Davos 2019: The Conversation in Switzerland Ripples Out to The Rest of the World – News, Commentaries, Reports, Initiatives, For Your Consideration

by Hank Boerner – Chair &  Chief Strategist, G&A Institute

Davos, Switzerland –  January 2019: The Conversation in Switzerland Ripples Out to The Rest of the World – News, Commentaries, Reports, Initiatives, For Your Consideration

by Hank Boerner – Chair and Chief Strategist, G&A Institute

The world leadership gathering in Switzerland in winter every year – we see this in the “Davos meetings” in the news report datelines – are part of the World Economic Forum’s (WEF) broad thought leadership activities.  This gathering is the WEF’s annual meeting (there are regional meetings as well).

Heads of state, CEOs, invited societal thought leaders, leading academics and journalists, politicians of all persuasions, NGOs, heads of multilateral heads (Christina Lagarde, International Monetary Fund)…they were all gathered there again this year.

WEF bills itself as “the international organization for public-private cooperation”; it was created in 1971 as a not-for-profit, to operate in a non-partisan, independent forum for leaders of society.  The annual meeting provides the opportunity for sharing ideas on a wide range of issues and topics. And then the broadcast of these out to the world.
This year, the broad themes of discussion included “4th Industrial Revolution”, “Geostrategy”, “Environment”, and “Economics”.

“Shaping” (taking actions as private-public partnerships) was the theme of numerous initiatives such as “Shaping The Future of Environment and Natural Resource Security”.

A slew of reports are typically issued each year; in 2019 one was “Seeking a Return on ESG: Advancing the Reporting Ecosystem to Unlock Impact for Business and Society”.

These reports and other information are available for you on-line at: https://www.weforum.org/agenda

Naturally, with the wise men and women of our global society gathered in the snowy reaches of Davos and presenting their views over several days, there was the usual flow of headlines and news stories out to the rest of the world.

Our team, led by Editor-in-Chief Ken Cynar closely monitors the Davos and other WEF meetings (the annual and regionals) to bring you relevant highlights. This week after the conference wrapped up, Ken Cynar selected this week’s Top Story pick.

That selection presents the comments of Hans Vestburg, CEO, Verizon Communications, on the theme of The Fourth Industrial Revolution and a Sustainable Earth.  CEO Vestburg (he’s originally from “high latitudes” Sweden and became CEO in August 2018) is strategically positioning his giant telecomm enterprise to balance market leadership, promising advances in technology (such as 5G networks) and challenges presented by climate change, population growth — and helping society achieve a sustainable and equitable future.

Hans Vestburg said at Davos: “Perhaps it because of my roots in a land so beautiful (Sweden) and yet so vulnerable…I’ve long had an interest in the potential link between technological advancement and environmental sustainability.”  CEO Vestberg helped to lead the U.N. Sustainable Development Solutions Network, as example.

He sees the coming generation of high speed, highly-interactive technologies as a possible resource to help society buy time against catastrophic worldwide climate change (think of 3D printing, 5G networks, the Internet of Things, 4IR networks, autonomous devices).

Consider this, said the CEO of Verizon to the Davos leadership gathering:  “If we and our partners throughout industry, government and academia can collaborate imaginatively on way to maximize the sustainability benefits of these emergent technologies from the very start, the next few crucial decades could see cascading gains in momentum against both materials wastage and emissions.”

We think you’ll find his comments intriguing – and most welcome from the CEO of a prominent U.S. corporation with commitment to address critical issues related to climate change, and willing to speak up!

This Week’s Top Story

Want a Sustainable Earth? Bring on the Fourth Industrial Revolution
(Wednesday – January 23, 2019) Source: World Economic Forum – When I became CEO of Verizon back in August, one of my commitments was to accelerate our company’s progress in Fourth Industrial Revolution (4IR) technologies, drawing upon our longstanding role as a world leading…

There Were Many Positive Developments for Sustainability Professionals in 2018 and Much Promise for What’s To Come in 2019 – We Are Watching For You

There were many positive developments and trendlines in 2018 that we believe were encouraging for corporate sustainability & responsibility managers, sustainable investing champions, NGO managers and members, and other stakeholders.  The analyses and wrap-ups are beginning to appear now in the many media outlets and platforms that we monitor.  We bring you some highlights in this first newsletter of the exciting new year, 2019!

One of the most compelling and sweeping of essays to kick off the year was the commentary of Andrew Winston in the Harvard Business Review – “The Story of Sustainability in 2018:  We Have About 12 Years Left.”

Author Winston came to broad attention with the publication of his books, “Green to Gold” and “Green Recovery”, and the recent “The Big Pivot”.  In his end-of-year HBR commentary, the author begins with the important 2018 sustainability themes that he sees as having lasting impact, and his belief that the year just ended brought “incredible clarity” about the scale of our challenges and opportunities.”

Clarity:  the world’s scientists sound a “final” alarm on the climate — citing the Intergovernmental Panel on Climate Change/IPCC report on where we are; that is, dear reader, in a global, universally-perilous state with just a dozen years left for bold, collective action on carbon emissions.

Clarity:  the key elements of the government of the United States of America told a similar story in the U.S. National Climate Assessment released at Thanksgiving time (with the White House attempting to bury on a slow Friday after holiday) – climate change inaction could knock off 10% of this, the world’s leading economy’s enormous GDP.  The U.S. GDP was US$19.39 trillion in 2017, said sources including the World Bank.

Clarity:  Business must dramatically change how it operates and companies must push well past their comfort zones.

There’s lots of information for you regarding the threats and challenges posed by dramatic climate change.  And, Andrew Winston points out the positive developments as well, by corporate leaders at organizations such as Unilever, Salesforce, Nike, Kroger, and Danone (which became the world’s largest B Corporation in 2018).

We present Winston’s wrap up for you in this week’s Top Story:

The Story of Sustainability in 2018: “We Have About 12 Years Left” 
(Wednesday – January 02, 2019) Source: Harvard Business School – We have about 12 years left. That’s the clear message from a monumental study from the Intergovernmental Panel on Climate Change (IPCC). To avoid some of the most devastating impacts of climate change, the world must slash carbon…

State of Corporate Sustainability, GreenBiz Releases Latest Update — Top Lines: (1) We are making progress and (2) There are still challenges

by Hank Boerner –  Chair and Chief Strategist – G&A Institute

It’s now three-quarters of the way through the year 2018 – what is the state of the Sustainability Profession?  John Davies, writing in GreenBiz (he’s VP & Senior Analyst), shares some interesting highlights gained through the firm’s recent report with us this week.

