Business and Sustainable Development – The Green Race is on

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Business and Sustainable Development – The Green Race is on Goteborg, November 2010 Björn Stigson Visiting Professor in Applied Corporate Management 1

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Business and Sustainable Development – The Green Race is on. Goteborg , November 2010 Björn Stigson Visiting Professor in Applied Corporate Management. Agenda. WBCSD The Sustainable Development Context The Green Race is On WBCSD Work Program. WBCSD. - PowerPoint PPT Presentation

Transcript of Business and Sustainable Development – The Green Race is on

Page 1: Business  and Sustainable Development – The Green Race is on

Business and Sustainable Development– The Green Race is on

Goteborg, November 2010Björn Stigson

Visiting Professor in Applied Corporate Management

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Agenda

1. WBCSD

2. The Sustainable Development Context

3. The Green Race is On

4. WBCSD Work Program

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Coalition of some 200 leading companies

• Market capitalization: 7,000 BUSD

• Total member company employees:13 million

• Global outreach– Supplies products and services to half of the world’s

population every day

WBCSD

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WBCSD Membership

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68

40

24

18

16

11

7

2

1

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Swedish Members

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WBCSD Sectors

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14

13

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10

10

8

7

6

4

4

4

2

2

2

1

1

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WBCSD Regional Network

Channel to globally disseminate WBCSD’s messages, to promote implementation of concrete projects on the ground and to provide input to WBCSD work program

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A World in Transition to Sustainability

SocietyEconomy

Environment

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The Future Society: A growth story

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1

2

3

4

5

6

7

8

9

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1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050

Source: United Nations Population Division, World Population Prospects: The 2006 Revision.

World population (in Billions): 1950-2050

85%

15%

Population in less developed countries

Population in more developed countries

2010= 6.9 billion

2050= 9.2 billion

+33%

85%

15%

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Income poverty: Over 2 billion people live on less than $2/day

Energy poverty: 1.6 billion people today without access to electricity

Mobility poverty: 900 million people without access to transport

Water poverty: 1.8 million deaths per year due to lack of sanitation,

poor hygiene and unsafe drinking water.

Development: The Poverty Challenge

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Urbanization

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50% urban in 2010: 3 billion

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The Urbanized Future

Billions of inhabitants47% urban

60% urban

1970 2000 2030

36% urban

urban

rural

70% urban

3.2 3.32.9

5.0

1.3

2.42.8

6.4

2050

Source: United Nations, World Urbanization Prospects: The 2007 Revision

70% urban in 2050: 6 billion 2010: 3 billion

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Shifting demographics

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Source: UN population prospects, 2008

A largely aging world The cost of growing old

Age-related spending (as % of GDP in selected countries) Source: Standard and Poor’s 2010

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Shifting Fortunes

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Emerging economies > 50% of global GDP and trend will continue

Sou

rce: A

ng

us M

add

ison

, OE

CD

; IMF

From

Th

e E

cono

mist p

rint ed

ition.

“Wre

stling

for in

flue

nce

.” July 3rd

20

08.

% Share of GDP

0

20

40

60

80

1913 1950 2005 2025

Emerging economies Developed economies

* At purchasing-power parity

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Risks and Returns

Financial Sector

Societies

Com

pani

es

A World in Transition to Sustainability

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Mindsets

Prioriti

esEquity

Shared visio

n ValuesEnvironment

SocietyEconomyNat

iona

l vs.

Glo

bal

GeographyA

sia vs. NA

& E

U

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“The Green Race is on” between countries to transform to low carbon economies and to become the leading supplier of resource efficient technologies & solutions

If you want to win:oTransform your home market to build domestic

demand, competences and scale for exports

The World is Turning Green

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The Green Race is On

EU – Market leader today on green technology exports (40% market share)– 300% increase in R&D for green technologies in 2009– Transformation of the internal market?

US – Mobilizing the US innovation capability?– Transformation of the home market?

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The Green Race is On

China – About to become the leader in the race– Key component of next 5-Year Plan (2011-

2015)– Clean energy investment : No. 1 rank with

21% of the 162 billion USD invested globally– Taking the lead on solar & wind

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The Green Race is On

Japan

– Most energy efficient economy

– Has a good technology platform for green solutions

Korea

– Largest share of economic stimulus devoted to “green” sector (80%)

– Presidential Decree: Green New Job Creation Plan 2009

– GGGI – Global Green Growth Institute

India

– Supplier of low cost solutions based on domestic demand from a large, poor population

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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WBCSD Vision 2050

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Vision 2050:A platform for dialogue about the role of business in a resource & carbon constrained world.

