Corporate sustainability in 2017

I’m in the jury for the ‘Best Swedish Sustainability Report’ award and we are announcing the 2017 winner tomorrow. Because of this jury work, I have been reading a lot of sustainability reports this summer and see some current trends.

On the positive side, companies increasingly work with sustainability in their core operations. Compared to when I started my research in this area eight years ago, there is much less reporting on how much money companies give to charities. These days, companies understand that their main focus should be on the social and environmental impact of their business operations. This is where they can really make a difference. Anyone can give money to a charity, but only the company can make demands on its suppliers and reduce the carbon footprint in the operations.

Another trend is that companies increasingly connect their work to the UN sustainable development goals. This can of course be seen as a way for companies to ‘glorify’ their work. Nevertheless, the UN goals may help companies to think about the global challenges and their role therein. It’s a way to connect everyday work to a bigger picture. Similarly, some companies describe how their work contributes to the Swedish state’s sustainability plan ‘Agenda 2030’ (which, in fact all Swedish state-owned companies should do).

Still, there is more work to be done. Sustainability, in its essence, is about the long term perspective. According to the 1987 definition, it’s about future generations. In this respect, the old criticism that companies’ sustainability reports are not really about sustainability at all is still valid. When you set goals for 2020 you are not considering future generations. When you mainly report what you did last year you do not see the longer time perspective. As a company you should ask how your business operations will affect the life conditions of future generations. If there is no unpolluted water left, how will it affect future generations? No biodiversity? Unfortunately, very few companies think in terms of such time perspectives (yet).

Still, there are reasons to be optimistic. A few companies stand out and show that things can in fact change fast. Swedish textile company Ellos isn’t known for their sustainability work. However, in two years they have gone from sourcing only conventional cotton to 46% ‘better’, organic or recycled cotton. By 2020 it should be 100% and, at this pace, they will definitely make it. If all companies went from 0 to 50% in one to two years it would help the environment tremendously.

From 2018, all large Swedish companies will report on sustainability (a Swedish adoption of the EU directive). I am excited to see how this will affect business practices.


Can we really compare meat to fossil fuels?

Many sustainability proponents these days encourage us to become vegetarians. At least once a day there is some article along these lines in my Twitter feed. Unfortunately, there are many arguments circulating in this debate that are quite misleading. The worst error people make, in my opinion, is to equate emissions from cattle with emissions from fossil fuels.

This is simply misleading because these emissions have very different relationships to the carbon cycle. By burning fossil fuels we are adding carbon to the carbon cycle whereas emissions from cattle have a role within the carbon cycle, it naturally belongs there.

Let me explain. We all learnt about the carbon cycle in school and thus we should know that carbon circulates between the atmosphere, to plants, to animals and us humans and is yet again released into the air. Microorganisms such as bacteria and fungi etc. also play a role in this. It is how it should work in nature. Animals have a part to play in this cycle by both storing and releasing carbon in different forms.

Now whereas cattle is part of this normal carbon cycle fossil fuels are not. Fossil fuel is stored away carbon that is suddenly released into the atmosphere through human intervention. Because the natural carbon cycle cannot absorb all this added carbon, a larger portion of it remains in the atmosphere. The natural equivalent is a volcanic eruption. But these days we have constant man-made emissions of such stored away carbon. This way, we add carbon to the atmosphere that was not there before and would not have been released without us. This is indisputable and should really be our focus since we know this for certain.

Now some argue that because we hold cattle as part of our food chain we have affected the carbon cycle by raising more cows than what existed before human intervention, i.e. before animal husbandry. That there are more animals on earth today, and particularly ruminants, is a hypothesis that is difficult to prove. We don’t know exactly how many animals existed before our animal husbandry or how many of these were ruminants, so it is only estimates. Even if there are more ruminants living on earth today, it is not necessarily a problem because cattle also absorbs carbon. Just as us humans, their bodies are partly built of carbon that is released through breathing and when we die etc.