Among the major themes:  (1) Companies large and small see advances – progress – more companies are communicating what they are doing.  (2) Serious concerns, challenges, barriers are still ahead (look at what is happening to the US SEC and the dismissal of sound science by policymakers).

The Greenbiz report on the state of the profession is always eagerly awaited (every-other-year) and the latest (the 2018 report) is available for you (the link is in the Top Story).

GreenBiz presented results of its research on such items as gender pay equity trends; the embedding of the sustainability role(s) throughout the organization; more professionals coming in to the firm from outside vs. being promoted from within; and, the corporate sustainability programs becoming more sustainable.

There is also an interesting collection of news items we’ve selected for you that describes the range of activities within industries as companies of all sizes as the “corporate sustainability wave” gains momentum.  It’s below the Top Story for you.

This Week’s Top Story

The State of the Sustainability Profession, 2018
(Tuesday – September 25, 2018) Source: GreenBiz – That’s a significant change from 2011, when the Governance & Accountability Institute found just under 20 percent of S&P 500 companies were publishing such reports.

And we call your attention to:
Sustainable Brands Delivers Insight on How to Build Better Sustainability Metrics
(Friday – September 28, 2018) Source: Sustainable Brands – Sustainable Brands® reveals program, networking and activity highlights for its upcoming conference: New Metrics 2018. Nearly 400 business executives will convene October 29-31 at the Loews…

INSTITUTIONAL INVESTORS LAUNCH ALLIANCE FOCUSED ON HUMAN RIGHTS

by Hank Boerner – Chair and Chief Strategist, G&A Institute

ICCR Provides Leadership for Investor Collaboration To Advance Corporate Sector and Investor Action on Human Rights Issues

The recently-launched Investor Alliance for Human Rights provides a collective action platform to consolidate and increase institutional investor influence on key business and human rights issues.

For nearly 50 years, the Interfaith Center on Corporate Responsibility (ICCR) has been engaging with corporate managements and boards, coalescing with asset owners and managers and waging campaigns on key E, S and G issues.

ICCR has become a major influence for investors at corporate proxy voting time, and in ongoing investor-corporate engagements.

Consider:  The member institutions have AUM of US$400 billion and influence many other investors (depending on the issue in focus at the time).

ICCR has 300-plus institutional investor members, many (but not all) are faith-based organizations. A good number of member institutions are leaders in making available sustainable & responsible investment products and services. (See representative names in references at end.)

Key issues in focus for ICC members include:

  • Human Rights (key: human trafficking, forced labor, fair hiring practices)
  • Corporate Governance (board independence, CEO comp, lobbying)
  • Health (pharma pricing, global health challenges)
  • Climate Change (science-based GhG reduction targets)
  • Financial Services (risk management for financial institutions, responsible lending)
  • Food (antibiotics in food production, food waste, labor)
  • Water (access, corporate use of water and pollution)

HUMAN RIGHTS IN FOCUS FOR NEW ALLIANCE

On the last issue – Human Rights – ICCR has long been involved in various Human Rights issues back to its founding in 1971 and has been organizing the Investor Alliance for Human Rights since late-fall 2017.  Here are the essentials:

  • Investor Alliance participants will have an effective “Collective Action Platform” for convening, information sharing, and organizing collaboration on action to make the case to corporate decision-makers and public sector policymakers (and other stakeholders) on the need for urgency in addressing human rights issues.
  • The umbrella of a formal alliance will help individual participants to build partnerships and develop collaboration within their own universes of connections (such as NGOs, other investors, community-based organizations, trade groups, corporate leaders, multi-lateral organizations, and other institutions and enterprises).
  • Among the work to be done is the encouragement and support of building Human Rights criteria and methodology into asset owner and manager guidelines, investing protocols, models, and to integrate these in corporate engagements and proxy campaigns, as well as to guide portfolio management. (Buy/sell/hold decision-making.)
  • All of this will help to expand investor reach and influence and strengthen advocacy for best practices in Human Rights by both companies and investors. Leveraging of broader investor influence is key in this regard.

The Alliance will provide participants with a “rapid response” resource to assure that the “investor voices” are clearly heard in corporate board rooms and C-suites, in public sector leadership offices, and in media circles when there are threats posed to effective actions and reforms in Human Rights issues.

The Alliance is outreaching to NGOs, faith-based institutions, academics, media, labor unions, multi-lateral global institutions, trade and professional associations, corporate managements and boards, and of course to a wide range of asset owners and managers.

# # #

The key player at ICCR for the Alliance is David Schilling, a veteran staff member who is Senior Program Director – Human Rights & Resources. (email:  dschilling@iccr.org)

David joined ICCR in 1994 and has led initiatives on human rights in corporate operations in Africa, Asia and Latin America, often visiting factories and meeting with workers on the ground.

David is currently Chair, Advisory Board of the Global Social Compliance Program; member, International Advisory Network of the Business and Human Rights Resource Centre; member, RFK Center Compass Education Advisory Committee; UNICEF CSR Advisory Group; and, Coordinator (with ICCR member institutions) of the Bangladesh Investor Initiative (a global collaboration in support of the “Accord for Fire and Building Safety”.

# # #

ICCR stresses that it sees its work “through a social justice lens.”  For more than two decades members and staff have worked to eradicate human rights abuses in corporate operations and across global supply chains, such as forced child labor in cotton fields in Uzbekistan.

The organization has an Advisory Committee of Leaders in Business and Human Rights (formed in late-2016).  Members include representatives of Boston Common Asset Management; Shift; Landesa; The Alliance for a Greater New York; Oxfam America; Mercy Investment Services; International Corporate Accountability Roundtable; and Global Witness.

# # #

ICCR has a long history in Human Rights progress.  The organization came together as a committee of the mainstream Protestant denominations under the  umbrella in 1971 to organize opposition to the policies and practices of “Apartheid” in South Africa.

Over time, the U.S. corporations operating in South Africa stopped operations there.  More than 200 cities and municipalities in the United States of America adopted anti-Apartheid policies, many ending their business with companies operating in South Africa.

Protests were staged in many cities and on many college & university campuses, and U.S. and European media presented numerous news and feature presentations on the issue.

In time, the government of South Africa dismantled Apartheid and the country opened the door to broader democratic practices (the majority black population was formerly prohibited to vote).

