Sustainability Reporting

BOOK REVIEW: Chocolate Nations

Thursday, August 29, 2013 by

Chocolate NationsOrla Ryan is a well-travelled financial and investigative journalist who lived in Africa for four years (Uganda and Ghana). Currently writing for the Financial Times in London, during the time of this book she was commissioned to Reuters and this project came out of a special grant for investigative reporting.  During her time in Ghana, she was specifically focused on the cacao industry.

The fundament of her book is about exposing the realities of the daily work program and calling on better education and a less corrupt government, and she really writes this for conscious consumers. The book is a good eye opener for those who love chocolate and want to inform themselves more about the complexity of the environment of cacao farming in West Africa. Given that there are almost two million small producers in West Africa, who farm and produce about two thirds of the total world cacao crop these are highly significant stories to tell. Not just from the economics, but the human aspect.

For perspective fifty percent of the world's cacao beans come from Ghana, the world's second-biggest producer, and its neighbour Ivory Coast, the world's biggest.

You want to read her work because she’s not emotional, but rather factual about the description. Giving a fair say to everyone involved. You might find it difficult to read as it looks at the causes of farmer poverty, and you’ll see an almost helpless role within the context of global commodity trading and the simple farmer’s daily battle to just live from his crops. Economic and geopolitical analysis with the human touch, it gives you a clear view of what is going on with the majority of chocolate.

It is a quick read, eight chapters in 160 pages. Weekend reading, where you will probably clean your cupboards out thereafter and look up more about sustainability reporting in chocolate.

You’ll read that for every £1 chocolate bar, just 7p is spent on cocoa ingredients, while 43p goes to the manufacturer. You’ll look for justice. And hopefully, start within yourself. What gifts you give, what snacks you enjoy, and just start looking at the back of pack a little more.

Typical cacao farmers receive just 4 per cent of the final price of an average bar of milk chocolate in Europe.

Ryan’s book gives you a background on Ghana and Cote d'Ivoire cacao farming histories, and then highlight where and how child labour is used on cocoa farms (specifically child and slave labour). Stories of government and cacao board corruption, the role of international traders who come to town to try and help. She shows how unfair Fair Trade is and that in current economics, there is dwindling futures for chocolate, by simply no-one wanting to go into the business anymore.

  ‘Orla's Chocolate Nations is a captivating read, painting a lively picture of the West African cocoa trade from a variety of perspectives. It casts a critical eye over the role played by governments and multinationals, while also putting fair trade and child slavery campaigns in perspective. It gives us all a good deal more to think about when we eat 'the food of the gods'." - Daniel Balint Kurti at Global Witness

"A courageous and thoughtful account of a murky industry." - Times Literary Supplement

"Chocolate Nations is a fascinating account of the struggles of cocoa producers in West Africa, almost all of them smallholders, and what it takes to turn a crop of cocoa into a warehouse full of Ferrero Rocher." - Jeremy Harding, The Guardian

"Paints a disturbing and subtle picture of an industry few chocolate consumers think about." - Sydney Morning Herald

Read an excerpt from the book: http://bit.ly/ChocNations

Buy the book here in Amazon

Chocolate Nations: Living and Dying for Cocoa in West Africa (African Arguments) [Paperback]

 http://bit.ly/BuyChocNations

 

Related Content!

  Ecological Thinking in Economics

Is Fair Trade Part of the LOHAS Movement?  10 Easy Ways to Celebrate Fair Trade Month

Where is the best place to start-up your LOHAS business: Copenhagen, Denmark vs. Colorado, USA

Friday, July 12, 2013 by

An entrepreneur spotlight Q&A with Sandja Brügmann, Founder of Refresh Agency. Interviewed by Lizelle van Vuuren

Sandja Brügmann EmSpot Entrepreneur Sandja Brügmann

Let’s Talk Starting up in different countries, shall we? Would you say it’s easier being an entrepreneur in Copenhagen vs Colorado?

I would say that it is much easier being an entrepreneur in Colorado, and I would think in the US in general over Copenhagen and Denmark.

It surprises me to hear that! What are the key differences?

This is due to many factors such as on the overall cultural differences and mindset of the two countries, to governmental structures, and all the way down to people’s culturally behavioral values, and the actual LOHAS industry I am focused on [LOHAS stands for: lifestyles of health and sustainability]. I have found my business community in Boulder, CO and nation-wide in the US in general to be extremely supportive, generous and helpful.

Can you say a bit more about the differences in mindset, cultural differences and governmental structures of the two countries – and how these influence the entrepreneurial start-up environment?

The politicians in Denmark say they want to focus on making Danish business culture and environment more fertile for entrepreneurial creators, but I do not quite see them understanding the high barriers standing in the way to make this a reality. High taxation, bothersome paperwork structures from VAT to taxation laws (substantially more complicated than the US tax laws), and costly price of services – all high interference roadblocks.  As a start-upper you just do not have the kind of time and resources required to maintain this kind of minimum structure. 

The US on the other hand has minimum governmental interference, which also means simpler reporting and paperwork as well as simpler taxation structures, and cost of services is relatively low – low barriers of entry as an entrepreneur.

Abundance versus scarcity as cultural mindsets and social culture:

The US is founded on the ‘American Dream’ – and if you have an idea and work hard, anything is possible (it’s an entirely other topic if this American dream is indeed still flourishing), as such people depend on other people to succeed, and we are all in the same boat. In my experience of my 16 years in the US, there is a mindset of camaraderie and abundance, where people are extremely open and supportive. I have been connected to collaborative partners and clients without even having to ask. I see this as an abundance mindset.

People in Denmark are not known to be a friendly, open and helpful people – and in my experience that stereotype has proven correct.  Danes tend to keep their networks closed and off limits. It is only a rare Dane, who will welcome you with an open mind, and think about your needs without their own benefit. That said, those people do exist, and I have met incredible people on my path – like attract like – and after my now 2 years in Copenhagen, I can honestly say that I have an incredible and supportive network of likeminded doers and visionaries. However, I believe it’s a rarety.

Furthermore, when I moved back to Copenhagen two years ago after having lived in Boulder, CO for 16 years – and with 10 years behind me as a successful entrepreneur and business owner, I was not met with an ‘awesome, so what’s your plan with your business now you are home’ – I was met with a scarcity mindset –more like ‘can you survive as a small-business owner’ mindset.

In the US I almost only meet people, who show genuine passion and interest when I share my passion and business vision. Just very different mindsets and cultures. Expanding beliefs and thoughts create exactly that – expansion. And the opposite is also true.

It’s quite comfortable in Denmark, and there is no need, so to speak, to work hard and create something from scratch. Being an entrepreneur requires a fearless and courageous attitude and a burning desire to do something better, new and to create. Danes are just too comfortable and contented – the driving force for change is almost non-existent.

What I will highlight as extremely positive about Denmark is the balance between work and family life, and the way children are integrated into life everywhere. People in Denmark strike me as being very good at living and ‘being.

In the US there is a high level of burning platform – there is no social and financial structure and safety net to catch and support you. Each person create their own safety and security parameters through hard work. 

So I would say, if you have the choice between being an entrepreneur in CO versus Copenhagen, I’d chose the US for all the reasons I’ve stated– however, that said, I am truly thriving in my new life and home base of Copenhagen. And I feel extremely fortunate to do business in both the US and Denmark, and the larger European markets. I feel I have created an exciting work- and personal life. I would not want it any other way.

 

Sandja Brügmann is the Managing Partner of @sandja, Facebook page Refresh Agency and Company website   Read the original Entrepreneur Spotlight Interview Now Lizelle Van vurren is founder and CEO of Emspot, a Denver based strategic marketing company, who enable business, start-ups and entrepreneurs grow organically through the power of competitive strategies, mindful marketing and by leaving a socially responsible footprint. The article was originally posted on Emspot Blog

LOHAS Food Trends

Sunday, May 5, 2013 by

I am fortunate to be able to connect with various experts in a variety of LOHAS related categories as well as research various articles predicting what to expect as new opportunities and market trends in the growing LOHAS market. Based on my discussions and findings, here are a few things that I think stand out in the organic and natural food vertical of LOHAS:

1.       A growing awareness of ingredients and sourcing – organic, GMO, fair trade

Those who are opposed to genetically-modified organisms in their food — everything from grains to fish — are getting louder and their concerns heard as demonstrated when, anti-GMO activists hijacked Cheerio’s Facebook page. But following the defeat of California’s Proposition 37, which would have been the first legislation to require GMO labeling, the community is bound to get noisier than ever.

2.       Closing the Price Gap on Organic

Consumers will be able to find certified organic products in all sections of the supermarket and pharmacy.  Expect an evolution of other industry sectors, such as organic personal care, pet food (more like pet treats) dietary supplements. What manufacturers create or retailers carry all depends on the target customer. Capturing discriminating LOHAS (Lifestyles of Health and Sustainability) customers goes well beyond one person: it spreads to their families and pets.

3.       Accessible Organic

Larger organic production, from farm acreage expansion to processing facilities, will translate into organic landing where it is most needed: schools, hospitals, food banks, convenience stores and in mainstream America’s home. Some communities are better served by organic than others, but organic will continue to pop up as distribution channels increase beyond grocery stores. New markets will open to organic food growers, makers and sellers as consumers look for cleaner food beyond grocery stores.

4.       Gluten free integrated into all food options and will be a common part of menu options

The gluten-free market, by comparison is expected to have reached US$1.3 billion in sales by 2011. However, the gluten-free market, which is still in its early growth, is expected to achieve higher growth rates (31%) from 2011 to 2014. Sales in the category have doubled in the last 5 years and are expected to double again in the next 3 years to $5.5 billion by 2015. The new ‘gluten-free’ is already here. With food allergies rising worldwide — at least seven per cent of Canadians have a food allergy — more companies will build facilities dedicated to manufacturing foods free of allergens like dairy, peanuts, egg, soy and shellfish.

5.       Healthy Fast Food - Other Chipotle type chains on the rise.

According to Baum & Whiteman, other chains are following suit, but need to make sure they capitalize on more than just comfy décor and made-to-order food: Companies  will needs to wear its heart on its sleeve … incorporating not just value, but values. Expect more fast food chains to promote sustainable food choices and friendly casual atmospheres. Giants like McDonald’s are embracing this with their new calorie information menus

6.       Food waste awareness on the rise

Americans throw out nearly half of their food, tossing up to 40 percent in the garbage each year, according to a new study. That adds up to an estimated $165 billion according to Natural Resources Defense Council. As more people seek to squeeze money out of their budgets this will be scrutinized as more become aware not to mention restaurants that may waste more .

7.       Chia seed and fermented beverages rule

The nutty tasting Chia seed has more protein, energy and fiber than any other whole grain. The seed is one of the most nutrient-dense foods on the planet. Three ounces of Chia contains the same amount of Omega-3 fatty acid as 28 ounces of salmon, as much calcium as 3 cups of milk, as much iron as 5 cups of raw spinach, and as much vitamin C as seven oranges!   Chia drinks & oils have seen over a 1000% growth in 2012 according to SPINS. No, we’re not talking about the kind you grow in a pot, but 2013 is all about adding the chia seed to your diet.

8.        Chill out power drinks

In a rebound from power shots such as 5 hour energy and Red Bull there are now drinks that promote relaxation using supplements and herbs. The drinks, which evolved in Japan as far back as 2005, contain no alcohol but some have melatonin, a hormone that can cause drowsiness for those suffering from insomnia and high stress.

9.       Sustainable seafood continues to grow  

According to the National Restaurant Association’s chef survey, sustainable seafood is a top trend among chefs. And sustainability initiatives, such as the well-known Monterey Bay Aquarium Seafood Watch program, report an increase in the number of chefs and operators following their guidelines.

10.   Organic soil promoted as carbon reduction

According to the Organic Center Analyzing  international experts headed by scientists from the Research Institute of Organic Agriculture (FiBL) in Switzerland have concluded that organic agriculture provides environmental benefits through carbon sequestration in soils. Not only are their health benefits but global environmental benefits.

