Green Investments

Going on this week is the annual World Economic Forum where leaders from around the world discuss major impacts.   Green investment is becoming a mature sector – the World Economic Forum publishes the Green Investment Report recently.  The report documents major growth in investment. It also finds that developing countries are increasingly becoming an important source of capital.  Here's a list of top 10 myths about climate change and green investments. 

From http://forumblog.org/2013/01/top-10-myths-about-climate-change-and-green-investment/

Top 10 myths about climate change and green investment

1. Reduced economic activity due to the financial crisis has resulted in a global reduction in greenhouse gases.

False – while some countries have seen emission reductions, the United Nations Environment Programme estimated global emissions in 2011 at 40 billion tonnes of CO2, 20% higher than 2000 levels.

2. The renewable energy market is in global decline.

Not true – the global renewable energy market has in fact been counter-cyclical to the economy: global investment in renewable power and fuels increased 17% to a new record of US$ 257 billion in 2011. The removal or roll-back of government subsidies has caused some firms to struggle. But other firms have maintained a positive gross margin and the expectation for 2013 is for a restructuring and emergence of a stronger, more focused industry sector.

3. Industrialized (OECD) countries are the leading clean energy investors.

Not true – in 2012, investment originating from non-OECD countries is set to exceed that from OECD countries. In fact, cross-border and domestic investment originating from non-OECD countries grew 15-fold between 2004 and 2011 at a rate of 47% per year. Most of this non-OECD finance is being used domestically.

4. The public sector is the primary source of funds for climate-friendly investments.

Untrue – while the international climate negotiations focus almost entirely on public finance, in fact, the Climate Policy Initiative documented that in 2011, only one-quarter of cross-border investment in climate change mitigation and adaptation was from public sources (US$ 96 billion); fully 75% came from private investors (US$ 268 billion).

5. Cross-border investment in clean energy is a bigger source of finance than domestic investment.

Again not true – in 2011, Bloomberg New Energy Finance reported that 70% of global investment in clean energy was from domestic sources. Interestingly, of this, more than 50% was from non-OECD countries.

6. We cannot address the climate challenge due to fiscal austerity and limited government budgets.

Untrue: While the International Energy Agency (IEA) estimates that US$ 700 billion per year in additional investment is needed to stabilize the climate at two degrees Celsius, the corresponding fuel savings make the transition much easier – between 2010 and 2050, the IEA predicts a net savings of US$ 5 trillion. Further, innovative public-private financing mechanisms have proved successful in reducing and distributing risks and drawing in private investment.

7. Renewable energy is the sector that requires the greatest investment.

This is false – the IEA estimates that more than half of the new investment required per year to 2030 to meet the climate challenge is needed for energy efficiency in the buildings and industrial sectors; 28% is needed for low-carbon transport and 21% is needed for clean power.

8. Investors do not have the right tools to manage the political risk associated with clean energy investments in emerging markets.

While investors have strong perceptions of risks, this is untrue. The Green Investment Report documents a number of existing products and solutions that development finance institutions (DFIs) are using to address investor risk, including loan guarantees, partial risk/credit guarantees and political and regulatory risk insurance cover. These tools are targeting new emerging markets where private lenders are not initially comfortable or familiar with green technologies.

9. It is difficult to mobilize finance for green growth in an uncertain economic environment.

False – the report finds that, despite the global economic slowdown, total new global investment in clean energy grew to US$ 257 billion in 2011. This represented a six-fold increase from 2004 and was 93% higher than in 2007, the year before the global financial crisis. In addition, the multilateral development banks made US$ 1.9 billion in investment through the innovative Clean Technology Fund, which has achieved mobilization of a further US$ 16.4 billion of private finance to date. This sort of leveraging effect has been seen in a number of instruments and can be replicated to scale up further private investment.

10. Institutional investors do not have the means to invest in green infrastructure financing.

Not true – green bonds have significant potential as a means to access deep pools of low-cost capital held by institutional investors for green and climate change-related projects. Institutional investors are natural buyers of green bonds, given their appetite for investment in low-risk fixed income products with long-term maturities that match their long-term liabilities. The Climate Bonds Initiative estimates the size of the global climate or “green bond” market at US$ 174 billion.  

Coming Soon..... Indonesia: Mining for Civilization

 More to come soon. 

Energy Sustainability

“We must accept that we have to make hard choices in this generation to bring about real changes for future generations and the planet. Politicians and the industry must get real.”

This is quoted from the report released by the World Energy Council (WEC) in partnership with the global consulting firm Oliver Wyman.  The report titled, World Energy Trilemma: Time to get real – the case for sustainable energy policy gives a overview of energy sustainability and methodology to achieve this.  

The three noted dimensions of energy sustainability

The World Energy Council’s definition of energy sustainability is based on three core dimensions - energy security, social equity, and environmental impact mitigation. 

The development of stable, affordable, and environmentally-sensitive energy systems defies simple solutions. These three goals constitute a ‘trilemma’, entailing complex interwoven links between public and private actors, governments and regulators, economic and social factors, national resources, environmental concerns, and individual behaviors.

Corporate Sustainability Leaders

In the world of corporate responsibility, CSR has become a “buzzword” and is becoming part of many industries, mining and exploration included.  CSR, is alternatively known as being a “good corporate citizen” or paying attention to the triple-bottom line of “people, planet, profit.”

