innovation

Businesses Are Facing a New Reality. These Are the Ones That Are Succeeding.

They’re taking responsibility for their effect on people and the environment.

By Peter Lacy
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Astrid Stawiarz Getty Images for UN Global Compact

Astrid Stawiarz Getty Images for UN Global Compact

Evidence is mounting to show that the frequency and ferocity of extreme weather events is intensifying on a global scale. From severe droughts to powerful storms, we are living in an increasingly changeable, uncertain, and unpredictable world.

You don’t have to believe in climate change to accept this new reality. Resilience and the ability to manage challenges impacting us and our environment are of far greater importance to both business and society. Take the recent destructive hurricanes in the U.S. and the Caribbean, or the devastating floods in Nepal, India, and Bangladesh that represent a stark example of this new reality and of our growing vulnerability.

The role of business within this new reality is changing. Businesses have a critical role to play in helping solve the challenges we face through providing services and solutions that support society. In fact, businesses that do not adapt their models run the risk of eroding trust and ultimately, forfeiting customer loyalty.

Uncertainty in the world—from extreme events, to declining natural resources, to the changing skills required for employment—gives forward-thinking C-suite leaders an opportunity to adopt conscious capitalism through the incorporation of key elements like trust, collaboration, and stakeholder orientation into day-to-day business practices. And, as consumers increasingly demand that their brands reflect these objectives, companies that want to remain competitive will need to adapt by joining the circular economy.

At its most basic, the circular economy replaces the current wasteful linear economic model. Instead of organizations relying on finite resources, they conduct sustainable business. They find renewable resources. They remove waste at every stage, from sourcing to recycling—creating a business model that restores and regenerates, rather than depletes and throws away. They look at how products are made, who makes them, and where, as well as how those same products are recycled or sustainably retired. In fact, adopting a circular economy model is not simply about products and services but also the way we do business as companies. It presents an opportunity to move beyond simply meeting sustainability standards to a solution that transforms the current model of business and one that can create a competitive advantage for the leaders.

Leading companies are still innovating, but now in a way that takes responsibility for their effect on people, the environment, and the state of our world. And they have realized that—contrary to popular belief—doing so can still be profitable. Accenture research shows a potential $4.5 trillion reward for achieving sustainable businesses by 2030. And a number of companies are already making progress toward this aim.

Rubicon Global, for instance, a pioneering U.S.-based waste management company that connects customers directly with independent waste haulers, is disrupting the current waste disposal model to reduce waste to landfill, while passing on $1 million in savings to its clients across 80,000 locations.

Nike, another leading example, is rapidly transitioning toward its closed-loop vision with a bold target for FY2020: zero waste from contract footwear manufacturing going to landfill or incineration without energy recovery. To date, 70% of all Nike (NKE, -0.43%) footwear and apparel incorporates recycled materials, using 29 high-performance, closed-loop materials made from factory scraps.

As the circular economy and conscious capitalism take hold, the C-suite is taking note: 64% of UN Global Compact CEOs say sustainability issues play a central role in their strategic planning and business development, while 59% of CEOs report that their company can accurately quantify the business value created through their sustainability initiatives, up from 38% in 2013.

The circular economy, a critical aspect of this change, is already happening—so much so that the World Economic Forum Young Global Leaders, in collaboration with Accenture Strategy and in partnership with Fortune, recognize leaders through The Circulars, the world’s leading circular economy award program. The Circulars, presented each year at the World Economic Forum Annual Meeting in Davos, attracts entries from individuals and organizations across business and civil society, from global giants such as Unilever to innovative startups such as Method. A winner at The Circulars in 2015, Method was built on wholly circular and sustainable principles, ensuring 75% of its products are cradle-to-cradle certified, meaning they are designed and produced in a socially and environmentally responsible way. Method has eliminated countless toxic chemicals from homes by using natural inputs.

These are just a few examples of organizations driving value through circular economy innovation—there are many more. In a world in which conscious capitalism is becoming mainstream, the circular economy has a significant role to play in enabling businesses to make the transition whilst continuing to deliver value to customers, shareholders, and society. As more businesses take the lead, the opportunity that the circular economy represents will become a reality.

Stimulating Innovation to Create More Sustainable Cities

Andre Veneman is corporate director for sustainability and HSE with AkzoNobel .Environmental Leader, 11/12/2014
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It won’t be long before the world’s population reaches nine billion and by 2050, 70 percent of the world’s population will live in cities. All around the globe, population explosions are putting city infrastructure under severe strain. And at the same time climate change is posing serious challenges.

How will we cope? Can our cities accommodate so many people?

Yes it can, but we have to do things differently. We have to use our ambition and imagination to more efficiently manage the world’s limited resources.

Ultimately, the future health of our cities – and the people who live there – will hinge on our ability to do radically more with less. We need more innovation, less traditional solutions, more collaboration and less introverted thinking.

The widespread idea that innovation is driven by a lonely genius, a specific department, or a special group of champion innovators is not the case. Instead, success hinges on organizing and driving innovation through a team effort and a strong sense of a shared mission.

