News & Views from the front line

17 June 2013

Why is the sky blue and other difficult questions

jim jam spainAt three and a half, my middle boy, Jimmy, has hit the golden age of the killer question - why?

Daddy, why do we have ceilings?

Daddy, why do cows moo?

Daddy, why is the sky blue?

Actually that last one really threw me as I assumed I knew the answer but found out I didn't have a clue (the answer is here). I look at the sky every single day - and sometimes it is blue, even in the UK - but I've never queried its colour. This is what kids like Jimmy can remind us - never to take anything for granted and never, ever be afraid to ask "why?"

Engineers talk about 'The Toddler Test" or "The 5 Why's" - keep asking why until you get to the fundamental truth. It works for sustainability practitioners as well, to take a simple example:

Why are we producing this amount of waste?

Because it comes from offcuts of sheets of raw material.

Why?

Because of the shape of our product's components means we can't avoid creating lots of big offcuts.

Why are the components that shape?

Um. Because they always have been...

Why?

Because no-one ever thought about waste when the product was designed 10 years ago, OK?

Obviously, like a kid who won't stop asking questions (naming no names...), you run the risk of being thought to be a right pain in the backside. But you won't cut through layers of institutional inertia and implicit assumptions to get to underlying truths without asking difficult questions. And without getting down to those underlying truths you won't be able to make the fundamental changes required.

It's a risk worth taking!

 

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Who has the power to green the supply chain?

Greening the Supply Chain Constraints

One of the issues we explored in our recent Corporate Sustainability Mastermind Group meeting on supply chains was who in the organisation has the power to drive or constrain the greening of the supply chain. I've been developing that line of thinking since for an exciting new project (watch this space), and I've come up with a hierarchy of constraints that you can see above.

  • Trying to green the supply chain by simply choosing the greenest option available is the easiest place to start, but it will only ever lead to incremental improvements.
  • By setting a procurement policy which, say excludes certain substances or certain suppliers, you will have more influence, but you are still constrained by the way the rest of the organisation operates as that is where demand comes from.
  • The design of operations - whether that's manufacturing, logistics or even office processes - will determine which materials you need and in what quantities.
  • Above that, the actual design of your product and service will drive operations and the levels below. Will this product be designed to be made out of recycled materials? Does it require rare earth metals?
  • The business model is the next influential - are you going to produce a physical product at all or a digital product or a product service system where you lease rather than sell?
  • And overarching everything else is your corporate philosophy - are you prepared to invest in the supply chain you need? Do you want to be a pioneer of the circular economy? Or collaborative consumption? Are you going to use your buying power to effect change on a transformational level?

Of course in practice, the boundaries blur and they may not all apply to all organisations. But the overall principle is that the higher in the hierarchy you effect change, the bigger the impact on your supply chain footprint.

 

 

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14 June 2013

There's nothing green about a crap product

socks holesI really liked these bamboo socks when I saw them in TK Maxx, but they barely lasted a couple of weeks before they wore through. Maybe I should have been alerted by the overt green marketing that I was probably buying a substandard product 'for the cause'. But I'm forced to add them to my depressingly long list of crap 'green' products.

A waste of resources, a waste of money and a reinforcement of the prevailing belief that green = poor quality. It doesn't have to, of course - as the late, great Ray Anderson of Interface said:

"There is no need to compromise either aesthetics or functionality for the sake of sustainability."

Or as I've said many times:

"You've got to compete on performance, price AND planet."

Grrrr!

 

 

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12 June 2013

What do (some) Greens and Climate Change Deniers have in common?

Admiral Lord NelsonOh, the UK's new energy bill. Otherwise much lauded by green industry commentators, the bill put off setting a 2030 decarbonisation target until 2016 - a compromise between Energy Secretary Ed Davey and the Chancellor George Osborne. An amendment to the bill to set the target now was narrowly defeated in the House of Commons. You'd think the world had ended from the Twitterstorm that followed.

For interest, I challenged a couple of people who were venting off, asking what they thought the problem was with delaying that target. Nobody could give me a clear answer apart from it would be better to have it sooner than later. In fact many tweeters seemed to think the target had been rejected outright rather than delayed, and some seemed to think the whole energy bill had been voted down. Few seemed to actually have investigated what they were tweeting about before hitting that blue button. One resorted to personal abuse for daring to ask.