Over the years since the Apartheid campaign, ICCR broadened its focus to wage campaigns in other societal issues, including:

  • Focus on fair and responsible lending, including sub-prime lending and payroll lending.
  • Putting climate change issues on the agenda for dialogue with corporations, including the demand for action and planning, and then greater disclosure on efforts to curb GHG emissions.
  • Encouraging investment in local communities to create opportunities in affordable housing, job development, training, and related areas.
  • Promoting greater access to medicines, including drugs for treatment of AIDS in Africa, and affordable pricing in the United States.
  • Promoting “Impact Investing” – for reasonable ROI as well as beneficial outcomes for society through investments.
  • Promoting Islamic Finance.
  • On the corporate front, requesting greater transparency around lobbying by companies to influence climate change, healthcare and financial reforms, both directly and through trade associations and other third-party organizations.
  • Opposing “virtual-only” annual corporate meetings that prevent in –person interaction for shareholders.

Proxy Campaigns – Governance in Focus:

ICCR members are very active at proxy voting time.  Among the “wins” in 2017:

  • Getting roles of (combined) Chair & CEO split – 47% support of the votes for that at Express Scripts and 43% at Johnson & Johnson; 39% at Chevron.
  • More disclosure on lobbying expenditures – 42% support at Royal Bank of Canada and 41% at First Energy; 35% at Cisco and 25% at IBM.

# # #

Notes and References:

Information on the new Alliance is at: http://iccr.org/iccr-launches-new-alliance-amplify-global-investor-influence-human-rights

ICCR’s web site is at: www.iccr.org

And at http://iccr.org/our-issues/human-rights/investor-alliance-human-rights

The Alliance initiative is supported with funding from Humanity United and Open Society Foundations.

Influence and Reach:  The ICCR member organizations include the AFSCME union fund, Walden Asset Management, Boston Common Asset Management, Oxfam, The Maryknoll Fathers and Brothers, and Maryknoll Sisters, American Baptist Churches, Mercy Investments, Christian Brothers Investment Services (CBIS), Wespath Investment Management, Everence Financial, Domini Social Investments, Church of England Ethical Investment Advisory Group, Gabelli Funds, Trillium Asset Management, Calvert Group, Clean Yield, The Nathan Cummings Foundation, and other institutional investors.

 

 

 

 

 

Critical Development for CDP Responders in 2018 & 19: CDP Introduces Additional Alignment With FSB Task Force on Climate-Related Financial Disclosures Recommendations

By Hank Boerner – Chair & Chief Strategist, G&A Institute

Corporate ESG Data, Data, Data – it’s now everywhere and being digested, analyzed and applied to corporate equity analytics and portfolio decision-making.

Whether your public company participates in the annual round of organizing responses to the ever-more comprehensive queries from leading ESG / sustainability / CR rating agencies or not, there is a public ESG profile of your company that investors (asset owners, managers and analysts) are examining and applying to their work.

If you don’t tell the story of your firm’s progress in its sustainability journey, someone else will (and is).  And if you have not embarked on the journey yet…and there is not much to disclose and report on…you are building the wrong kind of moat for the company.  That is, one that will ever-widen and impair access to capital and affect the cost of capital.  And over time, perhaps put the company’s issues on the divestiture list for key investors.

This sounds a bit dramatic, but what is happening in the capital markets these days can be well described as a dramatic shift in focus and actions, with corporate ESG strategies, actions, programs, achievements, and disclosure becoming of paramount importance to a growing body of institutional and retail investors.

Consider these important developments:

  • The influential Barron’s editors, reaching hundreds of thousands of investors every week, beginning in Fall 2017 made coverage of corporate sustainability and sustainable investing a mainstay of the magazine’s editorial content.
  • Morningstar, the premier ranker of mutual fund performance, added sustainability to the analysis of funds and ETFs with guidance from Sustainalytics, one of the major ESG rating firms (and Morningstar made a significant investment in the firm).
  • SustainableInvest, headed  by Henry Shilling, former leader on sustainability matters for Moody’s Investor Service, noted that in 2Q 2018 as the proxy season was ending, 2018 voting was notable for the high level of “E” and “S” proposals, some achieving majority votes in shareholder voting at such firms as Anadarko Petroleum, Kinder Morgan and Range Resources.  Assets in 1,025 sustainable funds analyzed added $14 billion during 2Q and ended in June at US$286 billion; more than $1 billion was new net cash inflows, demonstrating investor interest in the products.

Significant:  according to the Harvard Law School Forum on Corporate Governance and Financial Regulations, two-thirds of investor-submitted proxy resolutions focused on having the company follow through on the 2-degrees scenario (testing) were withdrawn and company boards and managements agreed to the demand for climate risk reporting.

The FSB TCFD Impact on Corporate Sector and Financial Services Sector

The Financial Stability Board, an organization founded by the central bankers and financial leaders of the G-20 nations, created a Task Force on Climate-related Financial Disclosures (“TCFD”) to develop climate-related financial disclosures for adoption by financial services sector firms and by publicly-traded companies in general.

The 32-member Task Force, headed by Mayor Michael Bloomberg, announced financial recommendations for companies and investors in June 2017.

The essence of the recommendations:

  • Corporate boards and managements should focus on the risks and opportunities present and in the future taking into account a global temperature risk of 2-degrees Centigrade (3.5-F), and in the future, 4-C and even 6-C global temperature rises.

The risks (presented are not just to the affected companies but to the financial sector institutions investing in the company, institutions lending funds to the company, carriers insuring the company, etc.).

The risks and opportunities related to climate change should be thoroughly analyzed using the scenario testing that the company uses (an example would be projecting future pricing, regulations, technologies, and “what ifs” for an oil and gas industry company).

The company should consider in doing the scenario testing and analyzing outcomes the firm’s corporate governance policies and practices; strategies for the long-term; risk management policies and resources; establishing targets; and, putting metrics in place for measuring and managing climate risk.  Then, the next step is disclosing this to investors and other stakeholders.

Key Player:  CDP and its Wealth of Corporate, Institutional and Public Sector Data

The CDP – formerly known as the Carbon Disclosure Project – was founded almost two decades ago (2000) as a United Kingdom-based not-for-profit charity at the urging of the investment community, to gather corporate “carbon” data.

Timing:  soon after the start of meetings of the “Conference of the Parties” (or “COP”), organized by the United Nations as the Climate Change Conferences. (The “UNFCCC”.)

In the mid-1990s, the Kyoto Protocol emerged that legally-bound nations to their pledge to reduce Greenhouse Emissions (GHGs).  The U.S.A. did not sign on to the global protocol during the tenure of President George W. Bush, and the agreement reached in Paris at the COP meeting in 2015 was finally agreed to by President Barack Obama.

