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STOCK EXCHANGE United Nations Sustainable Stock Exchanges Initiative (SSE)
M
INTERVIEW PRINCE OF GREEN FINANCE
Manoj K. Raut, CEO and Director of the Institute of Directors (IOD)
The Prince of Wales Accounting for Sustainability Project (A4S)
STRONG GREEN EMERGING ECONOMIES Discover how the BRICS are doing their part to ensure the sustainability of our world.
BUILDING THE FUTURE
Publisher Ziwira CEO and Founder Adam Merza adam@ziwira.com Editorial Saba Khan saba.khan@ziwira.com Nasreen Rasool nasreen.rasool@ziwira.com Zane Small zane.small@ziwira.com Marketing Nadir Khan nadir.khan@ziwira.com +971 56 7481747 Design Asif Habib asif.habib@ziwira.com Fahad Balabhai fahad@ziwira.com Head Office Techno Hub Building, Office No. 161-162, PO Box No. 341171, Dubai Silicon Oasis, UAE. USA Office Ziwira Inc. 445 Park Avenue
JUNE 2015
EDITORIAL A fully functioning sustainable world, is about more than just recycling and eating organic. Finance plays a key role in determining the success of global functionality. A healthy economy means a healthy world. In our first Finance Issue, ZIWIRA will guide you through different aspects of the world of finance and economy, and how today, business leaders are stepping up and acknowledging the vital importance of implementing sustainable practices. First of all, we present to you Corporate Knights, a Canadian based research organization who have released their annual Global 100 Most Sustainable Corporations list (Page 14). The number 1 spot was given to a corporation that integrates sustainability into pharmaceutical engineering (Page 16). Banks are vital to our modern existence. Learn about three banks from different areas of the world, that are actively changing the way banking corporations are run, by supporting ethical causes and a low-carbon economy (Page 18). In addition, our cover story will introduce you to five of the mightiest developing economies – often referred to as the ‘BRICS’. Learn about each of the BRICS countries, and how they are emerging as ‘green economies’ (Page 26). Be sure to take a look at our story on the Golden Peacock Awards, with an insight from Manoj K. Raut, CEO and Director of the Institute of Directors (IOD). Learn about the admirable Sustainability Award (Page 32). Furthermore, check out our ‘World Finance & Sustainability’ section – with information on how our economy grew without a rise in CO2 emissions (Page 42). Also, check out stories about aid supply to Nepal following the tragic earthquakes (Page 44), Prince Charles’ accounting and sustainability project (Page 48), and the vital importance of financial aid for charities (Page 50). In the final section we introduce you to Dr. Naoko Ishii, our Green Personality, the current CEO of the Global Environment Facility with a rich history in finance (Page 36). We also offer an insight into green business, and opportunities available to aspiring ‘green entrepreneurs’ (Page 52). We hope you enjoy our very first Finance Issue, and find it informative, intriguing, and most of all thought-provoking. We eagerly await your feedback!
9th Floor New York City New York 10022 United States of America Canada Office Ziwira Inc. Toronto, Canada
Zane Small CONTENT CONTRIBUTOR @ZIWIRA
© Copyright 2015 Ziwira. All rights reserved. No part of this publication can be reproduced in
parts, stored in retrieval system or transmitted in
any form or by any means without the prior written
permission of the publisher.
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June Issue 1 2015
CONTENTS GREEN & TRENDING
12
12
DUBAI HOSTS ANNUAL INVESTMENT MEETING The Dubai World Trade Centre was once again host to the Annual Investment Meeting which focused on Sustainable Development through Foreign Direct Investment from March 30 to April 1.
14
CORPORATE KNIGHTS GLOBAL 100 MOST SUSTAINABLE CORPORATIONS Discover which corporations Toronto based company Corporate Knights decided were the most sustainable in 2014.
16
PHARMACEUTICAL CORPORATION TAKING CARE OF PEOPLE AND THE ENVIRONMENT Biogen Idec has been ranked the number one most sustainable corporation by Canadian company Corporate Knights’ list of Global 100 Most Sustainable Corporations.
16 Biogen Idec
GREEN BANKING EVOLUTION
18
Number one most sustainable corporation
BANKING EVOLUTION Triodos Bank stands as a shining example of how ethical banking can be conducted in a modern world where climate change is on the horizon.
20
AUSTRALIA’S SHINING EXAMPLE OF SUCCESSFUL ETHICAL BANKING With a new Chief Executive, the world is watching Westpac Bank to see what great things are to come.
22
HSBC SUPPORTS A LOW CARBON ECONOMY HSBC recognizes the support and move to a low-carbon economy, which will help to reduce climate change, and benefit communities in the long run.
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18 www.ziwira.com
24 COVER STORY
GREEN BUSINESS
24
38
THE BRICS - STRONG GREEN EMERGING ECONOMIES Large economies come at a cost – a cost to the well-being of our fragile environment. Discover how the BRICS are doing their part to ensure the sustainability of our world.
INTERVIEW
32
GOLDEN PEACOCK AWARDS CELEBRATE CORPORATE RESPONSIBILITY In October, the global and national awards for corporate sustainability will be presented at the 15th International Conference on Corporate Governance and Sustainability in London. Manoj K. Raut, CEO and Director of the Institute of Directors (IOD) in New Delhi, India, spoke to Ziwira about the Sustainability Awards, and why it is such an important category to include.
A LEADING BUSINESS REFRESHINGLY PROMOTING SUSTAINABILITY As one of the world’s leading technology brands, it is refreshing to learn that Panasonic is actively incorporating sustainability into its business practices.
THE WORLD WITH GREEN 40 CONQUER INNOVATION The world is inspired not by what we know, but by what we don’t know. There are so many ideas out there just waiting to be revealed in the world – all you have to do is discover them for yourself. But first, you need to recognize an area that needs improvement. Take the environment, for example…
36
GREEN PERSONALITY
36
DR. NAOKO ISHII - AMBASSADOR FOR FINANCE & BETTERMENT As the former Minister of Finance in Japan, Dr. Naoko Ishii has rich experience in the financial sector, as well as actively working towards a more sustainable future for the world as the current CEO of the Global Environment Facility.
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June Issue 1 2015
52 WORLD FINANCE & SUSTAINABILITY
42
ECONOMY GREW WITHOUT RISE IN CO2 LEVELS – BUT WE CAN’T CELEBRATE JUST YET
50
While some people live comfortable lives, with safe homes and plenty of food, others do not. In some countries, particularly in poor African countries like Malawi and Burundi, people lack the knowledge to create sustainable lifestyles to live comfortably. Sometimes, all they need is a push in the right direction. That is exactly what US organization Heifer International is doing.
There is more carbon dioxide in the atmosphere today than at any point in the last 800,000 years. What’s more, 25 percent of the carbon dioxide pollution from fossilfuel burning is produced by the USA alone. However, recently there has been a new hope.
44
FINANCIAL AID STATISTICS FOR THE NEPAL EARTHQUAKE
48
Following the May 12, 7.3 magnitude aftershock, Nepal was left in a truly desperate situation. International aid is now of crucial importance to the region. PRINCE OF GREEN FINANCE His Royal Highness the Prince of Wales has managed to successfully and innovatively combine accounting and sustainability into one project.
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THE IMPORTANCE OF FINANCE IN CHARITY
52
ENCOURAGING GREEN ENTREPRENEURS Students in Vermont, United States, are being encouraged to seize the financial benefits of climate change, as opposed to only seeing the negative side of it.
54
WHO KNEW STOCK EXCHANGE COULD BE ETHICAL? It is important for stock exchanges to play a part in the sustainability of the world, as it maintains a significant amount of power on a global scale. The Sustainable Stock Exchanges Initiative is doing just that.
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June Issue 1 2015
NEWS
NEWS
Private sector financing required to keep UAE green
The UAE hosted the 6th edition of the Green Economy Annual Conference under the title National Roundtable of Financing and Investing in Green Economy Projects on May 25 in Dubai. In the UAE, private-sector environmental initiatives are being hampered by banks’ reluctance to finance clean-energy enterprises. Economic development is taking its toll on the environment even though the UAE has made progress in reducing its carbon footprint. The UAE has lowered its annual per capita emission of greenhouse gases to 18.8 tons in 2014 from 40 tons in 2006, according to the Ministry of Environment. “Although there are some banks that have a green remit, most are failing in their environmental concerns,” said Aisha Al Abdooli, assistant undersecretary of the Green Development Department at the Ministry of Environment and Water. “It is not a secret that conventional banks do not see the return on investment from green initiatives, but that is short-term thinking,” she added. “The government has committed to making the country environmentally sustainable. The investment is already being made, we need the private sector to join in.” Sabrin Rahman, a senior manager in HSBC’s Middle East corporate sustainability team, said the bank recognized the importance of supporting environmentally-friendly businesses. “Renewable energy is a big focus, but so is energy efficiency, low carbon transport, and waste and water management,” he said. Last year, HSBC helped to finance wind-energy projects, energy-efficient social housing, water projects, biodiversity schemes and public transport systems. Islamic finance is a natural fit for environmental initiatives, given its basic tenets of partnerships and benefiting society with a longer investment time frame than conventional banking, according to experts at the round table.
Prince Charles encourages Sustaianble Economics In his last stop on a goodwill tour of the United States, Britain’s Prince Charles attended an international conference on sustainable communities in Louisville, Kentucky, in May, and said the world faces a historic chance for change. “If we fail here, we fail humanity,” the Prince told a crowd of about 1,000 at the Cathedral of the Assumption in Kentucky’s largest city. “As a grandfather, I have no intention of failing my, or anyone else’s, grandchildren,” he said at the end of a four-day tour with his wife, the Duchess of Cornwall. Prince Charles encouraged public and private organizations to work toward his vision of a sustainable future. “He’s speaking the wisdom that we all must adopt if there’s going to be any hope for our children,” said Gary Hirschberg, chairman of Stonyfield Farms, as he left the cathedral. “I think sustainable economics, sustainable business is really the hope for our society, and he captured it perfectly.”
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Establishing China’s green financial system On April 22, China’s central bank, the People’s Bank of China, launched a ground-breaking report that sets out in specific and practical terms an ambitious agenda of how China can green its rapidly developing financial and capital markets. The report, entitled “Establishing China’s Green Financial System”, is the outcome of a Green Finance Task Force which was tasked to develop policy, regulatory and market-innovations that would better align China’s financial system with the needs of green industry and sustainable development. The Task Force was co-convened by the Research Bureau of the People’s Bank of China (PBC) and the United Nations Environment Programme project Inquiry into the Design of a Sustainable Financial System (`UNEP Inquiry`). The context of this prioritizing of greening China’s financial system is an important part of China’s roadmap to ‘eco-civilization’, which marks a major shift in its economic strategy towards a focus on greening the economy and broader aspects of China’s development, after more than 30 years of rapid economic growth that has created a legacy of environmental challenges.
