BA Module 3
adaptation strategies
- adapting to life in changing climate - goal: to reduce our vulnerability to the harmful effects of climate change
Future effects
- change will continue through this century and beyond - temp will continue to rise - changes in precipitation patterns - more droughts and heat waves - hurricanes will become stronger and more intense - sea level will rise 1-4 feet by 2100- increased flooding - arctic likely to become ice-free
Business modesl
- circular supplies: replace with fully renewable, recyclable or biologically degradable raw material (Royal DSM, BASF) - products as a service: a product becomes a service. rental or pay-per-use (Philips Lighting, Philips Healthcare) - resource recovery: recover and reuse; reduce raw materials waste and max economic value (DSM- Niaga Technology; Walt Disney World; Nespresso) - sharing platform: share products/ services; increase product usage value ( Airbnb; Zipcar) - product life extension: products kept or improved (Renault battery)
Barriers to adoption of circular economy
- difficulty recovering materials for recycling - lack of evidence - perception of high business risk - absence of consumer demand - difficulty accessinf suitable financing - lack of regulatory framework - shareholder pressure promotes linear thinking - low cost of virgin materials - dominant position of key market players - absence of government pressure - absence of legal principles *the successful implementation of circular models is heavily reliant on rethinking supply chain models too*
The evidence of climate change
- global temperature rise - warming oceans - glacial retreats - decreased snow cover - extreme events (fires, hurricanes) - sea level rise - declining arctic sea ice - ocean acidification- coral reefs
Why is resource use a sustainabilty driver?
- how can we meet the needs and demands of the growing population with less resources? - any ideas on what can be done? - conservation - change consumption, production, extraction patterns - innovation
Human development index (HDI)
- knowledge: expected and mean years of schooling - a decent standard of living: GNI per capita - long and healthy life: life expectancy at birth
Drivers of sustainablity
- population growth - resource use intensity - climate change
Why is population a sustainability driver?
- population growth will not be distributed equally. almost all growth in the less developed countries - each individual on earth uses raw materials and adds pollution to the land/air/water - development in developing nation do and will increase the demand further
future climate change
- rapid emissions reductions - continued emissions increase
Corporate Thinking and Sustainability
- Pre-2000: "it's not a problem" - 2000-2005: "it is a problem" - 2006-2010: "let's solve the problem" - Since 2010: "it's an opportunity to create shared value"
What is circular economy?
- Principles: design out waste and pollution; keep products and materials in use; regenerate natural systems - raw materials - design - production, remanufacturing - distribution - consumption, use, reuse, repair - collection - recycling repair - reuse - refurbish - recycle
Tragedy of the Commons
- a situation where different parties share a common good, and acting independently in their own self-interest, they will ultimately overexploit and deplete/destroy the shared resource - no incentive to conserve: - result: tuna stock collapses, no more tuna to eat, no more jobs for the fisherman
Smeal definition of sustainability
"Business sustainability is the way companies manage financial, social, and environmental risks and opportunities to ensure resiliency over time: market, communities, and businesses that thrive because they are intimately connected to healthy economic, social, and environmental systems."
Sustainabiltiy
"Development that meets the needs of the present without compromising the ability of future generations to meet their own needs"
PSU's definition of sustainability
"The simulation pursuit of human health and happiness, environmental quality, and economic well-being for current and future generations."
Unilever
"keeping our plastic in the loop" - "we are committed to halve our use of virgin plastic in our packaging and to collect and process more plastic packaging than we sell by 2025"
Important to know
- IPCC (intergovernmental panel on climate change: united nations body for assessing the science related to climate change - conference of the partners: COP21 Paris Dec 2015 (Paris agreement); COP25 Dec 2019 Chile - UN climate action summit 2019: New York 21-23, 2019
Circular economy benefits
- reduce costs (raw material, waste, energy consumption) - increased innovation and competitiveness - strengthen relationships with customers, employees, suppliers, investors - reduce risks - increased resource security. also environmental and human benefits - reduced greenhouse emissions and pollution - job creation
mitigation strategies
- reducing climate change - reducing greenhouse gases and enhancing the "sinks" that accumulate and store these gases
Climate Action Summit 2019
- the UN estimates: Need to increase efforts between three- and five-fold to contain climate change to the levels dictated by science- a 1.5 degree Celsius rise at most - 65 countries and major sub- national economies (e.g. California): cut greenhouse gas emissions to net zero by 2050 - 70 countries: will either boost their national action plans by 2020 or have started the process of doing so - over 100 business leaders: concrete actions to align with the Paris Agreement targets and speed up the transition from the grey to green economy - many countries and over 100 cities- including many of the world's largest: significant and concrete new steps to combat climate crises
Global Warming
- the long-term warming of the planet
What causes the change in temperature?
