Archive for November, 2008
A few days ago, I blogged on a major political shift in Washington D.C. that would increase the likelihood of the U.S. adopting a sweeping new climate change proposal during the upcoming session of Congress.
It didn’t take long for the effect of that seismic shift to reach corporate boardrooms. During last week’s Wall Street Journal CEO Council meeting, corporate chief executives shared their perspectives regarding passage of proposed climate change legislation by 2010, and the types of policies they would prefer to ensure that enterprises can achieve anticipated emissions reduction goals.
Most surprising was an observation by Duke Energy CEO James Rogers, who said the current economic climate “offers the perfect opportunity to start, not an excuse for inaction. This is just the time, because we’ll get a more reasoned approach” to economy-wide regulation. However, he cautioned, that the effort “won’t be cheap, and it won’t be easy.”
The majority of executives polled at the meeting favored a cap-and-trade scheme that encourages emissions reductions through the establishment of a commodity exchange in which companies would purchase credits for carbon emissions levels over a government-designed ceiling.
The group also advocated policies mandating that 10 percent of the total U.S. auto fleet should consist of zero-emissions vehicles by 2020; 50 percent by 2030. Nissan CEO Carlos Ghosn said that goal would require manufacturers to start producing electric cars similar to a model that is being developed by Renault. The French car company hopes to mass-market the vehicle by 2010.
The group’s other recommendation was to develop revised energy efficiency policies, from more stringent building codes to new laws that would provide incentives for utility companies to save, not generate, more power.
These are savvy CEOs who understand that the political climate throughout the U.S. now favors aggressive measures to address climate change. Some of those companies, including Duke Energy, have made the necessary investments in information technology so that they will be properly positioned to transform regulatory compliance activities into a powerful driver for competitive advantage. Companies that want to reduce costly non-compliance risk exposure will want to start planning now.
Tags: cap and trade carbon emissions ceo council climate change legislation duke energy emissions reduction
November 26th, 2008
It is undeniable that sustainability is a business component of increasing importance to corporate executives in the same manner that “re-engineering” and “just in time” were hot concepts in the late 1980s.
Noted branding experts Paula Oliveira and Andrea Sullivan of global consultant Interbrand make a compelling case for corporate sustainability as an integral part of corporate strategies. Just as company management practices influence business value, so do sustainability initiatives.
Therefore, the question is: How does it create value?
There’s no disputing that executives have plenty of ethical motivation to invest in sustainability for concerns like climate change and poverty. However, companies want to see direct bottom-line benefits from ROI and improved profitability.
Oliveira and Sullivan suggest that companies are starting to generate metrics that justify sustainability investments on economic grounds, for instance:
- Compliance with increasingly rigorous government compliance mandates;
- Cost savings derived from optimization of production lines and supply chains to reduce energy consumption;
- Reduction in CO2 emissions; desire for more ethical products;
- Satisfying an emerging wave of cynical green consumers.
Most importantly, there is evidence that indicates that incorporating sustainability as a business practice will increase companies’ brand value.
Sustainability incorporates companies’ relationships with the natural environment, social causes and corporate governance, otherwise known as the triple bottom line, in which a company’s initiatives account for environmental, social and financial impacts.
That, according to Oliveira and Sullivan, means companies must make investment decisions that will benefit the environment and society and guarantee the sustainability of the project itself. “We are not talking about charitable causes – but ethical products and services that will change consumers’ behavior and help them to live a more sustainable life,” they said.
As more companies adopt sustainability practices as part of their standard operating practices, they will need automated tools, like our Corporate Responsibility Solution, to help them collect and communicate their data to the appropriate stakeholders and regulators.
Tags: climate change co2 emissions compliance corporate sustainability environment interbrand
November 24th, 2008
There were two events in Washington that clearly signal that climate change and greenhouse gas management will soon become a front-burner political issue starting in January.
President-elect Obama’s address to the Governors’ Global Climate Summit this week sent a message that signaled that the incoming U.S. administration will make climate change a major priority. That’s not a huge surprise.