All of this reminds me of the dank underworld of the climate change denier. Keyboard warriors hunched over their screens, repeating the mantra in BTL article comments without ever stopping to ask key questions - or check the evidence. People who don't automatically agree are clearly inferior and should be put in their place with brutal efficiency.

At worst this is groupthink - repeating the myths 'cos the rest of the tribe is doing so it must be right. Often it is confirmation bias (which we all suffer from to some degree) where we exaggerate the evidence that suits our argument and ignore that which contradicts it.

The commentators I really respect are those who think for themselves, considering the evidence and coming to their own conclusions. Mark Lynas has proposed that GM and nuclear are required to saving the world, going against the green grain. Uber-greenie George Monbiot has considered the relative impacts of coal-power and nuclear power and concluded that the latter is preferable by a country mile - again upsetting the green doctrine. James Murray at BusinessGreen has made his name by objective analysis of the pros and cons Government policy rather than the kneejerk and predictable condemnation of the NGOs. I might not agree 100% with everything these guys say, but I always find their arguments valid and thought provoking.

Let's be clear, if we are going to shift towards a sustainable future, we need to be pragmatic. That means concentrating on what is possible and getting that done quickly, rather than getting all holier than thou. This may involve, dare I say it, compromise and certainly requires objectivity.

We expect rabid nonsense from the deniers, but what we need from the green community is a little more signal and a lot less noise.

 

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10 June 2013

Fear of a Green Planet II

screamI was fascinated to read that when BMW wanted to develop its new electric car range, they set up an arms length division to prevent "sabotage". Uwe Dreher, head of marketing for the car, told the Guardian,:

"What would have happened is when technical development has been concentrated for 40 to 50 years on the internal combustion engine, it gives everyone security. It's a human condition to be afraid when people face new things and have no experience out of their comfort zone.

So we had to create a new platform. We got the power from the board and they told us to come to them if we were having problems, if people in the business wanted to kill it. It has been sitting aside as a separate structure in the company to protect it."

I heard this concern previously from GlaxoSmithKline when I interviewed their then Vice President of Sustainability, Jim Hagan for The Green Executive:

We have a huge amount of sunk cost in existing technologies – not just the capital sunk cost in physical plant, but also the personal sunk cost – many people in the organization have developed expertise in the technologies that define the company. If we move into innovative approaches, their expertise may no longer be useful and may become obsolete which can make people anxious.

So fear is clearly a real problem if two huge but different manufacturers have identified it as a major risk. While BMW's approach will work in product development in the short term, it is a bolt-on solution that won't serve to align the whole company to sustainability - unless they start sacking the "traditional minded" employees en masse - hardly ethical and a great loss of talent. In practice I've seen quite a few such arms-length divisions either get closed down or sold off in the name of focus, usually after a change in leadership.

The Green Jujitsu approach would be to tap into the engineering mindset at the company and train up the existing engineers in EV technology and insert them into the emerging EV teams. A mixture of peer pressure and technical curiosity is likely to bring most people along. Above this, clear leadership is required to set the overall direction of travel with the ultimate threat of "this way or the highway".

But fundamentally, sustainability must be centre stage in the business, not lurking in the wings. That's where you get stage fright.

 

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7 June 2013

We've Got the Certificate, What More Do You Want?

Here's the latest in the Green Business Confidential podcast series. It's called "We've Got the Certificate, What More Do You Want?" and it's given by our occasional guest presenter Hugh Jim Pakt of DirtyCorp Ltd.

Audio MP3

Or, you can download it here and listen on your MP3 player:

GBC23 We've Got The Certificate, What More Do You Want?.

You can get the whole podcast series here or subscribe on iTunes.

 

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5 June 2013

How to deal with a climate sceptic

rantWhen I originally came up with the concept of "Green Jujitsu", it was in the context of 'dealing with difficult people' in The Green Executive. Difficult people from a sustainability practitioner's point of view are those who reject the whole idea that man is having a negative impact on the planet.

Now the natural habitat of the climate sceptic is blogs and below the line comments on newspaper websites. And as long as they stay there, repeating their zombie arguments ad infinitum, they're not doing any harm.

But it can be a real nightmare if you get one in your organisation trying to obstruct your sustainability efforts, throwing half-remembered snippets of rubbish they've read about where the Romans grew their grapes into the conversation. As soon as you knock one argument down, they'll bring up another and another until they land on something you can't answer on the spot and then they'll triumphantly say "See?" You can't win.

