Global shift to sustainability

Globally, the transformative impact for businesses to embrace and drive sustainable development is on the rise. With the age of social media, increasing levels of public awareness exert more pressure on companies to pursue a larger social and environmental purposes, other than just augmenting profits.

Terms such as “People, Planet, Profit,” “Environmental Social and Governance (ESG) standards,” “Impact Financing,” “Green Investing,” “Sustainable Business,” “Social Entrepreneurship,” and “Conscious Capitalism” have proliferated in private, public, and societal spheres in order to overturn the traditional way of doing business.

While these terms seem novel, the concept of sustainability was already in existence decades ago. In fact, sustainable development was described as early as 1987 in the United Nations Bruntland Commission Report as “development that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

Years later, the term “ESG” was first coined in the “Who Cares Wins Conference Report: Investing for Long-Term Value” by the United Nations Global Compact in 2005, wherein it was recognized that environmental, social, and governance factors play an important role in the context of longer-term investment.

In 2015, these principles were formally encapsulated in the United Nations Sustainable Development Goals (SDGs), as a “universal call to action to end poverty, protect the planet, and ensure that all people enjoy peace and prosperity by 2030.” The 17 SDGs — namely, No Poverty, Zero Hunger, Good Health and Well-being, Quality Education, Gender Equality, Clean Water and Sanitation, Affordable and Clean Energy, Decent Work and Economic Growth, Industry, Innovation and Infrastructure, Reduced Inequality, Sustainable Cities and Communities, Responsible Consumption and Production, Climate Action, Life Below Water, Life on Land, Peace and Justice Strong Institutions and Partnerships — recognize that “ending poverty must go hand-in-hand with strategies that build economic growth and address a range of social needs including education, health, social protection, and job opportunities, while tackling climate change and environmental protection.”

As sustainable development is inarguably recognized as an issue of global importance, businesses should carefully consider the social and environmental risks and threats to their long-term corporate existence in a world of poverty, climate change, and inequality.

Seeking to be part of the solution rather than the problem, companies are created and/or reinvented to not only seek financial returns, but to further address social and environmental impacts by reducing poverty, meeting basic human needs, and ensuring fair and equal opportunities, which are all in keeping with the UN SDGs.

The understanding that businesses play a vital role in addressing the world’s complex social and environmental problems is now widely recognized. This recognition and commitment towards sustainability, most especially in the investment community, is validated in a research study conducted by Robert G. Eccles and Svetlana Klimenko, as published in the May-June 2019 issue of Harvard Business Review, wherein it was reported that ESG was a “top-of-mind” for 70 senior executives at 43 global institutional investing firms, including the world’s three biggest asset managers (BlackRock, Vanguard, and State Street), giant asset owners such as the California Public Employees’ Retirement System (CalPERS), the California State Teachers’ Retirement System (CalSTRS), and the government pension funds of Japan, Sweden, and the Netherlands.

Following this trend locally, top executives of the Philippines similarly recognize the concepts of sustainability in their businesses. In a report by PwC in collaboration with the Management Association of the Philippines (MAP) entitled “The Future of Business: Sustainability. Development. Impact,” which discusses the results of the 2019 survey of 127 CEOs in the Philippines from a mix of large (50%), medium (27%), small (14%), and micro (9%) enterprises from various sectors, over 80% of CEOs expect to change their production or service model in the next three to five years to promote more sustainable practices. Notably, in the past PwC surveys, CEOs were mostly concerned with issues related to policies and terrorism. This year, however, CEOs are acknowledging that climate change and environmental damage are serious problems that they need to face.

In the same vein, strengthening environmental protection and combating climate change are recognized by the government and civil society as one of the most important gaps which need to be closed by 2030.

In the 2019 Asia and the Pacific SDG Progress Report by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), environmental targets in the Asia Pacific Region would require a complete turnaround in order to meet the SDGs. Specifically, a quarter of Asia Pacific Region targets that have worsened are linked to natural resource management — including sustainable food production, populations suffering from water scarcity, renewable energy, management of chemicals and wastes, and the loss of biodiversity.

The South-East Asian (SEA) subregion, comprised of Brunei Darussalam, Cambodia, Indonesia, the Lao People’s Democratic Republic, Malaysia, Myanmar, the Philippines, Singapore, Thailand, Timor-Leste, and Vietnam, leads other subregions of the Asia Pacific on three goals: quality education (Goal 4), affordable and clean energy (Goal 7), and industry, innovation and infrastructure (Goal 9). According to the report, the SEA region can expect to achieve 2030 goals by maintaining the current pace of progress on all targets on affordable and clean energy except for renewable energy consumption, where every subregion in Asia-Pacific needs to accelerate progress.

While government takes the lead in achieving these sustainable development goals, the private sector is now recognized as a key player in addressing the most pressing environmental challenges in the world today.

Serious commitments on a global scale are being launched by some of the world’s leading consumer brands. Big investments to produce environmentally friendly packaging alternatives that will not compromise food quality and safety are in full swing.

The Coca-Cola Company’s “World Without Waste” initiative has committed to an ambitious goal to collect and recycle 100% of its packaging by 2030. In the country, Coca-Cola Philippines recently launched its P1-Billion PET (polyethylene terephthalate) bottle recycling facility.