And then began the process of withdrawal under President Donald Trump.  The U.S.A. is now the prominent holdout (among the community of 197 nations signed on) in the global effort to address global warming before the danger point is passed.  In Paris, the COP agreed that the threshold was 2-degrees Centigrade.

Today, a growing universe of investors and many other stakeholders are increasingly focused on the role of carbon emissions in the framing of questions about what to do as scientists charted the warming of Earth’s climate.

And so — ESG / environmental data is critical to the mission of determining “what to do” and then implementing measures to address climate change challenges.

The Critical Role of CDP 

CDP over almost two decades since its founding has become the premier repository of corporate data related to climate change – with more than 6,000 companies’ data collected and shared in organized ways with the investment community.  (That includes the ESG data of half of the world’s public companies by market cap.)

The CDP emissions data focused has broadened over 16 years to now include water, supply chain, forestry (for corporates) and environmental data from more than 500 cities and some 100 states and regions available to investors.

Key user base:

  • 650-plus institutional investors with US$87 trillion in Assets Under Management.
  • Corporate Supply Chain members (such as Wal-Mart Stores) that collect data from their suppliers through CDP—a universe of 115 companies with over $3.3 trillion in combined purchasing power.

When the TCFD recommendations were being developed, CDP announced a firm commitment to align with the task force recommendations.

Following their release of the Task Force recommendations in July 2017, CDP held public consultations on a draft version of the TCFD-aligned framework. The current 2018 Climate Change questionnaire that corporations received from CDP is fully aligned with the TCFD recommendations on climate-related disclosures related to governance, risk management, strategy, and metrics and targets.

The TCFD recommendations are already aligned with the majority of CDP’s longstanding approach to climate change disclosure, including most of the recommendations for climate-related governance, strategy, risk management as well as metrics and target disclosure.

However, this year CDP has modified some questions and added new ones — the most impactful being on climate-related scenario analysis to ensure complete alignment.

Some modifications include:

The Governance section now asks for more information about oversight of climate change issues and why a company doesn’t have board-level oversight (if applicable). CDP also requests information about the main individual below the board level with the highest responsibility — and how frequently they report up to the board.

Next, in the risks and opportunities section, CDP now asks for the climate-related risk & opportunity identification, and assessment process.

As in past years, questions are posed in the Business Strategy module to allow companies to disclose whether they have acted upon integrating climate-related issues into their strategy, financial planning, and businesses.

CDP has also added a question for high impact sectors on their low carbon transition plans, so data users can gauge and further understand the sustainable and strategic foresight that these companies aim to achieve.

CDP also added a new question on scenario analysis, explaining that scenario analysis is a strategic planning tool to help an organization understand how it might perform in different future states.

A core aim of the TCFD recommendations is for companies to improve their understanding of future risks and develop suitable resilience strategies.

Finally, the TCFD recommendations highlighted five (5) sectors as the most important. In 2018, CDP rolled out sector-specific questions for the four non-financial sectors that the TCFD highlighted (they are energy, transport, materials, and agriculture).

TCFD also highlighted the financial sector – looking forward, in 2019, CDP is planning to release a financial sector-specific climate change questionnaire.

The TCFD resources for investors and corporate managers are embodied in three documents – (1) the Main Report; (2) an Implementation Annex; (3) the Technical Supplement for Scenario Analysis.  These are available at:  www.fsb-tcfd.org

G&A Institute Perspectives:

Our team has been assisting corporate managers in organizing the response to the CDP annual survey and we’ve tracked over the years the steady expansion of information requested of companies.

Our advice to companies not reporting yet:  get started!  The CDP staff members are very cooperative in assisting new corporate reporters in understanding what data are being sought (and why) and providing answers to questions.

CDP’s founding CEO Paul Simpson cautions:  “Big companies:  get better at telling those who hold the purse strings how climate risks could affect your bottom line.”

And so, our mission at G&A includes helping corporate issuers tell a better sustainability and ESG story, including the story told in the data sets communicated to 650-plus institutional investors by CDP!

CDP data is everywhere, we advise clients, including for example being part of the volumes of ESG data sets that Bloomberg LP shares on its terminals (through the terminal ESG Dashboard).

On the supply chain side, we point out that more than US$3 trillion is the collective spend of companies now addressing their supply chain sustainability factors and environmental impacts (customers see suppliers as part of their own CDP footprint).  Corporate leaders in this effort include Apple, Honda and Microsoft, CDP points out.

Resources:

CDP’s Technical Notes on the TCFD are available at: https://b8f65cb373b1b7b15feb-c70d8ead6ced550b4d987d7c03fcdd1d.ssl.cf3.rackcdn.com/cms/guidance_docs/pdfs/000/001/429/original/CDP-TCFD-technical-note.pdf?1512736184

The “A” List of CDP naming the world’s business leaders on environmental performance (160 firms) is at: https://www.cdp.net/en/scores-2017

The CDP USA Report 2017, focused on key findings on Governance, ESG and the Role of the Board of Directors is available at: https://b8f65cb373b1b7b15feb-c70d8ead6ced550b4d987d7c03fcdd1d.ssl.cf3.rackcdn.com/cms/reports/documents/000/002/891/original/CDP-US-Report-2017.pdf?1512733010

There’s an excellent interview with CDP CEO/Founder Paul Simpson at: http://www.ethicalcorp.com/disruptors-paul-simpson-atypical-activist-who-woke-c-suites-climate-risk

You can check out Henry Shilling’s SustainableInvest.com at: https://www.sustainableinvest.com/second-quarter-2018-sustainable-funds-investing-review/

 

There’s a new way for Delaware companies to highlight their sustainability chops. Will it be meaningful?

By Lois Yurow – Fellow, G&A Institute

Delaware companies that are focused on sustainability will soon have a new way to demonstrate their dedication.

Effective October 1, any Delaware “entity”—a term that encompasses corporations, partnerships, limited liability companies, statutory trusts, and certain associations—may elect to apply for a so-called “certificate of adoption of transparency and sustainability standards.”

The newly enacted Certification of Adoption of Transparency and Sustainability Standards Act is designed to give Delaware companies a platform for signaling their “commitment to global sustainability.” Since this is the first statute of its kind in the United States, and Delaware is home to a disproportionate number of U.S. companies, it’s worth looking at how the Certification Act is intended to work.

The statute at a glance

On its face, it looks like the Certification Act offers a formal seal of approval — a certificate from the Secretary of State to any entity that commits to publish an annual sustainability report. No big deal, right? But if you look deeper, it becomes clear that a certificate will represent both significant board-level involvement and greater corporate transparency.

Let’s start with key terms

Several definitions in the Certification Act are substantive and intertwined. It will be easier to appreciate what it means to get a certificate if you first understand some terminology.

