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December 16, 2021
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Sustainability Summary November 2021

By Adrian Bishop | Time to Read: 00:10:00
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Sustainability Summary November 2021
BFSI Oil & Gas Technology

MAMMA MIA! HERE WE GO AGAIN!

After our movie-themed Sustainability Summary a few months ago, the Name of the Game for November’s Summary is for us to follow up with an ABBA special, as the Swedish supergroup and Eurovision legend has released its first album in 40 years. It includes namechecks for some of their biggest hits, as well as lesser-known tracks.

A-HA!

Thank you for joining us for 2021’s Sustainability Summaries – we look forward to seeing you again in the New Year and to providing you with a suite of new sector summaries and useful articles on all things Sustainability. Season’s Greetings and all the very best for 2022.

GIMME, GIMME GIMME…

Only 25% of CEO pay linked to the environment

Just one in four Chief Executives at the top 100 banks have remuneration or bonus targets linked to environmental targets, new research suggests.

At the same time, when ESG measures are included, they often lack transparency and impact, the Capital Monitor report shows, which is based on publicly-available data.

Only two banks analysed made progress towards an approach linking remuneration with financed emissions, the report suggests – ING and NatWest Group.

Most environmental bonus targets do not account for financed emissions generated by the companies the banks lend to and raise capital for. Many have used targets relating to the emissions from their offices and business travel.

European banks dominate those setting environmental targets, with 21 out of 25 doing so. There are three in Asia-Pacific and one in North America. More of Europe’s banks are likely to follow, since the European Banking Authority has published guidance on linking pay to the objectives of an institution’s business and risk strategy, including ESG risk-related objectives, corporate culture and values, and risk culture.

In addition, the Task Force on Climate-related Financial Disclosures aims to focus more on ESG-linked pay for executives.

Shareholders are also putting more pressure on banks to link bonuses to ESG performance, with Canada’s CIBC planning to introduce an ESG bonus accounting for 10% of variable pay for executives after shareholder pressure.

Where North American banks are taking the lead is in social and governance targets, such as the proportion of women in senior management, the research finds. Of the 16 North American banks in the top 100, 12 have such goals. Globally, 48 banks link remuneration to an environmental, social or governance target.

Capital Monitor has created a unique transparency score for the top 100 banks, with the UK having three banks - UK: Barclays, HSBC and NatWest - with perfect scores. But the average transparency score was highest in North America (56), compared to 40 in Europe and just 18 in Asia-Pacific and zero from the three Latin American banks on the list, as well as the single Middle East bank.

Capital Monitor’s Editor-in-Chief, Daniel Flatt, says, “Given the huge environmental challenges we face, and the influence the world’s 100 largest banks can exert on the corporate sector, it is of deep concern that only one in four have publicly announced environment-related incentives for their CEOs.

iResearch Services Chief Executive Yogesh Shah says, “There are a couple of reports this month that challenge the big banks to do more on issues including ESG reporting, transparency and pay. As studies show, ESG measures can help boost business profitability, so it is in all of our interests for banks to make progress in these areas.”

TAKE A CHANCE ON ME

Investors fail to believe ESG claims

Few institutional investors are willing to take a chance on company ESG claims, new research reveals. Eight in 10 (86%) of the 700 US investors taking part in the 2021 Edelman Trust Barometer Special Report: Institutional Investors believe companies frequently overstate or exaggerate their ESG progress when disclosing results, and 72% don’t believe companies will meet their ESG commitments. The report identifies pivotal issues shaping global investment criteria and outlines ways in which companies can build trust with the investment community.

The research features new investor expectations on ESG, climate change, shareholder activism, employee activism and the meme stock phenomenon. Lex Suvanto, managing partner and CEO of Edelman Financial Communications, says, “Our research reveals that investors do not trust company ESG disclosures and they do not trust companies to deliver on ESG promises.