11.   Increased Demand on Transparency

Consumers demand transparency they will come to know what organic means across categories such as personal care, household cleaners and dietary supplements. Natural retailers are already at the forefront by using shelf talkers that tell the story behind the products. Manufacturers only have so much room on labels but can provide more detailed information on their website, Facebook and Twitter. Social platforms will allow consumers to become educated on organica. Companies such as Stoneyfield Farms and Nature’s Path are leaders in this.

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com

LOHAS: You Had Me at Hello

Monday, April 22, 2013 by

This is my first blog post for LOHAS and I’m happy to be here. I’ve been reading LOHAS newsletters for over a year now. I nodded in agreement so often that I jumped at the chance to join the conversation.

A focus on green business

While LOHAS covers many topics, my posts will focus mostly on green business. I am an MBA and spent many years in corporate America before leaving to start my own green business in 2011.

I believe that business can and should play a key role in the transition to a greener economy. Traditional big businesses have enormous financial and people resources at their disposal.  When they decide to move in a particular direction, they can do so with an impact that a small business can’t match.

Unfortunately, in my experience, big business's singular focus on quarterly profits conflicts with the vision, courage and patience necessary to reinvent themselves as truly sustainable enterprises.

So while I celebrate all businesses that move in a greener direction, I see smaller (and privately owned) businesses as leading the way for now. They have a nimbleness and a willingness to embrace change that larger businesses often lack. I suspect that until government mandates the changes necessary to move sustainable practices from optional to mandatory, certain business players will remain in the old, unsustainable model. In the meantime the rest of us need to charge ahead.

The sustainable business view from here

I also want to share the view from my current home in Tampa, Florida. Despite its moniker as the “Sunshine State,” Florida lags on policies ranging from renewable power standards to mass transit. One reason I read LOHAS is to keep up with developments in places like California and Colorado that are – ahem – ahead of Florida in this regard.

We have astonishingly beautiful natural resources in Florida. (That's a roseate spoonbill in the picture above.) From the Everglades to the Gulf beaches, there is “natural capital” here that needs to be protected. Not just because it’s pretty – although you’d think a state whose largest industry is tourism would understand its value. But because when the natural environment is healthy, so are the people – physically and economically.

Here are 3 challenges I’ve encountered as a green business owner. Which ones resonate with you?

Lack of awareness – when I say “green”, many people think I am referring to the color, or that I am describing myself as a newbie. (I’m not.) The topic of greener business is generally not on people’s radar here.

The schools educate kids about sustainability issues better than the mainstream media does for adults. Case in point: I asked a local publisher several years ago why his Florida business-focused magazine did not have a regular feature on green business. He replied that his readers (of whom I am one) weren’t interested in that. I find that stories about green business, green jobs and green learning programs are generally under-reported.

Fragmentation of effort – there is tremendous fragmentation and lack of coordination across green businesses, nonprofits and government agencies when it comes to efforts to go green. When I go to EcoFests, green business networking events and climate change conferences,  I am struck at how many well-intentioned people are struggling to do basically the same things. Imagine if all this effort and resource were consolidated and coordinated in an organized fashion. The whole impact could be greater than the sum of the parts.

Under-funding – too many businesses still see sustainable business practices as optional or a PR move. It’s long past time to invest in something more than recycling bins. To me, green business is a money-making venture for everyone.  Did you know that green jobs are the fastest growing sector in the economy?

The Good News

There is a lot going on under the radar. Last week I attended the 5th Annual Sustainable Business Awards at the University of Tampa. 13 winners collected awards and applause for their “triple bottom line” approach to business. Their businesses ranged from LED lighting to community-supported agricultural farms to recycled air filters. With one or two exceptions, you probably wouldn’t recognize any of their names. But these are the business that will shape the future.

Opportunities in green business are limitless. As a business person, I see the need to reinvent our economy in a more sustainable fashion not just as a daunting challenge, but as a huge opportunity.  To make a good living while helping to save the planet  - what’s not to love?

What do YOU want to hear about?

So that’s LOHAS blog post #1 for me. Let me know your thoughts and tell me what you’d like to hear about in future posts.

About the Author

Alison Lueders is the Founder and Principal oGreat Green Editing. She provides writing and editing services to green businesses and social enterprises that value high-quality content. She ensures that their content and communications – their business face to the world – are correct, clear and compelling. She is a graduate of Harvard College and received her MBA from MIT. She earned her Bronze seal from Green America in April 2013 and Platinum-level recognition from the Green Business Bureau in 2012.

She can be reached at info@greatgreenediting.com and at 813-968-1292.

Do You Know What Hispanics Want from Sustainable Products? You should.

Thursday, April 18, 2013 by

Hispanic sustainability We all know that the Hispanic population in the US is growing, and that they are changing every market they touch – from politics to grocery to banking – and everything in between.  But, have you considered how this growing demographic affects the LOHAS market, and your brand?

According to NMI’s most recent LOHAS Consumer Trends Database®, Hispanics* share a number of green-minded attitudes and behaviors.  For instance, they are more likely to be active in a number of areas:

  • Consumer Packaged Goods: More likely to report using natural products, such as natural home care products and natural personal care products
  • Energy:  More likely to state willingness to pay for renewable power, currently use renewable power, and to own an energy meter
  • Habits: More likely to take reusable bags to the grocery store, remind others to be environmentally-friendly, and contact their politicians regarding environmental issues

Aside from their above-average engagement, it is notable that these attitudes and behaviors span the gamut of sustainability – a range of product categories and behaviors spike for them.  In other words, they aren’t cherry-picking their involvement, it is more broad-based. 

There are implications for both Hispanic-focused and “green” brands.  Brands targeting Hispanics should be addressing their target consumers’ sustainable interests.  For instance, Dove has worked hard at attracting Latinas.  Unilever also has a very strong sustainability platform.  However, the two efforts seem to work independently, rather than synergistically. 

The flip-side is that “green” brands should ensure their marketing communications resonate with Hispanics.  Expect to tailor your communications to this audience in both copy and creative (not just drop your existing ads in Hispanic media outlets), but if executed well, this demographic could significantly expand your brand’s reach.

Both the Hispanic and sustainability markets are changing rapidly, and this appears to be an opportunistic time to understand how these two cultural forces interact.  NMI will be further exploring this market in collaboration with The Shelton Group in a joint study later this year.  For more information, please contact Gwynne.Villota@nmisolutions.com.

 

*English-speaking Hispanics only

LOHAS Internship Opportunities

Thursday, February 28, 2013 by

LOHAS internshipThe LOHAS internship is a part-time, or full-time school year remote or in Louisville, CO based LOHAS office position for a student or recent graduate seeking experience in a sustainable business environment.

Hours per week: 10-25 (will escalate as LOHAS conference gets closer)

Employment Start Date: Immediately


 

Job Description:

Event project intern will report to and work directly with Executive Director, Production team, sales manager organizing the annual LOHAS conference, LOHAS.com web content and LOHAS e-weekly newsletter. Intern will gain skills in event project management, sponsor management, speaker management, online event marketing and sustainable business content; managing multiple projects with deadlines and various online platforms – Drupal, Compendium, Get Response, Eventbrite and Regonline.

Candidates must have strong verbal and written communications, be a self starter able to take on projects and responsibilities confidently and have strong writing and editing skills. Other essential skills for a successful internship include familiarity with Microsoft Word, Excel, Facebook, LinkedIn, Twitter and Google +. HTML background a plus.

Intern responsibilities

  • Manage the delivery of LOHAS e-weekly newsletter
  • Update relationship contacts and outreach lists
  • Assist with marketing outreach via social media and online promotions
  • Assist with sponsor relations and materials needed
  • Upload sponsor logos and information on to LOHAS.com website
  • Upload speaker details on website
  • Update online program
  • Pass sponsor deliverable details to event coordinators
  • Load sponsor details into LOHAS HUB
  • Be on call meetings regarding event logistics
  • Coordinate with volunteers
  • Assist with publishing LOHAS.com blog posts and comments

Onsite:

  • Assist with event set up and registration
  • Assist with attendee QA, onsite logistics
  • Assist with event tear down

Qualifications:

  • Must be motivated and determined to succeed
  • Must be able to work cooperatively with all departments
  • Must be able to meet deadlines on time in a diligent and professional manner
  • Must be familiar with MS Office (excel, word) and comfortable learning new online platforms
  • Must be a student of an accredited intern program


If interested please contact us.

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com

2013 LOHAS Marketing Megatrends

Wednesday, January 23, 2013 by

In the “better, but not booming” economy many predict in 2013, shoppers will focus more than ever on what they care about most deeply. So human values will increasingly shape their spending agenda. At the same time, new trends and priorities will inspire consumers to find new ways to take their values shopping. In addition to their abiding commitment to Health and Sustainability, values-driven shoppers will honor values like Transparency, Justice, Peace, and the more practical value of Frugality. Look for these trends to gain traction in 2013:

Non-violence Emerges as Top Value. In 2013 Peace and Non-violence will increasingly shape our financial choices. After the Newtown, CT massacre, a CBS poll found an 18-percent increase in people who favor tougher gun restrictions. This year powerful investors (i.e. the California teachers pension fund) have already sold weapons stocks. There are new consumer calls to boycott sporting goods stores that sell guns. In 2006, Walmart banned gun sales, but reintroduced them in 2011 to boost weak sales. “Boycott Walmart” initiatives now appear on Facebook.

Fair Trade Takes Off. Fair Trade (FT for short) consumers voluntarily pay a little bit more to endorse the value of social justice for farmers and artisans in developing countries. Result: Fair Trade is trending toward $5 billion global market. Fair Trade USA’s “Fair Trade Finder” mobile app helps consumers find FT products.

Third Party Verification Rules. Conscious shoppers favor products bearing a seal or certification from a reputable organization. LOHAS shoppers—80 percent of them—want trusted, independent sources to verify corporate product claims and 40 percent of all shoppers demand a seal or certification, reports a study by the Natural Marketing Institute.

Old-fashioned and Green Cleaning Products Rock. As green cleaners like Method, Seventh Generation, and Green Works gain market share over traditional labels, most mainstream cleaning brands (except Clorox and S C Johnson) still refuse to disclose chemical ingredients, despite pressure from consumers and activists. Meanwhile LOHAS shoppers enthusiastically embrace Grandma’s non-toxic—and ridiculously inexpensive—baking soda and vinegar. Great Recession helped us discover joy of frugality, but it’s unlikely we’ll abandon it as the economy picks up.

If there were a motto for 2013’s consumer spending mood, it might be: “Conspicuous consumption is gone for good; but discerning, values-driven spending never goes out of style.” Key words such as quality, meaning, simplicity, peace, economical, and local aptly describe the value propositions that will encourage shoppers to open their wallet in 2013. Time was, marketers asked, “Who is my consumer?” and defined consumer identity in strict demographic terms. But those who seek to build enduring relationships with LOHAS consumers must instead ask, “What are her values?” then cultivate a strategy for reaching said consumer by authentically embodying her values in all branding messages. 

________________

Patricia Aburdene is one of the world’s leading social forecasters and an internationally-renown speaker. She co-authored the number one New York Times bestseller Megatrends 2000. Her book Megatrends 2010: The Rise of Conscious Capitalism launched a business revolution. Patricia’s new book, Conscious Money: Living, Creating, and Investing with Your Values for A Sustainable New Prosperity, published in 2012, is a finalist is the Green category for the “Books for a Better Life Award.” Read Chapter one of Conscious Money. Patricia was named one of the “Top 100 Thought Leaders in Business Behavior” and serves as an Ambassador of the Conscious Capitalist Institute. Patricia’s journalism career began at Forbes magazine and she was a public policy follow at Radcliffe College, Cambridge, MA. Her website is patriciaaburdene.com.

"The Next 20 Years of Sustainable Business" by Aron Cramer of BSR

Monday, December 31, 2012 by

[ Article form the special 20th Anniversary issue of the GreenMoney Journal (Fall 2012) and www.GreenMoney.com ]

The Next 20 Years of Sustainable Business

by Aron Cramer, President and CEO, BSR (Business for Social Responsibility)

Twenty years after the Earth Summit in Rio, and in this BSR’s 20th anniversary year, we are both looking back and looking ahead. And as we reflect on the past 20 years, it seems that everything has changed…and nothing has changed. There are reasons to celebrate great achievements, but even more reasons to redouble efforts to achieve the tangible successes that are necessary to put the world on a genuinely sustainable path. Just recently there has been an unprecedented turnout by business and civil society at Rio+20, while at the same time the American Meteorological Society reports that freak heat waves in the US and fatal floods in Russia were likely caused by climate change.