Unilever’s global commitment is to ensure all of its plastic packaging is 100% designed to be reusable, recyclable, or compostable and to increase the use of recycled plastic to 25% by 2025. They will also share their technical solutions to recycle multi-layered sachets with the industry.

Due to the increasing awareness of benefits of companies to pursue a larger and societal purposes, it seems that sustainability is the new reality for businesses.

The future of sustainability rests in commitment, continuity, and innovation which require the collaborative efforts of the businesses, government and civil society.


Dell says it will power all of its facilities with renewable energy by 2040

Dell has announced new sustainability initiatives as part of the “Progress Made Real” plan the company shared on Tuesday. The centerpiece of the company’s new climate change plan is to source 75 percent of the power for all of its facilities from renewables, and 100 percent by 2040. Dell also plans to make its supply chain and devices more energy efficient along the way. For comparison, Apple announced that as of last year all of its facilities were powered by renewables — though it was able to achieve that milestone by taking advantage of carbon offsets and credits.

On the recycling front, the company says it plans to recycle an “equivalent product” for every device that consumers buy. Dell also claims that by 2030 more than half of its devices will be made from either “recycled or renewable material.” Similarly, the company will make 100 percent of its packaging from reused materials (Samsung made a similar pledge earlier this year).

Vitally, Dell hasn’t said whether it plans to make its devices last longer or more repairable. Companies often like to tout their recycling initiatives, but the reality of the situation is that one of the best ways for electronics manufacturers to help with climate change is to limit how many of their products make it to landfills. Historically, Dell has been one of the better companies in that regard, with a 2017 report finding that the company’s Latitude E5270 was one of the most repairable laptops at the time. But it’s still something of an industry-wide problem.

Feature image credited to engadget

Penang’s Escape Theme Park to be powered by renewable energy

TELUK BAHANG: The Escape Theme Park here will become greener with the use of renewable energy by the end of next year.

Its chief executive officer, Sim Choo Kheng, said the theme park would be the first in Asia to adopt the eco-friendly feature, in line with its green ecotourism philosophy.

“The theme park will use less energy resource through solar panel facilities, and will be carbon neutral.

“It will 100 per cent rely on renewable energy technology.

“There are two theme parks in America, but I believe we will be the first in Asia with this technology,” he said after the opening of Escape Theme Park Phase 3 here today.

A tripartite agreement was signed between the theme park operator, Tenaga Nasional Bhd (TNB), and its subsidiary, GSPARX Sdn Bhd.

With the use of solar energy, the cost of power consumption will be reduced by 15 per cent.

TNB chief retail officer Megat Jalaluddin Megat Hassan said the solar panels would be installed on a 6,000sq m space and it would take between six months to a year before it could be used.

GSPARX will provide the capital outlay to install and maintain the solar system for 25 years involving an investment of up to RM2 million.

“This is part of our efforts to support the government’s initiative to encourage use of green energy.

“We are open to install a similar system at other theme parks in the country as well,” he added.


Chinese data centers are dabbling in renewable energy

Interest in renewable energy in China is growing, and leading Chinese companies are riding on the opportunities to go with renewable energy, according to Greenpeace. The environmental campain group is set to bring out a new release of the Chinese edition of its Clicking Clean report, which investigate the use of renewables within the IT sector.

The renewable energy market in China is increasingly open, Yuan Ying, program manager of Climate and Energy at Greenpeace East Asia, told DCD in advance of the publication of China Clicking Green 2019, a new release in Greenpeace’s Clicking Clean series of studies report, which examines the sustainable energy usage of Chinese IT and data centers. .

The report is due to be published at the end of the year, and Ying is scheduled to release some information from the report at a “Clicking Clean China Report Unplugged” session at DCD>Beijing in December..

Quiet adoption
Chinese companies have been quietly adopting renewables in small pilots, with some embarking on notable largescale deployments, she observed. For instance, Alibaba’s data center in Zhangbei in Hebei province – a mammoth cloud facility hosting over 600,000 servers – purchases wind power directly from local wind farms there. Elsewhere in China, a Baidu data center in Shangxi province purchased 550 GWh of wind power in 2018.

“These examples show that renewable energy is increasingly becoming available in China and top IT and data center companies are demonstrating great potential to lead the sector to make a shift towards 100 percent renewable energy,” said Yuan. At the moment, she says the data center sector’s renewable energy intake is around 23 percent.

China has made incredible progress in building renewable energy sources. Yuan said: “China is home to more renewable energy capacity than any other country in the world. By the end of 2018, solar and wind installation capacity wind [is more than] Europe’s entire solar and wind capacity.”

Room for improvement
There is room for improvement though. Yuan admitted that there were no “large shifts” towards renewables, and corporate renewable energy procurement in general is still at a relatively early stage. She says awareness in this area is “slowly building up”, however. ,Chinese companies are showing a lot more in this year’s report than in the inaugural report two years ago.