Annual Sustainability Summit held in New York
Dubai hosts World Green Economy Summit
The Conference Board’s 14th Annual Sustainability Summit was held in New York from 29-30 April. This year, the summit provided a forum to hear different perspectives and strategies from Citi, Accenture, Avaya, and HP, 3M, Lockheed Martin, Exxon Mobil, Michelin, Veolia, Avon and many other major corporate and financial leaders. The purpose of the summit was to
Dubai was host to the second annual World Green Economy Summit,
teach attendees how to successfully
held under the leadership of the Dubai Supreme Council of Energy
instill
circular
from April 22-23. The Summit was held at the Dubai World Trade
economy thinking into all aspects
Centre, Al Maktoum Hall, alongside WETEX, the annual Water, Energy,
of global management systems and
Technology, and Environmental Exhibition. Saeed Mohammed Al Tayer,
corporate ethos to drive business and
Vice Chairman of the Dubai Supreme Council of Energy, and CEO of
gain competitive advantage. Highlight
DEWA, said, “In establishing this summit, Dubai has demonstrated its
topics at the forum included market and
commitment to building a green economy and sustainable development.
investor perspectives for sustainable
As a result, we wish to make the following declaration of actions, to
operations,
and
extend this effort to build on the success of the World Green Economy
supply chain management, as well as
Summit to showcase green economy and business for the Dubai 2020
integrating and communicating circular
World Expo, the 2021 UAE Vision, and to develop Dubai as the capital of
economy thinking and sustainability.
green economy.” In attendance was Kandeh Yumkella, the United Nations
Also mentioned at the conference was
special representative of the Secretary General for Sustainable Energy, as
shaping the future of mobility and
well as many other speakers. Topics covered by the conference included
energy, and also addressing the gap in
‘Dubai the capital of the green economy and the road to Paris’, ‘greening
US materials recovery.
cities’, and ‘smart cities’.
sustainability
ethical
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and
practices
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June Issue 1 2015
NEWS
10TH Anniversary of Annual Green Economics Conference 2015 marked the 10th anniversary of the Annual Green Economics Conference held at Oxford University from March 22-24. This annual event has been host to major international organizations in the past including UNEP, UNESCO, ILO, and other significant international NGO’s. Also in attendance at the conference were members of domestic and foreign government agencies who joined the university for several days of lectures, debate, and innovation. The Institute stands at the forefront of debate, developing and informing a green perspective on current events. Every year, ideas exchanged at this conference have been key to the transformation of economic, social and environmental policy around the globe. Campaigners are welcome at the event, as well as academics,
Advancing Caribbean States through Green Economy
and institutional leadership, writers, journalists, university students,
In February, the Government of Jamaica, in
association
with
the
United
and
supporters.
Groundbreaking
research
is
introduced and world-class speakers present their work, often
Nations
Environment Programme, held the 2015 Green
publishing not only in the conference proceedings, but also in the Green Economics Institute’s books, academic journals, and membership magazine.
Economy Conference. The conference was a part of a project called ‘Advancing Caribbean States’ Sustainable Development through Green Economy’. The conference brought together policy makers, civil society, academia, and the private sector to network and share ideas, experiences and institutional innovations to transition to a green economy at the national and regional levels. In the Caribbean region, many of the states have showed significant commitment to creating and investing in green economy activities, which include Barbados, Haiti, Jamaica, and Saint Lucia. The conference created a way for these states to come together and
share
their
inspiring
institutional,
investment and policy innovations, as well as the challenges that they face, in the transition towards greener and more inclusive economies. Issues that were discussed at the conference include sectorial policies and projects, public and private investment, tariffs and trade policy, standards and regulations, capacity building for Green Economy, and mobilizing investments and bilateral aid.
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Carbon regulation could create more jobs By 2020, the Environmental Protection Agency’s (EPA) proposed Clean Power Plan will create nearly 100,000 more jobs than are lost, according to a new report from the Economic Policy Institute, a non-partisan think tank. The report’s initial estimates are higher than some similar studies; however, the institute found that the job impacts of the Clean Power Plan, which limits carbon emissions from power plants, would not last, and would become “almost completely insignificant by 2030.” Coal mining and coal-fired power plants will face the biggest job losses if the Clean Power Plan is implemented, because coal-fired power plants are responsible for 39 percent of the United States’ electricity generation and threequarters of the sector’s carbon emissions. But other sectors, including renewable energy, scientific research, and appliance manufacturing, will all increase, at least initially, the report found. Efficiency investments, such as retrofits for homes and businesses, will be a key driver in initial job growth, but will ultimately lower electricity demand, EPI said. The report looks not only at direct employment — for instance, coal mining positions that will be lost, or solar industry jobs created — but also at indirect employment, such as a waitressing job in a mining town or railroad jobs affected by decreased coal shipping. That means the report looked at where coal miners are spending their paychecks.
UNEP FI supports Bank Al Maghrib Sustainable Finance Strategy in Morocco One year after Bank al Maghrib (Moroccan Central Bank) held its first convening on finance and sustainability issues in June 2014, the United Nations Environment Program Finance Initiative (UNEP FI), together with the International Finance Corporation (IFC), has lent its support to the Central Bank. On May 19, Bank al Maghrib convened a national CEO Roundtable, inviting all the country’s banks to establish a Sustainable Finance Strategy for Morocco. The Roundtable was hosted by Governor Abdellatif Jouahri and addressed by Mr. Abdelouahed Fikrat, Secretary General for the Environment, followed by an expert panel featuring BMCE Bank, IFC, Societe Generale, and UNEP FI. A working group co-led by Bank al Maghrib and GPBM (Moroccan Banking Association) will now be formed to develop a roadmap for the country’s banking sector. The roadmap is intended to contribute to achieving Morocco’s impending National Strategy on Sustainable Development, a policy framework that is currently being adopted in the wake of new environmental legislation passed in 2014.
Third International Conference on Financing for Development Whilst in Europe in late June, UN Secretary-General Ban Ki-moon made an official visit to Luxembourg, where he met with a number of Government officials, including the Prime Minister, Xavier Bettel, where he conveyed his appreciation for Luxembourg’s important commitment to development aid and the European Union’s leadership towards reaching a meaningful agreement on climate change in Paris. Mr. Ban also took the opportunity to emphasize the importance of ensuring a success at the Third International Conference on Financing for Development, set to take place in Addis Ababa, Ethiopia. The Third International Conference on Financing for Development will be held from 13-16 July, 2015. The conference will gather high-level political representatives, including Heads of State and Government, and Ministers of Finance, Foreign Affairs and Development Cooperation, as well as all relevant institutional stakeholders, non-governmental organizations and business sector entities. The Conference will result in an intergovernmentally negotiated and agreed outcome, which should constitute an important contribution to and support the implementation of the post-2015 development agenda. The conference is expected to address new and emerging issues, including in the context of the recent multilateral efforts to promote international development cooperation; the current evolving development cooperation landscape; the interrelationship of all sources of development finance; the synergies between financing objectives across the three dimensions of sustainable development; and the need to support the United Nations development agenda beyond 2015. Another point to be discussed will be reinvigorating and strengthening the financing for development follow-up process.
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June Issue 1 2015
GREEN AND TRENDING
DUBAI HOSTS ANNUAL INVESTMENT MEETING Sustainable development is an imperative characteristic of a successful economy. Around the world, more and more businesses and organizations are opening up to the idea of economic growth through sustainable practices. The Dubai World Trade Centre was once again host to the Annual Investment Meeting which focused on Sustainable Development through Foreign Direct Investment.
T
his year, the Annual Investment Meeting focused
C-level executives from the regional and international
on
FDI
investment and trade communities. Also in attendance
‘Sustainable
Development
through
(Foreign Direct Investment) Induced Innovation
were world-renowned industrialists, investment experts,
and Technology Transfer’. The meeting was held from
and leading financial powerhouses to discuss economic
30 March-1 April, at the Dubai World Trade Centre.
governance, strategic expansion, and sustainability.
The occasion gathered the world’s leading academics, experts, and practitioners, to discuss economic growth and development, and also how FDI can contribute to sustainable economic growth through transfer of technology and the supportive investment policies that are needed to attract and retain investment of the right kind. The Annual Investment Meeting took place over two and a half days, with interactive educational sessions at a highlevel, between delegates and panelists, which will always be a unique and unparalleled experience for all who attend. Those who attended the meeting included individuals and
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H.E. Sultan Bin Saeed Al Mansoori, the UAE Minister of Economy (SEE IMAGE), remains a positive supporter of the annual meeting. He believes that it has, “established itself among the best events in the world as it opens the doors wide on Foreign Direct Investment (FDI) topics and the prospects for growth and development in emerging markets around the world.” The Meeting is a sourcing platform to create solid bonds and partnerships between sustainable businesses and potential investors. It also offers representatives from foreign investment offices and trade agencies, the chance to improve their country’s profile by showcasing private and public sector investment opportunities.
The event was held under the patronage of His Highness
the world’s first emerging markets FDI-focused event, the
Sheikh Mohammed Bin Rashid Al Maktoum, Vice-President
meeting combines an exhibition with intellectual features
and Prime Minister of the UAE and the Ruler of Dubai. The
aimed at enriching institutional, corporate, and individual
Annual Investment Meeting is now in its 5th year, and is
investors with a comprehensive set of guidelines for future
an initiative by the UAE Ministry of Economy. The meeting
investments in high-growth regions. The meeting featured
has been significantly growing in popularity each year
500 exhibitors from 140 countries, marking it a significant
with 6,070 visitors in 2013, to 11,356 visitors in 2014. Being
event for the world of sustainability and eco-development.
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June Issue 1 2015
GREEN AND TRENDING
THE MOST SUSTAINABLE CORPORATIONS There is an abundance of corporations in the world, all desperately competing to dominate the ever changing market. However, profitability is in some cases becoming less important alongside the issue of business sustainability. ‘Sustainability’ is becoming a title that corporations are prepared to fight for, which in the big picture, will prove to be extremely beneficial for the world. For two years in a row, the United States have topped the list with the most sustainable companies making it on to the list, with 20 placements including Campbell Soup, EMC, Johnson & Johnson, General Mills, and Adobe Systems. Canada came second, as it did in 2014, this time having 12 companies make it on to the list. Surprisingly, Australia did not feature highly this year, after having the first place ranking last year with Westpac Bank. Newcomers to the list in 2015, include Danske Banke, Marks & Spencer, Accenture, BNP Paribas, and Colgate-Palmolive. When ranking the companies, certain indicators are prioritized over others
C
K Capital, Corporate Knights, based in Toronto,
across industries. For example, banks do not have to worry
produces corporate rankings and research reports,
about safety rankings, because the financial sector does not
based on corporate sustainability performance.
pose any physical risks, while the transportation industry
It is well-known for its Global 100 Most Sustainable
does, and physical well-being can be at stake.
Corporations list. The information put together by Corporate Knights, is released annually at the World Economic Forum in Davos, Switzerland. The companies, with a market cap upwards of $2 billion, are evaluated by specific categories which include management of
Corporate Knights most Sustainable Corporations
resources, employees, and finances. Corporate Knights focuses on energy use, emissions, water use, and waste generated. It also looks at financial sustainability, revenue, and ratio of CEO compensation to the average employee’s compensation. Lastly, management practices, fatalities, turnover, diversity in leadership, and female representation on the board of management, is considered.