Standards—the “governing body” (such as the board of directors, general partner, or a “duly authorized and empowered committee”) of a “reporting entity” (one that has or wants a certificate) must adopt “principles, guidelines or standards” against which the entity will measure “the impacts of its activities on society and the environment.” Standards must be “based on or derived from third-party criteria.”

Third-party criteria are “principles, guidelines or standards developed and maintained by” someone unaffiliated with the reporting entity — such as a government unit, an NGO, or an independent consultant—for the purpose of “measuring, managing or reporting the social and environmental impact of businesses or other entities.”

Presumably, the requirement that standards have some relationship to third-party criteria will improve the odds that companies will select credible standards that are tangible and objective. This requirement also may accelerate the movement toward uniform disclosure and reporting standards — such as those developed by GRI or SASB.

Assessment measures—the governing body of a reporting entity must adopt “policies, procedures or practices” that will generate “objective factual information” about how well the entity is performing against the standards it adopted. (In other words, performance metrics.) This includes deciding whether to provide for “internal or external verification” of performance results.

Standards statement—the first step to getting a certificate is filing a standards statement. The most important things a standards statement must do are:

  • affirm that the entity’s governing body adopted resolutions that enumerate standards and assessment measures;
  • affirm that the entity will use those assessment measures to evaluate the entity’s performance in relation to those standards;
  • affirm that the entity will periodically revisit its standards and assessment measures and adjust them if the governing body thinks changes are appropriate;
  • affirm that the entity will publish a report (described below) every year; and
  • indicate where on the reporting entity’s principal website a visitor can (without paying a fee or providing any information) find a discussion of the entity’s “standards and assessment measures, the third-party criteria used . . .[and] the process by which such standards were identified, developed and approved,” as well as all of the entity’s reports.

Report—in order to maintain its certificate, a reporting entity will need to publish on its primary website comprehensive annual performance reports covering these topics:

  • “the standards and assessment measures in effect” over the past year, “the third-party criteria and any other source used to develop [those] standards and assessment measures,” and how the entity identified, developed and approved its standards and assessment measures;
  • the type of information described above regarding any standards or assessment measures the entity changed;
  • how the reporting entity has endeavored to satisfy its standards and whether those efforts included any interaction with stakeholders;
  • current “objective and factual information developed pursuant to the assessment measures” to gauge how the entity performed in relation to its standards;
  • the governing body’s view of “whether the entity has been successful in meeting the standards”;
  • if the entity was not successful, whether the governing body has ordered “additional efforts” to improve performance, and if not, why not;
  • whether the entity retained an independent consultant to help measure, manage, or report on its performance, and if so, whom; and if “materially different,” how the entity intends measure, manage, and report its performance in the next annual reporting period.

With these definitions under our belt, the statute is pretty straightforward.

Putting it all together

Any Delaware entity in good standing will be able to apply to the Secretary of State for a certificate of adoption of transparency and sustainability standards by delivering a standards statement and paying the prescribed fees ($200 to file and $50 for the certificate).

All the certificate will do is attest that the named entity filed a standards statement. The Secretary of State will not even confirm that the entity actually implemented the standards and assessment measures it purports to have adopted. Certificates are renewable every year, also with an application and a fee.

It looks so easy—until you return to the definition of “standards statement.” The seemingly simple application process belies the two rigorous obligations at the core of the statute: board-level involvement and complete transparency around standards, metrics, and results.

Again, the standards statement must affirm that the decision to adopt particular standards and assessment measures was made by formal action at the entity’s highest levels. The standards statement also must promise that the entity will issue an annual report. The prescribed content of that report—standards, metrics, results, and the governing body‘s reaction to it all—suggests this will not be a simple undertaking.

So why would a company bother getting a certificate (and paying fees, and assuming a disclosure obligation)?

Every company is at liberty now, certificate or no certificate, to voluntarily issue a sustainability report. Indeed, 85% of the Fortune 500 published a sustainability report in 2017. No doubt those reports represent a genuine commitment on the part of the issuing companies. Still, it pays to consider who chooses what a given company reports on: what goals it adopts, what metrics it uses to gauge progress, who measures that progress, and what specific information will be shared. With voluntary reporting, companies have almost infinite flexibility.

Under the Certification Act, reporting entities will need to disclose “objective and factual” performance results, and each entity’s governing body will be required to specifically address those results, offering its view of whether they represent success. By imposing these rules, the statute responds to the ever lingering concern that at least some sustainability reports are as much about marketing as they are about real change. The public in general, and investors in particular, may find the Certification Act’s data-heavy reports more valuable.

Liability concerns

Any company thinking about assuming the obligations of a reporting entity will want to consider whether there are any risks. The Certification Act explicitly eliminates two.

First, there is no audit or merit review required. The statute expressly does not prescribe particular sustainability standards. Moreover, every certificate will state that the Secretary of State does not verify standards statements or annual performance reports.

Second, no one will have a cause of action against a Delaware entity because of anything the entity does (such as choosing particular standards and assessment measures) or fails to do (such as falling short of a standard, or refusing to become a reporting entity at all).

Reporting entities may suffer reputational harm if their goals are unrealistically ambitious or easy, or if their disclosure seems inadequate, but these risks are largely controllable. In addition, the standards statement, the annual performance report, and every application to renew a certificate must be “acknowledged.” That means an “authorized person” of the reporting entity must “certif[y], under penalty of perjury, that the information [provided] is accurate and complete to the best of such authorized person’s actual knowledge after due inquiry.” This too presents a largely controllable potential risk.

Conclusion

A few Delaware companies reportedly are mulling whether they want to be the pioneer reporting entities. Many organizations already have the requisite governance and data-gathering processes in place, so applying for a certificate would be a relatively uncomplicated—and possibly logical—next step. For those companies that have not fully implemented sustainability practices and reporting protocols, the Certification Act may serve as another nudge.

Contents Copyright © by Lois Yurow, All Rights Reserved

Guest Commentator Lois Yurow is founder and president of Investor Communications Services, LLC, where she specializes in converting complex legal, business, and financial documents into plain English. Mutual Fund Regulation and Compliance Handbook, a book she co-authored and updates annually, is published by Thomson West. Lois writes and speaks frequently about plain English, disclosure, and other securities law matters. Before forming Investor Communications Services, Lois practiced corporate and securities law, first in Chicago and then in New Jersey. Email: lois@securitieseditor.com

Lois Yurow is a Fellow the Governance & Accountability Institute

 

 

Sustainability & ESG Trends in View -– The G&A Institute Team Closely Monitors Developments For You

by Hank Boerner – Chair & Chief Strategist, G&A Institute

Every week G&A Institute assembles the value-added content that our team gathers for you as we closely monitor trends and developments in corporate sustainability, corporate responsibility, corporate citizenship, sustainable investing, and related topics and issues.