Most businesses, and many other institutions, now recognize that we have in our hands the ability to create an economy that delivers dignified lives of comfort and opportunity for the 9 billion people we expect in 2050; an energy system that enables economic growth without irreversible climate change; and access to food, energy, water, and technology. Whether or not we turn this vision into reality is not just of interest to sustainability professionals, it is nothing less than the central challenge of the 21st century.

There are indeed many great accomplishments that have been achieved since 1992. As sustainability enters the mainstream, we see that hundreds of millions of people have escaped poverty in the past generation, something never before achieved in human history. Most large multinational companies and countless small and medium enterprises (SMEs) all across the world have embraced sustainability. Consumers, investors, and governments have vastly more information than ever before to enable them to assess how business is performing on sustainability, allowing rewards for the best performers. Collaboration and dialogue between business, NGOs, and community organizations, once taboo, is now considered basic. Technology’s ability to connect us has created a global community unprecedented in human history. And where companies once saw corporate social responsibility (CSR) as a risk mitigation exercise, more and more understand sustainability to be the mother of all innovation opportunities. All this is great cause for optimism.

And yet, there are many, many areas in which, twenty years after the initial Earth Summit, progress is insufficient. Our planet continues to warm, with carbon levels nearing 400 parts per million, dangerously close to the point at which irredeemable changes will occur. We need only consider the thousands of record high temperatures in the early summer of 2012 in North America, capping the hottest year on record in the United States, to make the point. The International Energy Agency, hardly an alarmist organization, now sees serious risk of catastrophic climate change. Deforestation proceeds. Progress towards the Millennium Development Goals is inconsistent. The number of water-stressed regions in the world grows annually. And our measures of economic vitality remain tied to unsustainable levels of natural resource consumption. Governments have largely abdicated responsibility to take concerted action to promote low-carbon economic growth, wilting in the face of the global financial crisis. This litany makes clear that, by many objective measures, progress is far too slow – at best.

Without a change in course, the remarkable rise in living standards that have enabled countless people to live lives of dignity will either be halted or reversed.

But with new thinking, innovation, and collaborative action, we can transform our world, and turn the vision of sustainable, prosperous lives for nine billion people into a reality.

Where We Need To Go

If we are to build on the successes of the last twenty years, we need to change course. The task ahead is no longer about defining the challenge; it is about meeting the challenge. We don’t need more roadmaps; we need to move faster towards the destination.

The path forward is fundamentally different than the one we have traveled over the past two decades. In the first decade after the original Earth Summit, the time when BSR was founded, the primary challenge was to raise awareness in the business community about why sustainability was a crucial and legitimate topic for the private sector. In the subsequent decade, energies were directed less to awareness raising, and more to the integration of social and environmental strategies into business strategy and operations. For the decade ahead, integration remains crucial. Companies have made great progress in the past two decades, and we have been proud to play a role in that. There is considerable room to go further, and we write about that elsewhere in this article.

But a new decade brings a new approach. More substantial progress, however, depends on change not only inside individual companies, but also within entire systems. The era of the hermetically sealed, vertically integrated company is long gone. Every business, in every part of the world, operates within a web of systems: economic, cultural, political, and natural. Every business in every part of the world relies on networks of suppliers, customers, and investors. Even the most innovative companies won’t capture the potential of their efforts if these systems disregard sustainability. And as much as we value best practices, we also know from the past two decades that even the most creative experiments and demonstration projects are not going to meet the scale of the challenge.

So the solutions we need to achieve our goals must also be systemic. A genuinely sustainable economy depends on four inter-related elements: (1) the operational systems in which companies act; (2) the markets that shape the way investments are made and value is defined; (3) the stakeholder world that holds great promise, and (4) the world of ever more empowered individuals and connected communities.

   •     Truly Integrated Business Models: Business decision-making does not currently integrate environmental, social, and governance (ESG) factors into investment calculations. Fifteen years after John Elkington popularized the triple bottom line, very few companies have actually integrated this model into their economic valuations. Whether or not financial markets change the game, there is an opportunity for companies to get smarter about the intangible assets that increasingly make or break their success. While some companies are experimenting with economic valuations that include elements like carbon, we have not yet seen widespread adoption of economic models that place a value on ecosystem services, community goodwill, or the risk of stranded assets. It is now widely agreed that these things have value; our task for the next decade is to get more precise about what the value is, and how to measure it. The Natural Capital Declaration that 57 companies signed at Rio+20 is a good start down this path.

   •     Financial Markets That Promote Long-Term Value: Despite the Great Recession, public markets focus as intensely as ever on short-term returns. Shares in publicly traded companies in the United States are held for an average of seven months, down from seven years two generations ago. Markets allocate capital with great effect, and the challenge ahead is to maintain the best aspects of market flexibility while reducing the relentless pressure of short-termism. Financial innovation, which was blamed for the crash in 2008, can also be parlayed into new mechanisms that help create long-term value. Integrated reporting, integration of non-financial risks and opportunities into definitions of fiduciary duty, the creation of “L shares” as proposed by Al Gore and David Blood, as well as other mechanisms will create a virtuous circle in which companies are rewarded for taking the long view, and investors are cushioned from the risks of excessive short-term thinking. And there is little doubt that there is also the need to restore trust in our financial system if the “real economy” is going to thrive.

   •     New Frontiers of Collaboration: The past 20 years introduced the concept of collaboration among companies and an increasingly powerful network of NGOs around the world. The next 20 years will see the lines between for-profit and not-for-profit organizations blur substantially. A world of dialogue between organizations defined by whether they are for-profit or non-profit may be drawing to a close. Can we imagine a world in which every enterprise is a social enterprise? A world in which every NGO thinks about market solutions to the world’s most pressing challenges? How will companies collaborate when every individual has a megaphone bigger than those available to the world’s biggest NGOs 20 years ago?

   •     The Empowered Individual: The next ten years will continue to put more and more information and autonomy into the hands of individuals and self-forming groups. The demise of business models relying on big businesses selling to passive mass audiences will accelerate. More and more information will be available to individuals. The “internet of things” and widespread sensors will make the invisible visible. Advances in biotechnology will provide quantum leaps in our understanding of how the world around us, and our choices as consumers and citizens, affects our health. These changes can – under the right circumstances – be a net positive for sustainability. And it is undeniably the case that companies will need to adapt to a world of truly radical transparency.

At BSR, we want to see a world with a truly inclusive economy that enables all people to meet their needs, shape their futures, and achieve their potential. We want to see a world that values and preserves natural resources so that future generations have the same – or better – opportunity to thrive. We see a world where economic health – for individuals and for nations and enterprises – is measured not by the quantity of consumption, but by the quality of life that economic activity delivers. And we want to see a world in which public policy and markets create the incentives and rules that make it possible for businesses that point in this direction to thrive. Companies that embrace this challenge will be the ones to achieve the greatest success…and the ones who create a world of which we can be proud.

The road ahead needs greater emphasis on systemic solutions like those I describe here. If real progress is made in these areas over the next twenty years, we will have done a great deal to accelerate… and will have more reasons to celebrate.

 

Article by Aron Cramer, President and CEO, Business for Social Responsibility (BSR) (www.bsr.org ). Mr. Cramer is recognized globally as an authority on corporate responsibility by leaders in business and NGOs as well as by his peers in the field. He advises senior executives at BSR’s nearly 300 member companies and other global businesses, and is regularly featured as a speaker at major events and in a range of media outlets. Under his leadership, BSR has doubled its staff and significantly expanded its global presence. Mr. Cramer is co-author of the book Sustainable Excellence: The Future of Business in a Fast-changing World, about the corporate responsibility strategies that drive business success. He joined BSR in 1995 as the founding director of its Business and Human Rights Program, and opened BSR’s Paris office in 2002, where he worked until assuming his current roles in 2004.

Previously he practiced law in San Francisco and worked as a journalist at ABC News in New York. He has expertise in integrating sustainability into business strategy, human rights policies and practices, and stakeholder engagement.

 

For more information go to- www.GreenMoney.com

 

==============

 

Looking Forward – Relevance Achieved

Wednesday, December 19, 2012 by

socially responsible investingLooking Forward – Relevance Achieved By Amy Domini, CFA, founder, Domini Social Investments ( Article from Fall 2012 - Special 20th Anniversary issue of GreenMoney Journal and  www.GreenMoney.com )

Looking forward ten, even twenty years, what will Socially Responsible Investing (SRI) have become? What will it have accomplished? What will the field look like? Today, I build a case for a good future. In a word, it will largely be marvelous.

Roughly 15 years ago, I spoke in Jackson Hole, Wyoming. It is a spectacular setting, one that makes a person proud to be in a great nation like ours, one that protects such places. Yet, as I reminded the audience that day, it had not been the public that had kept the Grand Tetons pristine. It was one man, John D. Rockefeller, who had purchased the land and given it to the nation.

This is the classic dilemma we in SRI struggle with every day. It is great that the Grand Tetons are a public treasure, but they became so on the backs of crushed labor forces, pollution and selfishness. One man made his money and then gave it away, but he set in motion the international oil industry, an industry that is robbing us of a climate, a future.

That day I challenged SRI to become relevant. Today, I can see clearly that it has. Over the next twenty years, the positions we have taken and the battles we have fought will lead to a universal understanding that what we have been saying, the way you invest matters, is absolutely correct. We will see our guiding principles integrated into the mainstream. We will be astonished at the acceptance and the impact that we have had.

How We Became Relevant - Performance Matters

Perhaps the most devastating argument we faced early on was the Modern Portfolio Theory (MPT). It argues that the previous “prudent man” idea of buying good stocks alone, created risk. Introduced in 1952 by Harry Markowitz, the original premise was simple: investors should focus on overall portfolio risk. Simply put, even if you love software, you still shouldn’t build an entire portfolio of software stocks. Astonishingly, this revelation won Mr. Markowitz a Nobel Prize in Economics and caused the entire financial services industry to argue that the individual risk characteristics of a company mattered little.

Against this backdrop, SRI seemed hopelessly old fashioned. We argue that each company, by virtue of the industry within which it operates, faces a series of risks that we label as risks to people or the planet. We then argue that taking too large a risk is not necessary and further, that it perpetuates an acceptance of these risks. Wall Street pundits stated with great authority, but with no basis, that our form of analysis flew in the face of Modern Portfolio Theory and so would fail. Our largest barrier was that, to use the vernacular, every smart person knew SRI was stupid.

The evidence proved otherwise. The MSCI KLD 400 Social Index has not only debunked the premise of MPT, but also shown that risk avoidance works. The index has outperformed -- and has done so with a lower standard deviation. Clearly, examining the risk of corporate behavior tells us something about a company that is useful to investors.

Why We Are Relevant – An Increase in Reporting

SRI practitioners have pushed for “extra-financial” data and have gotten it. At first, true comparative data on companies was extremely scarce in some areas of keen interest to the concerned investor. Any good researcher understands that the newspapers are a lousy place to start. The fact that we know that Apple sourced from Foxconn does not tell us what Hewlett Packard does. What is needed is data that is universally ascertainable, without the company answering a questionnaire (which allows them to self-define), and the data must be quantitative in nature, e.g. I don’t care as much about a statement that a company seeks diversity as I do about how many minorities have been hired.

Today, thousands of companies self-report. Whereas the one or two companies that issued Social Responsibility reports thirty years ago were real outliers, today it is so mainstream that Forbes magazine maintains a blog to follow them. Accounting giant PWC makes available the 2010 survey of CSR reporting on their website. The highlights: 81 percent of all companies have CSR information on their websites; 31 percent have these assured (or verified) by a third party. Their 2012 update contains examples of what to look for when writing (or reading) them.