The problem with more ruminants on earth, according to the veggie proponents, is that ruminants release more methane than other animals. Thus we have shifted the carbon cycle towards more methane, they argue. However, the more we learn about methane, it is not really an isolated case of cows as such but methane producing bacteria that we find in all kinds of environments. Moreover, most of these emissions do belong to the natural carbon cycle that was there before us. It is possible that human behavior provide more beneficial environments for these methane bacteria, by raising more ruminants (who release methane) and rice agriculture. But then again, there might have been wild animals and natural swamps before and if so there has not been a significant change. We basically don’t know. There are estimates in both directions.

Acting on very incomplete information on how methane acts is in my opinion risky. Before we start to mess with the methane-producing bacteria in the cow’s stomach (which they are now starting to do), let’s learn more on how it actually operates. And when we do address methane, let’s include all man-made sources such as rice, landfills and wetlands too.

Thus we see that equating fossil fuel emissions to emissions from cattle is misleading. In the case of fossil fuels we know that we have added carbon to the carbon cycle and in these amounts it cannot be absorbed in the cycle (although the oceans have compensated a lot). In the case of cows, we don’t really know whether we have shifted the carbon cycle towards more methane because of animal husbandry. Moreover,  the case is not just about cows but methane producing bacteria that could be affected by many of our activities. We still need to learn much more. So until we do, let’s address the things we know for certain and that are urgent: our red meat habit is pretty stable whereas our flying habits have exploded the last decades.

There’s so much more to say on the subject of climate change and food but I find this to be one of the main points.

On the picture: cow at Lovö Prästgård in the Stockholm area.

Is expensive fashion more sustainable?

You might, as I once did, think that you avoid the sustainability issues in fashion because you don’t shop at H&M, Gina Tricot, Dressman etc.

The short answer is no, expensive fashion is not necessarily more sustainable. Luxury production in Europe should guarantee better working conditions and less chemicals, but only a few luxury brands still produce in Europe. Those who do might only produce certain parts of the collection in Europe. And ‘Made in Italy’ can these days mean made by Chinese in Italy. Even when something is made in Europe, the fabric may be imported. Luxury brands often source their materials from outside of Europe and then we have the issues with conventional cotton and synthetic fibre etc.

There are also environmental issues with the chrome and heavy metals involved in tanning of leather. If you do want a new luxury bag, check where the leather came from, that it can be tracked to sustainable farming, and for vegetable tanning. I found that Swedish brand Palmgrens had a longstanding relationship the Italian farm the leather derived from and used vegetable tanning processes for a certain bag. Thus it’s the last bag I’ve bought, before my current year of no-shopping, and I don’t feel I compromised on design just because I focused on sustainability.

Another issue with luxury brands is that they don’t consider the environmental impact of care. Many put dry cleaning on the care instructions (as on this Ralph Lauren jacket, made in the Philippines) which isn’t environmentally friendly. And, in many cases, the items are better cared for by hand washing. I don’t know how many times the dry cleaner couldn’t remove stains and when I try at home, as a last resort, it works perfectly. Money and chemicals wasted.

The luxury conglomerates seem to lack a thorough understanding of sustainability issues. For example, when LVMH reports on biodiversity, they write about how they finance biodiversity research rather than how they take biodiversity into account in their sourcing of raw materials. Now I am all for funding research, of course, but certain issues we already know a lot about, such as pesticides and biodiversity. We can act on these today.

Similarly, it is admirable that Kering has developed the Environmental Profit and Loss account (which I often teach to students) but more important is how they handle their everyday sustainability challenges. I searched for organic on Kering’s website and only found ‘organic growth’.

Taking the opposite road, many cheap brands are not as diligent about working conditions and where things are made* but are instead rapidly increasing their share of ‘better’ or organic cotton and renewable fibre. They hardly ever prescribe dry cleaning. But then again they don’t make clothes that should last.

Thus while some brands are working on social issues and others focus on some of the environmental, few brands cover all the necessary issues. Those who do are generally those that started their business with a sustainability focus. These brands are generally slightly more expensive than fast fashion but usually much cheaper than luxury brands.