Our Editor-in-Chief Ken Cynar leads the daily effort and you see the results of his work in each issue of Highlights (note we are on #406 this week).  We hope that you benefit from this effort, part of our information-sharing and educational mission.

One of the benefits for us on the G&A Institute team is the yield from the close and continuous tracking and deep analysis of important trends in the related fields in every corner of the world, and in varying spheres of influence.   We are monitoring thought leaders on the corporate sector side, on the asset owner and manager side, from the perspective of the NGO or civic activist, the regulators, the academics, the ESG research service providers, and many more.

As the Global Reporting Initiative’s  (GRI) Data Partner for the United States of America, the United Kingdom and the Republic of Ireland, our team collects, analyzes and databases considerable volumes of data and narrative from the more than 1,200 reports we process each year (the reports are then made part of the GRI global inventory for public access).

From the thousands of corporate & institutional sustainability reports we process year-after-year, the yield includes value-added information on long-term trends, emerging trends, and “might-be-a-trend-taking-shape” development.  And so high on our list is news, information, research results related to corporate sustainability and responsibility reporting.  We highlight a few for you at the top of the newsletter this week.

We share volumes of information through our communication platforms, such as this weekly newsletter; our G&A Institute company website; the Accountability Central and Sustainability HQ web platform; the  G&A Sustainability Update blog; our TwitterFacebook, and other social media feeds; and more in-depth management briefs through our “G&A Institute To the Point!” platform.

IMPORTANT:  As always, we welcome your engagement, invite your queries, your feedback, your suggestions for issues and trends to watch, and suggestions for the guidance of the information-sharing that we do.  We’d also welcome the opportunity to speak with you about our consulting services.  Email us at info@ga-institute.com.

In this week’s issue, we’ve identified an especially higher number of important trends for you that are worth “tuning in to” as you continue on your sustainability journey.

“Sustainability “ trends that are the march – worldwide!

“Warm regards to you” from The Team at G&A Institute this sweltering summer in most parts!

“Total Impact Valuation” – Monetizing the Enterprise’s “Cost-Benefit Analysis” of the Impact on Society? This is for CEOs – Advice From The Conference Board

by Hank Boerner – Chair & Chief Strategist, G&A Institute

Today’s question for corporate CEO’s:  Have you examined your company’s “Total Impact Valuation,” a new approach being advanced by The Conference Board, wherein the enterprises’ impact on society is monetized (cost/benefit evaluated and value attached)?

A small group of companies is doing these exercises. Think of their efforts to date as expanding the usual reporting of “Input/Output” to seriously consider (1) Outcomes, (2) Impacts, (3) Cost and Benefit to Society (and to the company).

Such firms as BASF (the German chemical giant), cement industry leaders Holcim/Ambjua Cement and LafargeHolcim, Samsung, Akzonobel (materials), ABN AMRO (Holland, financial services), Volvo (vehicles), and Argo (materials, Colombia) have been doing something along these lines and reporting results for a few years now on web sites, in sustainability reports, in financial statements, in a “total contribution report” or “value-added statement”, and by other means.

Some of these disclosures are third party assured (Argo’s is by Deloitte) and otherwise guided; the big accounting firms are involved (PwC and KPMG included).

This appears to us to have the potential to take corporate sustainability reporting to expanded (new) levels for at least the publicly-traded large caps – that is, if enough investors jump aboard the concept and ask for the information.  (Think about public discussion of the company’s “plus or minus” impact on society beyond the fences.)

Thomas Singer, Corporate Leadership research leader at The Conference Board, presents findings of his sampling of firms (those identified above) and shares his perspectives on the concept in Chief Executive Magazine – it’s our Top Story for you this issue.

BASF shares its “Value to Society” model (there’s a link to this in the article).  The company, explains Singer, monetizes more than 20 different types of environmental, social and economic impacts, including direct and indirect suppliers and even customer industries.

Author Thomas Singer turns out a good amount of strategic advice to company leaders and has been focusing more in his Director Notes on ESG and corporate sustainability.  There’s links to his papers and publications for you in the link.

A major drawback here in the U.S.A.: there is no standard benchmark for measuring progress or lack of, and to guide reporting; there is in turn no way to compare company “A” to “B” for investors, ratings analysts and others.

So what do you think – is this a “we’re a long way from Kansas, Toto” moment for corporate leaders in terms of expectations of shareholders and stakeholders for what the companies will share in their disclosures of the future?  (The “Kansas” reference being the bad old days practices of chemicals and other companies “externalizing” costs to society for environmental mismanagement and minimizing the actual costs of clean up in financial reports.)

The total value practice got underway in Europe – and we will be watching to see if U.S.-based public companies pick up on the concept. Especially those where their foreign peers have the modeling and techniques underway.  That is what happened with corporate sustainability and ESG reporting over time.

Top Stories

CEOs Need To Put This Sustainability Trend On Their Radar
(Tuesday – July 03, 2018) Source: Chief Executive – What if America’s CEOs could understand the full financial impact their company has on society? It could make them rethink their game plan for how they prevent workplace accidents, lessen air pollution, manage waste – the list…

7 Reasons Why America is Rethinking Capitalism Now

Guest Post by Linda E. Dunbar

Global Public Affairs Executive: PR Strategist, Spokesperson, Employee Communications Leader Adept at Engaging Key Stakeholders.

7 Reasons Why America is Rethinking Capitalism Now

There is a move afoot to change capitalism as we know it. A radical overthrow by futuristic anarchist forces? Hardly. Actually, the US business community is bravely harking back to its pre-Milton Friedman roots.

In September 1970, the 5”0’, Brooklyn-born Friedman, a well-known American economist who would earn a Nobel prize in economics six years later, published an opinion piece in The New York Times.

The title — “The Social Responsibility of Business is to Increase Profits” — summed up his thesis succinctly. In his piece, he accused US business of “preaching pure and unadulterated socialism” in attempting to address social issues of the day.

Friedman’s dismissive view: “The business men believe that they are defending free enterprise when they declaim that business is not concerned ‘merely’ with profit but also with promoting desirable ‘social’ ends; that business has a ‘social conscious’ and takes seriously its responsibilities for providing employment, eliminating discrimination, avoiding pollution and whatever else may be the catchwords of the contemporary crop of reformers.”