1
American biotechnology company
2
American botox company
3
German sportswear label
4
Singaporean real estate firm
5
Finnish superstore
Biogen Idec
Allergen
This year, the company to rank first on the list of most sustainable corporations, was Biogen Idec, an American biotechnology company that has been a major contributor to creating treatments for multiple sclerosis and other
Adidas
autoimmune and neurodegenerative diseases. Biogen Idec was closely followed by Allergen, another American company that specializes in making Botox – achieving a 72.8% sustainability rating. Third on the list was the world famous German sports apparel brand Adidas, which scored a perfect score for the ratio of revenue to carbon emissions. Coming in fourth place was Singaporean company Keppel Land, a real estate management and development firm.
Keppel Land
Kesko
Fifth place went to a Finnish superstore called Kesko.
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June Issue 1 2015
GREEN AND TRENDING
PHARMACEUTICAL CORPORATION TAKING CARE OF PEOPLE & THE ENVIRONMENT Pharmaceutical companies are one of the most important industries, as they offer us the chance to live long, healthy lives free from destructive diseases. Biogen Idec has been ranked the number one most sustainable corporation by Canadian company Corporate Knights’ list of Global 100 Most Sustainable Corporations. The company was also ranked second place in 2014, after Westpac Bank.
Biogen Idec
B
iogen Idec Incorporated is a global biotechnology
then called Biogen NV, and operated in small, separate labs
company based in Cambridge Massachusetts. The
around the world. In 1980, Biogen announced its first two
company was first founded in 1978 by a group of
ground-breaking discoveries which included the expression
the world’s most accomplished biologists, at a gathering
of biologically active human leukocyte (alpha) interferon and
in Geneva, Switzerland. Their goal was to establish a
biologically active human fibroblast (beta) interferon, which
contemporary pharmaceutical company, with an emphasis
would lead to the development of AVONEX (interferon beta-
on making breakthroughs in biology. The company was
1a) used to treat Multiple Sclerosis (MS).
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Today, patients all around the world benefit every day from
company has ultimately rethought the way resources are
Biogen’s leading MS products. The company is focused
used during production. The environmental approach that
on bringing new therapies to the market for patients with
Biogen Idec takes is towards three main aspects which
neurodegenerative diseases, autoimmune disorders, and
include water, energy, and materials. In 2009, a long-term
hemophilia. The company operates in Zug, Switzerland,
goal was set to reduce the company’s overall environmental
with functional operations located in Research Triangle
footprint by fifteen percent by 2015, compared to 2006
Park, North Carolina, USA (manufacturing facility), Hillerød,
levels. The goal was reached in 2012, with environmental
Denmark
Maidenhead,
footprint reduced by 18 percent – new goals have been
UK (International R&D). The company also has offices
(manufacturing
facility)
and
set to achieve by 2020. Biogen also has a greenhouse gas
throughout Europe, in Australia and New Zealand, Latin
intensity goal to reduce greenhouse gas emission intensity
America, and Asia, and operates a global distribution
by 80 percent by 2020 compared to 2006 baseline and
network which covers over 70 markets.
normalized by revenue. This is equivalent to maintaining 2006 levels of greenhouse gas emissions, despite estimated
As well as striving to provide a better lifestyle for people
business growth. Biogen also hopes to reduce the amount
affected by terrible diseases, Biogen Idec also significantly
of waste it produces.
contributes to the well-being of the environment. The
Water, Energy & Waste Water is a vital part of operations at Biogen Idec. Water is needed throughout operations, including incorporation
into
products,
sterilization
and
cleaning of equipment, cooling towers, irrigation, and domestic use. For this reason, Biogen has realized the importance of making every drop of water count, to ensure continued use of the resource. The company now has more efficient irrigation and water reclamation, to optimize the water used in the cooling towers and HVAC systems.
During the process of developing therapies for biological diseases, a significant amount of waste is often produced. Biogen Idec is aware of this, and manages the byproducts of their developments just as seriously as creating new products. In 2012 Biogen successfully achieved zero waste-to-landfill through a range of projects that avoid, recycle and compost waste
The company does not deny the fact that it consumes
or turn it into energy. Biogen hopes to maintain this
a lot of energy through research, development,
status going forward. For an organization that already
commercial, and manufacturing operations. That
provides so much positive assistance to the world
is why they are continuing to implement more
through their breakthrough products that counter
energy-efficient technologies into their practices, by
serious diseases, they definitely deserve recognition.
purchasing energy credits and carbon offsets. They
They deserve recognition for not only providing
are then able to control greenhouse gas emissions,
breakthrough remedies, but also for remaining true
energy use, and associated costs.
advocates for the environment.
Biogen Idec Profits This year, Biogen reported first quarter 2015 results, including revenues of $2.6 billion, a 20% increase compared to the first quarter of 2014.Profit margin represents the percentage of revenue that a company keeps as profit after accounting for fixed and variable costs. It is calculated by dividing net income by revenue. Displayed as a percentage, profit margin can be thought as the amount of profit that a company keeps per dollar of revenue. For example, if a company has a profit margin of 43%, the company keeps $.43 of each dollar of revenue. Biogen Profit Margin (Quarterly): 32.19% for March 31, 2015
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June Issue 1 2015
GREEN BANKING EVOLUTION
BANKING EVOLUTION People, Planet, Profit. This is the slogan that Dutch bank Triodos operates by. It is one of the only banks in the world that is wholeheartedly dedicated to benefiting the environment – from investing in renewable energies, to reducing travel emissions. The bank stands as a shining example of how ethical banking can be conducted in a modern world where climate change is on the horizon.
Triodos Bank
T
riodos Bank is not your typical bank. It
‘Triodos’ is derived from the Greek meaning “three-
stands out as a bank that only finances
way approach” (people, planet, profit). Customers
companies which it believes add cultural
with Triodos Bank can open conventional savings
value, and benefits people and the environment.
accounts, as well as ethical funds and venture
Such companies include those associated with
capital. Triodos supports the developing world by
homeopathy,
farming,
supporting microfinance initiatives with their active
or culture. The bank uses money deposited by
solar
energy,
organic
international department. It is the only bank in the
100,000 savers and lends the money to hundreds
United Kingdom to provide and annual list of all the
of organizations. Triodos was first established in
loans the bank has made.
1980. It has its roots in Zeist, Netherlands. The word
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To begin its reign as one of the only ethical operating banks, in 1980, Triodos Bank launched its first ‘Green Fund’, to support environmentally friendly projects, on the Amsterdam Stock Exchange. Friends of the Earth (an international network of environmental organizations) in the Netherlands, claimed that transferring 10,000 euros in savings from ABN Amro (Dutch state-owned bank) to Triodos will effectively result in a carbon dioxide emissions saving equivalent to what would be achieved by not driving a car for six months. Triodos Bank is a firm believer that in order to transition
To Triodos Bank, an integrated sustainable picture means
from a carbon-based economy to a sustainable economy,
Low-carbon emissions within the life-cycle of a project,
it is essential to reduce energy demand and use energy as
including the fuels and materials used, resilient in terms
efficiently as possible. The bank plans to invest in renewable
of decentralized energy, flexible demand management
energy systems, while switching to low carbon fuels.
and storage systems. It also means socially embedding
Triodos is planning on reducing their own CO2 emissions
the idea into the minds of the people who associate with
in a number of ways, by printing less, and cutting down on
Triodos, and encouraging participation. Furthermore,
travel. The new Triodos buildings have been constructed
Triodos also believes it is important to use a balanced mix
using carefully selected sustainable materials and the most
of technologies, while respecting the costs and benefits,
energy-efficient lighting, heating, and cooling technology
for example, more distributed local energy schemes which
available. All of the electricity that the bank uses comes
combine heat and power. The bank certainly recognizes
from renewable energy sources. Some of the energy for
that energy has become a significant part of their business
the buildings located in the Netherlands, comes from wind
structure, through the bank and through investment funds.
farms financed by the bank. Any remaining CO2 emissions
Climate change and energy demands will remain key
created by the bank including emissions from natural gas
challenges for the next few decades. The bank wants to
consumption, paper consumption, and business travel and
connect people, and ensure that the social dimensions of
commuting, are compensated.
the energy they use are fully integrated.
PEOPLE, PLANET, PROFIT.
Supporting a worthy cause Triodos Bank is currently involved in a sustainable project in the Dominican Republic. Conacado Agroindustrial S.A. is one of the leading producers of sustainable cocoa. The trade finance provided by Triodos Sustainable Trade Fund allows Conacado to pay the farmers directly upon delivery of their produce. Conacado sources, dries, ferments, and exports sustainable cocoa to areas which include Switzerland, Italy, United Kingdom and Mexico. The farmers are the direct owners of Conacada and have been involved since the start.
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June Issue 1 2015
GREEN BANKING EVOLUTION
AUSTRALIA’S SHINING EXAMPLE OF SUCCESSFUL ETHICAL BANKING Even though it has officially lost the title of ‘Most Sustainable Corporation’, Westpac Bank remains one of the world class leading examples of high success rates and profit, combined with a will to cater to a more sustainable, prosperous world. With a new Chief Executive, the world is watching Westpac to see what great things are to come.
Westpac has been ranked number one in the ‘Global 100 Most Sustainable Corporations in the World’.
Westpac Banking Corporation
I
n 2014, Westpac Banking Corporation, based in
Westpac Banking Corporation was first established in
Australia, was ranked number one in the ‘Global
1817, and was the first bank to operate in Australia. It
100 Most Sustainable Corporations in the World’.
first began trading as The Bank of New South Wales. In
The ranking was placed by Corporate Knights, an
1982, it merged with the Commercial Bank of Australia,
investment research company based in Toronto,
and became the Westpac Banking Corporation. In
Canada. The placement was given to Westpac at
2002, Westpac was registered as a public company
the World Economic Forum in Switzerland. Former
limited by shares under the Australian Corporations
Westpac Chief Executive Gail Kelly was delighted that
Act (2001). As of today, Westpac has branches
Westpac’s sustainability efforts were recognized on
throughout Australia, New Zealand, and the nearby
a global scale, saying “It is wonderful recognition of
Pacific region, and maintains offices in London,
the work of our people to help create a sustainable
New York, Hong Kong, and Singapore. Westpac has
future and deliver long term value for our customers,
approximately 36,000 employees in Australia, New
employees, shareholders and the community.” In
Zealand, and around the world, with global assets of
February, Brian Hartzer was appointed as the new
AU$770.8 billion.
CEO of Westpac Bank.
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www.ziwira.com
Green Banking In relation to Westpac ranking number one in the Global
resource use, and lending to the energy sector annually
100 assessment by Corporate Knights, this quality is what
through their sustainability report. Westpac has a paper
makes Westpac a particularly admirable organization.
purchasing policy, where outlines have been written about
Westpac provides an annual sustainability report which
the standards Westpac expects of their paper suppliers. It
summarizes operating performance including financial
takes into consideration conservation of global resources,
and non-financial measures and performance. The
and the standards of sustainable production by paper
Westpac sustainability report is based on the Global
providers to the Group. Westpac also has a Climate Change
Reporting
GRI
and Environmental Position Statement & 2017 Action Plan,
guidelines - in the form of principles and indicators -
as well as an Environmental Policy Statement, covering
aim to provide comparability and consistency between
the management of their ecological footprint, and the
sustainability
incorporation of environmental considerations into their
Initiative
(GRI)
reporting
G4
Guidelines.
worldwide.