So how do you deal with sceptics? The Green Jujitsu way is...

  1. Get highly visible buy-in from the leadership - sceptics will have to feel very confident to go up against the CEO;
  2. Design the process to get people involved in the development of the strategy - then lots of people will have a stake in the results and peer pressure will sweep sceptics along;
  3. Ask people why (not whether) they think the business should take sustainability seriously - they end up selling it to themselves;
  4. Ask sceptics directly for help if possible. If they're an accountant, ask for help on carbon accounting etc;
  5. Choose your language to suit your audience. A sceptic may respond better to "risk management", "cost efficient" or "brand enhancement" than to "save the planet";
  6. Don't try to explain climate change science to employees - you're just asking to get bogged down in "How come Mars is warming?" type nonsense;
  7. Don't preach. Ever;
  8. In your employee engagement, ask teams of people to think of ideas to green their area of business. This makes it directly relevant to their day job and resistant to "none of my business";
  9. Create peer-pressure by running competitions between departments or teams;
  10. Make sure everything (language, imagery, tone, process) is aligned to the prevailing culture in the organisation, so the sceptic can't denounce it as tree-hugging.

In my client engagements I have worked with a couple of thousand employees, but because I use Green Jujitsu I have only ever had a couple of sceptics try to cause trouble - and they failed to disrupt the process.

 

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3 June 2013

The Resource Crunch IS Crushing Growth

Yesterday I was perusing The ENDS Report (possibly my last edition, but that's a different matter) when I saw this from Tom Burke:

Nearly a third of profit warnings by FTSE 350 companies in 2011 were attributed to rising resource prices. An EEF survey found 80% of senior manufacturing executives thought limited access to raw materials was already a business risk. For one in three it was their top risk.

That is shocking - particularly in light of the need to rebalance the economy towards manufacturing.

oil prices
Added to this is the energy situation (data taken from the EIA). The spike in oil prices probably burst the debt bubble in 2013 and, according to the EIA, the continuing high oil prices (three times what they were 10 years ago) are crushing economic recovery. Shale gas might be giving some light relief in the USA, but is clearly having little impact on global oil prices - the two usually relate. Unconventional sources rely on high prices on conventional reserves to make them viable, so we are very unlikely to go back to the days of cheap energy.

I've said it before and I'll say it again - the choice is not "green or growth" but "green or stagnation". We must reframe every argument in this way to meet this challenge head on. Lip service and/or burying our heads in the sand will get us nowhere.

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28 May 2013

Kids get it, why don't adults?

harry recyclingLast week I had one of the more exacting challenges of my professional career - explaining the circular economy (but not using that phrase, natch) to about 100 5-8 year olds at my eldest boy Harry's school. That's a tough gig - especially when you can't work out whether that look on your son's face is pride or mortification.

I went for the green jujitsu principle of 'show don't tell', taking a crate of recycled products, plastic bags of compost and the 'waste' those things were produced from. My pièce de résistance was talking about where a plastic juice bottle came from, then whipping off my Marks & Spencer's fleece to show them the big 'made from recycled plastic bottles' label inside. But the kids really went mad for stroking the sheep's wool insulation, poking at the undressed edge of chipboard and sniffing compost - I nearly had a riot on my hands.

But what really struck me is that these kids just get it. They love recycling a) because it's obviously the right thing to do and b) because they've grown up with it. They were born into a world where the domestic recycling bin was as common as the residual waste bin. They don't know a world where you dumped everything into one bin, or even one where you had to make the long slog to the bottle bank in some distant supermarket car park. It was harder to explain landfill to them than recycling.

Which made me wonder how much of the resistance to green behaviour is simply the baggage of having grown up without all this new-fangled renewable energy and closed-loop business models and seeing it as some esoteric novelty that we're not quite sure about? And how will we persuade people clinging to the sinking wreckage of the old, fossil fuel-driven economy to swim off boldly towards the green rescue boat on the horizon? Or do we have to wait for the natural cycle of the grim reaper and the stork to do that job for us?

 

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24 May 2013

Supply Chain Secrets of the Sustainability Masterminds

Crown Hotel Wetheral

Tuesday saw the fourth meeting of our Corporate Sustainability Mastermind (CoSM) Group. This time we went for a rural location - the Crown Hotel, Wetheral, Cumbria - with another great restaurant (one of the rules of the group is "no executive buffets").

