All the latest research and data you need to know
Asia’s weather risks
For those on North America’s east coast, Hurricane Sandy was epic and awful. For once, the “perfect storm” cliché had a place. Brace yourself for more, and not just in the west Atlantic. That’s the message from the Asian Development Bank. Disaster-related losses could cause an annual $19bn dent in Asian economies, the regional lender warns.
Floods and landslides in 2010 in China alone cost an estimated $18bn. Thailand ratcheted up a bill of $45bn when floods hit in 2011. Half of the economic impacts of natural disasters over the past two decades have occurred in Asia. Hydrometeorology and geography (two-thirds of Bangladesh lies less than five metres above sea level) make the region vulnerable to extreme weather risks.
Demographics play a part too. Asia-Pacific has more megacities than anywhere else on the planet. Then there’s India and China, which together contain more than a third of the world’s population. According to the bank, the region’s residents are 25 times more likely to be affected by natural disasters than their peers in Europe or North America. What to do? Invest in prevention. It reaps dividends. Every $1 spent on natural disaster prevention is reckoned to save $4 in disaster-related losses later on.
High emissions, hard decisions
If you’re looking for a sizzling hot investment tip (puns aside), here’s one for you: sun cream manufacturers. By the end of this century, temperatures could increase by as much as 6C.
To avoid such a scenario will require a reduction in carbon emissions by 5.1% year-on-year between now and 2050. These aren’t the predictions of the eco-lobby: so concludes a new report from global professional services group PricewaterhouseCoopers.
Since 2000, global emissions have dropped a mere 0.8%, meaning a six-fold increase of the cuts is needed in the years ahead. Worryingly, the report confirms that a growing share of emissions are from the world’s fastest-growing economies. The so-called Emerging E7 – China, India, Brazil, Mexico, Russia, Indonesia and Turkey – are collectively responsible for a 7.4% rise in emissions.
Tough decisions lie ahead. The UK, for example, will need to shut down all its coal-fired power plants if it’s to meet its official 2020 target of reducing emissions by 34% against 1990 levels. That’s despite a record reduction last year.
SRI in Europe
Europe’s investors are finally waking up and smelling the café de comercio justo. Investment funds carrying some kind of social or environmental screening now represent an impressive €2.3tn of assets under management. That’s 137% up on 2009, when the European Forum for Sustainable Investment (Eurosif) started annually reporting on the continent’s socially responsible investment market.
Funds that exclude certain sectors or companies have more than doubled (119% growth) during the same period. Another key finding from Eurosif centres on the dominance of institutional investors. The assets of pension funds and their ilk now represent 94% of all SRI investments in Europe, compared with 92% five years ago.
Energy anxiety
Flip the switch, and the power comes on. Done; no questions asked. At least, that’s how it used to be. Today, businesses are increasingly concerned about where their energy comes from and whether or not it’s secure.
Three-fifths (59%) of large UK companies say that future supply security preoccupies them, according to research funded by the British Chamber of Commerce. The proportion jumps to nine in ten when asked if they think creating a more “diverse energy mix” is a good idea.
The research, which was carried out by consumer rights group Consumer Focus, also reveals that 63% of businesses are motivated to reduce their energy usage by environmental concerns. By the same token, 40% say rising energy prices are hitting business growth. The findings come in the wake of another recent report by Consumer Focus, which suggests a large-scale rollout of energy saving measures could boost the UK’s gross domestic product by 0.2% and create 71,000 jobs by 2015. Behind both reports is a new carbon tax to be introduced by the UK government. The move is expected to raise as much as £63bn over the next 15 years.
Cotton wool, organic pull
In April 2011, fashion brand H&M announced it would use only sustainable cotton by 2020. The evidence suggests progress is good. According to a new report from Textile Exchange, the Swedish retailer tops the list for sustainable cotton use for the second year on the trot.
