a revelation atop the himalayas conservation comes after breakfast
TRANSCRIPT
A revelation atop the Himalayas
Conservation comes after breakfast
Which of the following items will take the shortest time to degrade in a landfill:
Aluminum can
Styrofoam cup
Cigarette butt
Disposable diaper
Which of the following items will take the shortest time to degrade in a landfill: Aluminum can
Styrofoam cup
Cigarette butt
Disposable diaper
Tasty mushrooms from dirty diapers
Sources of GHGs emission
33%
28%20%
11%
8%ElectricityTransportationIndustryCommercial & ResidentialAgriculture
Overall…
~Approximately 40% GHGs relate to subsistence activities
~60% of GHGs can safely be attributed to business related activities
Business and environmental sustainability
Environmental concerns
Business activities
Why should business care for the society/environment?
• Moral obligation
• The iron law of responsibility
• Social contract/legitimacy
• It pays off
Who other than business firms?
• Customers
• Watchdogs/NGOs
• Industry associations
• Governments
Business firms
Wide array of sustainability oriented
actions
Sourcing Manufacturing Selling
Sourcing stage- raw material choice
Aluminum can
Styrofoam cup
Cigarette butt
Disposable diaper
Concrete vs. wood/ wood vs. FSC certified wood
100 years
Immortal
10-12 years
75 years
Manufacturing stage- energy/waste management
Selling stage- Green logistics and retailing
Sustainability vertigo
Sustainability impasse
Why that impasse!
Restraint/regulation
Radical Innovation
Thomas MalthusRestraint
Regulation
Robert SolowRadical innovation
Deregulation
Restraint is intuitive, why not side with that?
A Solovian belief …
“…the world can, in effect, get along without natural resources,
so exhaustion is just an event, not a catastrophe.”
Three categories within the restraint paradigm
Conscious consumerism
Conscious business practices
Intervening mechanisms
Three categories within the restraint paradigm
Conscious consumerism
[Refuse/ Reduce/ Reuse/
Recycle/ Upcycle]
Conscious business practices
Intervening mechanisms
Three categories within the restraint paradigm
Conscious consumerism
Refuse/ Reduce/ Reuse/
Recycle/ Upcycle
Conscious business practices
[Workplace austerity, business model changes]
Intervening mechanisms
Three categories within the restraint paradigm Conscious consumerism
Refuse/ Reduce/ Reuse/ Recycle/ Upcycle
Conscious business practices
Workplace austerity, business model changes
Intervening mechanisms
[Regulations, standards]
Two categories within the innovation paradigm
Remedy oriented
“Eco-effectiveness” oriented
Two categories within the innovation paradigm
Remedy oriented
[Un-do the harm]
“Eco-effectiveness” oriented
Two categories within the innovation paradigm
Remedy oriented
“Eco-effectiveness” oriented
[Zero waste, cradle to cradle design, bio mimicry, circular industrial system]
Interaction between paradigms
When innovation fosters restraint
A shower that forces you to leave when you’ve wasted too much water
Interaction between paradigms
When restraint fosters innovation
Corporate fuel efficiency (CAFÉ ) standards
Restrainers’/regulators’ verdict
• Innovation is terrific but not the panacea
• Solovians are delusional in their denial of the earth’s carrying capacity
• Solovians risk lulling the public—and businesses-- into failing to reduce, reuse, and recycle as much as is required
Innovators’/deregulators’ verdict
• Focus on restraint can delay our collision with the earth’s carrying capacity but not allow us to innovate our way over it
• Malthusians are dreary and depressive: resist possibilities contained in innovation
Making innovation work
• Abundance of risk capital
• Policy against “problematic” practice
• Reducing the time between technology breakthroughs and mass commercialization
• Moore’s law for clean tech
• Unintended consequences (Jevon’s paradox)
Making restraint work
• Consistent, conscious, collective actions
• Social pressure on individual and companies
• Economic incentives?
Customers-sustainability
interfacePanwar – Kozak
Wood 465
Heard about Starbuck’s “race together” campaign?
• Brand misalignment
• Authenticity
• Reaction
Why customers in this conversation?
Let us learn something from FSC story (Buyer be fair Youtube)
What is the “take away”
Environment left to market forces: if customers want, they can pay a premium price for environmentally benign products
What does (or may) that mean?
• Tied to regulate/restraint- innovate/de-regulate dilemma
( and shhh…… it seems that they just voted against regulation)
• Should environment be left to consumers choice?
(Also consider this: …. https://vimeo.com/10324258 --Your brain on climate change: why the threat produces apathy, not action)
• Why should cost of environmental performance be passed on to consumers– reward/punishment dilemma?
• Will they pay?
Do customers care for corporate sustainability?
YES!
Are customers willing to pay for sustainability actions?
Conclusion of a meta-analysis
wood products with low base prices capture some price premiums
(Cai & Aguilar 2013)
实现森林可持续发展
潘瓦尔 – 科扎克(Panwar – Kozak )
Wood 465 (木材 465)
(Toward achieving sustainability in the forest sector)
About the title of the chapter
Words, words, words….
A typology of sustainability oriented initiatives
(i)Private governance networks
(ii)Transnational regulatory policies
(iii)Transnational voluntary market based policies
(iv)State level (national) regulatory policies
(v)State-level voluntary policies
Private governance networks
(i) FSC
(ii) PEFC
(iii) FFD
Transnational regulatory policies
(i) CITES
(ii) ITTA
(iii) UNCBD
Transnational voluntary market based policies
• International green purchasing network (IGPN)
• Equator Principles
• WB forestry financing
• Forest carbon and conservation policies– (e.g., REDD+)
• Global forest and trade network (GFTN)
State-level regulatory policies
• Lacey act
• European Union Timber Regulation
• How about BC’s Wood First Act?