So the answer is no: price is not a good indicator of sustainability.

* The Inditex group (Zara, Massimo Dutti etc. ) is an interesting exception. Around 60% of their suppliers are located in proximity to the headquarters in Spain.

Slow Fashion in memory of Rana Plaza

This week it’s four years since the Rana Plaza disaster in Bangladesh . 2500 workers were injured and 1129 killed when the eight-storey factory collapsed. This event is commemorated with the Fashion Revolution Week each year. Customers and consumers are encouraged to ask their brands ‘who made my clothes?’. Consequently, social media is buzzing with activity and many brands have shared pictures and stories about their production, for example Serendipity Organics and many more (to see the brands and their stories follow @fash_rev on Instagram). Even conventional fashion media, such as British Vogue, report on the activity.

Many of those active during Fashion Revolution Week are also all year round Slow Fashion proponents. Karen Templer of Slow Fashion October did a thoughtful  blog post defining ‘Slow Fashion’ as considering the human, environmental and monetary cost of clothing as well as taking full responsibility for what we own:

By take responsibility, I mean commit to wearing each item (whatever it is, wherever it came from) for as long as it lasts, extending the lives of things through care and mending, and re-homing anything that doesn’t work for you.

Independent pattern maker ‘In the folds‘ organised an Instagram challenge to direct attention to the time and skill it takes to make clothing. Most clothes are still made by hand and it should be valued, whether we do it ourselves or someone does it for us, she argues.

Elisalex of ‘By Hand London‘ made tutorials for Fashion Revolution Week on how to embroider and sew on patches to cover wholes, imperfections or just to make items more fun. The purpose is to make our clothing more useful so that we use what we have instead of buying new or throwing things out. The workers put a lot of effort into making clothing for us, one way to value their work is to give the clothing a long life (find my strategies for doing so here)

It seems to me that the Slow Fashion movement is here to stay. It is starting to have a presence in social media all year round. Fashion Revolution Week keeps the memory of Rana Plaza alive and educates customers and consumers about social responsibility in fashion production. The question is if the brands are changing their ways as fast as their customers are learning about the issues.

The Rana Plaza disaster shouldn’t have happened but it did. Supporting better and safer business practices is one way to commemorate the events.

How businesses handle legal but toxic chemicals

Some might believe that the use of manufactured chemical substances is tightly and safely regulated. Unfortunately it is not necessarily the case. In many cases we do not know yet if something is toxic (for example hormone-disrupting chemicals). In other cases we think it is safe and later find out that it is not. A famous example is the insecticide DDT that not only affected the environment but turned out to be an endocrine disruptor and likely carcinogen. It is prohibited since the 1970s but still found in our bodies and the environment. In certain cases, the company using the substance knows it is dangerous but conceals the information. The latter seems to be the case of Monsanto and glyphosate.

Sometimes businesses are in fact allowed to use substances that are toxic to us and the environment. One current example is PFOS and PFOA. They are water and stain repellent fluorosurfactants, used in all kinds of products. I found it in my water proofing spray for shoes and bags (that I am consequently handing in as toxic waste). They are legal to use. Today, however, we know that they do not degrade and thus accumulate in the environment: in the air, water and our food. They are commonly found in breast milk. In large enough doses it’s toxic and carcinogenic to us. While we are all exposed to it to some degree, the inhabitants of Swedish Kallinge were unknowingly exposed to large doses in their drinking water. Similarly, inhabitants close to DuPont’s factory in West Virginia were exposed to large doses too and developed all kinds of diseases (and successfully sued the company that was aware that it poisoned the water). Dupont has also contaminated the air around a factory in Holland for many years with a similar substance. Swedish environmental radio show Klotet made a very good reportage about these substances this week (in Swedish).

What can we as individuals do? When the substances are out there (and they travel far, for example to the Arctic) we cannot stop them on our own.

However, we can support the companies that voluntarily limit their use of the legal but proven, or potentially, toxic substances.