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Vision 2050: Living well, within limits of the planet

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Human Development Index (HDI)

Eco

log

ica

l Fo

otp

rint

(Glo

ba

l He

cta

res

pe

r P

ers

on

)

Source: G

FN

/ UN

DP

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Vision 2050 Pathway: 9 elements

23TODAY

The pathway to Vision 2050

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Turbulent Teens

24TODAY

The pathway to Vision 2050

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Opportunities in Vision 2050

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Size of potential additional sustainability related business opportunities

Sector Annual Value in 2050 (US$ trillion at constant 2008 prices)(+/- 50%)

% of projected world GDP in 2050 (+/-50%)

Energy 2.0 1.0

Forestry 0.2 0.1

Agriculture 1.2 0.6

Water 0.2 0.1

Metals 0.5 0.2

TOTAL: Natural Resources

4.1 2.0

Health and Education 2.1 1.0

TOTAL 6.2 3.0

26PwC estimates drawing on data from IEA, OECD and World Bank

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Follow-up of Vision 2050

Green Growth / Green Race– Cooperation with OECD

Consumption and Lifestyles

People Matter– Sustainable Management Institute

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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Focus– To contribute to a sustainable future for emerging

economies and developing countries

Development Focus Area

Key Workstreams:

1.National Market Participation

2.Inclusive Business

3.Energy Access Partnerships (Africa, Asia-Pacific)

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Development Focus Area

“Business & Development”

Message:– Business is a key source of

economic growth, employment & technology

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UN Millennium Development Goals

Summit September 2010 Workshop: “Accelerating progress towards the MDGs through

Inclusive Business” Organized by WBCSD and other leading business

organizations and networks

UN Private Sector Forum UN Secretary-General Ban Ki-moon:

“Business is a primary driver of innovation, investment and job creation. There is no longer any doubt that business plays an integral role in delivering economic and social progress."

World Bank President Robert Zoellick:

"The problem of the poor is not the dominance of markets, but its absence."

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Measuring Impact Framework – Helping companies measure

impacts to inform investment decisions and conversations with stakeholders

Forthcoming: summary of impact measurement methodologies relevant to business

Measurement & Reporting

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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Takeaways:

Copenhagen saw the end of old ways of intergovernmental negotiations

The Copenhagen Accord– A non binding “Letter of Intent”– But little clarity on how this will be implemented

COP 15 Copenhagen

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Main elements: – Committed limiting global warming to 2°C– Encouraged pledges of cuts from

developed countries and actions from developing countries

– Agreed to transparent reporting of actions– Proposed new mechanisms to manage

finance, technology and REDD+• Committed $30 to 2012• 2nd phase - 100 bln$ annually by 2020

The Copenhagen Accord

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UNFCCC COP 16 Cancun

Little urgency in UN negotiations post-Copenhagen

Expectations for COP16 Cancun played down

Major obstacles:

– Lack of US domestic legislation

– Country commitments to further reductions?

– Reporting and verification principles?

– Technology transfer and funding to developing countries?

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Climate negotiations and business

Governments recognize necessity for business input

WBCSD study for the EU focused on improving this interface

– Need to build an informal track for engagement to complement stronger links to the formal proceedings

Mexican Dialogues 2010

– Providing input on Finance, Carbon Markets and Technology

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Technology

Key issue for business– Need for long term plans to guide

investments and funding of RD&D New WBCSD reports:

1.“Enabling Frameworks for Technology Diffusion”

2.“Innovating for green growth - Drivers of private sector RD&D”

IEA cooperation with WBCSD:– IEA Technology Roadmaps– IEA “Technology Perspectives to 2050”– IEA Technology Platform project

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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Ecosystems degradation is a risk and an opportunity for business– Core operations – Value chains

Convention on Biological Diversity (CBD)– COP 10 Nagoya, Japan

Ecosystems

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Convention on Biological Diversity

COP 10 Strategic Plan approved by 193 parties which have 2

years to adjust their national biodiversity action plans

– “Aichi” targets for biodiversity by 2020 e.g.