At the same time, investors now see employee activism as a sign of a healthy corporate culture. These are disruptive forces across the investment community that corporate boards and leaders must embrace to ensure competitive cost of capital and fair valuations.” Investors expect a rise in ESG-related litigation with 94% anticipating more litigation as a result of companies not delivering on ESG promises. The same percentage expect companies to establish and communicate a Net Zero plan — with 92% concerned companies are not effectively executing these pledges. Investors believe that employee activism signals a healthy workplace culture — 86% of US investors say a workplace culture that fosters employee empowerment is important for building trust and 74% of global investors believe employee activism is indicative of a healthy workplace culture.

Ninety-five per cent of U.S. investors are interested in taking an activist approach to investments and proactively approach activists with ideas for effecting change, and 74% indicate they would take aggressive activist measures. Environment and board structure are top activist issues — Over 75% per cent of U.S. investors are likely to engage in shareholder activism on the eco-efficiency of a company’s operations, the environmental impact of the supply chain, and greenhouse emissions. Eighty-one per cent are likely to engage about board structure. Eighty-seven per cent of U.S investors agree that conversations taking place within online communities influence investment decisions.

Kevin Anthony, Associate Director of Thought Leadership Sales at iResearch Services, says, “The problem of ‘greenwashing’ has resulted in investors losing trust in ESG claims. Along with increasing scepticism, there may be rising incidents of litigation on the horizon. The industry must find a way to deal with this issue effectively, as, when trust evaporates, eventually, so do investors.”

Read more about greenwashing in the financial services industry and initiatives to combat it in the iResearch reports, How Sustainable is Financial Services? and Mitigating the risks of Misinformation.

WHEN ALL IS SAID AND DONE

Key points from COP26

It’s now been a few weeks since the conclusion of the vital COP26 climate change conference in Glasgow. If you caught our summary from Week One and Week Two, you will see the highlights and the implications for business. Following the event, S&P’s ’s Global Sustainable 1 team has produced a list of five key takeaways from COP26. These include: the need for public funding and public financing to connect; an Article 6 win; the attention to pledges to preserve or restore nature as part of addressing climate change; the need for increased accountability regarding climate commitments; and a focus on buildings’ carbon density.

GOVERNANCE AND POLICY

MONEY, MONEY, MONEY…

IMF Trust will provide SDRs for poorer nations

Vulnerable counties are to be helped to develop sustainable and resilient economies by a proposed $30 billion Sustainability and Resilience Trust from the International Monetary Fund (IMF). Managing Director Kristalina Georgieva says that, in developing countries, growth is expected to be around 3% this year on average, half that of larger economies. This is why the IMF’s Special Drawing Rights (SDRs) allocation for low-income and vulnerable middle-income economies and fragile island economies is important. “SDRs improve a country’s reserve position and create liquidity that is so precious for nations that have very tight fiscal space at this moment in time. “Because of shareholding and quota arrangements at the IMF, the countries that are most in need received a relatively small part of the overall allocation.

Of the new $650 billion SDR allocation, $275 billion went to emerging markets and developing economies and $21 billion to the poorest countries, with Africa receiving about $31 billion. SDRs do not add to a country’s debt—it is truly an injection of reserves and liquidity. Now, the G20 wants to rechannel $100 billion of the SDR allocation from richer to poorer countries. The IMF already has an instrument—the PRGT (Poverty Reduction and Growth Trust)—to rechannel SDRs and provide zero-interest lending to low-income countries. But due to the pandemic and the climate crisis, the IMF has proposed a second longer-term instrument with low interest rates and that would provide funding not only to low-income countries but also to vulnerable middle-income countries and fragile island economies. The Resilience and Sustainability Trust (RST) will start with about $30 billion, building up to $50 billion and more. The RST is due to start in Spring 2022.

Andrew Newby, Operations Director, iResearch Services, says,” We have been told that there is enough money available to finance measures needed to keep global warming within Paris Agreement parameters, but it just doesn't seem to be getting to those nations that need it most. The IMF measure is welcomed, but the world’s wealthiest nations must do more to ensure the money they have promised to poorer nations to deliver climate change initiatives is forthcoming.”

