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Business and Sustainable Development – The Green Race is on

Business and Sustainable Development – The Green Race is on. Goteborg , November 2010 Björn Stigson Visiting Professor in Applied Corporate Management. Agenda. WBCSD The Sustainable Development Context The Green Race is On WBCSD Work Program. WBCSD.

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Business and Sustainable Development – The Green Race is on

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  1. Business and Sustainable Development – The Green Race is on Goteborg, November 2010 Björn Stigson Visiting Professor in Applied Corporate Management

  2. Agenda • WBCSD • The Sustainable Development Context • The Green Race is On • WBCSD Work Program

  3. WBCSD Coalition of some 200 leading companies • Market capitalization: 7,000 BUSD • Total member company employees:13 million • Global outreach • Supplies products and services to half of the world’s • population every day

  4. WBCSD Membership 68 40 24 18 16 11 7 2 1

  5. Swedish Members

  6. WBCSD Sectors 21 18 14 13 13 12 12 11 11 10 10 8 7 6 4 4 4 2 2 2 1 1 1

  7. WBCSD Regional Network Channel to globally disseminate WBCSD’s messages, to promote implementation of concrete projects on the ground and to provide input to WBCSD work program

  8. A World in Transition to Sustainability Environment Society Economy

  9. The Future Society: A growth story World population (in Billions): 1950-2050 2050= 9.2 billion +33% 2010= 6.9 billion 85% Population in less developed countries 85% 15% Population in more developed countries 15% Source: United Nations Population Division, World Population Prospects: The 2006 Revision.

  10. Development: The Poverty Challenge Income poverty: • Over 2 billion people live on less than $2/day Energy poverty: • 1.6 billion people today without access to electricity Mobility poverty: • 900 million people without access to transport Water poverty: • 1.8 million deaths per year due to lack of sanitation, poor hygiene and unsafe drinking water.

  11. Urbanization 50% urban in 2010: 3 billion

  12. The Urbanized Future 70% urban in 2050: 6 billion 70% urban 2010: 3 billion 6.4 urban 60% urban rural 5.0 47% urban 3.2 3.3 36% urban 2.9 2.8 2.4 Billions of inhabitants 1.3 2050 1970 2000 2030 Source: United Nations, World Urbanization Prospects: The 2007 Revision

  13. Shifting demographics A largely aging world The cost of growing old Age-related spending (as % of GDP in selected countries) Source: Standard and Poor’s 2010 Source: UN population prospects, 2008

  14. Shifting Fortunes % Share of GDP * At purchasing-power parity Source: Angus Maddison, OECD; IMF From The Economist print edition. “Wrestling for influence.” July 3rd 2008. Emerging economies > 50% of global GDP and trend will continue

  15. A World in Transition to Sustainability Geography Risks and Returns Solutions Mindsets Governments Values Environment Asia vs. NA & EU Shared vision Societies National vs. Global Economy Society Financing Technology Equity Priorities Business Companies Infrastructure Markets Financial Sector

  16. The World is Turning Green • “The Green Race is on” between countries to transform to low carbon economies and to become the leading supplier of resource efficient technologies & solutions • If you want to win: • Transform your home market to build domestic demand, competences and scale for exports

  17. The Green Race is On EU • Market leader today on green technology exports (40% market share) • 300% increase in R&D for green technologies in 2009 • Transformation of the internal market? US • Mobilizing the US innovation capability? • Transformation of the home market?

  18. The Green Race is On China • About to become the leader in the race • Key component of next 5-Year Plan (2011-2015) • Clean energy investment : No. 1 rank with 21% of the 162 billion USD invested globally • Taking the lead on solar & wind

  19. The Green Race is On Japan • Most energy efficient economy • Has a good technology platform for green solutions Korea • Largest share of economic stimulus devoted to “green” sector (80%) • Presidential Decree: Green New Job Creation Plan 2009 • GGGI – Global Green Growth Institute India • Supplier of low cost solutions based on domestic demand from a large, poor population

  20. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  21. WBCSD Vision 2050 • Vision 2050: • A platform for dialogue about the role of business in a resource & carbon constrained world.

  22. Vision 2050: Living well, within limits of the planet Ecological Footprint (Global Hectares per Person) Source: GFN / UNDP Human Development Index (HDI)

  23. Vision 2050 Pathway: 9 elements The pathway to Vision 2050 TODAY

  24. Turbulent Teens The pathway to Vision 2050 TODAY

  25. Opportunities in Vision 2050

  26. Size of potential additional sustainability related business opportunities PwC estimates drawing on data from IEA, OECD and World Bank

  27. Follow-up of Vision 2050 • Green Growth / Green Race • Cooperation with OECD • Consumption and Lifestyles • People Matter • Sustainable Management Institute

  28. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  29. Development Focus Area • Focus • To contribute to a sustainable future for emerging economies and developing countries Key Workstreams: National Market Participation Inclusive Business Energy Access Partnerships (Africa, Asia-Pacific)

  30. Development Focus Area • “Business & Development” • Message: • Business is a key source of economic growth, employment & technology

  31. UN Millennium Development Goals • Summit September 2010 • Workshop: “Accelerating progress towards the MDGs through Inclusive Business” • Organized by WBCSD and other leading business organizations and networks • UN Private Sector Forum • UN Secretary-General Ban Ki-moon: • “Business is a primary driver of innovation, investment and job creation. There is no longer any doubt that business plays an integral role in delivering economic and social progress." • World Bank President Robert Zoellick: • "The problem of the poor is not the dominance of markets, but its absence."