• Increase land Protected Area by 17%; marine to 10 %

• Halve rate of habitat lost including forests

– Nagoya Protocol on Access & Benefit Sharing (ABS)

• Consultation obligations for use of genetic resources

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WBCSD and Ecosystems

Ecosystem Services Review (ESR)– method to develop strategies to manage

risks and opportunities arising from dependence and impact on ecosystems

“Ecosystem Valuation Initiative”

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Convention on Biological Diversity (CBD)

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New WBCSD publications:

1. Effective Biodiversity and Ecosystem policy and Regulation

Business has a strong interest in ensuring ecosystems continue to function properly to deliver both business and societal value

A framework for closer collaboration between business and policy makers on biodiversity conservation is needed

2. Responding to the Biodiversity Challenge 30 member company case illustrations responding to

CBD core objectives

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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Urban Infrastructure Initiative (UII)

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Overall objective: Involving business early in the urban planning process will

help create a cross-cutting strategy and provide competitive and effective solutions

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Sustainable Value Chains Initiative

Focus 1st Phase:

– Fast Moving Consumer Goods

– Co-chaired by:

• Unilever and Coca-Cola Objectives:

– A practical “how to” guide including best practice information, templates, case studies, etc.

– Leadership on the Rio +20 (2012) Sustainable Consumption agenda

Material sourcing

Manufacturing

Distribution

Sales & retail

Consumer purchasing

Consumer use

Consumer disposal

End-of-life

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New potential Systems Solutions

Food, water, land-use, energy, and climate change

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WBCSD Work Program

Focus Areas

- Water - Buildings

- Forest Products

- Cement

- Electricity Utilities

- Tires-Mobility

- Mining

-Eco Patent Commons

-Maritime

ProjectsDev

elopmen

t

Energy and

Climate Ecosystems

The Business Role

Joint ventures

• Urban Infrastructure• Sustainable Value Chains

• Urban Infrastructure

• Sustainable Value Chains

Systems Solutions

- GHG Protocol

- SDMI

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“Water, Energy and Climate Change”– Water & Energy linked

– Impacts from ecosystems and climate change

Measuring water use & assessing impacts:– WBCSD Global Water Tool

– Water Footprint Network

– Development of ISO standard on water footprint

Business input to major water events

Water

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Cement Sustainability Initiative

5 Chinese members Cooperation with

China Cement Association

5 Chinese members Cooperation with

China Cement Association

24 member companies - 10 years of successful collaboration Achievements:

–Cement CO2 Protocol

–Global database on energy and CO2

–Industry guidelines & company commitments (emissions, fuels, raw materials, safety management)

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Outlines existing and potential technologies, and how they may help the industry support a halving of global CO ₂ emissions (Dec. 2009)

CSI/ IEA Technology Roadmap

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CSI – expanding scope

Impacts on biodiversity Sustainable use of concrete

Water management

CO 2 M

anagement

Micro-pollutant e

missions

Supply chain

management

Sustainable construction

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Trilogy of policy reports– “Power to Change: A business

contribution to a low-carbon electricity future”

– Roadmap of sector specific policy recommendations

Next phase: – Input into the IEA– Global Energy and Water Initiative– e8 project

Electricity Utilities

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Co-Chairs:

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Buildings represent 50 % of world energy use

Business opportunity for new buildings as well as refurbishing of existing ones

Report: “Transforming the Market” Key Message: Cutting building emissions by 50%

globally by 2050 is possible at an average abatement cost of 25USD/tCO2 (PIIE, 2009)

EEB Manifesto – 95 Signatories so far Global Building Sector Roadmap in

collaboration with IEA (2011)

Energy Efficiency in Buildings (EEB)

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Co-Chairs:

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A World in Transition to Sustainability

WBCSD Book 1991: Changing Course Eco-efficiency : “Doing more with less”

Aim:• To demonstrate that pollution is waste

and sign of bad management• To argue that reducing pollution,

improving efficiency and profit go hand in hand

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The future is going to be resource and carbon constrained

– I.e. The Green Race

Business has a major role to play as a solution provider

Business cannot succeed in a society that fails

A World in Transition to Sustainability

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www.wbcsd.org

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