Task Force on Sustainable Finance launches in Dubai

The Dubai Financial Services Authority has launched the Task Force on Sustainable Finance (TFSF). It consists of members from 12 Dubai International Financial Centre (DIFC)-based entities and aims to drive forward sustainable finance discussions to support the consistent application and adoption of global regulatory standards relating to sustainable finance in the DIFC. Sustainability forms a key area of regulatory focus.

European banks all fall short of C&E risk targets

Europe’s banks must do more to improve their management and disclosure of Climate & Environmental (C&E) risks, finds a major report by the European Central Bank (ECB). In fact, none of the 112 institutions featured in the state of climate and environmental risk management in the banking sector report is close to fully aligning their practices with the supervisory expectations, says the ECB. Writing in a blog, Frank Elderson, Member of the Executive Board and Vice-Chair of the Supervisory Board of the ECB, says, “Tellingly, of the institutions that report C&E risks as being immaterial to them, not a single one has an appropriate materiality assessment in place: they are either not comprehensive enough in their risk assessment or they haven’t even attempted to analyse the impacts of climate risk on their business at all.”

The ECB requested 112 big banks to assess their current practices against 13 supervisory expectations in its Guide on C&E Risks and to submit plans on how and when they would bring their practices into line. Virtually all institutions that performed a thorough materiality assessment expect C&E risks to have a material impact on their risk profile in the coming three to five years, says the report. “While steps are being taken to adapt policies and procedures, few institutions have put in place C&E risk practices with a discernible impact on their strategy and risk profile.”

Most institutions have a blind spot for physical risks and other environmental risk drivers, such as biodiversity loss and pollution. However, The ECB also identified a set of good practices across different expectations spanning a range of business models and sizes. While almost all institutions developed implementation plans to further improve their practices, the quality varies considerably. “All in all, institutions have started paving the way, but the pace of progress remains slow in most cases,” says the ECB, and it expects all institutions to take decisive action to address the shortcomings set out in a supervisory letter sent to all taking part.

Targeting net zero carbon

Risk management provider Alcumus is not only providing advice for businesses on how to reach net-zero, but also taking steps itself. Its white paper, Targeting Net-Zero Carbon, shares key insights on carbon reduction and the increasing momentum for businesses to decarbonise by setting their own net-zero commitments and strategy. It includes the role of business in tackling climate change, building climate change into your ESG strategies, the benefit of setting carbon targets for your business and using technology to build sustainable and credible climate action.

Alcumus has just announced “a unique, triple-play commitment to climate action” – a Science-Based Target, a Net Zero Target and the Tech Zero task force. David Picton, SVP for Sustainability at Alcumus says, “For the world to reach net-zero by 2050, so many individual actions need to happen in every country. We must all play our part, connecting the bright dots of individual actions to shape a huge collective impact that cuts carbon emissions.”

Other stories you may have missed…

  • How Venture Capital can support ESG efforts

    VCs are evolving to be more socially and environmentally conscious, reflecting demand from the largest investors in Venture Capital, public and private institutional investors, who need to be able to demonstrate and communicate an ethos of engendering positive change. Fears of the tech industry becoming regulated in this area are driving action.

  • Why ESG reporting is a recipe for Alphabet Soup (KPMG)

FINANCIAL SERVICES

THE WINNER TAKES IT ALL

How Sustainable do you think you are?

iResearch Services has released a second paper in their How Sustainable is Financial Services? series – Sustainability Snapshots. The report draws upon research conducted earlier this year on how different financial services sectors are faring in their sustainability efforts and highlights a notable perception gap between the reality of the industry’s sustainability efforts, company-wide and peer perceptions.

The report maps responses from key financial sectors – Accounting, Corporate/Commercial Banking, Funds & Investments, Insurance, Investment Banking, Life Assurance & Pensions, Regulated Advice, and Retail Banking – across 14 countries.

Who are the leaders and who is lagging behind?

How can different sections of the financial services industry move forward with actions as well as words and work together to create a more sustainable future?

You can download this new report, the previously published detailed sustainability in financial services research report and a succinct financial sector snapshot on the risks of misinformation on the website.

