raising fuel prices, he acknowledged, so the elimination of subsidies could be accompanied by  “safety nets and cash transfers” to the poor.

Solving the climate problem will take the world economy into uncharted territory, Kim said. No rich country has ever reduced poverty and created prosperity for its citizens without burning cheap fossil fuels.

In that light,  it’s not surprising that some politicians in the developing world–notably Indian Prime Minister Narendra Modi–say they need to focus on development now, and climate at some future date.

(Kim didn’t say so but India can also make the case that it was the US and EU that created the climate problem, and they should clean it up–the issue sometimes described as “climate justice.” See below for a fantastic interactive timeline of climate emissions from major polluting countries from the World Resources Institute.)

“We’re going to do everything we can to help India down a cleaner path,” Kim said, again without saying precisely how. “Four hundred million people living on less than $1 a day. That is also his (Modi’s) responsibility.”

Poor countries like India and Bangladesh, of course, stand to suffer from climate-related storms and drought–a compelling reason for them to act.

As Kim put it: “The science is pretty astounding.” Not to mention frightening.

Here’s the WRI timeline. If you click on “emissions” at the top and then the “loop” button below, you will see how climate emissions provide a window into the rise and fall of the world’s powers in the last 150 years.

Filed Under: Animal welfare, Climate Change, Economics, Energy, Environment Tagged With: , , , ,

The trouble with local food

December 2, 2014

nicollet-mall-farmers-marketI enjoy shopping at the farmers market in Bethesda, Md., where I live. It’s a pleasant way to pass time on a Sunday morning, and a chance to run into friends and neighbors.  I feel good about supporting farmers who work nearby. Sure, it’s pricey–I was shocked to pay $8 for a sliver of cheese a while back and if I remember correctly, fresh tuna sells for $30 per pound–but the food at the farmers’ market is pricey the way a Venti Starbucks yada-yada-yada is pricey. You’re not buying cheese, tuna or coffee. You’re partaking of an experience.

What you are not doing is saving the planet.

The best thing for the environment is to not to grow food locally but to grow crops in the places where they grow best–places where the soil, rainfall and climate suit whatever is being grown.

So, at least, says Greg Page, the former CEO and current executive chairman of Cargill, the giant food company that grows, processes and ships agricultural and food products around the world. Of course you would expect Page, who is 62 and has worked his entire career at Cargill, to favor a globalized food system. But, as he notes, there’s no particularly good reason to treat food differently from other consumer goods that are produced efficiently and then shipped to where they are needed. We don’t worry about local big-screen TVs or local running shoes or local auto parts.

I interviewed Page last month in Washington, and wrote about him this week at Guardian Sustainable Business. Here’s how my story begins:

Long before Greg Page became the executive chairman of Cargill, one of the world’s largest food companies, the company dispatched him to Thailand to build a chicken plant in a rural province north of Bangkok. “It was a chance”, he said, “to start a business from scratch in an overseas location, while having access to the resources of Cargill”. Plus, he noted with a smile, he was “12 hours from headquarters … I loved it”.

Today, Cargill Meats Thailand imports soymeal from Brazil and Argentina to feed chickens, which are raised, slaughtered, processed, cooked and frozen into a wide range of products, most destined for restaurants and supermarkets in Japan, Europe, Canada and Hong Kong. Chicken parts that don’t appeal to western appetites — feet, heads and the like — are consumed locally or exported to nearby Asian markets.

To locavores who want to look their farmer in the eye, to the advocates of food sovereignty, and to those who argue that ‘cooking solves everything’, this is a nightmarish way to produce food. But to Greg Page, who has spent 41 years at Cargill and is now its executive chairman, global trade in food and agriculture is not only good for producers and consumers — it’s also a key element of a sustainable food system.

“Trade facilitates sustainability,” Page said when we met recently at Cargill’s Washington, D.C., office. “The world was not endowed with good soil and good rainfall equally. You want to move production to the right soil and the right climate, where it belongs.”

Of course, as Page knows, it’s not quite that simple. All other things being equal (and they rarely are), buying locally makes environmental sense, keeps food fresher and reduces waste. We may want to restrict agricultural imports from certain places because of food-safety concerns. And, as some of the commenters on my Guardian story say, the globalization of agriculture raises issues about land and water use and trade’s impact on poor farmers who can’t compete with large-scale agriculture.

But I’m trying to make a simpler point here–that local does not equal sustainable. Trade can be a glorious thing, Fair Trade is even better, and agriculture is no exception.

You can read the rest of my story here.

Filed Under: Climate Change, Consumption, Economics, Environment, Food, Global Poverty, Sustainability, Water Tagged With: , ,

How green are green bonds?

November 24, 2014

corp-bondSome $34 billion in bonds labeled as green have been sold so far in 2014, three times as much as last year. Some experts predicting that as much as $100 billion of green bonds will be sold in 2015. These bonds — issued by governments, companies and international financial institutions like the World Bank — will help to finance solar and wind energy, hybrid cars, efficient buildings, cleaner waterways.