The surprise development occurred earlier today when Rep. Henry Waxman was elected chairman of the U.S. House of Representatives’ Committee on Energy and Commerce, unseating his longtime colleague Rep. John Dingell during a closed-door session of the House majority caucus. That was a significant action because Waxman has long been a vocal proponent of U.S. federal agencies, specifically the Environmental Protection Agency, taking a more proactive role in regulating greenhouse gas emissions. Dingell championed the interests of major American car companies, which generally opposed aggressive emissions legislation.
No matter what your political preference, it’s now a well-established fact that U.S supporters of greenhouse gas legislation, and emissions management in general, got a boost from two committed climate change intervention advocates ascending to positions of authority. Both events immediately signal that American emissions regulation will be more activist in nature, starting in early 2009.
If your business has put off implementing processes that address the reality of a carbon-constrained environment for manufacturing, you might want to rethink your position. Your company’s legislative affairs staff is probably preparing recommendations that will detail the implications to your operations. Allow me to provide a concise summary: There’s just been a seismic shift in the U.S. regulatory landscape for emissions management. Both the new president and legislative leaders have indicated that the current economic slowdown won’t affect their efforts to pass climate change legislation next year. And, apparently, the winds of political change are blowing in their favor.
Tags: climate change policy committee on energy and commerce global climate summit greenhouse gas legislation
November 21st, 2008
We’ve just learned about a recent analyst report that spotlights ESS as a leader among providers of GHG data collection and reporting software. It was published by The 451 Group, which watches market activity from its offices in the U.S. and U.K. The report entitled, “ESS, Oracle’s Carbon Management Partner, Seeks To Move Beyond Its Healthy Niche,” was written by analyst Lynley Oram.
The 451Group’s report is one of the more extensive analyst evaluations of ESS. While the report is only available to subscribers, it has lots of information that is worth sharing, including comments like:
- “ESS appears to be thriving…”
- “Because this is still an early-stage market, it is difficult to assess where this puts ESS in terms of market share, but the company is clearly established as a leading supplier in this growing sector.”
- “To date, ESS has sold …to specialist environmental health and safety managers in companies with a strong interest in environmental management, such as manufacturers. Many are interested in the entire, integrated suite.”
- “ESS is selling its Carbon Management Solution as a standalone software product, or as part of its environmental management suite, a 23-module product spanning most key aspects of sustainability management.”
- “The company is making good use of partnerships. It has signed a partnership deal with Oracle… to provide the carbon management capabilities that Oracle does not as yet have. ESS has similar initiatives with SAP, Microsoft and IBM.”
Why is this important? Our leadership team has positioned the company to meet the growing demands of businesses that are besieged by local, national and international mandates for sustainability reporting, including GHG/carbon management, health & safety management, crisis management, environmental compliance and corporate responsibility reporting.
Our approach has enabled companies to conduct all of their compliance activities on a single software platform, which can reduce operational costs and risks. Our efforts, in large measure, have been well received in the marketplace. It’s good to see that industry observers like The 451 Group, Gartner and AMR Research, recognize our efforts, too.
Tags: 451 group carbon management environmental management ess ghg reporting software oracle
November 20th, 2008
The carbon offset market took a big jump today with the alliance between E+Co and Goldman Sachs (GS). Goldman has agreed to purchase the majority of E+Co’s carbon offset portfolio and help promote E+Co’s goal of providing investment capital and support services to small, clean energy business ventures in developing countries.
E+Co is a 15-year-old nonprofit investment company started as a result of a Rockefeller Foundation study on opportunities for developing clean energy businesses in developing nations. It provides business support services and capital to clean energy businesses in Africa, Asia, Europe and Latin America and the United States.
E+Co also assists clean energy businesses with the aggregation, validation, verification and creation of high quality GHG offsets, including those that will be sold to Goldman Sachs. The carbon financing provides the enterprises with additional capital that supports, sustains and helps clean energy ventures grow.
Goldman has made a big bet on the growth of the U.S. carbon offset market and on the continuing pressure to do something about climate change issues. Small-scale clean energy projects, while supporting important social and environmental benefits, can struggle to attract sufficient capital to assure success. The financial backing and business development services provided by E+Co assists small businesses in those developing nations to supply clean and affordable energy to those regions, efforts that simultaneously increase employment opportunities and reduce greenhouse gas (GHG) emissions.