Who was pushing for this disclosure? It wasn’t civil society, it wasn’t Wall Street; it wasn’t government. It was a loose confederation of concerned investors who consistently pushed for greater and more standardized “non-financial” information.

Why We Are Relevant – An Increase in Regulation to Disclose

Regulators are beginning to expand on the data corporations are required to disclose. Remember, there was no God-given definition of the right way to report financials to investors. In 1932, when reforms to protect investors began, regulators looked at some of the pre-existing methods and evaluated them. This led to audited annual reports on income statements and balance sheets. It led to quarterly unaudited reports. These had, in the past, come to be viewed as important in judging the financial soundness of a corporation.

However, the regulators did not stop with accounting issues. Given that the 1930s were a period of high unemployment, the number of company employees was considered important, and so its disclosure became mandated. There is no reason that more robust social and environmental reporting shouldn’t be in the financial reports. We already disclose a company’s hometown, without companies complaining of the inappropriateness and burden of so doing.

The Initiative for Responsible Investment at Harvard University maintains a database of Global CSR Disclosure requirements. In it we find 34 nations are taking steps. In 2009, Denmark, required companies to disclose CSR activities and use of environmental resources. In 2010, the United Kingdom required companies that use more than 6,000MWh per year to report on all emissions related to energy use. Malaysia, in 2007, required companies to publish CSR information on a "comply or explain" basis. Regulators, recognizing the societal costs of less than full cost accounting, are moving in to mandate disclosure.

Mainstreaming - With this solid base, here come the “big boys”

Conventional asset managers and the academic community have brought SRI to the mainstream. I began by saying the future for SRI is marvelous. Consider a world in which every major financial asset management firm demands that its staff study the social and environmental implications of the investments they make and bases recommendations upon it.

But this has already begun. Consider MEAG, the American portfolio management branch of Munich Re. Their team buys only publicly traded bonds which then back the insurance the firm issues. They use ESG criteria to give their research the edge and to avoid risk. When I met with their research team, I found that they use several of Domini’s Key Indicators. No, we don’t publish the indicators. It also was not a coincidence. The two firms independently discovered the same indicators to be telling because they both use the same logic in approaching the issues. Or there is UBS Investment Bank, where analysts specifically address the social, environmental or governance risks of a company they are recommending.

Finally, look at the all-important realm of academia, where MPT began. Just three recent examples are telling:

The Impact of a Corporate Culture of Sustainability on Corporate Behavior and Performance by Professors Robert Eccles and George Serafeim, Harvard Business School. “… we provide evidence that High Sustainability companies significantly outperform their counterparts over the long-term, both in terms of stock market and accounting performance. The outperformance is stronger in sectors where the customers are individual consumers, companies compete on the basis of brands and reputation, and in sectors where companies' products significantly depend upon extracting large amounts of natural resources.”

Corporate Social Responsibility and Access to Finance by Beiting Cheng, Harvard Business School, Ioannis Ioannou, London Business School, and George Serafeim, Harvard Business School. “Using a large cross-section of firms, we show that firms with better CSR performance face significantly lower capital constraints. The results are confirmed using an instrumental variables and a simultaneous equations approach. Finally, we find that the relation is primarily driven by social and environmental performance, rather than corporate governance.”

An FDA (Food and Drug Administration) for Financial Innovation: Applying the Insurable Interest Doctrine to Twenty-First Century Financial Markets, by Eric A. Posner and E. Glen Weyl, Law School, University of Chicago. “We propose that when firms invent new financial products, they be forbidden to sell them until they receive approval from a government agency designed along the lines of the FDA, which screens pharmaceutical innovations. The agency would approve financial products if they satisfy a test for social utility …”

The Next Twenty Years

This article limits its scope to only one leg of the SRI stool. It does not discuss the growth of shareholder activism, which is vibrant. Nor does it address the mainstreaming of selling products with narrow and specific social purpose, also a burgeoning field. Rather, by looking at the application of social criteria to an investable universe alone, we see that barriers have been removed, and that now both a mountain of money, and the force of government and academia, will work with us and introduce our goals into mainstream investment thinking.

We know we can make money, government is increasingly with us, and academia is swinging our way. Now, the rapid acceptance of more robust and integrated accounting has done away with the last barriers. This brings us the assets to have impact. As society sees the full cost of traditional business behavior, SRI will be embraced as the single most important lever towards building a better world than the planet has ever seen.

 

Article by Amy Domini, who has worked for decades to advocate that financial systems must be used to create a world of universal human dignity and ecological sustainability. She authored or co-authored several books. Her most recent, Socially Responsible Investing: Making a Difference and Making Money, was published by Dearborn Trade in 2001. She writes on the topic frequently. Her articles have appeared on the Huffington Post, the OECD Observer, GreenMoney Journal and the Journal of Investing. She is a regular columnist for Ode Magazine.

Time magazine named her to the “Time 100 list of the world’s most influential people” in 2005. President Clinton honored her at the inaugural meeting of the Clinton Global Initiative, citing her role in making socially responsible investing a global trend. The Dalai Lama, during a Town Meeting on Ethics, heard her presentation and urged his audience to give it credence.

Ms. Domini works with high net worth individuals at the Sustainability Group in Boston; she also founded Domini Social Investments, LLC ( www.domini.com ), a no-load mutual fund family for socially responsible investors. Between the two firms, she manages roughly $2 billion in assets, all invested with environmental and social objectives in mind.

She holds the Chartered Financial Analyst designation and received her B.A in International Economics from Boston University. In 2006, Ms. Domini was awarded an honorary Doctor of Business Administration from Northeastern University. In 2007, she received an honorary Doctor of Humane Letters from the Berkeley Divinity School at Yale. Ms. Domini is a past trustee of the Church Pension Board at the Episcopal Church (U.S.A.). Among others, she is also a past Board member of the Governing board of the Interfaith Center on Corporate Responsibility, the National Community Capital Association, and the Social Investment Forum.

 

For more information go to- www.GreenMoney.com

 

========

 

 

 

 

From Growth Capitalism to Sustainable Capitalism: The Next 20 years of Sustainable Investing

Monday, December 3, 2012 by

By Joe Keefe, President and CEO, Pax World Management  (From the special 20th Anniversary issue of the GreenMoney Journal and www.GreenMoney.com )

Twenty years from now, we will have either successfully transitioned from our current economic growth paradigm to a new model of Sustainable Capitalism or we will be suffering the calamitous consequences of our failure to do so. Likewise, sustainable investing will either remain a niche strategy or it will have supplanted mainstream investing. This is the critical point we must embrace: sustainable investing can no longer simply present itself as an alternative to traditional investment approaches that ignore environmental, social and governance (ESG) imperatives; it cannot simply be for some people; it must actually triumph over and displace traditional investing.  

The current model of global capitalism - call it growth capitalism - is premised upon perpetual economic growth that must ultimately invade all accessible habitat and consume all available resources.[Footnote 1] Growth capitalism must eventually collapse, and is in fact collapsing, for the simple reason that a finite planet cannot sustain infinite growth. Moreover, the dislocations associated with this infinite growth paradigm and its incipient demise - climate change, rising inequality and extreme poverty, resource scarcity (including food and water shortages), habitat loss and species extinctions, ever more frequent financial crises, to name just a few - will increasingly bedevil global policy makers in the years ahead. The public sector is already experiencing a high degree of dysfunction associated with its inability to confront a defining feature of this system: the need for perpetual growth in consumption spurs a corresponding growth in public and private debt to fuel that consumption, which has roiled financial markets and sovereign finances across the globe. 

Meanwhile, the environmental fallout from this infinite growth paradigm is becoming acute. All of earth’s natural systems – air, water, minerals, oil, forests and rainforests, soil, wetlands, fisheries, coral reefs, the oceans themselves – are in serious decline. Climate change is just one symptom. “The problem is the delusion that we can have infinite quantitative economic growth, that we can keep having more and more stuff, on a finite planet.”[FN 2] The problem is an economic system that makes no distinction between capital investments that destroy the environment, or worsen public health, or exacerbate economic inequality, and those that are aligned with earth’s natural systems while promoting the general welfare. Under growth capitalism, a dollar of output is a dollar of output, regardless of its side effects; short-term profit is valued regardless of the long-term consequences or externalities. 

It is therefore discouraging that, in the U.S. at least, there is no serious discussion in mainstream policy circles about alternatives to the present system. Nor do I think there will be for some time given our current political/cultural drift. Political and economic elites, and the public itself, remain committed to growth capitalism, accustomed to “having more and more stuff,” for a host of economic, social and psychological reasons. As Jeremy Grantham has written, “[t]he problems of compounding growth in the face of finite resources are not easily understood by optimistic, short-term-oriented, and relatively innumerate humans (especially the political variety).”[FN 3] Our campaign finance system, wherein policy makers are essentially bought off by and incentivized to advance the very interests that stand to profit most from the current system, is no help. Making matters worse, large segments of the public do not even accept what science teaches us about climate change, or natural systems, or evolution, or a host of other pressing realities. The late U.S. Senator Daniel Patrick Moynihan once said that everyone is entitled to their own opinion but not their own facts. Today, it seems that a growing number of people, aided and abetted by special interests that stand to benefit from public ignorance, are increasingly opting for their own “facts.”

So, neither the public sector nor corporate and economic elites, as a result of some newfound enlightenment, seem poised to consider alternatives to the current system. To the contrary, their first impulse will be to resist any such efforts. This is the critical problem at the moment: while there is an array of powerful forces aligned against the type of sweeping, systemic change that is needed, there is no organized constituency for it. There are individuals and groups who support this or that reform, or who are focused on critical pieces of the larger puzzle (e.g., climate change, sustainable food & agriculture, gender equality, sustainable investing), but there is no movement, no political party or leader, no policy agenda to connect the dots.

That is a shame because there is a clear alternative to growth capitalism that has been articulated in recent years by a diverse body of economists, ecologists, scientists and other leading thinkers - including leaders in the sustainable investment community.[FN 4]

Although there is as of yet no unified theory or common language, let alone any sort of organized movement to speak of, what has emerged is essentially a unified vision, and that vision might best be described as Sustainable Capitalism.[FN 5]

Sustainable Capitalism may be thought of as a market system where the quality of output replaces the quantity of output as the measure of economic well-being. Sustainable Capitalism “explicitly integrates environmental, social and governance (ESG) factors into strategy, the measurement of outputs and the assessment of both risks and opportunities…. encourages us to generate financial returns in a long-term and responsible manner, and calls for internalizing negative externalities through appropriate pricing.”[FN 6] Essentially, business corporations and markets alter their focus from maximizing short-term profit to maximizing long-term value, and long-term value expressly includes the societal benefits associated with or derived from economic activity. The connections between economic output and ecological/societal health are no longer obscured but are expressly linked.[FN 7]

There is no question that growth capitalism must give way to Sustainable Capitalism. It’s as simple, and as urgent, as that. Over the next 20 years, the sustainable investing industry must play a pivotal leadership role in ushering in this historic transformation. We will need to connect the dots and catalyze the movement. Why us? For the simple reason that finance is where the battle must be joined. It is the financial system that determines how and where capital is invested, what is valued and not valued, priced and not priced. The sustainable investment community’s role is vital because the fundamental struggle is between a long-term perspective that fully integrates ESG factors into economic and investment decisions and our current paradigm which is increasingly organized around short-term trading gains as the primary driver of capital investment and economic growth regardless of consequences/externalities.

The notion that sustainable investing can simply keep to its current trajectory - a few more assets under management here, a few more successful shareholder resolutions there, a few more GRI reports issued, another UN conference, an occasional victory at the SEC - and achieve what needs to be achieved on the scale required is, frankly, untenable. We need to be more ambitious in our agenda.

We will also need to take a more critical stance, not only advocating for ESG integration but against economic and investment approaches that ignore ESG concerns. We will need to consistently critique the notion that externalities associated with economic output are somehow collateral, or that financial return is sufficient without beneficial societal returns, or that markets are inherently efficient and self-correcting. We will need to unabashedly offer sustainable investing not as an alternative approach but as a better approach - as the only sensible, responsible way to invest.