  32. Measurement & Reporting • Measuring Impact Framework • Helping companies measure impacts to inform investment decisions and conversations with stakeholders • Forthcoming: summary of impact measurement methodologies relevant to business

  33. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  34. COP 15 Copenhagen Takeaways: • Copenhagen saw the end of old ways of intergovernmental negotiations • The Copenhagen Accord • A non binding “Letter of Intent” • But little clarity on how this will be implemented

  35. The Copenhagen Accord • Main elements: • Committed limiting global warming to 2°C • Encouraged pledges of cuts from developed countries and actions from developing countries • Agreed to transparent reporting of actions • Proposed new mechanisms to manage finance, technology and REDD+ • Committed $30 to 2012 • 2nd phase - 100 bln$ annually by 2020

  36. UNFCCC COP 16 Cancun • Little urgency in UN negotiations post-Copenhagen • Expectations for COP16 Cancun played down • Major obstacles: • Lack of US domestic legislation • Country commitments to further reductions? • Reporting and verification principles? • Technology transfer and funding to developing countries?

  37. Climate negotiations and business • Governments recognize necessity for business input • WBCSD study for the EU focused on improving this interface • Need to build an informal track for engagement to complement stronger links to the formal proceedings • Mexican Dialogues 2010 • Providing input on Finance, Carbon Markets and Technology

  38. Technology • Key issue for business • Need for long term plans to guide investments and funding of RD&D • New WBCSD reports: • “Enabling Frameworks for Technology Diffusion” • “Innovating for green growth - Drivers of private sector RD&D” • IEA cooperation with WBCSD: • IEA Technology Roadmaps • IEA “Technology Perspectives to 2050” • IEA Technology Platform project

  39. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  40. Ecosystems • Ecosystems degradation is a risk and an opportunity for business • Core operations • Value chains • Convention on Biological Diversity (CBD) • COP 10 Nagoya, Japan 40

  41. Convention on Biological Diversity COP 10 • Strategic Plan approved by 193 parties which have 2 years to adjust their national biodiversity action plans • “Aichi” targets for biodiversity by 2020 e.g. • Increase land Protected Area by 17%; marine to 10 % • Halve rate of habitat lost including forests • Nagoya Protocol on Access & Benefit Sharing (ABS) • Consultation obligations for use of genetic resources

  42. WBCSD and Ecosystems • Ecosystem Services Review (ESR) • method to develop strategies to manage risks and opportunities arising from dependence and impact on ecosystems • “Ecosystem Valuation Initiative”

  43. Convention on Biological Diversity (CBD) • New WBCSD publications: • Effective Biodiversity and Ecosystem policy and Regulation • Business has a strong interest in ensuring ecosystems continue to function properly to deliver both business and societal value • A framework for closer collaboration between business and policy makers on biodiversity conservation is needed • Responding to the Biodiversity Challenge • 30 member company case illustrations responding to CBD core objectives

  44. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  45. Urban Infrastructure Initiative (UII) • Overall objective: • Involving business early in the urban planning process will help create a cross-cutting strategy and provide competitive and effective solutions

  46. Sustainable Value Chains Initiative Material sourcing Manufacturing End-of-life Consumer disposal Distribution • Focus 1st Phase: • Fast Moving Consumer Goods • Co-chaired by: • Unilever and Coca-Cola • Objectives: • A practical “how to” guide including best practice information, templates, case studies, etc. • Leadership on the Rio +20 (2012) Sustainable Consumption agenda Sales & retail Consumer use Consumer purchasing

  47. New potential Systems Solutions • Food, water, land-use, energy, and climate change

  48. WBCSD Work Program Focus Areas The Business Role Energy and Climate Development Ecosystems Projects • - Water • - Buildings • - Forest Products • - Cement • Electricity • Utilities • Tires • Mobility • Mining • Eco Patent Commons • Maritime Joint ventures • - GHG Protocol • - SDMI • Urban Infrastructure • Sustainable Value Chains • Urban Infrastructure • Sustainable Value Chains Systems Solutions

  49. Water • “Water, Energy and Climate Change” • Water & Energy linked • Impacts from ecosystems and climate change • Measuring water use & assessing impacts: • WBCSD Global Water Tool • Water Footprint Network • Development of ISO standard on water footprint • Business input to major water events

  50. Cement Sustainability Initiative • 24 member companies - 10 years of successful collaboration • Achievements: • Cement CO2 Protocol • Global database on energy and CO2 • Industry guidelines & company commitments • (emissions, fuels, raw materials, safety management) • 5 Chinese members • Cooperation with China Cement Association

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