Inclusive finance ‘brings competitive advantage’

Firms that focus on inclusive finance will be at a competitive advantage, says a senior analyst. In a Forrester blog, Aurelie L'Hostis says, “Firms should focus on inclusive finance, which aims to enhance fair access for individuals and businesses to a wide range of affordable financial products and services that meet customer needs and are delivered in a responsible and sustainable way. However, financial services companies often have a short-sighted understanding of what financial inclusion means and so fail to recognize its business benefits. Many see it as limited to low- and middle-income countries or “banking the unbanked,” or else as a charitable venture and miss out on the business opportunity. “Diversity, equity, and inclusion (DEI) is no longer merely about compliance and talent management but entails increasingly critical issues for organizations.”

Employee-only DEI initiatives mean missing out on inclusive design and digital accessibility. Inclusive finance through innovation can enhance fair access and help open new markets. “Mobile technologies, the internet of things, 5G, AI, smart data, automation, open finance, digital identity, and central bank digital currency offer opportunities to create a more efficient, accessible, secure, purposeful, and equitable financial system.”

L'Hostis concludes, “In the coming decade, forward-thinking financial services firms that recognize the shift and foster digital equity and inclusive finance through innovation to drive sustainable growth will gain a competitive advantage and grow faster.”

I HAVE A DREAM

Equity Collective to find new finance sector diverse leaders

A new initiative to help develop diverse leaders in the finance industry has been launched by investment bank, Morgan Stanley. The Equity Collective has been backed by 23 Wealth Management and Asset Management businesses. It aims to educate, empower and develop the next generation of diverse leaders in the finance industry. Senior leaders from each member organisation will participate in education and awareness events in this multi-year commitment. Research conducted via Morgan Stanley’s Investor Pulse Poll found that among diverse groups of high-net-worth investors and entrepreneurs, finance repeatedly took the top spot as the industry that could most impact racial inequality. Andy Saperstein, Co-President of Morgan Stanley and Head of Morgan Stanley Wealth Management, says, “By banding together, we can be a force multiplier to impact our industry in a meaningful way. The Equity Collective is committed to investing early in under-represented communities, focusing our efforts on increasing the pool of interested and qualified people that consider a career in financial services.”

Financial equality and inclusion must be part of DEI

Companies rightly focus on diversity, equity, and inclusion (DEI), but often forget financial equity and inclusion. So says the Harvard Business Review. This means ensuring that all individuals have equal access to financial services and professional opportunities that can help them generate greater wealth.

Net zero financial services providers group grows

Six new members have joined the Net Zero Financial Services Providers Alliance (NZFSPA). Bolsa Mexicana de Valores Group, Clarity AI, Hong Kong Exchanges and Clearing, Johannesburg Stock Exchange, Luxembourg Stock Exchange and Qontigo. signed up on Finance Day at COP26 in Glasgow. NZFSPA, which is committed to aligning all relevant products and services to achieve net-zero by 2050 and to set interim targets for 2025, now has 23 members. NZFSPA is part of The Glasgow Financial Alliance for Net Zero coalition.

SUPER TROUPER

Conference on building resilience in financial services

Grant Thornton held its Financial services annual conference 2021 - building resilience in financial services on Thursday 18 November in London, UK. It featured a high-profile panel discussing the impact that financial services can make by reducing carbon emissions. Delegates also received guidance on regulatory insights, key dates, the pitfalls of non-compliance and the value of data.

Scottish Widows to invest £25bn in companies combating climate change

UK-based pensions provider Scottish Widows is to invest up to £25billon by 2025 in companies that are tackling climate change. At least £1bn will go to firms developing new sustainable ways of living and working, such as alternative green energy, sustainable agriculture, and pollution prevention, reports Professional Pensions. Scottish Widows aims to reach net-zero across its investments by 2050. Maria Nazarova-Doyle, Head of Pension Investments and Responsible Investments, says, "Today we're announcing another major milestone in our journey to net-zero by committing to invest at least £20-£25bn by 2025, in companies that are proactively adapting their businesses to be less carbon-intensive or are developing climate solutions. Scottish Widows will be supporting and incentivising companies it invests in to decarbonise at a scale and pace to meet the 1.5°C global warming objective of the Paris Climate Agreement. But she noted this was also about financial returns as well.