The theme of the meeting was greening the supply chain. As the group operates under the Chatham House rule, I can't share the company specific solutions we discussed, but here's a sample of the three dozen or so generic lessons we recorded at the meeting:

  • Sustainability risks in the supply chain often exceed risks within the factory fence
  • Proactive anticipation is essential – reacting is usually too late
  • Need to continuously scan horizon for future legislation from around the world - legislation has impacts way beyond its immediate jurisdiction in a globalised world
  • The business model defines the supply chain – only incremental improvements can be made without rethinking that business model
  • Awareness days are highly effective ways of sharing good practice across silos and identifying synergies
  • Identify the ‘difference makers’ and make them your champions
  • Use competition to drive performance above standards eg allocate 15% of tender scoring to sustainability and let bidders compete for those points
  • Investment appraisals must be made on through life costs, not just capital costs
  • Joint research with suppliers on greener options can deliver synergistic benefits
  • There is plenty of scope for closed loops for certain materials, particularly metals
  • Small products can be very difficult to recover. Composting and energy recovery may be preferential routes
  • Widen tolerances on inputs to open up a wider range of raw material sources
  • Chicken and egg situation with closed loop business models and civic infrastructure (materials recovery/composting) – need to be proactive and lead

As always, the real benefit was how we got to these generic points and the examples of company specific challenges and shortcuts members threw in to the discussion.

The CoSM Group is for senior sustainability managers in large organisations which meets quarterly in great locations for open and frank discussion - and NO Powerpoint. The next meeting will be in September and will be themed around Sustainability Strategy: The Next Generation. If you'd like to learn more, please drop me a line.

 

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22 May 2013

Words Matter: What "The Bedroom Tax" can teach us about selling sustainability

words-that-workYou can win or lose an argument on the words you choose to use.

Take the recent furore over changes to UK housing benefits. The Government introduced what they called a "under-occupation charge" for those living in social housing with more than the minimum number of bedrooms they needed. The Opposition branded this "the bedroom tax" and the press adopted the term. The Prime Minister tried to fight back, talking about the status quo as a "spare room subsidy", but it was too late, "the bedroom tax" had stuck.

Leaving aside the rights and wrongs of the policy, the case demonstrates how important language is. The original name was a dreadful piece of technocrat-speak, wide open to attack. The attack was effective as it used the much more emotive term "bedroom tax" which painted the policy as a 'bad' - tax - applied to a 'good' - a nice cosy bedroom. The response of a "spare room subsidy" was an attempt to apply the 'bad' (subsidy) to something much less cosy - a 'spare room', but it was too weak, too late.

This kind of verbal reframing is all part of the daily cut and thrust of politics, and, more often than not, whoever coins a resonant phrase first wins.

I was thinking of this at yesterday's Corporate Sustainability Mastermind Group meeting on sustainable supply chains. We were discussing Industrial Symbiosis - one company's waste becoming another's raw material - when one group member said that when talking to colleagues he preferred to call it "Waste to Value".

Genius!

Why? Do some green jujitsu and put yourself in your colleagues' shoes.

You are busy doing your job when someone comes up to you to talk Industrial Symbiosis. Your reaction is likely to be "Huh? Can't this wait?"

Or they could ask you about Waste to Value - "What, we can make money from our waste? Tell me more!"

To win sustainability arguments, we have to think more like politicians, kick out the technocrat-speak, and put a positive spin on our sustainability ideas and projects. As Frank Luntz, George W Bush's infamous spin doctor put it, it's not what you say, it's what people hear. We need to use words that work.

 

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20 May 2013

Book Review - The Green Book: New Directions For Liberals in Government

green-bookI've been a member of the UK's third political party, the Liberal Democrats, for the best part of a decade - and an elected Councillor here in Newcastle for most of that time (full disclosure!). When I first joined, the party seemed so far from power that its earnest and sometimes fiery debates on policy seemed somewhat quaint, but the 2010 General Election changed everything.

With no clear majority for either the incumbent Labour Party or the opposition Conservatives, the decision to go into coalition with the latter, on the grounds they got more of the vote than anyone else, sent shockwaves through the party, the 'Westminster bubble' and the electorate. Suddenly what the Lib Dems did or said meant something - for better or worse.