I believe the sustainable investing industry will also need to align itself with a more explicit public policy agenda - while remaining non-partisan - and work with like-minded reformers to advocate for that agenda. For example, sustainable investors should be sounding the alarm about resource scarcity and advocating for a massive public/private investment plan in clean energy, efficiency technologies and modernized infrastructure.[FN 8] The age of resource scarcity and the need for efficiency solutions is upon us.[FN 9] At Pax World, we offer a fund - the Global Environmental Markets Fund (formerly the Global Green Fund) - whose investment focus is precisely that. Our industry needs to fashion such investment solutions, and I believe there will be opportunities to do so collaboratively as well as competitively.

I also feel strongly that the greatest impediment to sustainable development across the globe is gender inequality. Advancing and empowering women and girls is not only a moral imperative but can unleash enormous potential that is now locked up in our patriarchal global economy. Sustainable investors need to press the case that gender equality needs to be a pillar of Sustainable Capitalism. At Pax World, we also have a fund - the Global Women’s Equality Fund - whose investment focus is exactly that.

In my view, the sustainable investing community should also be advocating for public funding of federal elections, either through a constitutional amendment or, absent an amendment, through a voluntary public funding system. The notion that we can tackle any major public policy issue, let alone undertake the epochal transition to Sustainable Capitalism, while politicians and regulators are captive to the very interests they are supposed to regulate, is beyond naïve. We will not be able to reform capitalism if we cannot reform Congress. 

Finally, asset management firms like my own will need to find ways to craft new, more persuasive messages, launch new products, form new partnerships, and fashion new distribution strategies and alliances that are focused on lifting the industry as a whole, because a rising tide will lift all boats. Pax World has taken a step in this direction in launching our ESG Managers Portfolios, where many ESG managers and strategies are now available under one roof in one set of asset allocation funds. There is more to be done - together, as an industry. 

The times call for leadership. The transition to Sustainable Capitalism is necessary and urgent, as is the triumph of sustainable investing over investment approaches that effectively prolong and exacerbate the current crisis. Twenty years from now, our industry will be judged by whether we have met this burden of leadership. Our impact either will be dramatic or inconsequential. We either will succeed or we will fail. We should resolve to succeed, and to work collaboratively toward that end. 

 

Article by Joe Keefe, President & CEO of Pax World Management, headquartered in Portsmouth, NH. Pax World manages approximately $2.5 billion in assets, including mutual funds, asset allocation funds and ETFs, all of which follow a sustainable investing approach. Prior to joining Pax World, Joe was President of NewCircle Communications (2000-2005), served as Senior Adviser for Strategic Social Policy at Calvert Group (2003 – 2005), and was Executive Vice President and General Counsel of Citizens Advisers (1997-2000). A former member of the board of US SIF (2000 - 2005), Joe was named by Ethisphere Magazine as one of the “100 Most Influential People in Business Ethics” for 2007, 2008 and 2011, and in 2012 was recognized by Women’s eNews a one of “21 Leaders for the 21st Century, where he was the sole male honoree. 

You should consider a fund's investment objectives, risks and charges and expenses carefully before investing. For this and other important information, please obtain a fund prospectus by calling 800.767.1729 or visiting www.paxworld.com . Please read it carefully before investing.

Equity investments are subject to market fluctuations, a fund’s share price can fall because of weakness in the broad market, a particular industry, or specific holdings. Emerging market and international investments involve risk of capital loss from unfavorable fluctuations in currency values, differences in generally accepted accounting principles, economic or political instability in other nations or increased volatility and lower trading volume.

Distributed by ALPS Distributors, Inc., Member: FINRA            PAX002590 08/13

Footnotes:

[1] See, William E. Rees, “Toward a Sustainable World Economy,” Paper delivered at Institute for New Economic Thinking Annual Conference, Bretton Woods, NH, April 2011, p. 4.

[2] Paul Gilding, The Great Disruption, Bloomsbury Press, 2011, p. 186.

[3] Jeremy Grantham, “Time to Wake Up: Days of Abundant Resources and Falling Prices Are Over Forever,” April 2011 GMO Quarterly Letter.

[4] I am thinking of such writers and thinkers as Wendell Berry, Lester Brown, Paul Gilding, Herman Daly, Thomas Friedman, Paul Hawken, Richard Heinberg, Mark Hertsgaard, Amory Lovins, Hunter Lovins, Bill McKibben, Donella Meadows, Jorgen Randers & Dennis Meadows, James Gustave Speth and, of course, E.F. Schumacher. Contributions from the sustainable investing community include Steven Lydenberg’s Corporations and The Public Interest, Robert Monks’s The New Global Investors, Marjorie Kelly’s The Divine Right of Capital, and The New Capitalists by Stephen Davis, Jon Lukomnik & David Pitt-Watson. See also the work of The Capital Institute, www.capitalinstitute.org

[5] Credit Al Gore, David Blood, Peter Wright and the folks at Generation Investment Management for putting a stake in the ground and endeavoring to define and popularize this concept.

[6] “Sustainable Capitalism,” Generation Investment Management LLP, 2012, p. 2.

[7] This notion of Sustainable Capitalism is not unlike the concept of “shared value” s advanced by Michael E. Porter and Mark E. Kramer. See, “Creating Shared Value,” Harvard Business Review, Jan-Feb 2011.

[8] See Daniel Alpert, Robert Hockett & Nouriel Roubini, “The Way Forward: Moving From the Post-Bubble, Post-Bust Economy to Renewed Growth and Competitiveness,” © 2011, New America Foundation, www.newamerica.net

[9] See Jeremy Grantham, “Time to Wake Up: Days of Abundant Resources and Falling Prices Are Over Forever,” supra; See also, “Resource Scarcity and The Efficiency Revolution,” Impax Asset Management, www.impaxam.com

 

For more information go to- www.GreenMoney.com

 

=======

Making Sense of the FTC Revised Green Guidelines

Wednesday, October 31, 2012 by

It only took them 20 years (The first Guides were issued in 1992), but then again, as the saying goes, every overnight sensation is twenty years in the making. Maybe the FTC Green Guide staff put in their 10,000 hours, but, at last, they nailed it. The revisions to the Green Guides, published on October 1, 2012, shows that the FTC is finally putting their foot down (both of them) about the term 'green', along with such related generalized environmental claims as 'eco-friendly' and 'Earth smart'.

While they are at it, they're advising against the use of any label, logo, seal or product name or image -- what I like to call 'daisies, babies or planets' --  that can imply any hint of environmental (or health) superiority without adequate scientific support. Because chances are such claims are nearly impossible to support, the risk-adverse will stay far away from suggesting same.

And just in time, too. Interest in green claims continues to swell despite tough economic times. As global population climbs to an unimaginable 9 billion by 2050, we'll no doubt find many more ways  for consumers to 'go green', with accompanying eco-language to boot (Will "Mars friendly" be next?) But for now, we're all still here. So hopefully there's still time to clean up the green marketing business so we can one day harvest the potential to lighten consumers' size-18 planetary footprint.

The lawyers at the FTC did what 'greening' requires everyone to do — to think holistically, acknowledging the need to back up environmental marketing claims with life cycle assessments. They obviously consulted with some smart ecologists and biologists because the revised Green Guides demonstrate a sophisticated understanding of sound science. The Guides don't explicitly state the science, but for us laymen, here's a quick crib sheet that can help you understand why they're saying what they're saying:

There's no such thing as a green product. Every product uses resources and energy and creates waste.
One attribute does not a green product make.  An Energy Star certified compact fluorescent light bulb has a tinge of mercury (and as such require a hazardous waste permit to landfill in quantities of five or more.) Organic strawberries grown in California and eaten in New York are responsible for creating so many greenhouse gases on the trip cross country we might as well eat berries conventionally grown in New Jersey. Paper made from sustainably-certified wood still needs to be bleached and / or otherwise processed with dangerous chemicals and shipped to Staples.

Should CFLs not be Energy Star qualified? Should strawberries destined to hit the road not be labeled organic? Should paper that's on its way to be bleached not be described as 'sustainable'? Definitely not! Let's simply be more specific, as FTC recommends, and not suggest they are totally 'green'. (More on this below.)

100% recycled content can be less 'green' than 10% recycled content.  Depending upon the nature of the recycled content and how far it must be shipped to a recycling center, environmental costs of shipping and other impacts can actually make a recycled product less 'green' than a virgin counterpart.
Natural is not necessarily green or more healthful. Arsenic is naturally occurring.

Sustainable is a moving target. Corn may be in plentiful supply today and able to be regrown year after year, but when water supplies wane, it may not be so 'sustainable' to continue to grow it, no matter how fast or how economically it can be converted into bio-plastics and biofuel.

So, green is a relative, rather than absolute, measure. The best way to determine relative greenness is a bona fide life cycle assessment covering all facets of a product's environmental impacts, from raw materials procurement straight through to disposal. This is duly acknowledged in the latest installment of the FTC Green Guides.

We are the next endangered species on the planet. The planet is not at risk, we are. (Yet another reason not to include images of planets in one's advertising or to make grandiose claims about saving it.) This is not a political issue, but an issue of our future, and particularly those of our kids' and their kids.

So it's incumbent upon every marketer, manufacturer, retailer, producer, and everyone else in the supply chain and their stakeholders to understand not just these Guidelines and ideally their scientific underpinnings, but to do what we can to make all green marketing work as it's supposed to.
We in industry -- and concerned consumers, too -- should get on the case of questionable green claims. In their infinite wisdom and thoroughness, the FTC provides lots of helpful information for marketers and to the public to make the process of reporting such claims easy. (The National Advertising Division of the Better Business Bureau can help too.)

Green marketing is just good marketing. As I've been saying for a while now -- and it is admittedly counter-intuitive, the best green marketing doesn't lead with a product's 'greenness'. The good news about many green(er) products these days is that, thanks to advances in design, materials and technology, they offer superior delivery on the primary benefits that consumers buy products for. So why not focus on those things instead of altruism and planets that don't need to be saved?

At a minimum, consider that environmental marketing, reflecting the planet itself, encompasses so many potential product-related attributes, organic, VOC, recycled, biodegradable, among them, as to render the term 'green' meaningless. Rather than confuse, even deceive, consumers intentionally or unintentionally with messages about 'eco-friendliness' and 'natural' (which in their infinite wisdom, the FTC refused to define) why not hone in on those green-oriented terms that a now mass market seeks via all its segmentary splendor: 'energy efficient', 'organically grown', 'water efficient', 'recyclable', among them, and render your marketing both relevant, targeted, and credible? (FTC would love you for being specific.)
Moreover, let's link those same 'green' attributes to the benefits they deliver to consumers. For instance, let's tout all things 'water efficient' as 'cost effective', and 'fuel efficient' as 'convenient (fewer fill-ups and the ability to drive in the HOV lane).

Does this mean we should not talk about 'the environment' at all?  Not in the least!  Consumers still want specific, well-documented and genuinely helpful environment-related information -- so let's include them in our marketing messages in its secondary or tertiary place in line with its importance on our customer's shopping list.

All of us environmental types like to talk about how, 'if we do our jobs right we'll put ourselves out of business'. Well, before we get run out of town for more greenwash and hogwash by a now enlightened FTC (and the Enforcement Division that stands ready to pounce) let's agree to put ourselves out of the 'save the planet' business and into the business of saving our customers some money, time, etc. in an environmentally sound way -- and make our marketing more legitimately green for our bottom lines, rather than our faces red with shame.

Jacquelyn Ottman is principal and founder of the New York City-based J. Ottman Consulting, expert advisers on green marketing to Fortune 500 sustainability leaders as well as several U.S. government labeling programs. The author of four books on the subject, her latest is The New Rules of Green Marketing: Strategies, Tools, and Inspiration for Sustainable Branding (Berrett-Koehler, February 2011).

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com


 

LOHAS Forum 2012: NativeEnergy Releases CO2 Report

Friday, October 5, 2012 by

>> Download the 2012 LOHAS Forum CO2 Report

The annual LOHAS conference is one that I look forward to. LOHAS is an acronym for lifestyles of health and sustainability. It refers to the substantial market for products and services, ethically delivered, for consumers especially concerned about wellness and corporate responsibility. It is the market at “the Intersection of Personal and Planetary Heath,” as Gwynne Rogers of the Natural Marketing Institute put it.