Hitanshu Dhingra, AVP Investment at iResearch Services, says, “With the growth in the sustainability sector and fresh measures being introduced all the time post-COP26, nations and businesses expect similar announcements from other firms to follow. As Scottish Widows highlights, returns are also an important part of the selection criteria."

JUST A NOTION

Other sustainable finance stories you may have missed

ENERGY

LOVELIGHT

Carbon transition offers $45 trillion investment opportunity

Over the next 20 years, the transition away from carbon-based fuels presents a $45 trillion investment opportunity, says a new report from risk assessment specialist, Moody’s. Rob Fauber, President and Chief Executive Officer of Moody’s Corporation, illustrates the scale of the potential gain in its Ready or Not? report. “The economic benefit from the transition to a climate-resilient, zero-carbon economy could amount to nearly a 25% cumulative gain in GDP over the next two decades alone compared with a scenario in which the world fails to act.

This is equivalent to adding the current Italian or Canadian economy to the global economy each year over this period and creates a $45 trillion investment opportunity for those able to take advantage of it.” He goes on to say, “Looking at the data, it is clear that carbon transition will be a key factor in corporate competitiveness. What emerges is a picture of mixed momentum and preparedness within and between sectors in the race to zero.” The report examines also examines which sectors are best placed for a rapid transition, how wide the disclosure gap is, how can transition preparedness can influence default risk, and what will it take to prepare for rapid transition in carbon-intensive sectors.

Gurpreet Purewal, Vice-President of Sales – Thought Leadership at iResearch Services, says, “The potential investment gain moving away from carbon-based fuels is huge – but the win for the world in doing so is greater. Innovative and creative companies that develop new solutions to smooth the transition can generate big benefits.”

Along a similar theme, a new report investigates how innovation on green-related activities can contribute to the prosperity of the future economy. The Greenovate for a Better Environment and Economy report from KPMG says that, as climate change continues to threaten humanity’s very future, the business community and its leaders possess the ability – and share the responsibility – to act without delay. Gary Reader, Global Head of Clients & Markets, at KPMG International, says, “Why are they pursuing decisive action now? In one word: opportunity. The business community knows that they have the means, responsibility and opportunity to make a real difference in their communities and across the world. In addition, they also know that the key to future success demands real transformative change.”

Mission Critical Microgrids white paper

With extreme weather increasing, energy independence and resilient power are becoming more important. The free Mission Critical Microgrids white paper from GreenBiz, explores the multiple options for sourcing and delivering electricity, and how leaders can use distributed generation and microgrid solutions to control and secure their energy future.

Making a difference to crypto environmental concerns

CurrencyWorks, a tech company based in oil-drilling Alberta, Canada, is turning oil waste into environmentally friendly energy to power crypto mining.

TECHNOLOGY

SOS

Tech industry struggling with sustainability

In an industry viewed largely as disrupters, future thinkers and agile first movers, tackling ESG issues in the technology sector might seem like a challenge to which the industry would readily rise. However, recent research from several sources paints a different picture, highlighting the long road ahead for a usually fast-moving sector of the global economy.

More than half (53 percent) of technology companies do not have a decarbonisation strategy or targets, according to annual research from KPMG, which explores how tech companies are progressing with decarbonisation strategies and the barriers faced by the industry. Ian West, Partner, Head of Technology, Media and Telecommunications, KPMG in the UK, says, “Unfortunately, delaying action will only create more headwinds for companies to overcome.”

A recent study from iResearch Services shows there is still a considerable way to go for a more sustainable technology sector. In a poll of 1000 senior professionals across the tech sector, only 38% of businesses across the globe have a formal commitment in place to achieve net zero.