To set the scene, when Friedman wrote his piece, life was very different from today although there remains no shortage of societal issues for the US business community to address.

In 1970, a woman needed a man, any man, even her 17-year-old son, to sign a business loan, get a mortgage or a credit card regardless of her income. Her income would then be discounted by the lender by as much as 50 percent when deciding how much credit to extend. In those days…

Equal access to credit for all, at least on paper, would not come to be in the US until the Congress passed the Equal Credit Opportunity Act of 1974.

Just the year before, in 1969 Rep. Charlotte Reid (R-Ill.) became the first woman to wear trousers in the U.S. Congress and Barbra Streisand became the first woman to attend the Oscars in pants.

Also, in 1969 the Stonewall Inn riots in Greenwich Village launched the gay pride movement.

The unpopular Vietnam War would rage on another five years until the fall of Saigon in 1975.

Despite the passage of the historic Civil Rights Act of 1964, discrimination against minorities continued to be rampant. In Loving vs. the State of Virginia, the U.S. Supreme Court case that overturned “miscegenation” laws in the US, was decided in favor of the plaintiffs a mere three years after in the year 1967.

The first Earth Day was proclaimed in April 1970.

The animal rights movement had not yet gotten momentum. In fact, People for the Ethical Treatment of Animals (PETA) was not founded until 1980.

Following Friedman’s pronouncement, Corporate America and its corporate governance practices made shareholder value the end-all-and-be-all of corporate thinking.

Even if that approach clearly didn’t make any sense. Anyone in business today knows intuitively no customers no business no employees no business. But along with that pronouncement came the opportunity for many major U.S. companies to take a pass on societal issues, even issues that might have been caused by business practices (extractive industries and their activities affecting the environment come to mind).

Thankfully, we have come full circle and Corporate America — in fact the global corporate business community — is coming together to rethink capitalism and its societal impact. Recent comments by asset management giants and others have been well-received as we look toward creating change.

What does rethinking capitalism mean? And why now?

Better Capitalism. Tempered Capitalism. The New Capitalism. Conscious Capitalism.

Whatever it is called, helping to transform the short-term, insular thinking currently stifling the potential of American business and its ability to effectively connect with stakeholders is an important element of the movement.

Understanding that although businesses have an important fiduciary responsibility to shareholders, the enterprises exist for reasons other than to solely enrich shareholders (and business leaders who understand that perform better than those who don’t).

And the core: understanding your reason for existing, your purpose, what business you are really in is critical for long term success. As in do what you love and the money will follow.

“Purpose” turns out to be an effective organizing principle for many businesses. This thought process is catching on.

Here are my seven reasons why I think the time is ripe to rethink capitalism and mesh social impact and success.

1. Social media – Businesses just can’t ignore customers and employees any more. Before social media an unhappy consumer complained to roughly 17 other people. Now unhappy customers have a direct impact on reputation in a way they just could not before social media and a poor reputation eventually leads to lost revenue.

2. The Age of Authenticity — People in the US are tired of literal and figurative airbrushing. People want companies to do what they say they will. And they want them to strike the right note. If your advertising firm has advised you to be edgy, you have no margin for error. See number 1.

3. Millennials – There are over 79 million Millennials and the numbers of men and women Gen Z are close behind. They expect a different relationship between society and business — and they are not taking no for an answer. The idea that life is too short to be someone you are not or spending time in a way that you do not want to is part of their DNA. Gay, transgender, what have you, Millennials and Gen Z are not batting an eyelash. Equality, diversity, and inclusion are table stakes. They expect diversity, inclusion, equality where they shop, eat, work. If not, they will go somewhere else. Period.

4. Additional demographic shifts – The minority is becoming the majority and in 2019, the majority of U.S. children will be minorities. As demographics shift no business can be successful by leaving people out, be they customers or employee or potential customer or employees. This loops back to numbers 1, 2, and 3.

5. Climate change and the detrimental impact of humans on the planet is real – some problems we — business, government, NGOs, activists, the general public — have no choice but to tackle together. Like having air to breathe and water to drink.

6. The #Me too, #Times up Movement – Dignity, respect, and equality in the workplace, everywhere actually, are a given. And these movements have ramifications beyond sexual harassment. According to CNN, #MeToo and #TimesUp have pushed 48% of companies to review pay policies. Gender pay equity has been an issue since possibly the beginning of time and now we are seeing movement on this issue.

7. The data – The data says inclusive, diverse companies perform better.
How much better will companies perform when their purpose is at the core of what they do, long-term strategy is understood and embraced by everyone from the board on down, and stakeholders are effectively engaged? That remains to be seen but the prognosis is good!

If this article resonated with you, please feel free to connect with me directly and also like, comment or share.

7 Reasons Why America is Rethinking Capitalism Now

Email me at: linda.dunbar@outlook.com
Linked In: https://www.linkedin.com/in/lindaedunbar/

U.S. States and Cities — “Still In” to the Paris Agreement — and Great Progress is Being Made

By Hank Boerner – Chair & Chief Strategist, G&A Institute

This is our second commentary this week on the occasion of the first anniversary of the decision by the Trump White House in June 2017 to begin the multi-year process of formal withdrawal of the United States of America from the Paris COP 21 climate agreement…

The action now is at the state and municipal levels in these United States of America.

Where for years the world could count on US leadership in critical multilateral initiatives – it was the USA that birthed the United Nations! – alas, there are 196 nations on one side of the climate change issue (signatories of the 2015 Paris Agreement) and one on the other side: the United States of America. At least at the sovereign level.

Important for us to keep in mind: Individual states within the Union are aligned with the rest of the world’s sovereign nations in acknowledging and pledging to address the challenges posed by climate change, short- and longer-term.

Here’s some good news: The United States Climate Alliance is a bipartisan coalition of 17 governors committed to upholding the goals of the Paris Agreement on climate change. These are among the most populous of the states and include states on both coasts and in the nation’s Heartland.

The Paris meetings were in 2015 and at that time, the USA was fully on board. That was in a universe now far far away, since the election of climate-denier-in-chief Donald Trump in 2016.

On to the COP 23 and the USA

In 2017, two years after the Paris meetings, the USA officially snubbed their sovereign colleagues at the annual climate talks. A number of U.S. public and private sector leaders did travel to Bonn, Germany, to participate in talks and represent the American point-of-view. This included Jerry Brown, Governor, California (the de facto leader now of the USA in climate change); former New York City Mayor (and Bloomberg LP principal) Michael Bloomberg; executives from Mars, Wal-mart and Citi Group.

