Resource efficiency report, banks and climate change, palm oil guidance, push for hydrogen and big data tackles deforestation
Resource-efficiency could save UK £76bn: Aldersgate Group
A new report from the Aldersgate Group, Amplifying action on resource efficiency, argues that greater resource efficiency could deliver economic benefits of £76bn to the UK up to 2030. The research is based on 26 pilot projects conducted across the UK and the Netherlands in key market sectors (including electrical and electronic products, textiles, construction and ICT) as well as case studies from Aldersgate group members IKEA UK, Sky and Thames Water.
The pilots range from UK social enterprise iPower, whose installation of small- scale fuel cells in social housing is estimated to save consumers up to 36% on their energy bills, to the Dutch Ministry of Defence (pictured), whose textile recovery programme for its military personnel has delivered additional revenue of approximately €750,000 and savings of over 14,500 tonnes of CO2 annually.
To reap these rewards, however, the UK must outline the future of its resource efficiency policy, much of which currently comes from EU legislation.
Nick Molho, executive director of the Aldersgate Group said: “As it prepares to leave the EU, the government should urgently develop a resource efficiency policy that will help replicate the benefits of these pilot projects across the UK economy. This policy should be supported by all key government departments and should include fiscal incentives, product standards on resource efficiency that are as good as or better than what is in place in the EU and working with businesses to remove the financial and technical barriers that stand in the way of innovation.”
Banks ‘failing on climate change’
A new report examining 28 of the world’s largest banks on their management of climate-related risks says they are failing to align business practices with the Paris Agreement to keep global temperature rises below two degrees.
The report, On Borrowed Time: Banks & Climate Change, backed by investors with $500bn in assets under management and led by Boston Common Asset Management, is a follow up to the 2015 report “Are Banks Prepared for Climate Change?”. It finds some notable progress by major banks over the last year, including more than 70% undertaking carbon footprints or environmental stress tests, and more than 85% of disclosing financing or investment in renewable energy. More than 80% have more explicit oversight of climate risk at board level; and almost two-thirds have performance goals.
However, with the Paris Agreement now in force, banks are still not doing enough, with more than 80% of responding banks not yet integrating the results of environmental stress testing into their business decisions.
The report points out that bank lending and investment to carbon intensive sectors continues to significantly outpace green financing. In the past three years, European and North American banks have provided $786bn in finance to some of the most carbon-intensive sectors.
Lauren Compere, managing director at Boston Common Asset Management, said: “The investors behind this report call on banks to not only expand the use of tools to collect climate data, but most crucially to integrate this data into their decision making process.” One recommendation is for banks to support industry collaborations, such as the Task Force on Climate-related Financial Disclosures, that increase the pace of change, and to use their public voice on climate action to encourage better government policy.
NGOs give guidance for reporting on palm oil
A group of 18 NGOs and investor groups led by Ceres has issued new guidance for corporate reporting on responsible palm oil sourcing and production.
The group, which includes Rainforest Alliance, the Rainforest Action Network, Oxfam, and the Zoological Society of London, came together to develop the guidance in a bid to create consistency and clarity for companies in the palm oil value chain.
“Numerous companies are putting resources towards sustainable palm oil; yet, deforestation, land conflicts, and labour issues persist,” said Noah Klein-Markman at Ceres. “Transparency on supply chain practices is critical for all stakeholders – investors, civil society groups, and businesses - to understand and address the implementation gap.”
The guidance document offers recommendations for growers, processors and traders; manufacturers; and retailers. It covers issues including supply chain transparency, effective grievance processes, forced labour, smallholder engagement, and responsible land expansion. Companies are encouraged to report the information outlined in the guidance through existing vehicles, such as the Roundtable on Sustainable Palm oil (RSPO) Annual Communication on Progress, CDP, or sustainability reports and dashboards.
Fiona Wheatley of Marks and Spencers said: “This document guides companies towards reporting that is most meaningful and material to a wide range of stakeholders and contributes towards our collective goal of making palm oil production sustainable and deforestation free.”
Global push for hydrogen to power energy transition
Thirteen leading energy, transport and industry companies have launched a global initiative to position hydrogen as a key solution in the transition to a clean energy future.
The Hydrogen Council, launched at Davos, is made up of some of the world’s leading industrial, automotive and energy companies, including BMW Group, Honda, Hyundai, Royal Dutch Shell, Total and Toyota, which have already invested €1.4bn (£1.19bn) in the development and commercialisation of hydrogen. They are aiming to increase this investment with a rise in stakeholder interest and support from governments.
Benoît Potier, CEO of Air Liquide, said hydrogen is "among the key solutions for the energy transition, in the mobility as well as in the power, industrial and residential sectors, and therefore requires the development of new strategies at a scale to support this. But we cannot do it alone. We need governments to back hydrogen with actions of their own – for example through large-scale infrastructure investment schemes.”
Takeshi Uchiyamada, chairman of Toyota, said: “We know that in addition to transportation, hydrogen has the potential to support our transition to a low carbon society across multiple industries and the entire value chain.”
Big data alliance to tackle deforestation
A group of 20 companies worth $2.9 trillion have formed an alliance to tackle deforestation in their supply chains through big data.
The corporations, including giants such as Walmart, Carrefour and Mars, brokered a deal with the World Resources Institute (WRI) in Davos last week, agreeing to install a monitoring tool to increase traceability of raw materials in their supply chains, such as palm oil, soy and cocoa.
The technology allows companies to plot the locations and sources of their materials with the same immediacy as tracking commodity prices or stock markets. By keeping a closer eye on suppliers, they are able to mitigate risks associated with sourcing products from protected forest areas, ideally making forest monitoring part of their core business strategy.
The president and CEO of WRI, Andrew Steer, emphasised the importance of deforestation commitments. “Now is the time to use the power of information technology to meet those goals, while also generating sustainable business opportunities. That could really change the world.”