We can also avoid items that contribute to this pollution, such as teflon, ski wax, stain and water repellent textiles. If we worry about our drinking water, a charcoal filter absorbs PFAS (charcoal filter made a difference in Kallinge ).

Businesses, on the other hand, can learn from the DuPont lawsuits that concealing information about toxicity and contamination is unethical business practice. Even if the substance is legal, they now have to pay for the contamination and health consequences.

When stakeholders oppose the company’s plans: the case of Schiphol airport

A key part of companies’ sustainability work is to communicate with parties that are affected by the company’s operations. This is generally called ‘stakeholder dialogue’ (see Edward Freeman’s definition from 1984).

Engaging local communities, environmental groups, customers and investors early on may prevent critic, and even boycott, of the business later on, when it might be too late to turn back. It can also provide valuable input and reveal opportunities. However, these different groups can, and most likely will, also have conflicting ideas and needs. So what can the company do when the stakeholders’ demands conflict with the corporate plans as well as with other stakeholders’ needs?

A NHH and CEMS student of mine, Elizaveta Sokolova, wrote her master thesis on precisely this issue. She used the case of the Dutch airport Schiphol and their stakeholders (local residents, regional authorities, the Dutch state, airlines, Friends of the Earth and more) to investigate how the airport handles the conflicting demands. The conflicts concerned for example birds that get in harms way around the airport, access to the airport and noise from the airport. Elizaveta found that even when the stakeholders do not disagree on the final goal, they can disagree on how to achieve the goals.

In Schiphol’s case, the stakeholder dialogue revealed the complexity of the issues. It also created a feeling among stakeholders that the problem is shared and only coordinated efforts can bring a solution. However, when the conflicts were too divisive, the airport decided to end, or at least limit, the dialogue. To read the full thesis, you find it here.

I asked Elizaveta, who also participated in the ‘Measuring sustainability’ course I teach at NHH, a few questions for the purpose of this blog:

You seem to have a keen interest in business and sustainability. What interests you most in this area? 

On the first glance, it seems that sustainability stop business from faster expansion and revenue growth. However, being more conscious of the impact that a business creates on people and environment allows to make the growth more sustainable, less dependent on external factors such as new policies or fuel/electricity/commodity prices. Finding examples of how this idea works in real life is what attracts me the most.

What is the main point we as readers can learn from your thesis?

The Schiphol airport example that I describe in my thesis shows that changing business towards sustainability and including diverse stakeholders for consultations is never easy: opinions vary. However, this approach leads to well-rounded final decision.

Writing the thesis, what was the main learning point for you personally?

For me personally, it was difficult to understand how to find a common ground on an issue when stakeholders’ opinions are literally opposite. The answer is: willingness to compromise and understand the opponent’s concerns.

Now that you have finished your master here at NHH, what are your plans for the future?

Now, when I have finished NHH, I am implementing the knowledge I got about stakeholder engagement in practice: I work at The Global Fund and deal with sustainability and transition. It requires a lot of negotiations and communications with different stakeholders, so the communication experience and theoretical background I got while working on the thesis is very beneficial.

Thank you Elizaveta for sharing your insights and good luck with your new job!

Can conscious consumerism change the world?

Last week, I heard from two sources that conscious consumerism, i.e. using your purchases to support good business practices is not enough. In this podcast, Stiv Wilson argues that we need to get political instead. Which is exactly what their organization Story of Stuff is all about. This article by blogger Alden Wicker states it a little more harshly:

“Conscious consumerism is a lie. Small steps taken by thoughtful consumers—to recycle, to eat locally, to buy a blouse made of organic cotton instead of polyester—will not change the world”.

These kinds of arguments are used in two contexts: those that want us to get involved politically instead, as in the above two cases, or those that want to give up, ‘it doesn’t matter anyway’, ‘we can’t change the system’ and so on.