While the U.S. government skipped having a pavilion at the annual United Nations-sponsored climate summit for 2017, the US presence was proclaimed loud and clear by the representatives of the U.S. Climate Action Center, representing the climate change priorities of US cities, states, tribes and businesses large and small who want action on climate change issues.

Declared California State Senator Ricardo Lara in Bonn: “Greetings from the official resistance to the Trump Administration. Let’s relish being rebels. Despite what happens in Washington DC we are still here.”

# # #

As the one year anniversary of President Trump’s announcement to leave the global Paris Agreement (June 1, 2018), state governors announced a new wave of initiatives to not only stay on board with the terms agreed to in Paris (by the Obama Administration) but to accelerate and scale up their climate actions.

Consider: The Alliance members say they are on track to have their state meet their share of the Paris Agreement emission targets by 2025.

Consider: The governors represent more than 40 percent of the U.S. population (160 million people); represent at least a US$9 trillion economic bloc (greater than the #3 global economy, Japan); and, as a group and individually are determined to meet their share of the 2015 Paris Agreement emissions targets.

Consider: Just one of the states – California – in June 2016, according to the International Monetary Fund, became the sixth largest economy in the world, ahead of the total economy of France (at #7) and India (#8).

Consider: The US GDP is estimated at $19.9 trillion (“real” GDP as measured by World Bank); the $9 trillion in GDP estimated for the participating states is a considerable portion of the national total.

The states involved are: California, Colorado, Connecticut, Delaware, Hawaii, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Oregon, Rhode Island, Vermont, Virginia, Washington, and the Commonwealth of Puerto Rico.

The initiatives announced on June 1, 2018 include:

Reducing Super Pollutants (including hydrofluorocarbons (HFCs), one of the Greenhouse Gases, and harnessing waste methane (another GhG).

Mobilizing Financing for Climate Projects (through collaboration on a Green Banking Initiative); NY Green Bank alone is raising $1 billion or more from the private sector to deploy nationally).

Modernizing the Electric Grid (through a Grid Modernization Initiative, that includes avoidance of building out the traditional electric transmission/distribution infrastructure through “non-wire” alternatives).

Developing More Renewable Energy (creating a Solar Soft Costs Initiative to reduce costs of solar projects and drive down soft costs; this should help to reduce the impact of solar tariffs established in January by the federal government).

Developing Appliance Efficiency Standards (a number of states are collaborating to advance energy efficiency standards for appliances and consumer products sold in their state as the federal government effort is stalled; this is designed to save consumers’ money and cut GhG emissions).

Building More Resilient Community Infrastructure and Protect Natural Resources (working in partnership with The Nature Conservancy and the National Council on Science and the Environment, to change the way infrastructure is designed and procured, and help protect against the threats of floods, wildfires and drought).

Increase Carbon Storage (various states are pursuing opportunity to increase carbon storage in forests, farms and ecosystems through best practices in land conservation, management and restoration, in partnerships with The Nature Conservancy, American Forests, World Resources Institute, American Farmland Trust, the Trust For Public Land, Coalition on Agricultural Greenhouse Gases, and the Doris Duke Charitable Foundation).

Deploying Clean Transportation (collaborating to accelerate deployment of zero-emissions vehicles; expanding/improving public transportation choices; other steps toward zero-emission vehicles miles traveled.

Think About The Societal Impacts

The powerful effects of all of this state-level collaboration, partnering, financial investment, changes in standards and best practice approaches, public sector purchasing practices, public sector investment (such as through state pension funds), approvals of renewable energy facilities (such as windmills and solar farms) in state and possibly with affecting neighboring states, purchase of fleet vehicles…more.

California vehicle buyers comprise at least 10% (and more) of total US car, SUV and light truck purchases. Think about the impact of vehicle emissions standards in that state and the manufacturers’ need to comply. They will not build “customized” systems in cars for just marketing in California – it’s better to comply by building in systems that meet the stricter standards on the West Coast.

US car sales in 2016 according to Statista were more than 1 million units in California (ranked #1); add in the other states you would have New York (just under 400,000 vehicles sold); Illinois (250,000); New Jersey (250,000) – reaching to about million more. How many more vehicles are sold in the other Coalition states? Millions more!

(Of course, we should acknowledge here that the states not participating yet have sizable markets — 600,000 vehicles sold in Florida and 570,000 in Texas.)

Project that kind of effect onto: local and state building codes, architectural designs, materials for home construction; planning the electric distribution system for a state or region (such as New England); appliance design and marketing in the Coalition states (same issues – do you design a refrigerator just for California and Illinois?).

There are quotes from each of the Coalition governors that might be of use to you. (Sample: Jerry Brown, California: “The Paris Agreement is a good deal for America. The President’s move to pull out was the wrong call. We are still in.”) You can see them in the news release at: https://static1.squarespace.com/static/5a4cfbfe18b27d4da21c9361/t/5b114e35575d1ff3789a8f53/1527860790022/180601_PressRelease_Alliance+Anniversary+-+final.pdf

# # #

In covering the 2017 Bonn meetings, Slate published a report by The Guardian with permission of the Climate Desk. Said writers Oliver Milman and Jonathan Watts: “Deep schisms in the United States over climate change are on show at the U.N. climate talks in Bonn, where two sharply different visions of America’s role in addressing dangerous global warming have been put forward to the world.

“Donald Trump’s decision [to pull out of the Paris Climate Agreement] has created a vacuum into which dozens of city, state and business leaders have leapt, with the aim of convincing other countries that the administration is out of kilter with the American people…”

# # #

At the US City Level

Jacob Corvidae, writing in Greenbiz, explains how with the White House intending to withdraw, cities are now in the driver’s seat leading the charge against climate change.

Cities have more than half of the world’s populations and have the political and economic power to drive change.

The C40 Cities Climate Leadership Group is the Coalition helping cities to make things happen. The C40 Climate Action Planning Framework is part of a larger effort to make meaningful progress toward carbon reduction goals and build capacity at the municipal level. Cities are expected to have a comprehensive climate action plan in place by 2020. This will include 2050 targets and required interim goals.

The cities have the Carbon-Free City Handbook to work with; this was released in Bonn in 2017 at COP 23. There are 22 specific actions that can (1) drive positive impacts and (2) create economic development. This September the Carbon-Free Regions Handbook will be available. There is information for you about all of this at: https://www.greenbiz.com/article/every-action-how-cities-are-using-new-tools-drive-climate-action

The clarion call, loud and clear: We Are Still In!  Watch the states, cities and business community for leadership on meeting climate change issues in the new norms of 2018 and beyond.