For many businesses, this should start with building strong relationships between different departments.

The problem is that in large corporations there is often a strong inward orientation. The structures, rules and regulations in place can hamper the ability to establish open relationships — both within an organization and externally. Perhaps the biggest challenge that companies face is creating a more open and forward-looking mindset; that is, thinking beyond current business issues and immediate future horizons.

To engage in sustainable innovation successfully, companies need to be prepared to work in a much more collaborative way. This means working effectively across procurement, operations, marketing and sales functions, and by partnering with suppliers and customers. A strong alignment between sourcing, research & development and marketing, for example, is vitally important to delivering sustainable solutions that work commercially and provide a practical benefit to urban environments.

A collaborative approach will make it possible to not only uncover exciting new ideas but help those ideas reach market faster than what would be possible through traditional models.

At AkzoNobel, we believe in establishing a collaborative, welcoming environment where ideas can be explored. When people have an idea, they are encouraged to reach out to anyone in the network to pursue the opportunity.

For example, on a flight home from a meeting, Peter Greenwood, a business development manager, came up with the idea to add colloidal silica to paint to enhance its self-cleaning properties. When he returned to the office, he reached out to another department to explore the idea. Before we knew it, a cross-departmental collaboration had developed between AkzoNobel’s Specialty Chemicals and Decorative Paints Business Areas resulting in a coating that can last up to 16 years, 25% longer than a standard product.

 

These types of collaborations are encouraged among senior level management. Of course, linking up departments is not enough on its own. They need to be aligned and focused on identifying sustainable solutions that customers need. Our company has a strong track record of creating innovations that benefit not only our customers but urban environments across the globe.

Sometimes, the insight to enhance urban environments comes from unexpected places. Our research and development team, for example, observed animals in nature to determine how they withstand cold and prevent ice from forming in their bodies. That insight led to Ecosel AsphaltProtection, a fully biodegradable additive for deicing brine. It works by slowing the freezing process, resulting in soft, slushy ice, rather than hard, abrasive ice.

There are many opportunities for businesses to develop commercially viable and sustainable product offerings that could make our cities more enjoyable, liveable and resilient. The key to success lies in the business model and in making the right connections: engaging effectively across the whole value chain and working in an open way open way with external stakeholders such as city councils, urban planners, NGOs, businesses and universities.

Companies can play an important role in safeguarding the future health of our cities. The world is changing and businesses must change with it to provide innovative products that make the world a better place.

Read more: http://www.environmentalleader.com/2014/11/12/stimulating-innovation-to-create-more-sustainable-cities/#ixzz3IsDERqfV

10 sustainable innovations: from solar-powered suitcases to floating classrooms

Laura Storm, the guardian, Wednesday 29 October 2014 03.00 EDT

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The 2014 Sustainia Awards, chaired by Arnold Schwarzenegger, attracted more than 900 submissions for projects and technologies representing 10 different sectors from food, fashion and, city development to transportation and healthcare. Collectively, these projects are deployed in more than 84 countries.

The runners up for the award are showcased here and the winner will be announced in Copenhagen on Thursday 30 October. The ceremony will celebrate these innovations ahead of the release of the Intergovernmental Panel on Climate Change’s (IPCC) anticipated report on climate change, due to be finalised 31 October.

  1. Food finalist: Netafim (Israel) – gravity-powered irrigation

Netafim offers low-tech irrigation. Photograph: Netafim

Netafim is behind a low-tech irrigation system for smallholder farmers in developing countries which increases and secures yields while saving water and cutting costs. It drips precise quantities of water and nutrients right at the root zone of crops while an elevated tank distributes the water using gravity.

This minimises the need for electricity and investments in infrastructure. The UN estimates that 500 million smallholder farmers provide over 80% of the food consumed in the developing world. Irrigation systems are vital to sustain agriculture as it addresses water scarcity and soil erosion. The solution is commercially viable with a payback-time of about a year, making it fit for microfinance projects.

  1. Transportation finalist: 8D technologies (Canada) – bike sharing app

Spotcycle bike-sharing app. Photograph: 8D Technologies

As a mode of transport, the bicycle is one of the lowest emitter of greenhouse gases – even with the CO2 emissions of the food you need to power a bike. This helps explain why bike-sharing systems are being adopted increasingly by cities. The Spotcycle app from 8D technologies aims to make bike-sharing more convenient and smartphone-friendly. The app locates nearby bike stations and communicates availability, maps out bike paths and helps with navigation. The app is already in sync with cities in North America, Australia and Europe.

  1. Buildings finalist: Advantix (USA) – air-conditioners which use saltwater

Advantix’s saltwater air conditioning system. Photograph: Advantix

Air conditioners use about 5% of all electricity produced in the US. As a result, 100m tons of carbon dioxide are released each year. Advantix’s air conditioning system uses saltwater which means it needs 40% less energy than normal systems. Whereas air-conditioning systems normally chill the air to remove humidity and then reheat it in a highly energy-intensive process, Advantix’s air-conditioners funnel the air through non-toxic fluid saltwater instead. The process dehumidifies the air without the need for re-heating.