LOHAS attracts the friendliest assemblage of conferees I have encountered. Perhaps it is all the yoga and healthy eating that makes attendees so cordial. Perhaps it is their determination to make the world a better place. Often when people advocate “change,” what they mean is the other guy should change. At LOHAS, the notion of change is often aimed at oneself.

LOHAS features talented business leaders like Kevin Rutherford, CEO of Mrs. Meyers, and Kim Coupounas, co-founder of GoLite, sharing insights. Douglas Gayeton, author of the Lexicon of Sustainability, is using the power of words to “activate change and transform societies.” His vehicles include billboards, social media, pop up shows, and PBS short films.

And this year, as in previous years, marketing experts, like Suzanne Shelton of the Shelton Group, dissected the “green market” and offered useful counsel on how to attack it. For example, inspire don’t educate. Don’t make the problem seem so big an individual can’t do something about it.

Personal conviction is the trump card at LOHAS, and it this seems to explains the abounding goodwill at the conference.

The conference was held in Boulder, Colorado, which is one of those supremely livable small cities and thus an appealing destination. We were there just before the forest fires arrived. The Mountain West is dry country and, to my thinking, increasingly vulnerable to climate change.

This year, as in previous years, NativeEnergy was the carbon offset sponsor, providing offsets from our signature Help Build™ projects to balance the greenhouse gas pollution from conference-related travel, lodging, and operations.

>> Download the 2012 LOHAS Forum CO2 Report

 

About NativeEnergy
NativeEnergy is an expert provider of carbon offsets, renewable energy credits, and carbon accounting software. With NativeEnergy’s Help Build™ offsets, businesses and individuals can help finance the construction of wind, biogas, solar, and other carbon reduction projects with strong social and environmental benefits. Since 2000, NativeEnergy’s customers have helped build over 50 projects, reducing more than 2.5 million tons of greenhouse gases, and the company has over 4 million tons under contract. All NativeEnergy carbon offsets undergo third-party validation and verification. Learn more at www.nativeenergy.com.

What Green Consumer Polls Should Really Be Asking

Monday, June 11, 2012 by

Ever since the resurgence of environmentalism in 1990, consumer polls have attempted to measure awareness, attitudes and behaviors towards environmental issues and products. Poll after poll has found that consumers claim to be concerned about the issues, they report high levels of green product purchase, and even claim willingness to pay a premium for greener products and packages.

But empirical evidence doesn’t seem to jibe with the research. In some markets, green products barely eke out 3% share, in contrast to the near majorities of consumers who express to pollsters interest in all things green. And despite consumer pronouncements otherwise, premium-priced green brands often gather dust on shelves. 

What can explain the gap between the polls and actual in-market performance? Are consumers lying to pollsters in an attempt to look virtuous?  Is the spirit willing but the pocketbook weak?  Or is it possible that we ourselves need to change the way we view the green consumer market — and ask different questions?  I suspect the latter.

What is “green” — exactly?

One of the biggest challenges in defining “green”, whether it be consumers, products or ads, is that “green,” like the planet itself, encompasses everything — air, water, biological life, chemicals, energy, you name it. 

When it comes to zeroing in on “green” products, what constitutes “green” can run the entire gamut of one or more attributes spanning a product’s lifecycle starting with raw materials (“sustainably harvested”, “organic” and “recycled”), right through to disposal  (“compostable”, “recyclable,”) — and everything in between. 

And most consumers can be said to be “green” in some way. For instance, NMI’s 2011 US LOHAS Consumers Trends poll found that 83% — an overwhelming majority of consumers — said they identified with green at some level.  (Who wouldn’t be for green?).

So when majorities of consumers say they are concerned about environmental issues and express interest in buying green products and recycling their newspapers and bottles, chances are they are telling the truth. 

Consumers may think they are actually greener than we give them credit for.

Is it possible that polls may overstate green consumer purchasing and behavior because consumers think that some of the conventional products they buy are actually green? 

Consider the language on the back of bottle of Tide. Every bottle of Tide, and many other big laundry detergent brands, too, now carries a recycling label and these messages:  “Bottle made from 25% or more post-consumer plastic,” “Contains no phosphates,” “Ingredients include biodegradable surfactants (anionic and nonionic) and enzymes.”  This all sounds pretty green to me!   

Even without such language, is it possible that consumers may believe that trusted brands from reputable companies are “green” —or that the government is watching out?

Do greener products need to scream green via eco-logos and images of planets, babies and daisies to merit a check mark in the “green” column?   Consider, too that white vinegar and baking soda have long been touted as green cleaning aids but don’t sport eco-logos of any stripe.

There may not even be such as thing as “green” marketing.

When the FTC Green Guides are issued in revised form (likely this year), what are referred to as “generalized environmental claims” will most likely be discouraged.  So “green” marketing is really an umbrella term for educating consumers about the various specific environmental benefits and attributes of one’s products or company.  Babies, planets and daisies are quickly disappearing from the vernacular and in their place are claims for particular environmental attributes.

So the answers to the $64,000 dollar questions of green marketing:  Who is the “green” consumer and will she pay a premium for green? Maybe that all  (or, okay, most ) consumers are green consumers since most consumers may think they are already buying green products, however they may define them.  And the extent to which they are willing to pay a premium may be no different for “green” than other products and that is: Do they provide value?

The Path Forward

What we seem to be dealing with, then, is a question of semantics, and the challenge of knowing which questions to ask to help us understand green market opportunities.  “Green” is a cozy, easy to remember term, but it may not be so useful in communicating with consumers who likely have their own interpretations of  ”green” expressed throughout their day-to-day lives.  And misleading polls results don’t help to build credibility for investment among skeptical businesspeople who for the past 20-plus years have been hearing that consumers “don’t care” and “won’t pay a premium”.

To those willing to take a shot at rebuilding interest and credibility in all things “green”, remember three important things: 1) Most consumers want to do the right thing. They want clean air and clean water, healthful food to eat, litter-free parks and beaches to play in, and energy to run their lives; 2) Whether it be keeping their bathtub clean, saving for retirement, driving the speed limit or eating healthfully, all consumers tend to overstate virtuous behavior to pollsters. (More than we would like, they report the person they aspire to be, or who they are just part of the time. ) And; 3) just like for all products, most consumers will only pay a premium when products demonstrate genuine added value.

Although it might take a little doing, most consumers have the wherewithal to understand the building blocks of “green”, e.g., “recycled”, “recyclable” and “biodegradable”.  Happily, businesses have the wherewithal to address consumers’ needs and to do it sustainably. Their motivations: a competitive advantage, profits, brand loyalty, motivated employees, the ability to innovate, and the promise of a business that will be sustained over time.

My book, The New Rules of Green Marketing  (LINK: http://www.greenmarketing.com/our-book ) includes detailed strategies and tools for businesses looking to positively address consumers’ environmental consciousness without fear of backlash.  On the top of the list, is the need for customized research to understand one’s own consumers’ attitudes and awareness of specific environmental attributes, including carefully segmenting the marketplace, and marketing one’s products accordingly.

 

Considered the nation's foremost expert on green marketing, Ottman is also a sought-after speaker and author of four books on green marketing. Her latest book is The New Rules of Green Marketing: Strategies, Tools, and Inspiration for Sustainable Branding (Berrett-Koehler, 2011). It is being hailed as "The New Green Marketing Bible" and "a must read for all marketers." Link here   (LINK:  http://www.greenmarketing.com ) for more information.

What Green Consumer Polls Should Really Be Asking

Tuesday, May 8, 2012 by

Ever since the resurgence of environmentalism in 1990, consumer polls have attempted to measure awareness, attitudes and behaviors towards environmental issues and products. Poll after poll has found that consumers claim to be concerned about the issues, they report high levels of green product purchase, and even claim willingness to pay a premium for greener products and packages.

But empirical evidence doesn’t seem to jibe with the research. In some markets, green products barely eke out 3% share, in contrast to the near majorities of consumers who express to pollsters interest in all things green. And despite consumer pronouncements otherwise, premium-priced green brands often gather dust on shelves. 

What can explain the gap between the polls and actual in-market performance? Are consumers lying to pollsters in an attempt to look virtuous?  Is the spirit willing but the pocketbook weak?  Or is it possible that we ourselves need to change the way we view the green consumer market — and ask different questions?  I suspect the latter.

What is “green” — exactly?
One of the biggest challenges in defining “green”, whether it be consumers, products or ads, is that “green,” like the planet itself, encompasses everything — air, water, biological life, chemicals, energy, you name it. 

When it comes to zeroing in on “green” products, what constitutes “green” can run the entire gamut of one or more attributes spanning a product’s lifecycle starting with raw materials (“sustainably harvested”, “organic” and “recycled”), right through to disposal  (“compostable”, “recyclable,”) — and everything in between. 

And most consumers can be said to be “green” in some way. For instance, NMI’s 2011 US LOHAS Consumers Trends poll found that 83% — an overwhelming majority of consumers — said they identified with green at some level.  (Who wouldn’t be for green?).

So when majorities of consumers say they are concerned about environmental issues and express interest in buying green products and recycling their newspapers and bottles, chances are they are telling the truth. 

Consumers may think they are actually greener than we give them credit for.
Is it possible that polls may overstate green consumer purchasing and behavior because consumers think that some of the conventional products they buy are actually green? 

Consider the language on the back of bottle of Tide. Every bottle of Tide, and many other big laundry detergent brands, too, now carries a recycling label and these messages:  “Bottle made from 25% or more post-consumer plastic,” “Contains no phosphates,” “Ingredients include biodegradable surfactants (anionic and nonionic) and enzymes.”  This all sounds pretty green to me!   

Even without such language, is it possible that consumers may believe that trusted brands from reputable companies are “green” —or that the government is watching out?

Do greener products need to scream green via eco-logos and images of planets, babies and daisies to merit a check mark in the “green” column?   Consider, too that white vinegar and baking soda have long been touted as green cleaning aids but don’t sport eco-logos of any stripe.

There may not even be such as thing as “green” marketing.
When the FTC Green Guides are issued in revised form (likely this year), what are referred to as “generalized environmental claims” will most likely be discouraged.  So “green” marketing is really an umbrella term for educating consumers about the various specific environmental benefits and attributes of one’s products or company.  Babies, planets and daisies are quickly disappearing from the vernacular and in their place are claims for particular environmental attributes.

So the answers to the $64,000 dollar questions of green marketing:  Who is the “green” consumer and will she pay a premium for green? Maybe that all  (or, okay, most ) consumers are green consumers since most consumers may think they are already buying green products, however they may define them.  And the extent to which they are willing to pay a premium may be no different for “green” than other products and that is: Do they provide value?

The Path Forward
What we seem to be dealing with, then, is a question of semantics, and the challenge of knowing which questions to ask to help us understand green market opportunities.  “Green” is a cozy, easy to remember term, but it may not be so useful in communicating with consumers who likely have their own interpretations of  ”green” expressed throughout their day-to-day lives.  And misleading polls results don’t help to build credibility for investment among skeptical businesspeople who for the past 20-plus years have been hearing that consumers “don’t care” and “won’t pay a premium”.

To those willing to take a shot at rebuilding interest and credibility in all things “green”, remember three important things: 1) Most consumers want to do the right thing. They want clean air and clean water, healthful food to eat, litter-free parks and beaches to play in, and energy to run their lives; 2) Whether it be keeping their bathtub clean, saving for retirement, driving the speed limit or eating healthfully, all consumers tend to overstate virtuous behavior to pollsters. (More than we would like, they report the person they aspire to be, or who they are just part of the time. ) And; 3) just like for all products, most consumers will only pay a premium when products demonstrate genuine added value.

Although it might take a little doing, most consumers have the wherewithal to understand the building blocks of “green”, e.g., “recycled”, “recyclable” and “biodegradable”.  Happily, businesses have the wherewithal to address consumers’ needs and to do it sustainably. Their motivations: a competitive advantage, profits, brand loyalty, motivated employees, the ability to innovate, and the promise of a business that will be sustained over time.