Crucially, no Chinese technology or data center companies have made a public commitment towards fully adopting renewable energy, unlike technology giants from the West such as Microsoft and Google. Energy usage transparency is not yet a norm with technology firms, which doesn’t help in building awareness.

“Few companies are openly sharing their overall electricity consumption, electricity mix, and energy carbon footprint. The lack of transparency poses a challenge for public stakeholders to gauge how the companies are handling their energy usage and its associated carbon footprint,” noted Yuan.

To drive the adoption of renewables, she suggested that companies establish an integrated internal structure or have a dedicated team of employees tasked to manage energy sustainability. This can help overcome the current situation where this function typically spans multiple departments, making it difficult for organizations to realize the full potential of switching towards renewables, she explained.

Increasing adoption of renewables
Shenzhen, China
10 Sep 2019
Greenpeace: China’s data centers are primarily coal powered, emit 99m tonnes of CO2
And it’s only set to get worse

What of the Chinese government’s push to improve energy efficiency by stipulating a PUE target? The average PUE (power usage effectiveness) of data centers in China was 2.2 in 2015, and has improved significantly over the lats few years. Earlier this year, the Shanghai municipal authorities issued a three-year action plan to bring the PUE of new data centers to 1.3.

While Yuan acknowledges that PUE serves as a powerful indicator that can be used to drive data centers towards substantial improvement in energy efficiency, she doesn’t see it as the solution.

“We believe that optimizing energy efficient alone is not enough to address the scale of the challenges we are facing from climate change. We need to start addressing the carbon emissions and air pollutants associated with the source of power that feed into our data centers.”

On this front, uneven policies in the emerging renewables market pose a barrier for data center providers to fully access renewable energy, says Yuan, due to unequal progress in the development of renewables across different provincial markets.

This places a heavier burden burden on data center providers to shop for the best renewable options that their data centers can access. Moreover, many companies lack the capacity or knowhow to navigate the inherent complexities of renewables to identify market opportunities for the best deal.

Urgent action needed
Fortunately, the situation is fast-changing, and additional procurement mechanisms are becoming increasingly available thanks to market reforms by the Chinese government.

“Since 2015, power market reforms have created unprecedented opportunities for companies to procure renewable energy via a diverse set of mechanisms, including building onsite distributed renewable projects, procuring clean power directly from renewable energy generators and purchasing green power certificates.”

Ultimately, a lot more can be done by the industry, and urgently. After all, China’s data centers are heavily reliant on coal power, emitting an estimated 117 million tons of CO2 in 2018. This is projected to reach 194 million tons by 2023, assuming no changes in the ratio of renewable energy intake.

Conversely, should data centers’ renewable energy intake increase by a third to 30 percent, a whopping 19 million tons of carbon emissions can be avoided by 2023, says Yuan. This is equal to the emissions from roughly 10 million round-trip transatlantic flights. So every data center that adopts renewable energy matters. And the earlier, the better.

For now, Yuan is hopeful that various renewable pilot projects – though small – may yet bear fruit. “We believe as China power reforms deepen and corporate procurement mechanisms diversify, these pilots will become the seeds for a massive shift towards renewable energy.”


Climate change: Asia ‘coal addiction’ must end, UN chief warns

A labourer loads coal in a truck next to containers outside a logistics center near Tianjin Port, in northern China, 16 May, 2019.Image copyrightREUTERS
Image captionNew coal power plants are planned in Asia

The chief of the United Nations has warned Asia to quit its “addiction” to coal in a bid to tackle climate change.

UN Secretary General António Guterres said countries in the region were among the most vulnerable to global warming and should be on the “front line” of efforts to stop it.

He cited a new study that found that Asian countries were at particular risk of climate-driven flooding.

Coal is a major source of power in many Asian countries.

Speaking to reporters in the Thai capital Bangkok on Saturday, Mr Guterres described climate change as the “defining issue of our time”.

The UN chief referenced a study published on Tuesday, which found that climate change would put millions more people at risk from coastal flooding by 2050 than previously thought.

The majority of those implicated were in developing countries across Asia, the study said.

UN Secretary General António Guterres speaks at the 74th session of the United Nations General Assembly in New York on 24 September, 2019Image copyrightAFP
Image captionMr Guterres said climate change was a “defining issue” of our time

Mr Gutterres said that while “people can discuss the accuracy of these figures…what is clear is that the trend is there”.

He said the issue was “particularly sensitive” in Asia, where a “meaningful number” of new coal power plants are planned.

“We have to put a price on carbon. We need to stop subsidies for fossil fuels. And we need to stop the creation of new power plants based on coal in the future,” Mr Gutterres warned.

Presentational grey line

Who is at risk in Asia?

Tuesday’s report by Climate Central, a US-based non-profit news organisation, said 190 million people would be living in areas that are projected to be below high-tide lines in the year 2100.

It found that even with moderate reductions in greenhouse gas emissions, six Asian countries (China, Bangladesh, India, Vietnam, Indonesia, and Thailand), where 237 million people live today, could face annual coastal flooding threats by 2050.

  1. China – 93 million people
  2. Bangladesh – 42 million
  3. India – 36 million
  4. Vietnam – 31 million
  5. Indonesia – 23 million
  6. Thailand – 12 million