Westpac
The
actively
reports on greenhouse gas emissions, travel performance,
risk management framework.
“It is wonderful recognition of the work of our people to help create a sustainable future and deliver long term value for our customers, employees, shareholders and the community.” – Gail Kelly Former Westpac Chief Executive.
Ethical Awareness Westpac as an organization, has dedicated itself to the
bank works with local water authorities and landlords
awareness of climate change, which they believe is not just
to implement water saving initiatives, as well as being a
an environmental problem, but a fundamental economic
participant in the Australian Banker’s Association water
and social issue posing various risks to business. Westpac
security group, engaged in public policy recommendations
has five key strategies to tackle the issue of climate change.
and contributing to the current policy debate in Australia.
These strategies include minimizing direct environmental footprint, managing climate risks and building capacity,
Westpac Banking Corporation today, is leading the world to
driving positive change through products and services,
a better, more sustainable way of business administration.
and engaging customers and the wider community with
It has proven that with substantial success, a company such
environmental issues. Biodiversity is another issue of
as Westpac then has an opportunity to make a difference
importance to Westpac. The bank supports initiatives to
and influence its customers and associates to become
maintain Australia’s unique biodiversity through day to day
more aware of the ecological needs of the world. That
risk and lending policies and practices, and the volunteer
being said, unfortunately Westpac lost its title as the most
efforts of employees. Westpac sees great potential through
sustainable corporation to Biogen Idec, which indicates
the use of carbon offsetting to create additional revenue
that sustainability as an issue is increasing in importance,
streams for farmers, and improve local biodiversity through
and is becoming a title that is worth competing for in
reforestation. Furthermore, in late 2007, The Westpac
business.
Group committed to the UN’s CEO Water Mandate. The www.ziwira.com
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June Issue 1 2015
GREEN BANKING EVOLUTION
HSBC SUPPORTS A LOW CARBON ECONOMY With considerable global success, HSBC Holdings plc not only operates within 80 countries with 6,600 offices, it also stands as a corporation that holds firm for what is right, resilient, and sustainable for global well-being. The corporation recognizes the support and move to a low-carbon economy, which will help to reduce climate change, and benefit communities in the long run.
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www.ziwira.com
“By setting the highest standards of behavior, our aim is that all of our employees and customers can be proud of our business.” – Stuart Gulliver, HSBC Group Chief Executive.
WHO ARE
decisions. The corporation actively helps their
HSBC?
customers to understand sustainability risks, and make improvements to their sustainability practices. HSBC is one of a number of financial institutions that is playing an important role
H
SBC Holdings plc was first established in 1865, which makes it a staggering 150 years old! It began in Hong Kong
by the Hong Kong and Shanghai Banking Corporation. Today, it is a British multinational banking
and
financial
services
company
headquartered in London, United Kingdom. HSBC stands as the world’s third largest bank in terms of assets. The HSBC name is derived from the initials of the Hong Kong and Shanghai Banking Corporation. The corporation currently operates in 6,600 offices in 80 countries and territories across Africa, Asia, Europe, North America, South America, and Oceania. Stuart
in shaping the fast-developing green bond market. Green bonds are issued to finance climate or environmental projects. HSBC is a member of the International Capital Market Association’s Executive Committee for the Green Bond Principles, which are a set of voluntary standards for issuers of green bonds. The corporation also recognizes and supports the move to a low-carbon economy, which will held to reduce climate change and benefit communities. HSBC can play a role by financing climate business – the goods and services that will thrive in and accelerate this transition to a low-carbon future.
Gulliver is the current Group CEO of HSBC. He was included in the 50 Most Influential ranking of Bloomberg Markets. He was also Co-Chair of the World Economic Forum on East Asia in 2011 in Jakarta, Indonesia.
These opportunities include: Increasing the share of low-carbon energy production such as bio-energy, solar, and wind.
Exemplary Banking
Improving energy efficiency in buildings, industry, and transport, as well as energy
As a corporation with considerable influence, HSBC has managed to channel this power to actively benefit the world. HSBC takes important
issues
into
consideration
such
as climate change and the impact on local
storage. Adapting to the impact of climate change, particularly in agriculture, infrastructure, and water and waste management.
communities that can arise from their financing
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June Issue 1 2015
GREEN BANKING EVOLUTION
HSBC Climate Business by Sector in 2014 The HSBC Water Programme 3%
8%
Water is recognized by HSBC as an increasingly
10%
scarce
resource,
and
therefore, the corporation has decided to
29%
act upon the issue. Water is essential for individuals,
communities,
economies,
and the environment. In 2010 nearly 800 million people were without access to safe water, and 2.5 billion without access to
22%
basic sanitation. As the global population grows, and the effects of climate change
28%
take hold, demand on freshwater resources will increase. Together with three leading NGO’s – Earth Watch, Water Aid, and WWF, HSBC developed the following goals for their Water Programme.
Solar
Wind
Transport
Water and waste Other
Water Aid will provide safe water to 1.1 million people and sanitation for 1.9 million people in South Asia and West
For over 10 years, HSBC has worked with their business
Africa.
customers to help them to understand and manage
WWF will protect freshwater eco-
their environmental and social impact with a focus on
systems in some of the world’s most
certain sectors and themes. In 2014, HSBC issued new
important river basins - the Yangtze,
policies on forestry, agricultural commodities, World
Ganges,
Heritage Sites and Ramsar Wetlands. They also have
Rift Valley; help thousands of small
policies covering chemicals, defense, energy, freshwater
businesses
infrastructure, mining and metals. To ensure their
provide 140,000 fishermen and farmers
sector policies are implemented, HSBC has invested in
with improved food security.
Mekong, tackle
Pantanal water
risks
and and
a network of sustainability risk managers in every region of the world. More than 3,000 colleagues have been
Together with Earth Watch, 100,000
trained on the sustainability risk framework and policy
HSBC
updates. Between 2011 and then end of 2014, almost
continents will participate online in
8,000 HSBC colleagues completed online training in
freshwater research and learning, and
sustainability risk. The World Heritage Sites and Ramsar
will engage HSBC employees from
Wetlands policy was designed to protect unique sites
all regions through one-day citizen
of outstanding international significance, as listed by
science program’s.
employees
across
four
the UN, and wetlands of importance. The policy covers possible adverse impacts on these sensitive sites by any sector and relates to all business customers involved in major projects.
June Issue 1 2015
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June Issue 1 2015
COVER STORY
STRONG GREEN EMERGING ECONOMIES With great power, comes great responsibility. Big countries have the benefit of large profitable economies driven by big populations. But large economies come at a cost – a cost to the well-being of our fragile environment. Discover how the BRICS are doing their part to ensure the sustainability of our world.
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www.ziwira.com
Get to know the BRICS
J
im O’Neil, from American multinational investment bank Goldman Sachs, first coined the term ‘BRIC’ countries in 2001, in a paper called “The World Needs Better Economic BRIC’s”. Brazil,
Russia, India and China are the four countries that made up the BRIC’s. All four countries cover a large landmass, and have high populations. Together, the BRIC countries comprise more than 2.8 billion people (40 percent of the world population), and cover more than a quarter of the world’s landmass. Goldman Sachs predicts that by 2050, China will be the world’s largest economy, followed by the USA, and then India. There has been controversy surrounding Russia’s inclusion since its population is not as large as its BRIC counterparts, however Russia’s landmass certainly makes up for it. There was much debate about whether this grouping made sense. At the time, Brazil’s growth seemed too sluggish to warrant inclusion, and China has a much higher economic growth rate than the rest. Even so, the label proved so catchy that the foreign ministers of the BRIC countries decided to hold a summit in New York in 2006. What began as a hook for an investment bank’s research note, became a real political institution. There was just one problem with the BRIC collection of countries - no African countries were included. This was unfair and embarrassing. Overlooking Africa suggested that the continent was an economic irrelevance, good only for providing raw materials to the rest. It also cast doubt on the group’s claim to speak for the emerging world. Two African countries might have been candidates, Nigeria and South Africa. But only one would keep the acronym intact. And so, in 2010, the club of BRIC’s became the BRICS. Russia currently holds the chair of the BRICS group, and will host the group’s seventh summit in July 2015. The five BRIC countries have been grouped together because they all have the economic and demographic potential to rank among the world’s most influential countries in the 21st century. However, with all of this potential power, comes responsibility – a responsibility to create sustainable, ecologically conscious businesses and solutions, to lead as an example to the rest of the world. These five countries have together shown that they are becoming much more environmentally aware, which is important because of the size and influence each of these countries have.
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June Issue 1 2015
COVER STORY
Green opportunities in Brazil Brazil has the fifth largest population after China, India, United States, and Indonesia, with an annual urban growth rate of 1.8 per cent between 2005 and 2010. It is extremely rich in biodiversity and ecosystem services, and possesses huge water reserves. Seeing the potentials of this resource rich nation, her leaders have embraced the notion of generating growth based on the principles of a ‘green economy’ and thereby channelizing a sustainable environment for its citizens. An area where the Brazilian model of a green economy has been a success is through the ‘Green Jobs’ initiative. The Brazilian Government has embraced it as a core element in its national development policy. Since 2009, the International Labor Organization (ILO) has been providing permanent technical support to the conceptual development and practical implementation of green jobs at federal and state levels in Brazil. Such jobs are seen in industries such as seedling production management, forest management, recycling, and biofuel production activities. Brazil also
Yingli Solar, the world’s largest solar panel manufacturer, and a FIFA
proved its commitment to sustainability by
World Cup Sponsor, provided solar panels for the Arena Pernambuco
means of solar powered stadiums for the FIFA
and the Estádio do Maracanã, which generate more than 1MW per year,
2014 World Cup.
and clean electricity for 25 years or more.
Estádio do Maracanã, Brazil Solar powered stadium for the FIFA 2014 World Cup
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Russia, like the whole world, is facing new challenges nowadays. They determine the need to modernize the economy, including innovative development and energy efficiency. Nature and modernization are determined by its ultimate goal, which, despite the importance of economic growth, technical excellence and competitiveness, is to improve the lives of everyone today and to provide enabling environment for future generations. The task for Russia is now to provide sustainable development based on the “green economy� principles. Magnitogorsk is an industrial city in Chelyabinsk Oblast, Russia. For a city so reliant upon iron and steel production, it is great to see that an urban greenhouse is being built with convenient access to highways and major transport axis of the city. Basic direction for the country development is energy. It is necessary to ensure the safe use of traditional resources and energy efficiency. Realization of great opportunities to improve energy efficiency involves introduction of urgent measures to ensure the interest in energy conservation at all levels - from the industrial development to an individual household. Magnitogorsk relies heavily on imported foods, so an establishment such as this could mean less imported goods, and more locally grown produce – a much more sustainable solution. The greenhouse has been specifically designed to cater to the whole city,
Green Russian Innovation
seeing as most greenhouses in Russia are out of date, with produce that does not extend to all those that it should. Contemporary technologies and substrates allow to grow the most eco-friendly and nutritious products.