My book, The New Rules of Green Marketing includes detailed strategies and tools for businesses looking to positively address consumers’ environmental consciousness without fear of backlash.  On the top of the list, is the need for customized research to understand one’s own consumers’ attitudes and awareness of specific environmental attributes, including carefully segmenting the marketplace, and marketing one’s products accordingly.

 

Considered the nation's foremost expert on green marketing, Ottman is also a sought-after speaker and author of four books on green marketing. Her latest book is The New Rules of Green Marketing: Strategies, Tools, and Inspiration for Sustainable Branding (Berrett-Koehler, 2011). It is being hailed as "The New Green Marketing Bible" and "a must read for all marketers." Link here for more information.

Fair Trade USA's 2011 Almanac Shows Impressive Growth in Imports

Sunday, May 6, 2012 by


Fair Trade USA recently published its 2011 Fair Trade Almanac: a compliation of data that the organization's certification department collects from both business partners and producer organizations. The report serves as a key indicator for the health and growth of Fair Trade in the United States.

The 2011 edition showcases monumental growth in Fair Trade Certified™ imports, record-breaking community development premiums, and Fair Trade USA’s reinvigorated efforts to strengthen producer organizations through a variety of new cooperative development programs. This parallels significant increase in consumer awareness, which has quadrupled in the past 5 years.
 

Continuous Growth in Fair Trade Certified Imports
Thanks to conscious consumers across the United States, and more than 800 committed companies, Fair Trade Certified products are now available in virtually every major supermarket in America as well as thousands of restaurants, cafeterias and cafes (nearly 100,000 retail locations).  In fact, in 2011 the vast majority of food categories showed impressive growth, including:  Coffee (32%), Cocoa (156%), Tea (22%), and Sugar (31%).

Here are some exciting highlights from the 2011 Fair Trade Almanac:

fair trade coffeeCoffee
In 2011, Fair Trade USA certified a record 138 million pounds of Fair Trade Coffee from 22 different countries around the world, 52 percent of which were also certified organic. In total, coffee imports were up 32% versus 2010, resulting in almost $17 million in Fair Trade coffee premiums paid to producer organizations, a new record for Fair Trade premium returns in one year. The money generated by the surge in consumer demand for ethically and sustainably sourced products is invested into farming businesses to build infrastructure and capacity, as well as into farming communities for schools, roads, health care and other development efforts.

Produce
2011 showcased growth across nearly every country. Notably, 2011 marked the first time that Fair Trade Certified bell peppers, cucumbers and bananas from Mexico were imported into the United States. One of the most outstanding trends within the produce category during 2011 was continued growth of organic imports, up 64% over 2010.

Co-op Link
In addition to what farmers earned in both sales and community-development premiums, since 2006 Fair Trade USA and its partners have invested over $7.4 million in programs to strengthen small-scale farming communities in projects spanning sugar, cocoa, produce, tea and coffee.  Building on this deep history of development work, in 2011 the organization took an invigorated new approach, called Co-op Link.  Fair Trade USA surveyed farmers to better understand their most pressing needs, raised $5 million in 2011 alone for programs to address these needs, and worked with NGO’s and local service providers to execute programs.

Sustainability Trends for 2012: energy, water and employee engagement

Friday, April 27, 2012 by

Energy EfficiencyA quick review of sustainability trends reported on the internet shows (not surprisingly) that energy will stay a high priority. The focus is on alternative energy, energy efficiency  and solar energy. Within the green building movement, retrofitting buildings for sustainability is gaining momentum.

This poses a huge market opportunity for businesses. However, it helps if (local) governments create the environment that is beneficial for investing in clean energy. For rapid introduction of new technologies a so called ‘innovation system’- the needs to be in place. Innovation systems are networks of organizations that work together on diffusing new technologies. They are facilitated through entrepreneurial activity, knowledge development through collaboration with educational institutions, and knowledge diffusion through networks such as accelerators and business platforms. Governments can play pivotal roles in facilitating innovation systems.

A more recent trend is concern over water issues. Many places in the world don’t have access to enough water to meet agricultural, urban and industrial water needs. Large areas deal with droughts, and disruptive weather patterns caused by climate change  aggravate these issues.

Though this is important for business, especially in the food industry, it is even more important to governments. Water supplies are directly related to energy and food needs. The repercussions of water shortages in combination with an exploding world population cannot be underestimated – and may lead to water wars. Meriting this issue to be dealt with from a diplomatic point of view. For example: it is for a good reason that China does not want to leave Tibet: the country is the source of all the rivers in the region.

Thirdly, employee engagement is finally on the corporate agenda. Which is great, because the social side of the triple bottom line often gets little attention.  I often wonder why we have so few very successful cases for sustainability. In my opinion, engagement is the missing link – you can’t just roll out policies, or change light bulbs. Sustainability becomes a part of the organization when employees are engaged in the subject. Luckily for us, there is a strong business case for engagement, and links to sustainability within a company

LOHAS Asia – A Growing LOHAS Development

Tuesday, March 6, 2012 by

Last week marked the first LOHAS Asia conference inspired and designed off of the LOHAS Forum. The event was held in Singapore and brought in a modest but enthusiastic crowd of 200 business people from Malaysia, Japan, Sri Lanka, India, Indonesia and China. I was fortunate to keynote and experience the excitement of the event first hand and was very impressed. I have been to many Asian conferences and they tend to be a mixed bag. Often events done by  Asian trade associations tend to be lecture style in format and seldom provide any interaction with the audience. Language barriers also add an extra challenge when discussing complex concepts. However this event was very different in design and style and extremely refreshing. In Singapore people speak English and have adopted western styles of thinking. Adam Horler, president of LOHAS Asia designed an interactive program that brought in high power speakers representing companies like Google and Six Senses Resorts as well as others who were local green specialists. LOHAS Asia and LOHAS USA are affiliate groups that work together to promote LOHAS awareness in both regions of the globe. LOHAS Asia has representatives in various countries in  Asia ranging from Japan and China to Thailand and Malaysia. Each contributes time to promote LOHAS Asia initatives in the region as well as maintain relations with LOHAS USA.


The sessions presented were a mix of green values, branding strategy, trends, design and LOHAS entrepreneurial initiatives that were informative and inspiring. Bobby Paterson, a former Scottish professional soccer player, introduced his Happiest app that helps measure a person’s happiness and provide rewards. Matthias Gelber, winner of the Greenest Person on the planet award by 3rdwhale in 2009 and Malysian resident, spoke passionately on the need to be aware of our actions and make changes in our lives for the planet. Another spoke on successful branding strategies that LOHAS companies could learn from. The most fascinating for me was Amena Lee Schlaikjer's talk on how LOHAS is entering the Chinese market and how it is positioned to provide access to stress-free living. With pollution, food scares, straining work force and cultural pressures pressing upon Chinese it makes sense that LOHAS can offer a path to a simpler and cleaner way of life.
 

me presenting at LOHAS AsiaLOHAS Asia is designed around the LOHAS HUB Directory. The directory is free for companies to sign up however companies must take a pledge to integrate LOHAS principles or provide an initiative which they are to report on one year after registering. Once in the HUB companies can interact with each other and network. Consumers can search companies by country to find local companies that are pre-vetted. Not all companies who apply are accepted. This is all nice but the key element is that the HUB is a resource for Asian based investors interested in funding LOHAS startups. There is a tremendous amount of VC and angel capital that is ready to be injected with the caveat being that they must be a LOHAS company that is listed in the HUB. The LOHAS Asia team will present companies to investors. Those start up companies receiving funding will also go through a start up boot camp that will  be provided by Proctor & Gamble. Google will also provide a suite of tools and trainings for small business. Not a bad upside for signing up for free on the LOHAS HUB Directory eh?
 

LOHAS is still very new to many in the Asian region despite its massive proliferation. Many may have heard of it or seen a store promoting a LOHAS sale but rarely do they know what it really means. This was the purpose of the conference. After the conference not only did people understand it but wanted more or wanted to partake in expanding awareness. There is a lot of fertile ground for LOHAS in S.E. Asia and I look forward to future events. The next events are in Shanghai and Singapore. Stay tuned for details.

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com


 

Hail to the "Embracers"

Monday, February 13, 2012 by

cool bike

Recently I was asked to present a compelling "business case for sustainability."  It is a common question innovative business students are attempting to answer inside the Presidio MBA program for Sustainable Management.  At first, I thought I would bring up all the great evidence and case studies that already exist for proving why businesses need to move in this direction… then something occurred.   

I started to think about all the grand evidence that exists in the world and how little it actually impacts our decisions.  Consider the overwhelming "evidence" out there on the following topics.  Cigarette smoking, global warming, alcohol abuse, fast food health impacts, obesity, exercise and fossil fuels for energy … the list goes on and on.  There are mountains of data that "prove" the case for or against these societal issues and thus "prove" the case for a better way. Yet in the end, some people simply refuse to believe strong data, clear evidence or compelling arguments and continue their old ways.   

But this post is not about them, it is really celebrating you, the online LOHAS community.  It is about how you should be applauded and hailed as the "embracers" of sustainability and health.  The way you live, shop and support new markets is your achievement, hopefully to be imitated, as it is the highest form of flattery.  

A recent study by MITSloan shows that "embracers" are leading their industry and not waiting for  a core of sustainability to be included sometime in the future … they know the future is now.   This thinking is paying off and the "laggards" or cautious adopters are thus falling even further behind.

There are many others out there that are not working as hard as we are, to find the best sustainable solutions for our modern living and in business.  They can be considered "laggards", the people we feel we have to "prove" that sustainability works and that they should adopt it.   Now I am certainly a believer of sharing best practices, but proving that health and sustainability are important … really?  Mother nature designed us to think and find the best solutions for our own survival, we are in the process of our own evolution now and I am not sure proving our case is the best use of our time and energy.  

Clearly, you are the innovators and early adopters, the people on the front lines of our very evolution, pushing for change, not waiting for it arrive or be handed to us.  You are seeking out solutions every day to the very ills of our way of life and not willing to settle for conventional thinking, standard products or disconnected living.  Each time you spend money, you are considering larger impacts, each time you vote you are planning our collective future, each time you invest you are creating a new markets.  

The best part is that the world is finally listening, societies are paying attention, communities are shifting.  Your innovative thinking and bold actions are getting noticed all the world over.  You are bucking the trends, you are going against the grain and you are the exception to the rules.  Forget having to "prove the case", continue to live your lives your way and let that be your shining evidence to the world.  

The MITSloan report identifies seven best practices that "embracers" share:
    1.    Move early
    2.    Balance long-term vision with short-term impact
    3.    Drive sustainability philosophy from both the top-down and the bottom-up
    4.    Don’t make sustainability a silo
    5.    Measure in whatever way you can
    6.    Remember the intangible benefits
    7.    Communicate your expectations

I congratulate you for listening to your true gut instincts, your breakthrough mind and most importantly your compassionate heart. I look forward to shaking your hand at the June 2012 LOHAS conference in Boulder.   

Jared Brick is a current student at the Presidio Graduate School in San Francisco. 

You can follow him here:
http://twitter.com/jaredbrick
 

LOHAS Wellness Trends

Tuesday, February 7, 2012 by

wellness trendsAfter scanning health and wellness trends for 2012 here are a few that caught my eye along with my own perspectices that are LOHAS related.

1. Yoga & Meditation as Mainstream Treatment: Interest in alternative treatments will experience a second surge. Even though interest in alternative treatments is already high, more people, practitioners and patients will be willing to experiment with new remedies, activities and lifestyle changes to avoid these kinds of medications. A study[10] finds that of the 41 million Americans that use mind-body therapies like yoga or tai chi, 6.4 million are now doing them because they were “prescribed” by their medical provider.  Yoga, tai chi, qigong, Feldenkrais, guided imagery, acupuncture and other practices will continue to gain attention due to their ability to calm, soothe and attend to medical situations such as chronic pain, hypertension, obesity and stress. With returning PTSD suffering Iraqi war veterans and stress brought upon with tornadoes, hurricanes and earthquakes there will be a greater interest in how trauma affects us both personally and in our institutions, including our workplaces and schools and how to respond in effective ways.