Who does the tech industry feel is responsible for supporting the sector in becoming more sustainable? Over half (56%) of all respondents state that governments need to support the technology sector to become more sustainable and, on average, 30% believe that consumers have a part to play. When asked what is preventing the sector from achieving sustainability objectives, the top three reasons highlighted were:

1.    Prohibitive costs of initiatives (51%)

2.    Speed to market (38%)

3.    Lack of resources (35%)

Watch out for the full report from iResearch Services on sustainability in the tech sector, launching in January 2021.

Climate misinformation

Other hurdles in addressing sustainability issues are misinformation and disinformation. New analysis reveals that an estimated 818,000 climate misinformation posts received 1.36m views everyday.

According to a report on misinformation by iResearch Services, 68% of business leaders thought that their companies’ sustainability messaging accurately reflected the level of activity actually undertaken. In contrast, only 39% of consumers we surveyed thought the same.

Yi Ling Huang, Editor at iResearch Services, says: “Misinformation isn’t always consciously deceptive. However, the lack of a robust, universally adopted set of standards means that businesses are struggling to represent their efforts in sustainability accurately. Unchecked, the gap in perception between how business leaders and individuals feel companies are performing can lead to an erosion of consumer and stakeholder trust. More work needs to be done to ensure viable and enforceable frameworks for collecting, analysing and communicating this data.”

Find out more about the implications of misinformation for both businesses and consumers in the latest iResearch Services report, The New Reality: Mitigating the Risks of Misinformation.

DATA

Data centers could cause serious environmental damage without regulation

According to the Uptime Institute’s 2021 Global Data Center Survey, while many report on power consumption, the electricity and water resources needed to keep data centers cool often aren’t being tracked or accounted for. Neither is the e-waste created by the need to continuously replace servers.

Microsoft opens sustainable datacentres in Sweden

IT giant Microsoft has opened sustainable datacentres in Gävle, Sandviken and Staffanstorp in Sweden. They deliver advanced data security, privacy and storage, are powered by 100% carbon-free energy and support zero-waste operations. Microsoft President Brad Smith says, “As Swedish industries and enterprises look to adopt and innovate on Microsoft’s platform, our datacenter investments build on our portfolio of products and services while meeting important data residency, security and compliance needs.”

The Swedish Circular Center will have the ability to support 12,000 servers per month. Supporting the company’s water positive by 2030 commitment, the datacenters’ servers will be cooled with only outside air and rainwater will be captured and used to provide humidification.

Hélène Barnekow, general manager of Microsoft Sweden, says, “Our Swedish datacenters are among the most sustainably designed and operated in the world. This is an important launch for Sweden and Europe, as I am of the firm conviction that new tech innovation is the most important enabler for the world to reach the global sustainability targets. By moving to the cloud, we create new opportunities to accelerate the transformation to a more sustainable future – together.” On December 8, Microsoft Sweden will host customers and partners in a Sustainable Business Transformation event.

VOULEZ-VOUS?

More technology-led stories you may have missed…

Technology can stop $66bn in damages from climate change

A new paper highlights the importance of data for developing countries tackling the climate crisis.

New tech platform aims to ‘shape the future of ESG data’

The ‘ESG Book’, a central source for accessible and digital corporate sustainability information, has launched, led by Arabesque, a coalition including financial institutions and organisations such as the International Finance Corporation.

Smart Containers could save $7 billion in shipping supply chain

Delivering 11 billion tons of goods a year is fraught with risk, but using smart containers can create a more efficient, safer and more sustainable shipping supply chain and bring about savings of $7 billion, it is claimed. Among the issues the sector faces are loss due to severe weather, damaged goods and spoiled food, says Jules Kollman, ING Managing director of Containers and Logistics.

A smart container is just a regular container, but you put a little chip in it that has a connection with a network. The idea behind equipping containers with an array of sensors is that they can collect real-time data about everything from the temperature inside a container to its exact location – thanks to GPS tracking. Smart containers create a lot of data, which can ultimately optimise the supply chain. Estimates suggest that there can be a $7 billion cost-saving by creating a more optimised process.”