Unsurprisingly, I do believe my purchases matter. I believe in political power too. I also believe I can make a difference with my research and teaching. Basically, let’s use the means that are available to us and with which we are comfortable. Some people are comfortable marching for environmental causes, others are more comfortable changing their purchasing behavior. However, like the politician that argues for public service and then doesn’t pay the tv-licence, it is desirable to try to be consistent.

How could then purchasing behavior make a difference? Will H&M or Varner notice that I am doing a no-shopping year? No, they will not. Most likely we cannot affect H&M and Varner politically either. They are private companies, not states, and they can shop around for the tax and environmental rules that suit them, if they like.

So the impact of purchasing behavior depends on who you are trying to affect and how important your purchases are to them.

My local organic food store in Bergen has only so many customers and I purchase most of my food there. They would notice if I move. The people I purchase food from at the farmers market might notice (Bergen’s farmers market on the picture above) . Based on this fact, I feel quite comfortable telling people to stop buying from the fashion giants (they will not notice) and start buying from small sustainable brands (who will notice). For small businesses, your purchase does make a difference.

At this point, the ‘elitist’ argument usually appears. The small sustainable brands are more expensive. Not everyone can afford to buy all their food at the organic food store. This is absolutely true but it is not an argument against conscious purchasing behavior generally. We who can afford the sustainable brands have a bigger environmental footprint than people with less purchasing power. It is more important that those with the biggest environmental impact and who can afford do change their behavior. Moreover, buying food directly from the farmer is not necessarily more expensive. Second hand stores are terribly cheap.  Most likely, we could all save money by buying less and learning to mend.

But how do we affect the big companies that are larger than states and that we cannot affect by vote or with our individual purchases? I think maybe social movements can play a role here. These companies are at least concerned with trends among customers. How large groups of consumers behave affect their business. Now I might have prided myself in being the only one I know that is on a shopping fast. Getting active on Instagram, however, I soon discovered that there are many more like me. You could even say I am late to the trend. We are not as unique as we might like to believe. If I decide to only buy grass-fed local meat, there are many more like me, acting on similar impulses. Most likely we are already part of some social movement or trend, whether we know it or not. And, as group, how we behave does concern these companies.

So, in my opinion, our consumption does impact the world and if you choose to purchase consciously it will too. This, however, is not an excuse for politicians and companies to not do their job and instead put all responsibility on the consumer’s shoulders (as happens all to often). We have some big challenges, so we all need to do our best.

Sweden to become a ‘circular economy’

The Swedish government is investigating how it can promote a ‘circular economy’.  Now, what is a circular economy? While it is not so well defined, I’d say it’s an ambition to keep materials in a loop. Nature tends to work with cycles (the carbon cycle for example). Businesses, the circular economy proponents say, should mimic such systems. In a circular economy,  waste should become input to new production. In addition, there’s the idea that sharing and renting is better than owning things (I’d like to see some evidence for this).

The Swedish government’s investigation into the circular economy resulted in a 400 pages report, released last week. The report suggests tax deductions for rental, second hand and repair services, which sounds like more of what the Swedish government has already done. Other suggestions are for example to increase access to carpools and to facilitate prevention of waste (the latter is always a good idea).

When I encountered the ‘circular economy’ concept, I was initially a sceptic. It might be an academic instinct to question terms the industry has invented. ‘Isn’t this just a new fancy concept for recycling?’. Lately, however, I have slightly changed my mind. The more I learn about the waste issue the more it seems necessary that companies ‘design out waste’ (as the circular economy proponents put it). We need to have a plan for what happens to the materials and products when they are discarded. We need to make sure that our products are safely recyclable and can potentially be recycled more than once. If the circular economy concept is helpful for businesses (or states!) in order to work on these issues, then that’s more important than the lack of definition.

I also find the circular economy system diagram useful. The ways in which materials circulate are put into a hierarchy where maintaining products (such as mending) is more desirable than recycling. This seems very reasonable.