  1. Fashion finalist: I:CO (Switzerland) – textile recycling

An I:CI clothing drop-off recepticle. Photograph: I:CO

Clothes are often discarded after the first or second life cycle, and apparel accounts for up to 10% of a western consumer’s environmental impacts. Through an advanced take-back system, I:CO works to keep apparel, footwear and other textiles in a continuous closed-loop cycle. Used shoes and clothing are collected in stores and retail outlets, where customers are financially rewarded for depositing their used items. Once collected, the textiles are sorted according to more than 350 criteria for designation. Used clothes can be labeled suitable for: second-hand sale, recycling into fibres and paddings for new products, or upcycling.

 

 

  1. IT Finalist: Fairphone (Netherlands) – A smart-phone with social values

Fairphone conflict-free phones. Photograph: Fairphone

Through development, design and production, social enterprise Fairphone works to create positive social impact in the consumer electronics supply chain – from responsible mining, decent wages and working conditions to reuse and recycling.

Fairphone began by redesigning the processes behind the production, making phones that use conflict- free minerals and are assembled in a factory with a worker-controlled welfare fund. To date, Fairphone has sold nearly 50,000 phones from its first two production runs.


 

  1. Health finalist: We Care Solar (USA) – solar suitcases giving life

The Solar Suitcase provides lighting for medical professionals. Photograph: Solar suitcase

Preventable causes related to pregnancy and childbirth claim 800 lives daily and 99% of cases happen in developing countries. We Care Solar has created a sustainable solution. The Solar Suitcase provides solar electricity for medical lighting, mobile communication and essential medical devices for rural areas and humanitarian settings. This enables safe and timely obstetric care, which ultimately improves maternal and neonatal outcomes. Additionally, the innovation allows emergency surgeries to be conducted around-the-clock in rural hospitals. The Solar Suitcase has been introduced to more than 600 healthcare facilities in 20 countries.


 

  1. City Finalists: Wecyclers (Nigeria) – Pedal-powered recycling

Wecyclers collectors. Photograph: Wecyclers

In Lagos, Nigeria, Wecyclers is fuelling social and environmental change by enabling people in low-income communities to make money from unmanaged waste piling up in their streets.

It is a response to the local waste crisis; the municipal government collects only 40% of city garbage. The Wecyclers initiative has deployed a fleet of cargo bicycles to pick-up, collect and recycle garbage in low-income neighbourhoods. Families are encouraged to recycle their bottles, cans and plastics through an SMS-based programme. For every kilogram of material recycled, the family receives Wecyclers points on their cell phone. Families can then redeem points for goods such as cell phone minutes, basic food items or household goods. The initiative adds to the local economy by hiring personnel locally.

  1. Resource finalist: Newlight Tech (USA) – carbon-negative plastic

Carbon-negative plastic. Photograph: Newlight

With its novel technology that converts greenhouse gases into plastic material, AirCarbon has disrupted the market by replacing oil-based plastics with a sustainable product that is competitive in both price and performance. It is made from a process where carbon in the air is captured and used in manufacturing. AirCarbon uses pollutants as resources to make products otherwise made from oil. Products made from AirCarbon are carbon-negative even after calculating the emissions from the energy used in production. AirCarbon is currently used to make chairs, bags and cell phone cases.


 

  1. Education finalists: Shidhulai Swanirvar Sangstha (Bangladesh) – school boats combatting climate change

Floating school rooms. Photograph: Shidhulai Swanirvar Sangstha

More than one million Bangladeshis could be displaced by rising sea levels by 2050. One consequence is that children cannot attend school for long periods of time, making it harder for them to escape poverty. By building a fleet of solar-powered school boats, the Bangladeshi initiative Shidhulai Swanirvar Sangstha has secured year-round education in flood-prone regions of Bangladesh. Each floating school boat collects students from different riverside villages, ultimately docking at the last destination where on-board classes begin. Solar lighting makes the schedule flexible, which provides for additional educational programs in the evening. Shidhulai’s floating schools model has been replicated in Nigeria, Cambodia, Philippines, Vietnam and Zambia.

  1. Energy Finalists: Opower (USA) – personal energy-efficient expert

Utilities use Opower to share money-saving insights with custumers. Photograph: Opower

Through use of big data, Opower has given energy utilities a new way of engaging with customers in order to improve energy efficiency. The software solution combines cloud technology, big data and behavioural science to produce data analyses and personalised information on how to save energy. To motivate reductions in energy consumption, utilities use Opower to share money-saving insights with custumers. Opower can also show households their energy usage compared to neighbours; an effective method in motivating people to save energy. Opower has enabled savings of over 4TWh of energy, which is equivalent to $458m (£283.1) in bill savings.

Laura Storm is executive director at Sustainia