MIT Technology Review’s Blue Technology Barometer

The Blue Technology Barometer ranks 66 coastal countries and territories on progress in and commitment to protecting ocean sustainability, measuring how far economies are prioritizing protecting ocean health, whether by more sustainable marine activity, blue innovation and policy implementation. Highlights from the report can be found here.

Government backs ground-breaking space technology to tackle climate change

The UK Space Agency is funding cutting-edge technology to help tackle climate change and predict global disasters with satellites.

LEADERSHIP AND THOUGHT LEADERSHIP

I STILL HAVE FAITH IN YOU

Senior managers mar ESG effectiveness, says survey

A lack of senior management support is the biggest barrier to ESG effectiveness, says a new survey. Also damaging are a lack of understanding of expectations, requirements, and resources. That is one of the findings of a Grant Thornton Business Outlook Tracker about What ESG Means. The survey of 601 UK business leaders also shows almost half of businesses (49%) are yet to formulate a net-zero strategy. Having an unethical supply chain can lower brand reputation, say 77%. Only half of businesses offer recruitment and progression programmes for ethnic diversity, the survey suggests.

Rachael Kinsella, Editor-in-Chief at iResearch Services, says, “Senior managers are responsible for leading companies and so it is little surprise that their decisions play a big part in how effective a company’s ESG policies are. But this survey suggests that not enough businesses have clear net zero strategies in place and struggle with recruiting workers from diverse backgrounds. When they do so, and communicate their ideas effectively, then ESG measures will be more successful.”

I DO, I DO, I DO, I DO, I DO…

Implementation is key for climate change in 2022

Actions speak louder than words when it comes to climate change, and implementation is vital for 2022. So says The Economist in its World Ahead report. There is no time for a lull after the frenzy of COP26. Early in 2022, the Intergovernmental Panel on Climate Change will publish its next two major reviews of climate science, detailing the latest findings on how societies and ecosystems are vulnerable to the effects of climate change and the measures needed to cut greenhouse-gas emissions.

The first report will reveal how much climate change is already affecting lives in both rich and poor countries. The second will detail the challenge ahead. “As a result, in 2022 there will be considerable pressure on governments and the private sector to keep their foot on the (decarbonised) accelerator pedal.” With more companies adopting net-zero plans, better data and transparency will be needed to avoid ‘greenwashing.’ The American Securities and Exchange Commission and counterparts in Europe are likely to introduce more stringent rules on disclosure and the effect climate change has on their business.

AS GOOD AS NEW

IKEA changes Black Friday to Green Friday

Furniture company IKEA changed Black Friday to Green Friday by encouraging customers to recycle. IKEA stores in 32 countries asked customers to bring back their preloved IKEA products in return for a shopping voucher. Customers were also offered the chance to choose pre-loved items when shopping at IKEA, online as well as in-store. According to recent research by Ingka Group and GlobeScan, nine out of 10 people are willing to take action on climate change, seven in 10 are worried about it, but only four in 10 are taking action. “Giving used items a second life and buying pre-loved products are just some of things that we can all do to lower our climate footprint.”

Karen Pflug, Chief Sustainability Officer, Ingka Group (IKEA), says, “This is a critical decade in tackling climate change, where actions speak louder than words, and we keep pushing forward to reach the IKEA ambition to become a circular and climate positive business by 2030. Raw materials are one of the biggest contributors to the IKEA climate footprint. By keeping products and materials in use as long as possible, we can make a significant contribution to reducing the climate footprint of the IKEA business. Our buy-back service is one of the ways we are testing how we can enable customers to prolong the life of their IKEA products in a convenient way.”

DON’T SHUT ME DOWN

OTHER SUSTAINABILITY STORIES YOU MAY HAVE MISSED

ANOTHER TOWN, ANOTHER TRAIN

SUSTAINABILITY EVENTS COMING UP

  • The Edie Sustainability Leaders Forum takes place at London’s Business Design Centre 1-2 February 2022. You can book tickets via this link.
  • Save the date now for the Edie Sustainability Leaders Awards on 2 February 2022. Early bird tickets are still available (just!). More information can be found here.
  • The GreenBiz 22 events program has just been announced and tickets are available.

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