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June Issue 1 2015
COVER STORY
India’s Eco Potential At a glance, India has a great profile for building a low-carbon, green economy. It is, in fact, currently rated by Ernst & Young as the fourth most attractive country for renewable energy investment. The country also has the world’s second largest pool of scientists and engineers which has instilled confidence in the global investors looking for safe investment destinations. Also, India’s achievements in information technology, professional services, and communications in the past decade all added to its profile. For India, the issue of climate change has become very important for the continuation of its successful economic growth. The government, like its predecessors, has stressed its resolve to integrate environmental concerns into the mainstream of the process of economic growth. India simply cannot afford the “grow now, pay later” model that has been adopted by most other countries, including China and Brazil. There is no country that faces the type of multiple vulnerabilities to climate change, both current and future as India does. This is because of India’s dependence on the monsoon, and very large population living in coastal areas who are vulnerable to increase in mean sea levels, and its reliance on the health of the Himalayan glaciers for water security, and also its preponderance of extractable natural resources like coal and iron ore in dense forest areas (more extraction means more deforestation that aggravates climate change).
China’s Growing Natural Image In China, the country’s quantum leap in growth has long been associated with a corresponding degradation of the environment: Poor air quality, poisoned water supplies, and despoiled farm land, toxic waste belching from the countries factories and power utilities, the list goes on. China’s air and water pollution, dam construction, and resource consumption have a profound impact around the world. What China does affects global climate change, ozone depletion, biodiversity loss, desertification, acid rain, commodity prices, fisheries, wildlife migrations, and a host of other environmental challenges. China’s Green Great Wall—formally known as the “Three-North Shelter Forest Programme”, is regarded by some experts as the largest ecological engineering project on
June Issue 1 2015
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the planet. Since 1978, at least 100,000 square miles of forests have been planted by Chinese citizens across the arid north, in an effort to hold back the creeping Gobi Desert. Once the project is completed in 2050, a massive belt of trees will stretch from northwestern China’s Xinjiang through several northern regions to the country’s northeastern part, Heilongjiang province. Plants play a significant role in slowing down climate change, absorbing about a quarter of the carbon dioxide that people are putting into the air by burning fossil fuels and other activities. It is one of the favorable outcomes of China’s mass economic growth.
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South Africa’s Green Economy Model South Africa was recently admitted to the economic coalition of Brazil, Russia, India and China. With its new economic position, South Africa stands as a promising emerging market. The governments of South Africa and Russia are cooperating for complementary diversification in areas of science, space exploration, hightechnology, gold and diamonds. In terms of sustainability, the South African Green Economy Modelling Report shows that investing in a low-carbon, resource efficient green economy is fundamental for South Africa’s sustained economic growth and well-being. Based on the government’s current targets and expenditures, the report identifies possible opportunities for achieving government targets in each of these four sectors.
The report finds that a green economy approach - such as investing in low-carbon technologies, green buildings, and renewable energy - can create more jobs than a business as usual approach, while supporting the same level of economic growth, yet with lower emissions of greenhouse gases and less environmental damage. The study was commissioned by UNEP at the request of South Africa’s Department of Environmental Affairs, with technical assistance from the Millennium Institute and the Sustainability Institute, in collaboration with the Centre for Renewable and Sustainable Energy Studies of Stellenbosch University.
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June Issue 1 2015
INTERVIEW
GOLDEN PEACOCK AWARDS CELEBRATE CORPORATE RESPONSIBILITY To get ahead in business, it’s all about taking necessary risks, and never losing sight of your goals. Therefore, recognition for success in business is essential – not just for those businesses that perform well, but also for the ones that make an extra effort to practice ethical corporate responsibility. In October, the global and national awards for corporate sustainability will be presented at the 15th International Conference on Corporate Governance and Sustainability in London.
A Strategic Tool to lead the Competition The Golden Peacock Awards were founded in 1991, and instituted by the Institute of Directors (IOD) in India. The awards work as a means of recognizing businesses who have performed exceptionally on either a global or national scale. Clearly a highly respected, amiable association, the Golden Peacock Awards Secretariat receives over 1,000 entries per year, from over 25 countries worldwide. Having been founded in India, the awards also represent the growth and influence of India on a global scale. The process of selection is conducted by independent assessors, and finally by a Grand Jury. All institutions whether public, private, non-profit, government, business, manufacturing, and service are eligible to apply for Golden Peacock Awards. However, leadership awards are determined through nomination. The process of selection involves an expert evaluation committee from various sectors who are invited to examine the applications, who are reviewed independently, and shortlisted if successful. The applications are assessed on an exhaustive set of parameters. Winners of the Golden Peacocks Awards are eligible to use the award logo on all promotional literatures, which helps to inspire and align the entire workforce and rapidly accelerate the pace of system improvement.
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His Highness Sheikh Nahyan bin Mubarak Al Nahyan, Lt Gen J S Ahluwalia, President, Directors of India; and Justice Arijit Pasayat, co-chairman, Institue of Directors India; presenting the Golden Peacock Distinguished Fellow award to Saeed Mohammed Al Tayer. Dubai recently hosted an event where Golden Peacock
award. DIAL CEO Mr. I Prabhakara Rao said, “DIAL has
Awards were presented. The Dubai Global Convention,
won this accolade for its commitment and focus on
the 25th World Congress on Leadership for Business
making excellence the way of life, in everything that we
Excellence and Innovation was held from 20-22 April,
do.” The National Training Award was also presented,
2015. The Institute of Directors (IOD) organized the
along with the Innovative Product/Service Award,
convention,
Peacock
and Business Excellence Award. His Highness Sheikh
Awards were presented to outstanding companies
Nahyan bin Mubarak Al Nahyan, Minister of Culture,
for their performance in areas on training, quality,
Youth and Community in Development Dubai said, “The
business excellence, and innovative product services.
Excellence that you recognize today with the Golden
At the convention, Delhi International Airport Limited
Peacock Awards is precisely the kind of excellence that
(DIAL) was one of the winners of the National Quality
we continually seek.”
and
the
prestigious
Golden
Sustainability Awards The Sustainability Awards presented by Golden Peacock directly encourage initiatives in promoting sustainable development in business. There are two Golden Peacock Awards for Sustainability; one global and one national.
“
The Global Award for Sustainability is a powerful selfassessment process, and a way to build an organizations
The whole world is seeing a competitiveness challenge, which is a productivity issue, and Responsible Competitiveness is vital. – Manoj K. Raut, CEO and Director of Institute of Directors.
brand equity on ‘sustainability’. The fee to apply for the sustainability awards is US$1000. The sustainability awards cover three segments which include: Corporate Governance, Economic, and Environmental (materials, energy use, water use, emissions, effluents and waste, products and services, compliance, and transport). Other additional factors taken into consideration are training and education, human rights, corruption, and customer health and safety. Winners of the 2014 Sustainability Awards included KPMG International (Consultancy), Doha Bank, Qatar, and Dubai Customs (UAE Government). Doha Bank has impressively won four times since 2010. The objective of the awards is to assess the extent of: Responsiveness to organizational strategy, to the needs of different stakeholders. Integration of Sustainable Development issues, with corporate functioning. Development of innovative partnership models, to fulfill social responsibility.
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June Issue 1 2015
INTERVIEW
An insight from the CEO and Director of the Institute of Directors (IOD) Manoj K. Raut, CEO and Director of the Institute of Directors (IOD) in New Delhi, India, spoke to ZIWIRA about the Sustainability Awards, and why it is such an important category to include, in order to incorporate ethical practices into business operations. Raut joined IOD as a Management Trainee in the year 2000. He is also on the boards of the World Environment Foundation and the International Academy of Law.
Q: Coming up in October, is the London Global
business approach that creates long-term consumer
Convention
15th
and employee value by creating a “green� strategy
International Conference on Corporate Governance
2015
incorporating
the
aimed towards the natural environment and taking
& Sustainability. Can you tell us about the Global
into consideration every dimension of how a business
and National awards for Sustainability?
operates in the social, cultural, and economic environment. It also formulates strategies to build a
A:
The
London
Global
Convention
2015
is
company that fosters longevity through transparency
incorporating the 15th International Conference
and proper employee development. We do believe
on Corporate Governance & Sustainability on 7-9
that Awards are the most powerful way, to motivate
October 2015, London (UK). This is one of the most
and mobilize intellectual assets and spur them to
important annual programs in IOD’s calendar, where
achieve greater heights in business performance. It
a large number of corporate honchos and policy
is a strategic tool, to lead the competition. We also
makers around the globe are expected. With regard to
believe that businesses will strive harder to achieve
the Sustainability Awards, the businesses are required
ethical corporate practices if they are recognized for
to submit an application based on the prescribed
their outstanding achievements.
Guidelines, to the Golden Peacock Awards Secretariat, on or before the due date. After the submission of the applications, the Evaluation Process begins and the applications are duly assessed and thereafter, shortlisted. The shortlisted applications are then put up to the Jury and the Jury takes the final call and decides the Winners.
Q: Is the Sustainability Award a popular category for businesses to apply for? Or do you feel that it is slightly overshadowed by some of the other award categories like Business Excellence and National Quality? A: Each award in its own business domain is popular
Q: As a well-known, influential organization, why
as the industries need a holistic transformation
do you feel that it is important to reward businesses
by integrating the issues of quality, governance,
who
sustainability?
Environment, Innovation etc. With regard to the
Furthermore, do you agree that for the chance
are
actively
practicing
Sustainability award, it is a comparatively popular
to be recognized for their efforts (for example an
category as board members of the organizations
award), businesses will strive harder to achieve
are directly involved for their day to day activities.
sustainability (incentives)?
This category along with the other categories in the Golden Peacock Awards, provides a platform to the
A: It is really important to recognize the best of the
businesses to showcase the excellence they have been
best organizations which are actively practicing
able to achieve in their concerned fields.
sustainability because Corporate Sustainability is a
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June Issue 1 2015
GREEN PERSONALITY
AMBASSADOR FOR FINANCE & BETTERMENT She may not look familiar to you, but Dr. Naoko Ishii has achieved an extraordinary amount of feats during her lifetime. As the former Minister of Finance in Japan, she has rich experience in the financial sector, as well as actively working towards a more sustainable future for the world as the current CEO of the Global Environment Facility.