Next in line are Dutch retail chain C&A, US sports clothing brand Nike and fashion retailer Zara. Four-fifths of brands say they intend to increase their use of sustainably source cotton, the Organic Cotton Market Report finds. That’s good, yet the hard data suggests organic cotton production is actually falling. In 2011, total production reached 151,079 tonnes, down 37% on the previous year.
It takes an average of 8,500 litres of water to grow one kilogram of cotton lint, research from WWF indicates. That’s enough to make one pair of jeans. Working with the Better Cotton Initiative, H&M has so far invested more than €2m to assist cotton farmers in reducing their environmental impacts. Organic cotton as a proportion of the total cotton market remains small. “Green” cotton comprises less than a tenth of the total cotton on market leader H&M’s hangers.
textileexchange.org
Wage imbalance
Now here’s a surprise. In the UK, the rich are getting richer, while the poor are getting – well, a fraction less poor. Wages for the top 10% of earners rose by 81% in real terms between 1986 and 2011. The bottom 10%, on the other hand, have had to content themselves with a rise of 47%.
The figures, produced by the UK Office for National Statistics, are adjusted for inflation. The mean average for all workers comes in at a healthy 62% (in inflation price terms), increasing from a nominal equivalent wage of £3.87 per hour to £12.62 over the same period.
As for those at the very tip of the earning pile, the last quarter-century has been kind. The top 1% has seen their wage packet expand by 117% since 1986. The situation is skewed disproportionately in London, due to the concentration of the financial sector. Wages among the top 1% in the UK capital outstrip those in the bottom 1% by 16.2 times.
Gender pay gap
It's official: women have it tougher. A recent report by the Fawcett Society shows that men in the UK earn on average 14.9% more than women for the same job. This could worsen with government cuts as more women will shift to the private sector, where pay imbalances are more pronounced.
Corroborating evidence comes from the Chartered Management Institute, which reports that an average UKfemale company directorcan reckon on finishing her career with £423,000 less in her pocket than her male peers. The average annual pay difference between the sexes currently stands at £10,060.
Organisation snapshots
Dodgy deforesters
Illegal logging is responsible for the bulk of deforestation in tropical forests, the United Nations Environment Programme maintains. Between 50% and 90% of all forest loss in the Amazon basin, central Africa and south-east Asia comes at the hands of unregistered loggers. The illegal timber trade is now estimated to be worth up to $100bn a year, and could account for as much as 30% of all timber sales.
Resource curse
Africa’s oil and mineral boom isn’t alleviating poverty levels, the World Bank contends. In fact, it could be worsening them. The bank’s biannual Africa Pulse report finds that poverty eradication is happening slower in resource-rich countries than in those not blessed with natural bounty.
Corn crisis
Wheat prices could soar as a consequence of extreme weather in the US and other key agricultural markets. Prices of the staple have already gone up 25% this year, the United Nations-backed Food and Agriculture Organisation reports. That trend could continue, with full-year production expected to have dropped by 5.2%.
Company insights
Coke cuts calories
Nearly one quarter of Coca-Cola’s brand offerings – more than 800 products in total – contain zero or low calorie content. Since 2000, the US food and drinks giant has decreased its average calories per serving by 9% globally. Other highlights in the company’s 2011-2012 Sustainability Report include its community spend, which increased by 21% in 2011 to $123.5m.
GM, landfill-free
US carmaker General Motors recycles 90% of its worldwide manufacturing waste and operates102 landfill-free facilities, the company reports. GM’s new Landfill-Free Blueprint statement reveals that that company saves about $1bn in revenues each year from recycling and reusing by-products from its manufacturing operations. The maker of flagships brands such as the Chevrolet and Cadillac has set a goal to achieve 100 landfill-free manufacturing sites and 25 non-manufacturing sites by 2020. At the time of the report’s publication, its number of landfill-free manufacturing sites stood at 83.
media.gm.com
May 2013, London
Europe's largest and most acclaimed CSR summit. Featuring 500+ attendees 50+ speakers including; CEO of BUPA, Executive Editor of Greenpeace and Executive Editor of the Economist