State-level voluntary policies (market based)
• Green procurement programs
Bi-preferred
Eco- buy Australia
Or innovation is the answer?
Stopping illegal logging: DNA Barcoding of tropical woods
Initiatives on the manufacturing side
• Environmental management systems (EMS)
• Industry codes of conduct
• Environmental product declarations (EPDs)
Or are there some fundamental shifts to be made?
• Decentralization
• Fostering sharing economy
Sharing economy
Panwar –Kozak
Wood 465
Sharing
An informal co-operative arrangement
A niche market
An emerging economic system
“A system within which broad segments of the population can collaboratively make use of under-
utilized inventory via fee-based sharing”
“Developing value from untapped potential residing in goods that are not entirely exploited by their
owners”
For book-worms
“What’s Mine Is Yours: The Rise of Collaborative Consumption”
(Botsman & Rogers)
Drivers and enablers of sharing economy
• Financial incentive
• Concerns for sustainability (or perhaps a post hoc justification)
• Evolution from Web 1.0 to Web 2.0
• Changes societal views of sharing (doesn’t equate with intimacy)
How is it a fundamental shift?
• Consumption centric economy: you are what you own
• Sharing economy: you are what you can access
A semantic landscape of sharing economy
Collaborative consumption
Market mesh
Commercial sharing systems
Co-production
Co-creation
Prosumption/prosumers
Access-based consumption
Consumer participation
Online volunteering
Examples abound…
• Collaborative web content (Wikipedia, YouTube, Twitter, Flickr, fb,)
• Zipcar, Airbnb, Freecycle, Uber
• $335 billion by 2025
• P2PL/P2PI (e.g., Prosper and LendingClub)
(Goldman Sachs is seriously considering to invest in p2p platform Aztec Money)
Why give a damn…
sharing economy is going to represent a serious threat to established industries, due to fewer purchases and consequent
distress in conventional markets
So… learn to adapt to sharing economy!
1. Sell the use, not the product
2. Support your customers in their attempts to resell
3. Take advantage of unused resources and capacities
4. Provide repair and maintenance services
5. Align with collaborative consumption to target new customers
6. Find new business models based on the sharing economy
Sell the use, not the product
• Hilti Group (Liechtenstein)
products, systems and services to the global construction industry
sales losses to competitors’ inexpensive small tools in 1990s
sought to learn from its customers how the company could improve its offerings
Hilti learned (i) that workers sometimes saw small tools as basically disposable, (ii) that cheap battery-powered tools — while seemingly efficient at first glance —overload constructions worksites
Hilti’s response
• commoditization of tools represented a threat to current sales, it also opened up an opportunity to compete by providing customers with convenience and a service known as “tool fleet management”
• Customers can lease tools for no upfront capital investment and a fixed monthly rate within a defined usage time
• Not just flexibility and efficiency, but also an all-inclusive repair service
Zipcar triggered adaptation in auto industry
• Daimler AG- Europcar joint venture Car2go
• BMW’s Drivenow
• Peugeot’s Mu
Support your customers in their attempts to resell
• Ikea launched an online platform in Sweden allowing customers to resell their used Ikea goods– open to members of their loyalty program, Ikea Family
• Patagonia established the Common Threads Partnership with eBay. The partnership aimed to make it easy for anyone to buy and sell used Patagonia products
• Brand aligned de-marketing
Take advantage of unused resources and capacities
• share existing assets and capacities
• Maschinenring
- association in the industries of agriculture and forestry
- began with the basic sharing of machines, but now facilitates collaborative use of machinery, and even personnel renting
- Collaborative strategies- leveraging each other’s competencies (think Strategy as Ecology)
LiquidSpace (the “Airbnb of work spaces”)
• Collaborative consumption to the world of office space
• Tailors workspaces and meeting rooms to the particular needs of renters
• Connects corporations that have unused office space with those who are temporarily in need of it
• Enablers : the pressure of businesses to control real estate costs, mobile and social technology, and employees who like working from home
• Lq app relies on a “how I work” profile
Provide repair and maintenance services
• FedEx built up a large body of knowledge in the area of repairing electronic devices that its employees use in the process of making deliveries.
• FedEx TechConnect-- specializes in repairing electronic devices
• Coming back to the idea “what business are you in”
• You just cut lumber or are you in construction business?
Best Buy’s Geek Squad
• BB bought in 2002
• For both old and new purchases
A recommended reading
“Sustainability through servicizing” by Sandra Rothenbeg (2007). SMR.
Align with collaborative consumption to target new customers
What all could it mean?
Find new business models based on the sharing economy
• Kuhleasing.ch (a cow-leasing website)
• Illustrates how conventional industries can establish new business models by moving away from traditional revenue
Confronted with decreasing milk prices and the abolition of a cheese export union in 1999 Swiss farmers faced the challenge of selling large amounts of cheese to surviveActing from necessity, a Swiss farmer started leasing his cows to customers instead of solely selling the cheese- Lessees pay a fee to sponsor a cow for a season. The
arrangement includes a photo of the cow and a certificate, plus the option to visit the farm to help out as a volunteer or to watch the daily farm work
- The leasing cost does not include the cost of the final cheese product, but it guarantees a special price for a minimum purchase of 30 kgs of cheese from that cow
- The farm also offers additional leasing options that are available as gifts, such as short-term packages
- According to one farmer, all 150 of his cows are leased to customers around the world — in countries including Japan, South Africa and the United States
The Wine Foundry, a company that enables amateur and professional winemakers to make their own wine without owning a vineyard, by providing tools and assistance for wine production.-The Wine Foundry is a one-stop shop for custom wine production. -The company offers a full range of services, from fruit sourcing to label design.