The central thrust of this new tome, The Green Book, is that the party should focus on its strong reputation on environmental issues to define the next stage in its history. The editors make the case on three grounds:

  • Moral: many environmental pressures are now hitting critical levels and the time for action is now;
  • Economic: a green economy could rescue the UK economy from its current torpor;
  • Political: as the Conservatives' initial ambition for 'the greenest Government ever' has faded, the Lib Dems have continued to fly the flag, providing clear green water between the coalition parties.

What follows is a collection of 31 essays designed to set out a vision for eco-liberalism, as distinct from the eco-socialism championed by the Green Party. The authors are predominately MPs and party insiders, but many of the latter are sustainability professionals in their day jobs, and they are augmented by heavyweight guest authors. As a result, the majority of the pieces are intellectually hefty pieces of work, going way beyond the usual political blandishments. Here are some of the key themes I distilled:

  • The need for political leadership: across the UK economy, companies are sitting on mountains of cash which could be invested into greentech, if they the confidence to do so;
  • The need for a narrative: too much of the environmental debate has consisted of barrages of data and statistics, we need a narrative to take people with us on the quest for sustainability;
  • The need to sell the wider benefits of a green economy as well as the risks of inaction: energy security, rebalancing the economy, job creation etc;
  • The need to tackle the (politically more difficult) demand side of the economy as well as the supply side;
  • The need to understand and work with prevailing culture: "Persuading people to change their behaviour is, in general, only likely to succeed when it goes with the grain of their lifestyles and beliefs." (fits with my concept of Green Jujitsu);
  • The need for finance: for example, 3% of companies in the Cambridge greentech cluster have venture capital funding, compared to 36-40% in sectors such as healthcare or IT;
  • The need for policy integration: only the Department of Energy and Climate Change (DECC) sees a green economy as more than a standalone issue, the need to see resource management as more than a waste issue etc;
  • The need to break up vested interests and cartels to open up markets and devolve solutions to the local level.

Given there are more than two dozen authors, the book provides a smorgasbord of potential solutions to these issues rather than a tightly defined manifesto. The ideas range from high level principles, most well understood in the sustainability sector such as the circular economy, to some quite specific solutions, such as how to allow the Green Investment Bank to borrow to invest without upsetting national finances. There is however a significant job left to do to weave these together into a cohesive whole and, more importantly, develop that narrative to make a compelling case to the electorate - we're still deep in policy wonk territory here.

Obviously this is a party political publication, and non-party supporters will have to put up with a degree of Lib Dem braggadocio, but there's plenty of red meat in here for environmental policy geeks no matter what their political viewpoint. As many psephologists are predicting another coalition Government after the 2015 election, and the party leadership has adopted its key thrust, The Green Book could become very influential indeed.

 

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17 May 2013

Sustainability Stories or Statistics?

LOTR or Data

 

How many times have you sat through a sustainability presentation that consists of graph after graph, table of data after table of data. And then at the end the presenter says "OK, what are we going to do?" and you rouse yourself from your day dream and think "about what?"

I've long promoted storytelling as a way of making sustainability more enthralling than an avalanche of evidence. Most people who use storytelling use a simple little personal story, but the best use the classic narrative ark of the quest. Somebody like us is suddenly thrown into a challenge and they must change to meet it - just like Frodo in Lord of The Rings, the everyman who is suddenly tasked with saving the world. The best example is the late Ray Anderson of Interface who talked of the 'spear in his chest' which made him set off on 'Mission Zero'. I once saw him tell this story in person, calmly and politely with no histrionics, and it was riveting.

Of course I have been a bit naughty and set up a false choice in the title of this post, but it's a mistake many people make. Stories and narratives wrap us up into sustainability, but the hard facts must be there to underpin the story - substance to match the style.

 

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15 May 2013

The New Mindset

wasted

 

 

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13 May 2013

How to Unblock Global Progress on Climate Change

escher

The United Nations Framework Convention on Climate Change (UNFCCC) was set up at the Earth Summit in 1992. That's 21 years ago and where are we? Atmospheric carbon levels have just hit 400ppm for the first time in human history and emissions show no sign of slowing. We're running out of time.

Is it time to admit that, no matter how many international jamborees held or acronyms forged, trying to agree an over-reaching framework of targets, processes and systems that will satisfy Beijing, Washington and Dar es Salaam just ain't gonna happen?

