The Week in Sustainable Business News: 8 March 2020

Companies and Industries

GE Says It’s Going Green, But Overseas It’s Still Pushing Coal: In the USA, General Electric positions itself as a clean technology company working on wind turbines and other clean energy equipment. In Vietname, it’s selling equipment for new coal power plants, along with 18 other coal plants in 17 other countries. The company is beginning to attract criticism from banks and financial institutions less interested in financing carbon-intensive projects.

Shell Has a Plan to Profit from Climate Change: Oil companies like Shell and Exxon have known for decades that burning fossil fuels would cause climate change. So far they’ve fought against policy to reduce fossil fuel use while attempting to market themselves as part of solving climate change, such as BP’s ill-fated Beyond Petroleum branding campaign of the 2000s. As momentum builds for policy to reduce the role of fossil fuels in society, oil companies are now seeking ways to shift strategies away from oil to clean technology while remaining profitable. It’s one of the most dramatic strategic shifts in modern corporate history, and Shell hopes to convince governments to help pay it to make the transition.

Ethical Forests investigates how brands are performing on 2020 commitments to end deforestation: In 2014 a coalition of companies, governments, NGOs, and other organizations committed to halving the global deforestation rate by 2020. Instead, the deforestation rate grew 43%. The only country where forest loss slowed was Indonesia where the government instituted a ban on new forest concessions. The failure of the coalition mirrors a broader failure on the part of companies to achieve sustainability commitments. Recently the number of companies even making commitments has slowed. Only 8% of existing commitments cover all of a company’s supply chain and operations. More than half of companies buying and selling forest-risk commodities have made no commitments to end deforestation.

Australia Banks to Face Climate Stress Tests, Regulator Says: The Australian bank regulator is increasing pressure on banks to become more resilient to a host of risks, one of which is “climate change financial risks,” a term left undefined in the regulator’s statement (pdf).

Business, Politics, Policy

How a Trump Insider Embeds Climate Denial in Scientific Research: The New York Times reports an employee of the Interior Department in charge of overseeing land managed by the US government inserted scientifically debunked claims about atmospheric carbon dioxide benefits into government reports. The employee has worked at Interior since the 1980s. The Trump administration promoted the employee to a senior position in charge of reviewing Interior’s climate policies. During their time at Interior, the employee also collaborated on reports with the Cato Institute and the Heartland Institute, both think tanks that have sought to undermine findings from climate science.

Cashmere and climate change threaten nomadic life: Cashmere wool is produced from the hair of cashmere goats. Growing global cashmere demand has led Mongolians to increase ownership of cashmere goats that are grazed on Mongolia’s grasslands. The goats are replacing sheep, also popular herd animals in the country. While sheep graze by biting off the top of grass, leaving roots intact, cashmere goats rip the entire plant out of the ground, killing the grass. Substituting cashmere goats for sheep is increasing overgrazing and grassland degradation while also threatening traditional nomadic practices.

Global rescue plan for nature ‘overlooks genetic diversity’: Researchers criticized a new 10-year strategy to protect biodiversity for focusing too much on people and not enough on wildlife, especially protecting the genetic diversity of all species rather than focusing on those currently viewed as beneficial to people.

Colorado bill would require utilities to shift to ‘renewable natural gas’: A proposed law in the US state of Colorado would require energy utility companies to source some of their natural gas from landfills, sewage plants, and livestock manure.

Teaching

Teaching sustainability: how MBAs are combining mainstream with green-stream: MBA students report increasing interest in learning about and working for governments and nongovernmental organizations. A recent survey of prospective business school students found 70% named “ethical leadership” as important to business teaching and research.

MBA students and employers demand ‘profitable solutions for people and planet’: MBA student respondents to a survey about business school social responsibility and impact made the following demands:

  • Sustainability and social impact training should be mandatory,
  • Reduce carbon dioxide emissions and food waste, exchange ideas on good practice, and prioritize, gender parity,
  • Stop investing in fossil fuels,
  • Stop treating sustainability as a secondary concern,
  • Stop accepting funds from unethical companies and people,
  • Stop flying students abroad for courses
  • Stop emphasizing profit maximization

As a sign that business schools might implement some reforms, accredication and other bodies related to business schools–the Association to Advance Collegiate Schools of Business (AACSB), the European Foundation for Management Development, and the Association of MBAs–have incorporated some trends in guidelines.

While calls for change exist, they are not universally agreed on among business school students, faculty, and staff, many of whom remain focused on “traditional” research and learning. Global demand for management education continues increasing despite declines in MBA applications in the United States.

The Week in Sustainable Business News

The Institute of Chartered Accountants in England and Wales called for all members of the Accounting Sustainability Project to integrate climate crisis solutions into their work.

The push for companies to address climate risks is increasing demand for employees who understand sustainability, climate change, and their relationship to business operations.