Now my research area is really the measurement of such initiatives. And, as it happens regularly, I got a really good question from a student some week ago: “How can we measure whether a business is circular?”  While businesses are quite different from nation states, the Swedish government’s report has in fact suggested some indicators for whether a country is ‘circular’. The proposed indicators measure the amount of recycled materials, the use of raw materials and the amount of waste produced. These are standard indicators that companies disclose in their sustainability reports. In a business setting, such indicators are nothing new. However, they might be more difficult to calculate on a national level. The government report suggests no indicators for the sharing, renting or repairing ideas of the circular economy.

Clearly, this is an area that needs some more work. Now if the Swedish government would want some help with measuring their circular economy ambitions, I am here to help 😉

When pollution comes back to haunt us

You might remember the cadmium in imported rice scandal or lead in imported rice scandal. These are examples of heavy metal contamination of imported foods. ‘We import foods from countries with too low environmental standards’, you might think. And that’s true.

But how did the heavy metals end up in the foods? How did a fifth of China’s farmland become contaminated? Countries like China and India have for quite some time been producing for our consumption. It has been attractive because of price, but it has also been done under lower environmental standards. One example is the dyeing of clothes. Another example is the production of pharmaceuticals. We know that these industries pollute the water and soils (and there are of course further industries in this category). We also know that residuals of the toxic waste may remain in what we import.

So, ironically,  when these countries produce for our consumption, the resulting pollution comes back to haunt us in the foods we import.

Even more ironically, while contamination of soils in India and China is spreading, we are in Scandinavia placing buildings on uncontaminated good soils that used to be farmland. The national strategy is to rely on imports, both of foods and other kinds of manufacturing. When this is the strategy, we have an interest in the countries that we are now dependent on. It is in our interest that their farmland and water supply remains uncontaminated so that they can continue to produce for us. There is only so much farmland in the world. If our strategy is to rely on imports, then we need to be concerned with the pollution in the countries we import from. Because it is not only the local population’s food supply that is contaminated, it’s ours too.

Is more recycling the answer?

We’ve learned that recycling is desirable. It’s the way to a more sustainable society. And in some ways it is. Compared to accumulating trash in landfills, then yes, recycling might be a good idea. Keeping materials in the loop means that we don’t have to produce new resource intensive materials, such as cotton, from scratch. However there are also issues with recycling.

First, toxic materials might result in toxic recycled products. In a recent case, artificial football turf, from recycled car tires, seems to be carcinogenic. Recycling is not desirable if football kids develop cancer as a result.

Second, although something can be recycled once, it does not necessarily mean that it can be recycled twice. So although we produce something by recycled materials, it may not be recyclable a second time. When it is worn out, it still ends up in the landfill or to be burned. Taking one more turn and having a second life is of course better than going directly to trash but it is not a final solution.

Third, recycling requires resources. Recycling processes require energy, the items to be recycled are moved around and transported, there might be environmentally unfriendly chemicals involved (for example in the case of textiles) and it requires money. These resources may be well spent money compared to things ending up in a landfill. However, if we instead reuse what we have and produce less waste, these resources can be saved and spent on other things.

Bea Johnson, of zero waste home, asks the thought provoking question: “What if our municipalities could shift the resources they spend on waste handling to other activities, such as schools and hospitals instead?” She has many relevant points.

Overall, the zero waste movement is doing a pretty good job in educating us on how to reduce our waste. It means fewer things going into our homes, particularly disposables, and fewer items being thrown out. Everyday. If we all did it, it would make a big difference.

Personally, I’m a bit of a late adopter in this area. I’m at this point trying to reduce everyday plastic disposables. I’m also pretty good at the DIY skincare and home cleaning supplies that Lauren Singer suggests. In terms of food packaging, although I’m recycling, I’ve got a long way to go in terms of reducing what comes into my home. On my wish list for this year is to start composting food waste. Many cities have composting schemes that you can subscribe to and in Bergen even certain houses/areas (as in my friend Turid’s case).

On the picture: buying milk directly from the farmer (Lovö Prästgård) using old Kockum milk jars. Buying directly from the farmer, also at farmers market, is a good way to reduce waste.

Are you making effort to reduce your waste? Please share your experiences.