This year DNV Two Tomorrows conducted its 9th annual global research of corporate responsibility best practices using the Tomorrow's Value criteria, a research tool designed to answer "Who are the CSR leaders?' question.  It looked at best practices in the 25 largest companies by revenue in the Americas, Europe and Asia and 19 Dow Jones Sustainability Index supersector leaders from 2011. 

Who are the leaders in CSR?  Typically consumer brands and technology companies gain much of our attention and create a lot of hype surrounding their marketing campaigns.  They are creating important approaches that will revolutionize the way we do business. 

Outside of these limelight sectors is another category, industries with historically risky, messy and challenging operations - petroleum, mining, heavy manufacturing.  Although rarely seen as models of sustainability, many have pioneered leadership in some of the most important areas of corporate responsibility.  These systems are not perfect, and when they fail, consequences can be disastrous and fatal.  But it is this risk that has driven such leading edge practices. 

 
Overall, companies are learning that there are some practical and profitable applications by focusing on protecting the environment, being proactive regarding health and safety of employees, or working with indigenous and local populations beyond what is required by government regulations.

What do you see as the future trends for CSR?

Indonesia: Mining for Civilization (sneak peak)

Have a look at a sneak peak preview of the exclusive upcoming documentary, Indonesia: Mining for Civilization

type in the password: ameaintel 

for the sneak peak. 

Filming and production on the mining communities begins the 31st of October and planned completion and program to be ready by mid November.  

Contact the team at AMEA for more details! info@ameaintel.com

AMEA is the associated media broadcast partner for Asia Pacific Mining Conference 2012

Asia Pacific Mining Conference

Jakarta, October 10 - 11, 2012
http://www.apmcindonesia.com/index.html

Background
The world’s economic growth will continue requiring mineral products and source of energy. Undoubtedly mining sector continues to play a significant role in supporting the world’s industrial and economy sectors and Indonesia has been one of major contributors in the world industrial and economy landscape as exporter country and as well as investment destination. With the recent improved investment ratings, Indonesia is in the best position to leverage the opportunities.
It is great time for Indonesia to show the world of its potentials, investment opportunities and particularly for its mining industry to tap the world and regional’s capacity for its benefits. The followings are some relevant references:

• World Trade in 2050 will jump from $37 trillion in 2010 to $287 trillion in 2050 (Citigroup‘s Report, Oct 2011)
• Indonesia has set the long-term development plan, MP3EI
• Prices for mining commodities are expected to rise with the demand increase.
• Mining companies continue to face some major challenges for sustainable growth:

• Performance improvement and cost savings are key challenges to cope with rising demand
• Rise of resource nationalism is of major concern
• Miners are facing a political landscape that has become more intertwined with operations, resulting in a direct hit to bottom lines.
• Taxation has become an issue at the forefront of CEOs' minds. Mining companies are also contending with a shortage of skilled workers, particularly in developing markets.

• Improving safety and reducing the environmental impact will be ongoing goals.
• "Low-carbon" production of minerals is increasingly important in the years to come
• The world demands for energy continue to grow and coal is anticipated to contribute a significant portion of the Indonesia‘s energy mix in 2050
• Indonesia has become a popular source for emerging markets like China and India, and as a major supplier for Japan, South Korea and Taiwan.
• There are a number of companies holding significant cash, looking for access to new reserves or expansion into new territories.
• However, Indonesia is yet to set a favorable investment climate with right regulatory framework, infrastructure and government supports

Tell your sustainability story!

Pictures tell a thousand words and creative visuals are the best way to engage audiences worldwide on serious concerns. In the highly active world of sustainability communications, presentations, film documentaries, as well as case study success stories are all commonplace—and often very strong tools to highlight the numerous environmental, social, and economic challenges and opportunities facing global business today.  Then the question becomes, in the mid of all this creative dissonance for the greater good, how will your company’s own sustainability story stand out from the crowd? 

Today Major Corporations focus on the following:

In the universe of communications and creative marketing strategy often poses the question of:  What will my company’s sustainability story stand out in comparison to my competitors?  

I laughed while reading the blog article How highly  Networked Non-Profits Are Using Social Media to Power Change written by social media specialists Beth Kanter. In a recent post, Kanter describes the “living case study,” as a constantly evolving picture that paints a beautiful image on issues or causes by piggy backing, not simply celebrating the arrival. As Kanter writes, “While the traditional case study is tidy, packaged, and finished—the living case study is open to feedback, questions, thoughts, and most of all, empowerment of peers.” 

This idea of sharing a complex work-in-progress to audiences engaged in sustainable business is not new one. This is the case with retail giant Wal-mart, that has been telling the story of its intense and highly complex journey towards sustainability that has been in progress for many years. Which as a result of  has opened Wal-Mart  up to everything from extreme criticism to praise from analysts, environmentalists, media, corporate leaders, consumers, and key player.  One can argue that Wal mart’s approach to opening itself up to multiple stakeholders on how to minimize its global environmental footprint has been a large part of its sustainability success to date.

 

And while airing ones dirty laundry isn’t every corporation’s cup of tea, here are some reasons to consider sharing your sustainability struggles as you go:

1. Do thing others have not done. Learn from others who have faced. If you ask for help to solve a particular challenge that’s keeping you up at night, you just might get it.
2. Social media loves social inquiry. Show your challenges publicly through social media channels. Start a blog tracking your sustainability efforts. See who responds and engages. They might just become your next biggest advocate—or most loyal consumer.
3. True leaders have the guts to reach out and engage.; Leadership today is no longer equated with top-down, informative messaging and communications. Include multiple voices into your policy for impact and change. The more you share, the more you stand to gain from the perspective of others.