Oil firms face continued pressure to find new business models. Investors remain unimpressed. Energy has been the worst-performing sector S&P 500 sector over the past 10 years due to a combination of shale drilling increasing supply and transition away from petroleum fuel affecting demand. Many companies across sectors face increased investor pressure to address carbon emissions.

Canadian mining company Teck Resources Ltd. canceled its permitting application for a multi-billion dollar tar sands mining project in Alberta. The company blamed a lack of clear climate change policy, but oil prices remain below the profitability threshold assumed by the project planners several years ago.

Norwegian oil firm Equinor abandoned plans to drill in one of Australia’s relatively undeveloped marine ecosystems. Equinor’s cancellation followed a pattern of canceled plans for drilling in the area, including BP, Chevron, and Karoon Energy since 2016.

Glassmaking companies hope growing opposition to plastic packaging can end the decades-long decline in glass packaging consumption. However, glass recylcing remains a challenge.

Indigenous protesters against a natural gas pipeline in Canada faced forced removal by Canadian police after several weeks of disrupting railroads.

Indonesia’s 2018 ban on exporting coral caused thousands of sustainable coral farms to collapse. Environmentalists fear lifting the ban will resume destructive wild coral harvesting, even if it helps the farmed coral sector.

Environmental campaigners won a court case against Heathrow airport’s plan to build a new runway. The court ruled the government must account for the Paris climate agreement in airport planning. The government plans to appeal the ruling and still supports airport expansion.

USA government laws under consideration

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The Week in Sustainable Business News

The Trump administration is struggling to implement regulatory changes to allow automakers to create more air pollution from cars.

US lawmakers in the House of Representatives introduced two bills related to carbon capture and sequestration. H.R. 5865 seeks to promote new technologies that capture or store carbon. H.R. 5859 seeks to promote forest management practices that sequester carbon in soil.

Frederik Dahlmann at Warwick Business School argued companies must focus on supply chains to reduce emissions. “Sustainability has become the issue of this generation. If businesses are to prosper in this climate, they need to include their whole supply chain to claim they are truly on the planet’s side and not be accused of creative carbon accounting.”

JPMorgan bank CEO Jamie Dimon claims the environment is a priority, but the company has resisted calls to act on climate. It requested permission from regulators to skip shareholder votes on climate-related proposals at its next annual meeting.

The Washington Post Editorial Board called on US lawmakers to embrace putting a price on carbon.

David Roberts discussed continued inaction on climate solutions. Climate advocates cling to the idea of social tipping points to believe progress will accelerate fast enough despite continued inaction.

Thomas Roulet and Joel Bothello wrote about degrowth and why it shouldn’t scare businesses, in Harvard Business Review.

Delta announced a plan to become the first carbon neutral airline by decreasing its use of jet fuel, buying carbon offsets, and working with partners to decrease their emissions. It remains unclear how airlines can reduce their emissions, and there’s no evidence that offset programs are effective.

Employees are taking collective actions to pressure their companies into acting on climate change.

Giselle Weybrecht writes about what business schools and faculty can do about climate change.

  • Make sure everyone knows what climate change is
  • Start with climate science, but don’t dwell on it
  • Move the discussion to areas that are relevant to business school students
  • Research climate change
  • Address climate change as an organization

Despite anti-plastic campaigns, investors are piling into plastic production.

Jeff Bezos pledged $10,000,000,000 to fight climate change.

Martin Wolf argued developing new technologies to power the economy without fossil fuels is the only realistic route left to avoid catastrophic climate change.

The United States government agency that collects taxes cleared up uncertainty around tax breaks for developing carbon capture technology.

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The Week in Sustainable Business News

The political right continues its turn toward engaging in climate policy. On Feb 13 the right-leaning Climate Leadership Council released its Bipartisan Climate Roadmap, offering both a compliment and substitute to the left-leaning Citizens’ Climate Lobby‘s Energy Innovation and Carbon Dividend’s Act. However, Republican lawmakers continue to face resistance within their party. Grist published a guide to determining if a Republican is serious about climate action. Some questioned the science behind the plan to plant a trillion trees President Trump mentioned in his State of the Union address to Congress.

In the same week the Financial Times asked if greenwashing is a “necessary evil,” oil giant BP announced plans to become net-zero on carbon and a group of firms that relies on soybean inputs announced they will pay Brazilian farmers not to convert the Cerrado grassland into soybean fields.

The future of oil continues to be uncertain. Plastic bans in China threaten a major source of oil demand. One-third of oil assets might be stranded. The concept of a “stranded fossil state” emerged with concern about what Venezuela and other nations with oil-dependent budgets will do in a world with too much oil supply.

The Church of England adopted a net zero target for 2030. Airports around the world are threatened by sea-level rise. The concrete industry continues grappling with its emissions problem, this time with plans to grow bricks.

Canada could gain increased agricultural capabilities from climate change, but at the expense of natural systems and people around the world.

We’re learning more about nature’s tipping points, even as we push past potential points of no return.

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