Dr. Naoko Ishii – A life of Finance & Sustainablity – In 2012, the Executive Director of the United
was the recipient of many prizes for numerous
Nations Development Programme (UNEP)
papers and books she has produced. The
announced that Dr. Naoko Ishii had succeeded
awards she has won are equally as impressive
Monique Barbut as CEO and Chairperson of
as her achievements. She won the Suntory
the Global Environment Facility (GEF) based
Prize in 1990, the Okita Memorial Prize for
in the United States. The organization was first
International Development Research in 2004,
established in 1991, and has provided $13.5
and the Enjoji Jiro Memorial Prize in 2006.
billion in grants, and leveraged $65 billion in co-financing for 3,900 environmental projects
Dr. Ishii clearly has a passion for maintaining a
in more than 165 developing countries.
healthy environment, and is a proud advocate of sustainability. She spent time working
Naoko Ishii has an impressive background in
at the World Bank, where she was assigned
finance and sustainability. Before obtaining her
as the Country Director for Sri Lanka and
position as the CEO and Chairperson of GEF,
the Maldives from 2006-2010. While based
Dr. Ishii served as the Deputy Vice Minister of
in Colombo, she managed the World Bank
Finance in Japan. She was responsible for the
program for Sri Lanka amidst the country’s
country’s financial and development policies,
civil war conflict by building partnerships
and for its global policies on environmental
among key stakeholders. Dr. Ishii also served as
issues such as climate change and biodiversity.
the country program coordinator for Vietnam
Dr. Ishii led the Japanese delegation at the
at the World Bank from 1997-2001. From 1996-
Transition Committee for designing the Green
1997 she was the project manager at Harvard
Climate Fund.
Institute for International Development, and previously worked as an economist at the
Her career at the Ministry of Finance began
International Monetary Fund from 1992-1995
with a focus on the international sphere,
working for Africa and Asia, as well as visiting
in 1981. She predominantly focused on
fellow at the Centre for International Affairs at
development issues. She has a Bachelor of Arts
Harvard University from 1984-1985.
and a Ph.D. from the University of Tokyo, and
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CEO of the Global Environment Facility The Global Environment Facility essentially unites 183
projects in more than 140 countries to tackle a broad range
countries in partnership with international organizations,
of threats to the global environment, including climate
civil society organizations (CSOs), and the private sector,
change, deforestation, land degradation, extinction of
to address global environmental issues, while supporting
species, toxic chemicals and waste, and threats to oceans
national sustainable development initiatives. In Sweden,
and freshwater resources. Joachim von Amsberg, Vice
April 2014, 30 donor countries pledged US$4.43 billion for
President for Concessional Finance and Global Partnerships
the Global Environment Facility to support developing
in the World Bank Group, felt that the GEF had successfully,
countries’ efforts over the next four years, to prevent
“gained the confidence of development partners for its
degradation of the global environment. Dr. Ishii was
strong track record in protecting the global environment
overwhelmed and excited about the significant amount of
and for its sound management of development partner
support her organization had received. She believed that
funds.”
the decision made to support the GEF was, “a powerful signal from the global community about the importance
As the current head of GEF, Dr. Naoko Ishii is a shining
of urgently reversing the negative environmental trends
symbol of woman in powerful positions, as well as a
in order to ensure a sustainable future for everybody.”
true dedicated ambassador of world sustainability. She
She further went on to continue that she was, “extremely
represents a minority of selfless individuals who have
encouraged by the broad coalition that has come together
dedicated their lives to their betterment of our world.
behind the belief in GEF’s ability to play a critical role in
Today, GEF is developing a long-term strategy called the
helping achieve this transformation.”
GEF2020 which aims to enhance the GEF’s impact by focusing its interventions more on the underlying drivers
The funding that was given by the 30 donors, will support
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of environmental degradation.
37 |
June Issue 1 2015
GREEN BUSINESS
A LEADING BUSINESS REFRESHINGLY PROMOTING SUSTAINABILITY As one of the world’s leading technology brands, it is refreshing to learn that Panasonic is actively incorporating sustainability into its business practices. For its efforts, the Japanese brand has been recognized for this by receiving the Zayed Future Energy Prize by His Highness General Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi.
Sustainable Business Practices
P
anasonic is a Japanese multinational electronics
Markus Reichling stresses the importance of relating
corporation headquartered in Kadoma, Osaka,
to customers, and meeting their expectations, while
Japan.
According to Markus Reichling, the
offering solutions to increase resource efficiency,
General Manager for Environmental Affairs at Panasonic,
as the market seems to be steadily leaning towards
consumers still play the main role in influencing new
promoting sustainability. One of the innovative ways
innovative products and solutions. Without demand
that Panasonic has been able to cater to the demands
for a product, there can be no further development of
of its customers, while staying true to its eco-friendly
it. Formulated in 1929, Panasonic still operates by its
nature, Markus explains, is by the creation of their new
‘Basic Management Objective’ to devote themselves to
‘Nostalgic Clear’ LED light bulb. In the past, there has
the progress and development of society and the well-
been a strong demand by customers for incandescent
being of people through their business activities. In
light bulbs, which have in fact been prohibited for sale
January, Panasonic was awarded with the Zayed Future
in Europe due to their very high power consumption.
Energy Prize 2015, an award established by the United
For years, the lighting industry struggled to offer a light
Arab Emirates government and managed by Masdar,
bulb that could offer the same effect and design as the
for the Large Corporation category. The Zayed Future
incandescent bulb, while also using a limited amount
Energy Prize, inaugurated in 2008, was presented by
of energy. However, Panasonic has filled this gap with
His Highness General Sheikh Mohamed bin Zayed
their new light bulb creation which uses a significantly
Al Nahyan, Crown Prince of Abu Dhabi and Deputy
less amount of energy, as well as many other sustainable
Supreme Commander of the UAE Armed Forces. The
products.
award recognizes leading solutions in renewable energy and sustainability.
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Panasonic strives to offer sustainable business solutions to its investors that will offer good financial results, as well as business forecast, business strategies, and corporate structure. The company is also often approached by investors with more ESG (Environmental Social and Governance) related questions particularly from long-term investors, such as referring to corporate governance, and sometimes even concrete issues such as battery recycling and conflict minerals.
HH General Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces (R), presents the Zayed Future Energy Prize Large Corporation award to Yoshihiko Yamada, Executive Vice President and member of the board of Panasonic.
According to Markus, Panasonic remains very active in its attempts to create as less waste as possible by recycling unwanted materials. Often these unwanted materials end up back in the production process, a very admirable aspect of the business. The company has gone so far with this sustainable solution that they have developed a machine which efficiently separates plastics containing critical chemical substances from those which are allowed to be reused for new electronic products. Panasonic has also released their sustainability report for 2014, which describes its annual social and environmental initiatives. It explains Panasonic’s CSR/environmental management structures, including policies and promotion systems, with a look at the results of fiscal 2014. As shown in the graph, Panasonic considers the contribution in reducing CO2 emissions through energy-saving products. The share of air conditioners is equal to 34%, LCD TV 15%, Plasma TV 13%, refrigerators 9% and washing machines 3%.
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June Issue 1 2015
GREEN BUSINESS
CONQUER THE WORLD WITH GREEN INNOVATION The world is inspired not by what we know, but by what we don’t know. There are so many ideas out there just waiting to be revealed in the world – all you have to do is discover them for yourself. But first, you need to recognize an area that needs improvement. Take the environment, for example…
I
f you are thinking about starting a business, there are
an eco-friendly establishment, it pays to do your research.
obviously going to be a substantial amount of things
However, here are some tips to get you started. Whatever
that you need to consider and prepare for. Something
business venture you choose to pursue, be sure that it is
worth considering, is making your business an eco-
both innovative, beneficial, and most of all, environmentally
friendly, sustainable operation. Any business associated
sustainable. Sustainability is the only way to go in a world
with sustainability will stand out from the rest, especially
that is slowly eroding before our very eyes. People don’t
because people and businesses alike will want to be
want to be exposed to the same thing all the time. Use your
associated with an organization that caters to the well-
research skills to establish what businesses are already out
being of the environment. If you are planning on opening
there in the market, and then consider what is missing.
Fashion The fashion industry is always hungry for that next big label to come along with a new trend to set off another season. If you have ambitions of entering the fashion world, what can really set your label apart from others, is using strictly sustainable materials. Customers will love you for it, because they will be able to tell their friends and colleagues how they chose your brand because it caters to the environment. You can create ‘upcycled’ items, handbags or accessories made from unwanted product. Using organic materials such as hemp or organic cotton has also been a popular choice in the past. There is huge profit to be made by the person who is able to combine popular fashion, with sustainability.
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Apps As we all know, smartphones are taking over the world. It’s almost impossible to walk down the street these days, and not witness someone with their eyes glued to their smartphone screen, scouring the hundreds of apps now available to people. You could use this popularity to your advantage, by thinking of an innovative way to combine the use of apps to benefit the environment. The app could focus on recycling, green living, or energy conservation. It could be as simple as listing the closest eco-stores available to you. Apps are becoming the most commonly used form of communication, and being such a recent development in the modern world, there is plenty of room to expand.
Consulting If you feel that you are considerably knowledgeable in the field of sustainability, you could consider the possibility of opening an eco-consulting company. As an eco-consultant, you could personally advise people on how to become more environmentally conscious, by offering your advice on sustainability tips for around the house. You could create a partnership with a solar panel company, and offer the solution to people who want to be more energy efficient. Particularly in the Middle East & Africa region, solar power is increasing in popularity due to the abundance of sunlight available.
Fresh Food For those of you who want a simpler way of creating revenue, but want to remain true to your eco-friendly roots, there is a way. Farmers markets have become a very popular community event, because of the booming popularity of buying fresh, locally grown produce. If you have a means to grow your own fruit or vegetables, a local farmers market is an easy, profitable way to sell it. You will not only be increasing the money in your pocket, but will also be enhancing the lives of those buying your produce, because of the health benefits.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
ECONOMY GREW WITHOUT RISE IN CO2 EMISSIONS BUT WE CAN’T CELEBRATE JUST YET
It is incredibly important for mankind to understand the impact that he can have on the world through CO2 emissions. There is more carbon dioxide in the atmosphere today than at any point in the last 800,000 years. What’s more, 25 percent of the carbon dioxide pollution from fossil-fuel burning is produced by the USA alone. However, recently there has been a new hope.
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CO2 Stabilization Energy is, and will remain, important and necessary for infrastructure, industry, transport, and houses. If we are unable to consistently use renewable forms of energy, then the rise in energy consumption will no doubt lead to increased carbon emissions, and global warming. However, recent data shows that for the first time in 40 years, the world has experienced unchanged or decreased CO2 emissions. In 2014, CO2 emissions from the energy sector stalled, according to a report released by the International Energy Agency (IEA). IEA Chief Economist Faith Birol is optimistic about the news saying, “This is both a very welcome surprise and a significant one.� She believes that the news will provide momentum for negotiators preparing to forge a climate deal in Paris in December - For the first time, greenhouse gas emissions are decoupling from economic growth.
Reaching Climate Goals without compromising Economic Growth According to the IEA, China and other members of the Organization for the Economic Cooperation and Development (OECD), are to thank for the shift in energy use. China has witnessed an increase in the amount of energy it is producing, from much more favorable renewable sources. An example of this is solar wind, which means a decrease in the burning of fossil fuels. Other factors which would have influenced the stability of our worldwide CO2 emissions, include warmer temperatures experienced last year, which is then connected to less energy being used to heat homes. Also, lower oil prices played a factor, because when the cost of oil drops, companies preferentially use this as an energy source over coal since it releases fewer emissions per unit of energy produced.