- volcanic eruptions - changes to the sun
Greenhouse Gasses
- water vapor H2O - Carbon dioxide - methane - ozone - nitrous oxide - fluorinated gases ( chlorofluorocarbons and hydrofluorocarbon) - we wouldn't be able to live without greenhouse gases, but too much is not good
What are some important human needs?
-Basic material for good life -Security -Health -Good social relations: affection, understanding -Identity: a sense of belonging -Mobility: need mobility to go to work/ see our loved ones -Freedom of choice and action -Communication
Societal Impact on Linear Economy
-Expected increase in world population (pressure on stock of raw materials) -Increase in middle class population
Without healthy economy
-High unemployment -Social problems -Governments do not have revenues to solve societal problems
Without healthy envieonment
-Human health and well-being negatively affected -foundations of strong economy undermined (e.g. raw material availability)
Reasons of unsustaibaility
-Linear economy model -Barriers to people meeting their basic needs worldwide (e.g. work conditions, environmental conditions, governments)
^^Keep in mind
-Not 3 separate entities, but intimately, intertwined. Need to be balanced -Economics is not less important than the others -Overemphasis on any element is detrimental to the achievement of strong sustainability
Environmental Impact on Linear Economy
-Pressure on ecosystems (water, air, soil); -High energy and water consumption; -(Toxic) emissions; -Waste disposal (plastic soup)- pollution
Economic Impact on Linear Economy
-Raw material prices -Scarcity of raw material -Waste is no longer available to the economy
Benefits of changing to circular model
-USD 700 million annual material cost savings in the fast-moving consumer goods industry -48% reduction of CO2 emissions by 2030 -3,000 euro increase in disposable income per annum for EU households -USD 550 billion reduction in healthcare costs associated with the food sector
Building blocks of circular economy (four pillars)
-collaboration: very important for the system to work. Supply chain, consumers, policy makers, etc. -design: modular, upgradable, maintenance, disassembly (ease of), recycling, innovation - reverse logistics: final return of the materials to nature or back into the industrial production system 4Rs - business models
Benefits from pursuing sustainability
-differentiation of product or services and brand -increase attraction and retention of employees who care about sustainability. employee satisfaction and commitment -increase in investor interest -improvement of company image and reputation. customer satisfaction and commitment -reduction of energy and materials use, and waste. reduction in costs associated with these -lowering legal risks and insurance costs (e.g. environmental disasters) -innovation to create new products and serve new markets (e.g. seventh generation)
Moving towards sustainability
-set goals -measure performance and progress -identify risks and opportunities -integrate goals and metrics into long-term business strategy: sustainability is a long-term issue
Important Human Needs
...
COP21 Paris Dec 2015- Paris agreement
For the first time, brings all nations into a common cause to undertake ambitious efforts to combat climate change and adapt to its effects, with enhanced support to assist developing countries to do so - limit to below 2 degrees C (preferably 1.5 degrees C) - increase the ability of countries to deal with the impacts of climate change - an enhanced transparency framework for action and support
Triple Bottom Line
Not only economic prosperity(bottom line, account of profit and loss of business) but also business' impact on wider society and environment; that is, environmental quality(impact on the planet) and social justice(social impact of business)
Overshoot occurs when
humanity's ecological footprint exceeds earth's biocapacity
Weather
local changes we see on short scales from minutes to hours to days
Climate
long-term averages (regional or global)- the weather averaged overall several decades - it's harder to get a sense of climate change because the time scales involved are much longer and the immediate impact of climate change is much less (it takes a long time before we see a change) - encompasses global warming - broader range of changes that re happening to our planet
Linear economy: take - make - dispose
raw materials -> production -> use -> non-recyclable waste
Circular Economy
raw materials -> production -> use -> recycling -> repeat -The circular economy is a $4.5 trillion global opportunity by 2030