On the other hand, we know what will happen if we don't have some form of international agreement. Nations that take action will lose polluting industries to those who won't, creating to a race to the bottom and no reduction in emissions. The Tragedy of the Commons writ large.

This is a conundrum I've been wrestling with for a long time and I've come to the conclusion that simplicity is the answer. Just think about when you get overwhelmed at work - trying to do too many things at once just leads to you rushing around like a headless chicken and getting nowhere fast. The only solution is to list what needs doing, pick the one which will give you the biggest return on your efforts, and focus on that 'til it's done.

So if you could pick just one thing to do on the climate, what would it be?

My vote goes for a carbon tax in every nation. A carbon tax is very simple, penalises carbon intensive energy (eg coal) more than cleaner energy sources (renewables), and some countries have already gone down this route so we have some experience to build on. If every UNFCCC country committed to impose a carbon tax then, in theory, there would be no carbon 'leakage' as industries would find a similar regime in place wherever they went. Nations could spend the revenue raised as they see fit to avoid 'World Government'-type paranoia.

In order to prevent poor countries being penalised, the level of taxation in each country could be linked to per capita GDP. This could lead to limited carbon leakage initially, but growth and carbon emissions would be decoupled.

This approach would lead to immediate action on carbon emissions, rather than arguing over targets which, once agreed, might lead to reduced emissions at some point in the future - and might not.

Once a such a global carbon tax agreement was agreed and implemented, then the UNFCCC could start looking at other issues one by one, such as protection of forests, targets, development mechanisms etc. These would have to play second fiddle in the medium term, but at least we'd have one practical measure up and running and cutting carbon, rather than yet another avalanche of position papers.

So let's keep it simple and actually do something. Carbon taxes for all!

 

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10 May 2013

Green Business Confidential: Lighten Up

Here's the latest in my Green Business Confidential podcast series. It's called "Lighten Up". Make sure you listen to the end...

Audio MP3

Or, you can download it here and listen on your MP3 player:

GBC22 Lighten Up.

You can get the whole podcast series here or subscribe on iTunes.

 

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8 May 2013

What would you ban, if you could?

law"Hurrah!", shouted the green world, as the neonicotinoid pesticides blamed by everybody (except their producers and their political allies) for the worrying decline in bee numbers.

Bans work. Some major environmental problems have been pretty much fixed by banning the substances involved:

  • The Montreal Protocol banned the use of CFC refrigerants, leading to a stabilisation and slight closure in the hole in the ozone level.
  • The ban in leaded petrol has been credited for great improvements in local air quality - and even for the steady reduction in violent crime which has occurred since the ban.
  • Restrictions on DDT use have been attributed to the rebound in Bald Eagle numbers in the US (although eggs shells remain thin). A ban in lead shot fishing weights led to a massive increase in swan numbers in the UK.

What is inevitable, however, is that those threatened by a ban (and those who are against any environmental protection as a 'cost' to business) will resist, producing their own research to prove that, in the memorable title of a book on the subject, "toxic waste is good for you." This happened in response to the call to phase out DDT in Rachel Carson's Silent Spring and it is happening in the neonicotinoid ban now.

This economic barrier is bunk as bans lead to innovation which is good for the economy. We still have fridges despite the CFC ban. Non-toxic 'sharkskin' anti-fouling paint was developed in response to a ban on toxic TBTs. So we shouldn't listen to the voices of 'no change'.

You don't have to wait until international authorities act, of course. Many organisations run black and grey lists of undesirable chemicals and other materials. Black listed substances must never be used, and whoever proposes a grey list chemical must make the case why it should be used over alternatives. This pre-empts legislation and makes sure the company is ahead of the curve. Some companies have added green lists of preferred chemicals too.

InterfaceFLOR deleted quite a number of carpet tile lines because of the flame retardants required by the other raw materials. The company sees ruling out toxic materials as a drive to innovate and maintain competitive advantage, so they're quite gung-ho about it.

So, over to you. What would you ban, if you could?

 

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6 May 2013

Is business evil?

HieronymusBosch

Very amusing column from Lucy Mangan in the Guardian at the weekend where a trip to her local independent bookshop threatened to tempt her from her from her bookish, left of centre, middle class intelligentsia comfort zone into the raging vortex of greed that is free market capitalism. Well, she had a thought that if she took a stake in the bookshop she wouldn't want people hanging about in the cafe for too long, which seemed to mean the same thing to her.