The IEA have been gathering information on emissions for the past 40 years. Within this timeframe, they have only recorded three other times when CO2 emissions either stalled or decreased, compared with the previous year. However, these other times when emissions dropped, were at periods during history when the global economy was not thriving, for example in 1992 after the Soviet Union collapsed. What makes this year different and something to celebrate, is that the global economy increased from 2013-2014 by 3 percent, and the global emissions remained unchanged at 3.2 billion tonnes.
Still, experts warn that we should not get too excited over these results. Even though this data is encouraging, it should not be an excuse to become complacent and stop all efforts to reduce CO2 emissions. We still have a long way to go before we should sit back and feel satisfied that our world is in good health. Instead of giving up on reducing emissions, those who are passionate about creating a sustainable economy, should use the finalized report (which was released in June) to aid the creation of policy measures that will help nations reach climate goals without compromising economic growth. This new data represents a glimpse of hope for our world and economy.
Total Annual World Carbon Dioxide Emissons from Energy Consumption (Million Meteric Tons)
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
FINANCIAL AID STATISTICS FOR THE NEPAL EARTHQUAKE The devastation of the April 25 Earthquake that struck Nepal has been felt all around the world. One of the amazing aspects of humanity, is our willingness to provide assistance to those in desperate need. Following the May 12, 7.3 magnitude aftershock, Nepal was left in a truly desperate situation. International aid is now of crucial importance to the region, and the countries that have contributed financially, deserve to be recognized for their efforts.
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Nepal Earthquake Key Figures (May 18)
Number of people killed (ESTIMATE)
Number of people injured (ESTIMATE)
Number of IDP (Internationally Displaced Person) Camps
Funding Received
8,604
16,808
234
$192.9 million
International Helping Hand Nepal is a peaceful, scenic country with very little conflict or issues, especially on an international scale. Its main source of revenue is through tourism. According to a 2012 estimate, Nepal had a total Gross Domestic Product of US$19.921 billion. It is therefore one of Asia’s poorest countries, and does not have the ability to fund a major construction effort without outside financial help.
National Disaster Response Force teams, over 1,000 personnel, search-&-rescue dogs, vehicles, equipment, helicopters, and engineers. India also sent a 41 member medical team from the state of Rajasthan, 18 Indian Army Engineer Task Forces (Indian Army Corps of Engineers), and a 39 member Indian Army team deployed at the Mount Everest Base Camp to search for, rescue and assist climbers. China sent an international Search and Rescue Team (CISAR) with 268 members, and 26 search-&rescue dogs.
The Asian Development Bank estimated that it would need to spend about four times more than it currently does annually on infrastructure through to 2020 to attract investment. In order to help the impoverished nation following the earthquakes, a numerous amount of aid funds have been set up to raise finances helping to rebuild Nepal. ‘Save the Children Federation’ has set up an online payment system for people to donate to Nepal. ‘Global Giving’ has also set up an online payment system, as well as ‘Indiegogo’, ‘Go Fund Me’, Médecins Sans Frontières (Doctors without Borders), and the International Federation of Red Cross and Red Crescent Societies. The International Red Cross made a cash donation of $535,664, and contributed volunteers and supplies. JP Morgan Chase and Co. donated up to $1 million to aid Nepal. In addition, many countries generously contributed supplies and humanitarian aid (excluding direct cash donations). Some of the major contributors included:
India & China
Australia & New Zealand Far south of the Nepalese Earthquake, Australia managed to pull together an incredible amount of aid to support the nation. They sent two Boeing C-17 aircraft carrying 15 tons of Australian aid and two RAAF aero medical evacuation teams. They also sent 2 humanitarian experts and a crisis-response
India contributed an enormous amount of aid
team, and 70 defense personnel, immigration and
including 8 tons of baby food, 100 tons of medical
other federal government officials to distribute
supplies, 200 tons of water, 43 tons of relief
aid and help with evacuation efforts. New Zealand
material, 10 tons of blankets, and the evacuation
deployed 45 urban search and rescue technicians, 2
of 20,000 Indian citizens. Plus, an additional 16
aid workers and an engineer.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
Indian soldiers arrive with supplies at the Tribhuwan International Airport a day after a massive earthquake in Kathmandu, Nepal.
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Bangladesh & Indonesia The Nepal Earthquake was felt even as far as Bangladesh. In response, the nation sent a 34-member team of 6 military medical teams and foreign ministry officials. Plus, an additional four cargo trucks carrying approximately 25 tonnes of essential relief materials for earthquake victims in Nepal left Dhaka. Bangladesh also provided a BAF Lockheed C-130B aircraft with 10 tonnes of relief materials, and at least one lakh metric ton of rice and other relief materials including drinking water to help the earthquake victims. Indonesia sent 2 Boeing 737-400s belonging to the Indonesian Armed Forces and Garuda Indonesia, and flew 6 tons of relief supplies.
United Kingdom & United States The UK was quick to rally millions of dollars’ worth of donations, as well as sending 30 tonnes of humanitarian aid and 8 tonnes of equipment to Nepal, along with 100 search and rescue responders, medical experts, and disaster and rescue experts deployed by the Department for International Development. The US deployed a disaster response team from USAID, and the
Urban
Search and Rescue Virginia Task Force 1 from Fairfax County, Virginia was deployed to Nepal from the Dover Air Force Base, as was the US Army Green Beret soldiers with 100 Marines, two helicopters and four V-22 Osprey VTOL aircraft.
NEPAL AID STATISTICS HELP
POPULATION
HELP PER INHABITANTS
United States
9,200,000€
316,128,839
0.0291€
Japan
7,310,000€
127,338,621
0.0574€
4,919,563,108,372
4,525,998,059,702
United Kingdom
6,800,000€
64,106,779
0.1061€
2,678,454,886,796
2,464,178,495,852
Canada
3,700,000€
35,154,279
0.1053€
1,826,768,562,832
1,680,627,077,805
Norway
3,500,000€
5,080,166
0.6890€
512,580,425,531
Australia
3,400,000€
23,129,300
0.1470€
1,560,372,473,125
1,435,542,675,275
European Union
3,000,000€
505,700,000
0.0059€
17,958,073,311,155
16,521,427,446,263
China
3,000,000€
1,357,380,000
0.0022€
9,240,270,452,047
8,501,048,815,883
Germany
2,500,000€
80,651,873
0.0310€
3,730,260,571,356
3,431,839,725,648
South Korea
920,000€
50,219,669
0.0183€
1,304,553,972,501
1,200,189,654,701
New Zealand
700,000€
4,442,100
0.1576€
185,787,824,483
170,924,798,524
Italy
300,000€
60,233,948
0.0050€
2,149,484,516,711
1,977,525,755,374
Taiwan
275,000€
23,268,087
0.0118€
489,210,000
COUNTRY
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GDP US$
GDP EU€ 15,426,652,000,000
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471,573,991,489
450,073,200
June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
PRINCE OF
GREEN FINANCE High Royal Highness the Prince of Wales has managed to successfully and innovatively combine accounting and sustainability into one project. He has actively promoted the establishment of resilient business models to create a more sustainable future. He has reached out to accountants to spread the word and promote sustainability in business themselves.
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The Prince’s Accounting for Sustainablity Project In 2004, His Royal Highness Charles the Prince of Wales
to convince just five others to start accounting for
established the Accounting for Sustainability Project
sustainability, and then each one of them engages
(A4S), which recently celebrated its 10th anniversary.
another five each year, in five years’ time we could
The Prince of Wales has always shared his concerns
reach all of the three million accountants in the world!
that the world we live in with all of the things we enjoy,
However, I hate to tell you that for obvious reasons five
could soon be lost. He believes that it is important to
years is too long – so each of you needs to rush out
leave a positive legacy for the next generation, and
and convince ten! And then accountants really will be
ensure that they live in a healthy world. Prince Charles
helping to save the world!”
is particularly concerned about the current rate at which we are using the planet’s resources.
considering the environment and wider-society as part
“Help ensure that we are not battling to meet 21st Century challenges with, at best, 20th Century decisionmaking and reporting systems.”
of their everyday business decisions. In 2004, when
– Prince of Wales.
In 2004, Prince Charles initiated the Accounting for Sustainability Project to help and encourage businesses and the private sector to recognize the benefits of
Charles first started the project, he spoke at the launch, claiming that he wanted to, “help ensure that we are not battling to meet 21st Century challenges with, at best,
Having run for ten years now, the A4S Project has had
20th Century decision-making and reporting systems.”
many achievements. The Project was essentially driven by the finance and accounting community to move
Because of his substantial influence and power, Prince
towards resilient business models and a sustainable
Charles was able to establish a project to work with the
community. During its ten years, the project has formed
finance, accounting and investor community. He was
a Chief Financial Officers (CFO) Leadership Network,
able to drive change through the demonstration of the
which over the last year has developed four practical
importance of considering the environment and wider
guides for CFOs on embedding sustainability into
society in their day-to-day actions, accounting, and in
key finance activities. The project has also formed the
their annual report. The A4S Project also drives change
Accounting Bodies Network, which reaches 2.5 million
through developing systems, tools and guidance for the
accountants worldwide, amounting to two thirds of
accounting, finance and investor community to take
the global accountancy profession. Furthermore, the
action and take consideration of the environment and
project initiated the International Integrated Reporting
wider society into account. Furthermore, it creates an
Council which is leading the work to transform
‘enabling environment’ or wider economic context in
corporate reporting, as well as establishing the Finance
which organizations are able to function sustainably,
for the Future Awards, which reward organizations that
within a ‘bigger picture’ that supports this approach.
are practicing ‘Integrated Thinking’ and embedding
In December 2014, the Accounting for Sustainability Project celebrated its 10th anniversary. Prince Charles
environmental and social considerations into day-today decisions with leadership from their finance teams.
wanted to take this opportunity to reach out to his
The A4S Project is run by The Prince of Wales’ Charitable
followers and present to them a challenge. He reached
Foundation, which was founded by His Royal Highness
out to 200 senior leaders from the finance and
the Prince of Wales in 1979, which has become one
accounting community to go out, use their voice, and
of the largest independent foundations in the United
convince their peers of the importance of taking action
Kingdom. Profits generated by the sales of ‘Duchy
on sustainability while they still could. At the summit
Originals from Waitrose’ and Highgrove (Prince’s
held on December 11, the Prince of Wales said:
residence) products, and from tours of the Gardens at
“Go out and seek to convince your peers. In this regard, the team of accountants at A4S has highlighted some rather interesting numbers to me. I understand – and I assume a team of accountants must be right! – that if every one of you here in the room today manages
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Highgrove, are donated to the Foundation. Funds from these donations help to run initiatives and projects that fall within the Charitable Foundation’s primary areas of interest, such as the International Sustainability Unit and The Prince’s Accounting for Sustainability Project.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
THE IMPORTANCE OF FINANCE IN CHARITY We live in a terribly unbalanced world. While some people live comfortable lives, with safe homes and plenty of food, others do not. In some countries, particularly in poor African countries like Malawi and Burundi, people lack the knowledge to create sustainable lifestyles to live comfortably. Sometimes, all they need is a push in the right direction. That is exactly what US organization Heifer International is doing.