Goldman’s move is just another subtle reminder that smart companies are preparing now for the advent of a U.S. carbon trading market. Even though companies must exercise prudence in order to survive this market correction, executives must be mindful that failure to address both current and future market shifts will put your organization at a competitive disadvantage.
We anticipate the mounting wave of clean energy activity will generate greater pressure for companies of all sizes to measure and monitor their GHG emissions and acquire those carbon credits Goldman Sachs will help E+Co create.
Tags: carbon credits carbon offset market carbon trading e+co ghg emissions goldman sachs greenhouse gas
November 12th, 2008
Here comes the SUN, err- CLOUD! Microsoft has unveiled the Azure Services Platform for the cloud, which offers unprecedented power of choice and open connections for developers.
During a keynote speech at the Microsoft Professional Developers Conference 2008 (PDC2008), Ray Ozzie, Microsoft Corp.’s chief software architect, announced Windows Azure, the cloud-based service foundation underlying its Azure Services Platform. The presentation highlighted this platform’s role in delivering Microsoft’s software plus services approach to computing.
The Azure Services Platform is an industry-leading move by Microsoft to help developers build the next generation of applications that will span from the cloud to the enterprise datacenter and deliver compelling new experiences across the PC, Web and phone.
Our Microsoft Gold development certification (we also have Powered by SAP NetWeaver® and Oracle development partnerships) enabled ESS to send our chief software architect to PDC2008, giving him a chance to try out Azure’s features and functions and evaluate the platform for our own future development.
Microsoft says the Azure Services Platform promises to transform the way businesses operate and how users access their information and experience the Web. Most importantly, it provides the power of choice to deploy applications in cloud-based Internet services, through on-premise servers or to combine them in any way that makes the most sense for your business needs.
Unlike many of today’s service-based solutions, the Azure Services Platform provides developers with the flexibility and ability to create applications while taking advantage of its existing skills, tools and technologies such as the Microsoft .NET Framework and Visual Studio.
New services technologies, when employed alongside other core technology enablers such as virtualization and modeling, could result in dramatic benefits for customers’ IT departments. Specifically, these technologies enable IT departments to further drive down operating costs, focus their spending on systems that differentiate the business and ultimately enable IT to become a more strategic asset.
I am pleased that ESS continues to be at the forefront of technology innovations that offer the potential to provide new benefits to our customers including those mentioned above. You can be assured that the software development and product management teams at ESS are evaluating these new technologies carefully against our product solution roadmaps for the company’s GHG and carbon management, environmental compliance, health & safety, corporate responsibility reporting and crisis management software solutions.
Tags: azure services platform cloud computing microsoft pdc2008 windows azure
November 11th, 2008
While reading CSR reports recently, I noticed a huge shift in both the kind of sustainability reporting that is done and the manner in which it is done. All of this bodes well for green initiatives, even in a down economy. This trend is further evidence that the sooner you implement an integrated platform for collecting and reporting data across the enterprise, the more money you can save.
First of all, there is now a widely-accepted framework for sustainability reports created by the Global Reporting Initiative (GRI) that enables the reader, or investor, to compare common data. GRI guidelines call for measurement and monitoring. Now in its third generation, companies have had a chance to get comfortable with them and stakeholder input has made the process much more user-friendly.
Nearly 200 leading global organizations comply with GRI guidelines, and that number is expected to grow rapidly. GRI compliance is “voluntary,” but it’s really not. You get the drift. Your company’s investor relations and corporate communications people already know that investors and customers are closely examining these reports…or the lack thereof.
The important takeaway about GRI guidelines is that it drives companies to watch what they’re doing in relation to their footprint, collect data about it and make that data transparent. Exactly how does a particular company emit greenhouse gasses? Through its product? Through its manufacturing process? Can that process be changed? Can equipment be retrofitted, or new equipment purchased that is more energy efficient? Answers to those questions are now available for public examination.