2. Awareness & Prevention Will Have a Renewed Focus: As chronic diseases account for many of our healthcare issues and costs there will be a revitalized focus on preventative medicine. Anticipate the integration of wellness programs into businesses by employers and provide resources programs to encourage better health and prevention. This was predicted in our 2011 wellness trends but anticipate stronger campaigns on all fronts as health becomes a larger issue for society.

3. The Empowered Consumer Continues to Rise: The DYI trend among consumers will continue in 2012. And technology plays a large role here. Research shows that 80% of U.S. Internet users claim to have used the web to search for health-related information and answers. And that is just search. Many platforms from interactive healthcare kiosks to social media to personalized health sites are allowing consumers to empower themselves. As consumers increasingly turn to self-service technologies and channels, the entire healthcare industry has a tremendous opportunity to reach, engage and interactive with today’s empowered consumer. And that will yield some powerful results from consumers to doctors to advertisers.

4. Family Wellness Travel: The boom in solo travellers continues to rise for wellness holidays but more families are now searching for these types of getaways. Parents want their children to be healthy on holiday and also keep busy with plenty of activities so they don’t get bored. More resorts are also introducing healthy children’s menus so they can learn good habits early. Parents also want to be able to enjoy holistic activities and spa treatments, whilst their children are staying active.

5. Retail Plays an Increased Role: In response to the DYI demand from consumers in-store clinics and healthcare kiosks will play vital roles to connect with consumers for better healthcare access, awareness and treatments. Consumers are still frequenting brick-n-mortar stores; connecting with them while they are there offers great opportunities for healthcare providers, advertisers and the retail locations.

6. Holidaying with Health Gurus: Top health and fitness experts now work at some of the leading resorts around the world. More people want to receive dedicated support and guidance from the best in the industry; wellness retreats are bringing in the top yoga teachers, nutritionists, doctors, personal trainers and more health gurus to raise their game. Clients want to be inspired and informed so that they can lead a healthier and more fulfilling lifestyle when they return home. Expect more tailored programs to be developed such as ones provided at Tao Inspired Living or Rancho La Puerta.

7. Obesity Awareness: Losing weight will continue to be the primary reason consumers seek personal training support as the public responds to the expanded messaging concerning the dangers of physical inactivity and obesity. The recently released Gallup-Healthways Well-Being Index report that showed a modest improvement in the nation’s obesity rates for the first time in more than three years is a very encouraging sign. However, the fact remains that three out of five Americans are still overweight or obese, requiring more work to be done. 

8. Whole-life training: Lifestyle/ Wellness coaching will become a bigger trend with more personal trainers, fitness centers and spas looking to holistically improve client lifestyle and expanding their education and training to include this skill set. There are efforts to clearly define the parameters of coaching and help distinguish coaching (which is future-focused) from other professional services like counseling (which delve into a person’s past). The medical industry and academic groups are examining the value of wellness coaching. Harvard Medical School (www.harvardcoaching.org) now underwrites an annual conference on coaching’s role in healthcare. One of the many research initiatives being analyzed by the International Coaching Research Forum (U.K.) is developing coaching as a global, academic profession. Companies like Wellpeople.com (U.S.) offer certified on-site or virtual wellness coaches for spas, hospitals and businesses. Anticipate fitness facilities to hire nutritionists and other allied healthcare professionals such as physical therapists and psychologists to serve the expanding needs of their health-conscious members including wellness, nutrition, and stress-management programs.

9. Community Collaboration: Access to fitness services and education will continue to expand in local communities including activities in gyms, parks, and recreation centers. Local leaders are taking a more active role to address health issues in their communities. This includes proactive measures through school-based education programs and engagement with low-income and at-risk families. The Canyon Ranch Institute provides Life Enhancement Programs in underserved communities of the South Bronx, Cleveland, and Tuscon to prevent, diagnose, and address chronic diseases.

10. Healthy Fast Food: There will be a greater push to keep students and employees healthy. This will mean a closer examination of cafeteria food in schools and on-site vending machines in work places, including information on how eating patterns create stress, obesity and health and behavior problems. As more people recognize the failings of fast food and food processing companies expect vendors to upgrade their product offerings to develop and market products that are not only healthy but actually promote health.

11. Clean Eating Focus: The food-health connection will be very important. As we learn more about "clean eating" -- consuming foods without preservatives, chemicals, sugars and other additives -- our habits will change as we read labels even more carefully and appreciate the rewards of more energy and fewer chronic illnesses. Along with clean eating, we will also become aware of the problems associated with GMO crops that have been over-hybridized by corporations for fast growth and easy harvest. The Non GMO projectThe Institute for Responsible Technology and others are working on raising awareness for consumers on the hazards of GMO foods on the environment and health.

12. Evidence based Spa Therapies: There has been a significant amount of efforts put forth by skincare companies and alternative therapy groups to provide research backing the results of treatments. SpaEvidence is a web resource that gives the world easy access to the “evidence-based medicine” databases that doctors use, so they can search thousands of studies evaluating which spa modalities are proven to work, and for which exact conditions.

Feel free to add any that I may have missed.

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com

LOHAS Trends 2012

Saturday, January 28, 2012 by

After reviewing the numerous trend articles out there and considering my own perspectives I have put together some that I think are relevant to LOHAS. Here are a few that I feel are relevant for the coming year:

1. Whiskey is for Drinking, Water Is for Fighting Over
droughtThe famous Mark Twain quote will become more prevalent in society as new realities of water scarcity will become better known to an ever growing global thirst.  Everyone will talk about it but few will do anything. Sadly, it may only start to take off if humanitarian crises hit close to home.  As we focus on our societal water use, it is an admission that climate change is our new reality and it is time to start managing the effects. The material risks associated with increased droughts and flooding will be among the most poignant effects of climate change. You may already be talking about this with the lack of snowfall around the country during the early part of this year.

2. Capitalism is Changing as We Know and it Should
Since the Industrial Age, businesses have built their wealth off of the extraction of natural resources. Unless businesses start to value and protect these resources, this cycle will have a devastating impact on the lives of our children and grandchildren.  Richard Branson echoes this sentiment and also believes it cannot survive in its current model. This can also cause potential ecoflation identified in 2008.  Many people have begun to realize that business as usual is no longer an option. What is an option is to reinvent capitalism and truly be a force for good in the world. Certification groups such as FairTrade and Benefit Corporation are working to use the power of business to solve social and environmental problems.  The changing economic scene provides unique opportunity for innovation and success in unconventional settings. The sky is the limit as new ways to do better business are taking root everyday.

3. Blurring the Differences Between “For-Profits” and “Non-Profits”
nonprofit forprofitThere has been a surge of entrepreneurs providing innovative business solutions with the purpose of “doing good”.   In these tumultuous times when unemployment is high, many are turning their backs on the job fairs and putting their efforts into creating new businesses that fill needs such as TaskRabbit, and Viatask.   Non-profits will incorporate more for-profit business models into their programs. There is a strong growth in social entrepreneurialism globally and this will increase with the emergence of new solutions for world issues. Groups like the Social Venture Network, Sansori and Unreasonable Institute will increase to provide resources for start ups. Social enterprises will encompass the very definition of business and 2012 will be an important year.

4. Gamificating Your life
Expect and increase in the game addiction methods to make a world a better place this next year. Game and point system rewards programs such as My Recycle Bank , My Energy and Greenopolis will see newcomers such as Ecobonus that rewards points to green and organic shoppers. More smart apps will provide LOHAS shoppers and energy efficiencies for homes and automobiles. 

5. Evidence Based Sustainability
Proof of sustainability will be emphasized more than ever as businesses will seek cost effective measure to reduce bills and be a good environmental citizen. Purchasing departments will be requiring vendors to document how they address sustainability issues within their own businesses will become more commonplace. As facilities and businesses increasingly operate in a more sustainable manner, they will turn to "dashboard" systems to help measure, manage and report progress.

6. We'll All Want to Plug in to Plug-in Hybrids
plugin hybridHybrids are not new but the latest improvements in technology will allow them to be more affordable to the average consumer. If electric cars like the Nissan Leaf and Chevy Volt are the trail-blazers, plug-in hybrids could be the game-changer the auto industry has been seeking. The prospect of a car that can travel distances of up to 40 miles using electric power before switching to a gas engine for longer journeys promises to overcome the biggest objection to electric cars - the fear the battery will run out mid-journey.  Design also looks exciting. We only need to look into BMW i8 roadster concept and visualize where this might take the car industry in near future. The high profile Vauxhall Ampera and Toyota Plug-in hybrid will create a lot of buzz this year and assuming the cars offer reasonable performance they could quickly become the default option for green-minded motorists and cost-conscious fleet operators

7. More Fun with Sharing Stuff
Sharing will not only be a part of social media but of reality. Considerations of downscaling due to financial, lifestyle reasons or social pressures will increase in sharing the excesses of the past decade as we become more conscious of what we have that we don’t use that others can borrow. Rent Stuff, Loanables and Rent Stuff Easy allow you to do exactly what they say.  A while back Sharable listed eight ways to share your stuff. That's about few of those thousands of ways of giving your stuff (or money) away for charity. Couchsurfing connects travelers with people who offer their homes as an economical place to stay. Rising oil costs will put pressure on transportation and the demand for shared and public transportation. Transportation share programs such as Zipcar, Bixi or Bcycle will increase. In four years the number of registered users have gone up from less than one million to more than four million. By carpooling, shared trips have gone up from less than three million to almost eight million.
 
8. Responsible Profitability Attracts Attention
Responsibility has been strongly associated with greater profitability, equity and asset returns, and shareholder value creation. But that’s no longer good enough. Today, the bar is being raised; success is itself changing. Companies are beginning to be judged against a whole new set of criteria by customers, governments, communities, employees, and investors. They’re already saying, so you made a profit. Yawn. Did you actually have an impact? Did what you do have a positive, lasting consequence that was meaningful in human terms? Several studies have provided evidence suggesting that betterness yields greater equity returns, asset returns, and profitability. This not only makes sense for those who are mission oriented but also for risk management.  One recent study found firms that score strongly in terms of corporate social responsibility (CSR) find that their cost of equity capital financing is consistently lower than firms with weaker CSR track records. Responsibility fuels outperformance because it is risk management: better insurance against adverse future events.

9. Emphasis on Corporate Culture
Successful startup companies such as Method, Zappos and New Belgium Brewery are all preachers of their unique culture developed around their workplace. They preach not to chase the profits but to chase the dream. Engaging employees as a collective of ideas and not compartmentalization is a new form of corporate structure. It is not just about the fun office parties and surroundings but understanding the larger mission of the company and empowering employees. Creative agencies and culture builders have seen the need to train and educate companies on these emerging traits that are attractive for the young new work force.

10. Natural Disasters Will Continue
Expect your homeowners insurance rate to rise in 2012 as weather related damages cost $70 natural disastersbillion in U.S. economic losses in 2011.  All the indicators on climate risk are pointing the wrong way.  The financial and human cost of extreme weather and climate-related disasters is on an unmistakably upward trend. Meanwhile, our energy infrastructure remains as risky as ever with the Fukushima disaster following the BP oil spill in highlighting how fragile our energy supplies really are. It is a safe bet that 2012 will again be marred by a large-scale environmental tragedy of one form or another. Meanwhile, sensible businesses and policymakers will start taking climate adaptation more seriously.

References for these trends are:
Ecopreneurist.com
Taombo.com
Greenbiz.com
Huffington Post
PR Newswire

Are there any missing? Let me know what others trends you forsee for 2012 and LOHAS.

 

Ted Ning is renowned for leading the annual LOHAS Forum, LOHAS.com and LOHAS Journal the past 9 years Ted Ning is widely regarded as the epicenter of all things LOHAS leading many to affectionately refer to him as ‘Mr. LOHAS’. He is a change agent, trend spotter and principal of the LOHAS Group, which advises large and small corporations on accessing and profiting from the +$300 billion lifestyles of health and sustainability marketplace.  The LOHAS Group is a strategy firm focusing on helping companies discover, create, nurture and develop their unique brand assets.  For more information on Ted visit  www.tedning.com