Heifer International
Bill & Melinda Gates
I WANT
I DESERVE
I CAN
Heifer International is an organization that strives to target the issue of world hunger and poverty. The initiative which has 41 known celebrity supporters, including Bill Clinton and Kirsten Dunst, does not simply give goods away to those who need them, because that is only a temporary solution. Rather, its main operation is giving livestock to families in need, so that they can continuously live off the produce created by the animal.
I AM
Dan West was inspired to create Heifer International when he left his profession as a farmer in the American Midwest, to work as an aid worker during the Spanish Civil War. He soon discovered that the small cup of milk that each person was given, was simply not enough. He had a thought – what if a person was given a cow, then they could produce all the milk they could ever need. Thus, the idea for Heifer International was born, adopting the ‘teach a man to fish’ philosophy. 70 years on, the legacy is still alive, as one of the top sustainable charity organizations in the world. Heifer International is a business that is run by donations which are given to the Heifer Foundation and are invested in endowments which are funds that provide operating income and program revenue every year in the future.
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Endowment funds are carefully managed to protect the
The Heifer International website has an option to donate
principal, which grows over time, to make increasing
specific animals to families or individuals in need. For
payouts to the Heifer mission of ending hunger and
US$120, people can donate a goat, or a water buffalo for
poverty. The company received a four-year $42.8 million
US$250, or a Heifer for US$500. To promote women’s
grant from the Bill & Melinda Gates Foundation to fund a
empowerment, people can donate money to launch a small
project to help poor rural farmers in East Africa double their
business, or give the gift of clean water. What particularly
incomes by increasing their production of high quality raw
stands out, is that people can also give the gift of a bountiful
milk to sell to dairies. It is the largest single grant Heifer has
harvest for only US$70, a gift that when made the most of, is
ever received.
worth so much more.
Achievements
Passing on the Gift lasts for at least nine generations. Heifer also helps with, and encourages farming, as farming has
The flourishing organization has successfully set 22.6
always been the foundation of thriving civilizations and
million families, and 114.9 million individuals on a path
societies. This increased knowledge offers people the
towards prosperity by giving them the training and means
chance to develop a means to create income to look after
to have a reliable and consistent source of food, and often
their families.
income. Heifer sent 17 young cows to Puerto Rico to enable the futures of a substantial amount of families.
Giving the gift of livestock, or money to start a harvest, will benefit a family in need for years, if not generations, because
With the animals that are gifted to families or individuals,
it gives them the head start they need that is so hard to get.
those who received the animal agree to pass on the
Once the knowledge of how to run a farm has been passed
offspring of the animal to another family who is in need.
down, it will remain in the family as a precious treasure that
This creates a cycle of giving within communities, which is
cannot be stolen. Heifer International has built a bridge
an important aspect of community success. In some places,
between poverty, and a healthy existence, by eliminating
22 generations of Heifer animals can be traced. On average,
the main problem: Lack of knowledge.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
– Vermont Governor Peter Shumlin.
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“
“
How important it is to weatherize, install solar, get off oil and become energy independent.
Governor Peter Shumlin, speaking at Climate Economy Summit
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ENCOURAGING GREEN ENTREPRENEURS Students in Vermont, United States, are being encouraged to seize the financial benefits of climate change, as opposed to only seeing the negative side of it. There are new opportunities emerging from the need to be sustainable, and these ideas were shared at the Vermont Climate Economy Summit held in February.
Vermont College of Fine Arts, situated in Montpelier, Vermont, has found a way to encourage people of the financial benefits of tackling climate change, as opposed to ignoring it. The college which opened in 2008, held a summit in February which drew more than 400 Vermonters, including business leaders, policy-makers, and entrepreneurs. Paul Costello, the Vermont Council Rural Development Executive Director, felt very positive about the event, claiming that there is “really good work going on in Vermont relating to climate change.” Costello, among other speakers at the summit, emphasized Vermont’s opportunity to really seize the moment and position itself as a beacon for green business, investors, and advocates. One of the speakers Governor Peter Shumlin, shared his views on creating prosperity and opportunities confronting climate change, pointing out that there were five times more solar jobs in Vermont today than when he took office in 2011. He highlighted how there’s a reason for optimism with Vermont leading the nation in the following ways moving towards a sustainable energy independent economy: 15,000 jobs in a renewably focused green economy Highest per capita solar jobs in the nation Real movement towards a micro-grid dominated utility grid with support Substantive efforts in weatherization and energy efficiency improvements in commercial and residential buildings around the state.
Another speaker, Jigar Shah, the founder and former CEO of Sun Edison and author of ‘Climate Change Wealth’, addressed the crowd by stressing that, “the resource revolution represents the largest wealth creation opportunity of our generation.” Shah currently runs the green economy specialty finance company Generate Capital. He urged Vermont to push for large scale, systematic innovations that would position the state to emerge at the forefront of the climate change movement, touching on the way policies that incentivize resource efficiency can mean scalable profits for businesses and therefore significant investment. Throughout the summit, thirteen different sessions focused on initiatives that ranged from innovation in transportation, renewable energy, and recycling, to adapting Vermont’s tourism industry, to changing weather patterns, and to branding Vermont as an innovative hub for young environmentally-minded entrepreneurs. One of the final topics that was discussed at the summit, was the need for Vermont College to establish itself as a brand leader in the climate change economy, by exploring the need for public relations initiatives. An idea was even suggested to host a similar climate change summit on a national scale. By emerging as a leader in this industry, Vermont could attract more young people to the state, a perennial challenge. The Vermont Climate Change Economy Council will develop the strategies and ideas discussed at the summit and present them to the Vermont legislature, the Governor, and the public in January 2016. It is encouraging to see leaders inspiring the younger generation to embrace the reality of climate change, rather than pretending it doesn’t exist. If more young business entrepreneurs are able to see the benefits of climate change in relation to business and profit, then the world will be much better off.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
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WHO KNEW STOCK EXCHANGE COULD BE ETHICAL? The stock exchange is a vital part of business and economy. For one, it is a reliable barometer to measure the economic condition of a country. The stock market plays a pivotal role in the growth of the industry and commerce of a country that eventually affects the economy of a country to a great extent. However, it is important for stock exchanges to play a part in the sustainability of the world, as it maintains a significant amount of power on a global scale. The Sustainable Stock Exchanges Initiative is doing just that.
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June Issue 1 2015
WORLD FINANCE AND SUSTAINABILITY
The Sustainable Stock Exchanges Initiative Stock exchanges have a vital role to play in advancing sustainability in capital markets. Created by the United Nations, the Sustainable Stock Exchanges (SSE) initiative,
“
provides an effective platform for exchanges to engage with the UN, investors, companies, and regulators. By exploring how exchanges can work with these actors, the SSE works to create more sustainable capital markets. The SSE initiative invites exchanges globally to become Partner Exchanges by
Stock exchanges and other financial bodies and institutions have a key role to play. Many of you have taken important steps to advance this agenda. I welcome your efforts to incorporate ESG considerations into new stock indexes, listing rules and regulatory frameworks.
making a voluntary commitment to advance sustainability in the market. They also welcome participation from securities regulators, investors, companies, and other key stakeholders. In 2009 SSE was named by Forbes magazine as one of the “World’s Best Sustainability Ideas”. The SSE initiative offers a global platform for exchanges to demonstrate leadership and understanding of the sustainability-related opportunities and challenges facing the capital markets today. Sharing a common commitment
“
– BAN KI-MOON
to encourage responsible investment and enhanced ESG
UN Secretary-General Sustainable Stock Exchanges Launch, 2009.
performance among listed companies, Partner Exchanges
(Environmental, Social, and Governance) disclosure and utilize the SSE to discuss best practices and to learn from their peers and other strategic stakeholders. As the SSE offers a unique platform for multi-stakeholder dialogue, exchanges have an opportunity to take a leading role in creating a more sustainable and inclusive economy. All stock exchanges are invited to make a public commitment to promote sustainability in their markets, thereby becoming a Partner Exchange.
Bucharest Stock Exchange Bombay Stock Exchange Borsa Istanbul
Stock Exchanges who have made the Commitment
Colombian Securities Exchange Deutsche Börse
Nasdaq
Egyptian Exchange
Nairobi Securities Exchange
Jamaica Stock Exchange
Nigerian Stock Exchange
Johannesburg Stock Exchange
New York Stock Exchange
Lima Stock Exchange
Santiago Stock Exchange
London Stock Exchange
Stock Exchange of Thailand
Mexican Stock Exchange
Warsaw Stock Exchange
June Issue 1 2015
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Partner Exchanges of the United Nations SSE initiative have begun publishing a Communication to Stakeholders to engage capital market participants in a dialogue on responsible investment and sustainable business practices. The Communication explains each exchange’s approach to promoting sustainability among investors and companies. These are the first such disclosures done by exchanges through the SSE, which is convened by the PRI and three UN partners.
Every two years the SSE initiative hosts a Global Dialogue, which brings together leaders from exchanges, regulators, investors and companies to share best practices, and releases the SSE Report on Progress to coincide with the event. The report is designed to measure progress, while underlining challenges and opportunities ahead. On
“In addition to promoting transparency with external stakeholders,
Regional Dialogue 2015: Southeast Asia
the
Communication
to
Stakeholders
document is a very effective tool for engaging internal stakeholders including the board of directors, senior leaders, and employees,” said Gavin Power, Deputy Director, UN Global Compact (April 15, Geneva). “Our Partner Exchanges are already using it to start an internal conversation about their role in sustainable development and sustainable capital markets.” The Communication to Stakeholders includes questions such as: How does your exchange define and view the rationale for corporate sustainability and the exchange’s role in promoting it? What objectives does your exchange have in regards
Monday 18 May, the 2015 Sustainable Stock Exchanges Regional Dialogue Southeast Asia took place in Bangkok, Thailand. The SSE Regional Dialogue, the first of its kind in Southeast Asia, offered a unique platform for CEO’s of stock exchanges, listed companies, and institutional investors, alongside
high-level
policy
makers
and
regulators,
to demonstrate leadership and understanding of the sustainable development opportunities and challenges facing capital markets today. Questions addressed at the SSE Regional Dialogue included: What role can stock exchanges, regulators and investors play to improve the environmental, social and governance performance of companies? What are the experiences of listed companies?
to advancing sustainability in your market?
What are the main challenges and opportunities
How do you track sustainability reporting of your
capital markets?
listed companies?
for promoting sustainable development through
What next steps can be taken by policy makers,
What incentives and/or sanctions do you have in
regulators, investors, companies and exchanges
place to encourage environmental, social, and
collectively in the region? What are the key roles for
governance (ESG) disclosure and discourage non-
each actor?
compliance? How has your exchange supported the development
What regional and national policy options are available to reinforce existing best practices?
of financial products that address sustainabilityrelated issues? www.ziwira.com
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June Issue 1 2015