I’m going to guess that many corporate executives were only summarily aware of their unsustainable operating processes or the non-sustainable ingredients in their products, before that information became accessible for public viewing. It’s possible that decision makers at the head of the enterprise were not getting accurate, adequate and actionable data from their facilities. Furthermore, the data, and its implications, were difficult to comprehend. Once executives became aware of the implications of the data, they demanded appropriate action, as did their stakeholders.
In every report I’ve read, companies have reduced emissions and waste since they starting measuring. Almost all of them have set goals to continue on a more sustainable path. Some of them have established BHAGs (big, hairy audacious goals) like WalMart’s goal of zero waste, and equally ambitious target dates and accountability for executing them.
But here is something more important. Companies that execute on their sustainability goals are also reducing their operating costs. This is crucial because in business, at the end of the day, the goal is to reduce costs and make profits. Sustainability goals are not just nice, feel-good items; they’re necessary. Cutting costs, especially in these tough times, is a must.
Tags: compliance csr reports global reporting initiative greenhouse gas gri sustainability sustainability reporting
November 10th, 2008
One of President-elect Barack Obama’s stated first objectives in office is to lead the U.S. back into the heart of the global debate on climate change, ending the country’s years of isolation from other leading industrialized nations. Obama has pledged a demolition of the policies in place since March 2001 dealing with global warming.
He has called climate change “one of the greatest moral challenges of our generation,” and proposes cutting carbon emissions 80 percent by 2050 by implementing a cap-and-trade system.
Efforts to craft a more ambitious successor to the Kyoto Protocol, which expires in 2012, has been stalled by a standoff between the United States and developing nations. Obama — in his election manifesto, has pledged that his administration will take a more active role engaging with other nations to find climate change solutions.
In addition, Obama promised an “Apollo project” that will generate jobs and provide energy security through a new alternative energy economy.
“That’s going to be my number one priority when I get into office,” Obama has said of his “green recovery” plan. “We’ll invest $15 billion a year over the next decade in renewable energy, creating five million new green jobs that pay well, can’t be outsourced and help end our dependence on foreign oil.”
To marshal support for his plan, Obama argues that investment in renewables will create a significant number of new jobs. He also emphasizes that energy efficiency is linked to national security, weaning the U.S. away from imported fossil fuels.
The process of putting a new administration in place while securing support for emissions curbs isn’t going to be easy — especially when millions of Americans are worried how the plan will impact the nation’s sick economy. Then there is the mammoth challenge of getting a carbon emissions bill through Congress – not expected until 2010 at the earliest. We’ll be watching closely as the incoming president’s new direction takes shape.
Tags: cap and trade carbon emissions energy efficiency global warming kyoto protocol obama us climate change policy
November 5th, 2008
Remember the Chinese curse, ‘may you live in interesting times’? That adage definitely applies to corporate managers who are under mounting pressure to cut operational costs. As corporate revenues spiral downward, cost cutting pressures accelerate.
Increased demand for water and electricity is driving plans for expanded power generation and treatment plants, which are likely to drive higher utility costs. However, what alternatives are available if there’s no money to build new power plants or water desalinization facilities? It’s time for the enterprise to harness its collective ingenuity to develop improved resource management practices.
As a result, a growing number of companies are looking to save money by minimizing use of water and electric utilities. I got this idea from an article in Scientific American that shows how water and energy management are interconnected. Communities need water to produce electricity, which is needed to treat water.
The article says communities need to solve both of these problems at the same time. More businesses are contributing to the solution by developing programs that emphasize better resource stewardship.
Investing in EHS technology can empower your company to improve energy efficiency by cutting waste. EHS software can pay for itself in lower energy costs and lower compliance costs and risks. Companies would reap immediate ROI, improve environmental performance plus help defer the need for new utility plants, pushing potential cost increases further into the future.
Which leads me to another timely adage: You can’t manage what you can’t measure. Companies can’t efficiently manage their resources unless they have accurate and actionable information from an EHS software platform.
Tags: ehs software energy efficiency energy management environmental performance scientific american utility costs
November 4th, 2008
