Coal-fired pollution, BP’s Gulf of Mexico ban lifted and drought in Brazil that might turn the lights out
Italian police partially closed a power plant in March in the northern Italian town of Vado Ligure, on the grounds that it was implicated in the deaths of 442 people between 2000 and 2007. Francantonio Granero, the public prosecutor in the city of Savona, which adjoins Vado Ligure, brought the complaint against the plant, saying its management continued to operate its coal-fired units although they were violating limits on pollutant emissions, causing the premature deaths. Prosecutors are considering manslaughter charges. The plant operators, part-owned by France’s GDF Suez, say studies on the levels of emissions were “biased”. Greenpeace says Vado Ligure was only the 55th worst polluting power station in Europe, with seven UK facilities among those that spew out more pollution.
No April fool
India’s 2013 Companies Act took effect on April 1. The first major update to India’s corporate rulebook in 50 years, it includes a range of corporate responsibility obligations, from the requirement to have at least one woman on company boards, to the disclosure of the ratio of executive salaries to average employee salaries. The act also requires about 8,000 large companies, including foreign companies, to spend at least 2% of their net profits on “CSR activities”. The government has listed 10 areas that qualify as “CSR”: initiatives on hunger, poverty, malnutrition, preventative healthcare, sanitation, safe drinking water, education, gender equality, environment and protection of national heritage. According to the Business for Social Responsibility network, the rule could mean an annual $2bn spending boost in India.
Perform or else
In a twist on non-financial performance targets for company executives, China’s Communist party says regional and local officials will in 2014 be judged against environmental and social indicators, in addition to their success in stimulating economic growth. Some provinces are adding measures on air pollution, nature conservation and quality of life to their performance metrics, while watering down expected GDP growth figures. The knock-on effect is likely to be more pressure for companies to be green. A major concern for the Chinese leadership is that public protests, especially about air pollution, could get out of hand. Speaking at the 12th National People’s Congress in March, China’s prime minister Li Keqiang said: “Environmental pollution has become a major problem, which is nature’s red-light warning against the model of inefficient and blind development.”
German pharmaceuticals and chemicals giant Bayer has had to publish on its website a motion calling on the company to take responsibility for its “toxic heritage” of polychlorinated biphenyls (PCBs). Environmental group the Coalition Against Bayer Dangers filed the motion ahead of the company’s annual shareholders’ meeting. The campaigners say Bayer started to sell PCBs in the 1930s and became the world’s second largest producer, after Monsanto, but when the dangers to health presented by PCBs became known, Bayer speeded up production to beat the eventual ban. Bayer stopped making PCBs in 1983, but about half of the PCBs used historically in caulking products in German construction are still present in buildings, the coalition says. The Bayer meeting will vote on the motion in late April.
Every last drop
The government of Singapore has said it will oblige all “large” water users to submit Water Efficiency Management Plans (WEMPs) in 2015, in a bid to make companies think about their water consumption. The mandatory scheme will be a step up from the current voluntary programme, under which only about a third of relevant companies submit plans. “Large” water users are those that consume 5,000 cubic metres or more per month, a definition that covers about 600 company sites in Singapore. In a shower of acronyms, Singapore environment minister, Vivian Balakrishnan, said: “With mandatory WEMP submissions, PUB will also be enhancing the WEF,” referring to financial assistance from the Public Utilities Board Water Efficiency Fund for companies wanting to make water savings. As Ethical Corporation reported in February, Singapore is one of the world’s most water-stressed countries.
BP back in business
A US government freeze on public contracts for BP, following the disastrous 2010 Gulf of Mexico oil spill, has been lifted, allowing the company to bid again for oil and gas exploration leases in the Gulf. The public-contract ban was imposed in 2012 when the US Environmental Protection Agency deemed that BP had not done enough to address the problems that contributed to the Deepwater Horizon explosion in the Gulf, which killed 11 workers and triggered the record spill. In lifting the ban, the EPA placed BP on five years’ probation, obliging the company to comply with a detailed list of safety and corporate governance standards. Being unable to bid for public contracts was one more cost arising from the spill for BP, which had been the US Defence Department’s main fuel supplier. The overall Deepwater Horizon price tag for BP has amounted to about $43bn so far.
Brazilian companies are praying for precipitation, because of fears that low levels of rain during the November to April rainy season could lead to energy rationing. By the middle of March, dam reservoirs were only one third full, potentially meaning reduced hydropower capacity – a serious issue for Brazil, which generates 75% of its electricity from hydro schemes. Brazil has a back-up fleet of fossil-fuel power plants, but companies could still be obliged to make energy cuts. The last time the rains failed, in 2001, electricity users were told to reduce consumption by a fifth or face fines. Brazil’s industrial output was cut by up to 20% as a result.
The European commission has proposed its version of Section 1502 of the US Dodd-Frank Wall Street Reform and Consumer Protection Act, which requires companies to report their use of minerals from conflict zones. Unlike the mandatory requirement in the US, European companies will be asked to report voluntarily on their use of gold, tantalum, tin and tungsten, which are used in high-tech products such as consumer electronics. However, the EU rule would have global scope, rather than just covering minerals from the Democratic Republic of Congo and surrounding countries. The US rule had penalised legitimate exporters in those countries because “risk averse” companies simply switched to other sources of supply, the commission said. According to one survey, only 12% of relevant EU companies not already covered by Dodd-Frank report on conflict minerals. An EU official says the bloc wants to “double these numbers to 24%”. Campaigners say this shows the likely “limited impact” of the EU measure.
May 2014, London, UK
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