It is easy to mock such woolly thinking - if booksellers couldn't make a profit, there would be no bookshops. And quite probably no books.

On the other hand, business has done itself no favours recently with greed outstripping common sense in the banking sector, big businesses shifting money around the world until it settles in the lowest-tax jurisdiction, the horrendous factory collapse in Bangladesh, and pharmaceutical and engineering companies caught bribing officials. We can't even caveat this as a big business problem - cf the "entrepreneur" who made millions selling war-ravaged poor countries golf ball detectors instead of the bomb detectors he promised them.

So is business a necessary evil?

I would say 'no'.

Business decisions are not made by 'the market' but by people. In each of the cases above a person or people are making those moral decisions and coming up short. This can be through greed, or it can be through ignorance. And these scandals can cause as much lasting damage to the business as they do to society.

And beyond that, business brings fundamental benefits like political stability - a functioning local economy is one of the criteria used to measure the recovery of a war-ravaged state. It is business which has brought people out of poverty, not aid. There could be no free press if it didn't operate in a market.

In Ms Mangan's case, I suspect that she might find that her instinctive urge to bring more efficiency to her putative bookshop cafe would put off exactly the sort of bookish customer like her she would be trying to attract. Because capitalism gives people choice and, if they don't like what you're offering, they can choose to go elsewhere.

 

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3 May 2013

Can you design a green economy?

Darwin monkeyYou only have to see the repercussions of the 'Arab Spring' to see that revolutions are inherently unstable. Yet we constantly call for a 'revolution' in sustainability.

Evolution is stable, but slow. Nature itself took over a billion years to come up with a stable, sustainable environment which could support a diversity of life.

The internet 'revolution' of the mid nineties was over 20 years in the making - waiting for a number of key technologies to mature.

Far too many big green ideas seem to involve trying to 'redesign' chunks of the economy - cf the Hydrogen economy. And like the hydrogen economy they tend to fail.

On the other hand, evolution is slow, and in terms of climate and biodiversity in particular we don't have much time to waste.

So how do you accelerate evolution?

In economic terms, anything that boosts demand which produce change much more quickly than any other intervention - see how the costs of solar PV plummeted as Feed-In Tariffs produced a domestic market for a technology which was previously a specialist niche. Marks & Spencer boosted demand for recovered polyester fibre by using low grade material in bulk in cushion filling etc which brought down the price of high grade fibre for clothing.

That's not to say that business and Governments shouldn't intervene in supply chains when there is a key sticking point. But they shouldn't try to 'design' a whole green economy as one thing is sure - they'll get it wrong.

 

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Posted by Gareth Kane 2 responses

1 May 2013

Have eco-labels had their day?

eulabel You get eco-labels on everything these days. You can't grab a coffee without it being rainforest-certified, fair-trade, organic or all three. This very ubiquity bothers me - are all these products wonderful, or is the bar too low and do labels continue to challenge industry to strive harder?

Even the most successful of the eco-labels - the EU energy label on white goods which drove up energy efficiency dramatically - has a fatal flaw. Instead of cranking up the ratings so it was more difficult to meet them, the EU simply added ratings to the top end - A+, A++ etc. So a fridge that hit A in 2000 will still be ranked A in 2020 - where's the drive to improve or ditch old and under-performing technologies?

More worrying was a conversation I had with a sustainability manager at a major multinational last week (not one of our clients). He said something along the lines of:

We lobby to make sure the eco-label is something we can achieve, then we meet that target and no more - there's no pressure to exceed the standard.

In other words, industry tries to dictate what "green" means, makes sure it is easily achievable and then, bingo, achieves it! And sits back, job done.

Such lowest common denominator thinking exasperates me. We need to be creating powerful drivers to make industry strive forwards, not sit on their (modest) laurels. The rankings in all eco-labels should be designed to tighten over time to keep people on their toes. If there is no fear of losing the label, then it is worthless.

An alternative approach is the league table. Industry loves competition and hates to come last - certainly the Greenpeace ranking of electronics firms made even Steve Jobs sit up and listen. A comprehensive set of rankings across sectors would really spice up progress to sustainability.

Whatever is done needs to be done quickly - very soon the public is going to notice that almost everything has a label of some sort. And if they get cynical, the eco-label won't be worth the product packaging it is printed on.

 

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Posted by Gareth Kane no responses


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