Moves from the European Union, the International energy agency, the Deutsche Bank, and all the latest from other brands in corporate responsibility and sustainability this month
Reporting rules review
The European Union could revise company law to standardise the way firms are required to report non-financial information, such as on social or environmental performance. The European commission is concerned that some countries have introduced stricter rules than others on company reporting, making it hard to compare information, while the EU’s framework is being overtaken by initiatives such as the Global Reporting Initiative or the UN Global Compact.
The commission wants companies and others to give their views on “possible improvements to the current regime for the disclosure of non-financial information” via an online consultation that is open until the end of January.
Global temperatures are on course to rise by 3.5C over pre-industrial levels by the end of the 21st century, signalling an unmanageable level of climate change, the International Energy Agency (IEA) says in its annual World Energy Outlook.
The study takes into account promises made by governments to reduce greenhouse gas emissions – and finds that they are far from being enough to keep global warming within the commonly cited “safe” limit of 2C. Global energy demand continues to rise steeply, and while this is increasingly being met through renewable power in rich countries, emerging economies remain reliant on fossil fuels. In addition to fulfilling their emissions-reduction pledges, governments should quickly phase out fossil-fuel subsidies, as promised by G20 leaders in 2009, the IEA says. Such subsidies amounted to $312bn worldwide in 2009.
In the US, lack of substantial regulation to tackle greenhouse gas emissions is prompting an increase in climate-related litigation, according to research by Deutsche Bank. Lawsuit filings connected to climate change are expected to triple in number in 2010 compared with 2009. Legal challenges have come from both sides of the debate, with environmental activists seeking, for example, to block the construction of coal-burning power plants, while companies aim to clarify and place limitations on moves by the US Environmental Protection Agency to use its executive powers to regulate emissions. “It is possible that the threat of court action will in some cases galvanise legislators to take action where before they simply avoided the issue,” Deutsche Bank says.
Wind in the east
Russia, until now dependent on fossil fuel and nuclear power, is preparing to move into renewables, with plans to build wind farms in the Balkans, eastern Europe and Turkey. The green energy charge is being led by the giant state’s nuclear power generator Rosatom, which says it will put up wind turbines on land belonging to a number of Russian nuclear power stations, and then will seek partners in “traditionally friendly” countries, such as Bulgaria and Ukraine. The wind farms will contribute to a target of 4.5% of power to come from renewable sources by 2020.
Britain on target
The UK is making headway with its renewable energy plans, and will meet a 2020 renewable power target that was previously thought hard to achieve, according to the National Grid. Currently planned capacity will result in nearly 32,000 megawatts of electricity coming from wind, wave and other green sources in 2020, more than meeting a target for 15% of energy to be renewable by that date.
The entire territory of the Netherlands is to become free of non-sustainable palm oil by the end of 2015, under a pledge made to the Dutch government by the Dutch Task Force on Sustainable Palm Oil, which represents all palm oil suppliers and buyers in the country. The agreement means that only palm oil certified by the Roundtable on Sustainable Palm Oil will be allowed into the country.
Meanwhile, the Indonesian and Malaysian ministers responsible for overseeing the palm oil production in their countries have joined forces to defend the industry. Speaking in Brussels, where they lobbied officials and members of the European parliament, the ministers said palm oil producers were “unfairly attacked” by NGOs, and that the industry was sustainable, generating jobs and doing more environmental good than harm.
Research by the Carbon Disclosure Project, published in its first CDP Water Disclosure report, shows that nearly 40% of responding corporations have been affected by droughts, flooding, declining water quality or other “water risks”. Almost nine in 10 companies have put in place water management strategies, and 60% have water-related performance targets. Water scarcity and competition for water are increasing headaches for the largest firms.
Separately, at the beginning of November, the CDP went public with a new programme summarising the efforts for cities to quantify and report their greenhouse gas emissions. London, New York and Toronto are among the metropolises providing data to the CDP, which will publish reports on the emissions-reducing efforts of cities, to go along with its range of corporate reports.
Consumers in emerging markets such as Brazil, China, India and Mexico are more ethically minded than their American or European counterparts, according to research from consultancy Edelman. The 2010 Edelman Goodpurpose study finds that eight in 10 Brazilian or Mexican consumers would opt for products from companies supporting good causes, compared with about half of consumers in rich countries. “Citizen consumers” have emerged quickly in emerging economies because of the rapid pace of change and conflicts over issues such as natural resources and human rights, Edelman says.
Sustainability reporting is booming, despite the economic downturn, with four out of five corporations listed in Standard & Poor’s indexes now publishing corporate responsibility reports, and 31% of companies having the reports externally verified. The data, from the CSR Trends 2010 report, published by PricewaterhouseCoopers in Canada, shows that European firms are leading the way, with corporate responsibility reporting having become more or less universal in Europe.
PwC notes that “the environment is the dominant issue”, with 92% of reporting companies detailing their greenhouse gas emissions. Firms are also using “the full breadth of the internet’s capabilities” to reach out to stakeholders. Microsites and blogs abound, while a quarter of major companies now use social networks to talk about responsible business issues.