This sounds like unalloyed good news–and it may be. It’s just hard to know.

Today, the YaleEnvironment360 website posted my story about green bonds, headlined with a question: Can Green Bonds Bankroll A Clean Energy Revolution? Again, the answer is maybe. That unsatisfying, perhaps, but that’s the way it is.

That’s because, for the moment, a green bond is any bond that an issuer decides to label as green. Big banks and NGOs are working to set stricter standards, but they will take a while to arrive. So, for example, corn ethanol, nuclear power and methane capture while fracking could all be deemed green.

The bigger question, though, is whether green bonds are financing projects that, without them, would not get done. Again, that’s hard to say. But if all we are getting with green bonds are labels on bonds that would have been issued anyway, we’re wasting our time.

That said, there’s potential here–at heart, the potential to attract new money to finance low-carbon infrastructure. So the boom is green bonds is worth watching.

Here’s how my story begins:

Looked at from one angle, climate change is an infrastructure problem. To limit global warming to 2 degrees C and avoid the worst effects of climate change, about $44 trillion will need to be invested in low-carbon projects like wind farms, solar panels, nuclear power, carbon capture, and smart buildings by 2050, the International Energy Agency estimates. That’s more than $1 trillion a year — roughly a four-fold jump from current investment levels.

Where’s the money going to come from? Maybe from green bonds, say bankers and environmentalists alike. Green bonds, which are also known as climate bonds, are fixed-income investments that are designed to finance environmentally friendly projects. Pioneered by international development banks — the European Investment Bank issued the first climate bond in 2007, followed a year later by the World Bank — they are today issued by state and local governments (Massachusetts, Hawaii, New York, and the cities of Stockholm and Spokane, Washington, among others) and by big companies (Bank of America, Unilever, and the French utility GDF Suez).

Uses of the bond proceeds are varied. The World Bank sold green bonds to raise funds for geothermal energy in Indonesia and free compact fluorescent bulbs for the poor in Mexico. Massachusetts raised money to clean up a superfund site. Energy company EDF’s green bond financedwind farms in France, and Toyota used the proceeds from a green bond to make loans to American consumers who buy hybrid cars.

The story goes on to explain why “green bonds may not be all they’re cracked up to be.” You can read the rest here.

Filed Under: Climate Change, Economics, Energy, Environment, Investing, Socially Responsible Investing, SRI, Sustainability Tagged With: ,

Sustainability advocates who deserve thanks

November 22, 2014

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I ran into Hunter Lovins last week at a meeting of business leaders at the UN. She’s wearing a black hat but she’s one of the good people. Author, activist, sustainability consultant, force of nature — Hunter always has plenty to say, and she says it bluntly and passionate.

At the UN gathering of executives from companies that are part of the UN Global Compact LEAD group, Hunter got into a friendly debate with Joel Bakan, a law professor and corporate critic, whose 2004 documentary, The Corporation, likened corporations to psychopaths.

Hunter argued that business, not government, is more likely to lead us to a sustainable future. Joel took the opposite view. I wrote about the debate here, in a story for Guardian Sustainable Business.

“We’re in a horse race with catastrophe,” Hunter told me afterwards. “Can corporations move fast enough? Government cannot. It will not. Corporations might. Will they? I don’t know. On that turns the future of the world.”

Not a bad summary of where things stand today. Hunter’s not just a good talker but a do-er, working with a variety of companies — her future and past clients include Walmart, Unilever, Patagonia, Clif Bar, Interface –to help them become not just sustainable but, ideally, regenerative.

With Thanksgiving approaching, this is a good time to thank people like Hunter–those who, as insiders or advisers, are working in the trenches of corporate America, trying to persuade their companies to become part of the solution to big social and environmental problems.

It can be a tough slog, but it’s important work. That’s while this fall in Guardian Sustainable Business, we’ve been running a series of brief q-and-a’s that showcase sustainability executives. Some are with people who I know well, and others I hardly know at all. But I persuaded my colleagues to run the series because they don’t get enough credit for the work they do.

Here are some of the people I’ve talked to, in no particular order:

Tim Mohin of AMD, about an electronics industry coalition that is seeking to improve factory conditions in the developing world.

Frank O’Brien-Bernini of Owens-Corning, about the need to be rigorous when dealing with environmental issues.

Kathrin Winkler of EMC, about electronic waste.

Rhonda Clark of UPS, about carbon emissions reductions.

Adam Mott of North Face, on the responsible cycling of down.

Vince Digneo of Adobe, about green teams.

Paulette Frank of Johnson & Johnson, about recycling.

Amy Hargroves of Sprint, about the importance of standards.

Marcus Chung of The Children’s Place, about the need to go beyond factory auditing.

If you’d like to nominate someone (or yourself) for this series, let me know. Meantime, thanks to all for participating–and for all the good work you do.

Filed Under: Climate Change, CSR, Environment, Global Poverty, Health, Leadership, Sustainability Tagged With: , , , , , , , , ,
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