ManagingaCompanyintheComingGreenEconomyEdwardClarence-SmithUNIDORepresentativeChina,DPRK,Mongolia21June2010TheGreenEconomyiscomingPresidentHuJintao,atUNGeneralAssembly,Sept.2009“Wewillstepupoureffortstodevelopagreeneconomyandlowcarboneconomy”PremierWenJiaobei,commentingFifthChina-EUBusinessSummit,Nov.2009“WeagreedthatiftheChina-EUComprehensiveStrategicPartnershipistomoveforward,itshouldbeanchoredonafoundationofeconomiccooperation,behi-techdriven,andmakegreeneconomyapriority.”VicePremierLiKeqiang,atInternationalConferenceonGreenEconomyandClimateChange,May2010“TheChinesegovernmentattachesgreatimportancetothedevelopmentofgreeneconomyandcopingwithclimatechange.”Today’sPresentationWhydoweneedaGreenEconomy?WhatwouldaGreenEconomylooklike?ManagingaCompanyinaGreenEconomyDevelopment-GlobalPoliticalContextDevelopingcountrieswanttodevelop.Puttingitverysimply,theywanttobecomeliketheUS,likeEurope,likeJapan.5IndustrializationisKeyDevelopmentisonlygoingtohappenthroughindustrialization.Thatishowthe“rich”countriesdeveloped,andnoonehascomeupwithadifferentwayofdoingit.BUTthatcreatesaproblem!EcologicalFootprint–AnIntroductionOureconomiesneedtheplanetfortwothings:Asthesourceofthematerialresourcesweconsume(crops,animals,cleanwater,coal,oil,minerals,landforbuilding,…)Astheplacewhereallthewasteandpollutionwegenerategetsbrokendown,absorbed,andmadeharmless.“EcologicalFootprint”isameasure,inhectaresperperson,oftheamountofbiologicallyproductivelandandseaareaweneedtoregeneratetheresourcesweconsumeandtoabsorbandmakeharmlessthewasteandpollutionwegenerate.7EcologicalfootprintofdifferentnationsSource:Factor5AGrimFutureContinuingthesegrowthtrendsissimplyunsus-tainable.EcologicalFootprint:IfeveryonelivedlikedEuropeans,ourecologicalfootprintwouldbe~5hectares/person.Thatwouldneed2.5Planets!IfeveryonelivedlikedAmericans,ourecologicalfootprintwouldbe~10hectares/person.Thatwouldneed4.5Planets!!!Theplanetwillcollapse,andsowillwe.TheUnderlyingProblemDevelopmentistoomuchseenasimproving/maintaininganECONOMICstandardofliving.Thismeansconsuminglargeamountsofresources.Butdevelopmentshouldbemuchbroader:personal,social,cultural,political,…ItshouldbeaboutincreasingourQualityofLifeQualityofLife:HumanDevelopmentIndexHumanDevelopmentIndex(HDI):acompositestatisticusedtorankcountriesbylevelof“humandevelopment”.HDIiscomposedfromdataon:Lifeexpectancyatbirth(indicatorofpopulationhealthandlongevity)Adultliteracyrateandenrollmentratesinprimary,secondary,andtertiaryeducationalinstitutions(indicatorofknowledgeandeducation)PercapitaGDP(indicatorofeconomicstandardofliving)11HumanDevelopmentIndexandEcologicalFootprintofNationsSource:GlobalFootprintNetworkandWWF2006GreenEconomyTheChallengefortheDevelopingCountriesGreenEconomyshould:TheChallengeoftheFutureSowhatdoesthismeanforacompany?GreenEconomyshould:ThechallengeforCompaniesReducetheecologicalfootprintoftheirfactories;Reducetheecologicalfootprintoftheirproducts;Improvethequalityoflifeoftheircustomers;Improvethequalityoflifeoftheiremployees;Improvethequalityoflifeofthecommunitiesinwhichtheyarelocated.Today,focusontheecologicalfootprintaspectsReducingtheEcologicalFootprint:TwosetsofstrategicoptionsAcompanycanchangeitsbusinessmodeltosellgreenproducts/offergreenservices:“GreenIndustries”.Itcankeepondoingwhatit’sdoingbutdoitinagreenerway:ThroughitsproductsAttheprocesslevel(inthefactory)Beyondthecompany=“GreeningofIndustries”15Twosetsofstrategicoptions:CreateGreenIndustriesGreenExistingIndustries16HugeNumberofOpportunities-1Companiescanstartmanufacturinggreentechnologiesandproducts:Renewableenergy:wind,solarthermal,photovoltaic,hydroelectric,biomass,geothermal,tidal,hydrogen,smartgrids,….EquipmentandproductstoimproveenergyandmaterialsefficiencyWater:watertreatmentandpurification,moreefficientuseofwater,…Transport:electriccars,hydrogen-fueledcars,fasttrains,planesusingbiofuels,…Wasteandpollution:technologiesforrecyclingortreatingwasteandpollutionHugeNumberofOpportunities-2Companiescanstartofferinggreenservices:Wastecollectorsandtransporters;Eco-designfirms:designfirmsthatspecializeindesigningproductsfromanenvironmentalpointofview;ESCOs:companiesthatmanageotherorganization’senergyforthem;Environmentalconsultants;Laboratoriesthatspecializeinenvironmentalmeasurementandanalysis….Twosetsofstrategicoptions:CreateGreenIndustriesGreenExistingIndustriesThroughproductsAttheprocesslevel(inthefactory)Beyondthecompany19Throughproducts-goodsRedesignyourgoodssothat:Theycanbemadewiththeleastamountofmaterials(“dematerialization”);Theyconsumetheleastamountofmaterialsandenergyduringuse(“lifecycleanalysis”);Theycanbeeasilyrecycledattheendoftheirusefullife.Dematerialization-exampleLessconsumptionduringuse-exampleASSESSMENTOFENVIRONMENTALIMPACTWashingMachineRecyclingatendoflife–theidealRecyclingatendoflife–therealitytodayManagingaProcesstoGreenGoodsPointstoremember:Youneed(accessto)strongeco-designcapabilities.Youneedtoeducateyourusers.Youneedtoworkwiththerecyclingindustry.Servic