E-mail Sign-up
You are here: Home Press and Media Blogs and Opinion Pakistan Flooding Hits Home
Document Actions
  • Print this Print this
  • Email this page

Pakistan Flooding Hits Home

Beyond the immense suffering within Pakistan's borders, the flooding is also triggering ripples for America's economic interests, from higher cotton and rice prices to national security costs in the fight against terrorism.
by Mindy S. LubberHuffington Post Posted on Sep 23, 2010

Attention T-shirt lovers: Pakistan's catastrophic flooding is important to you, too.

Beyond the immense suffering within Pakistan's borders, the flooding is also triggering ripples for America's economic interests, from higher cotton and rice prices to national security costs in the fight against terrorism.

While many US companies have been sympathetic - and generous - in helping to ease the human toll from such disasters, they have not yet fully absorbed the hit their companies can take from them. Yet as climate change causes unusual weather patterns and more severe weather, such incidents are expected to become more common.

Companies I work with say climate events are already affecting their business models. Jeans maker Levi Strauss announced this week that skyrocketing cotton prices - partly the result of Pakistan's floods and an earlier drought in China - will force higher clothing prices next spring, whether for T-shirts or blue jeans.

Nike is worried that shrinking water supplies from Asia's Himalayan mountains will trigger higher water prices that will raise production costs. Nike is also concerned about factories in Asia sitting in low-lying coastal zones vulnerable to sea-level rise.

Starbucks is seeing troubling trends in its coffee supply chains. Coffee prices hit a 13-year-high earlier this month. "Climate change poses a direct threat to our business; it puts our supply chain at risk," says the company's Jim Hanna.

All three companies are working with their suppliers to become more climate-proof.

Starbucks is collaborating with Conservation International to help coffee farmers in Mexico and other coffee-growing countries use sustainable growing techniques that prevent deforestation, a key contributor to global warming. They're also helping farmers generate extra income by tapping into carbon trading markets.

Levi Strauss is partnering with big-name brands in an organization called the Better Cotton Initiative, an effort to improve labor conditions and reduce chemical and water use among cotton farmers in Pakistan, India, Brazil and Africa. The company has also joined other retailers, NGOs and investors to stop buying cotton from Uzbekistan, a country where forced child labor is a big problem.

These efforts are encouraging. But the complex challenges our planet faces - whether from population growth, water constraints or climate change - require broader and deeper actions from companies. The poor decision-making that marked the BP oil spill shows that many companies are not prioritizing environmental and social factors across their businesses.

Among those pressing the hardest for action are major investors.

Yesterday, at the Clinton Global Initiative, the nation's largest public pension fund joined a collaboration with Nike, the Skoll Foundation and Ceres to urge the nation's biggest companies to move more quickly to embed sustainability risks and opportunities into day-to-day decision making.

"We expect our portfolio companies to do what is necessary to position themselves to be successful in a sustainable economy," said CalPERS CEO Anne Stausboll, whose office oversees about $200 billion in assets. "Environmental and other sustainability issues are core to business performance in the 21st century."

Read the post at Huffington Post

Meet the Expert

Mindy S. Lubber JD, MBA

Mindy S. Lubber is the president of Ceres and a founding board member of the organization. She also directs Ceres’ Investor Network on Climate Risk (INCR), a group of 100 institutional investors managing nearly $10 trillion in assets focused on the business risks and opportunities of climate change. Mindy regularly speaks about corporate and investor sustainability issues to high-level leaders at the New York Stock Exchange, United Nations, World Economic Forum, Clinton Global Initiative, American Accounting Association, American Bar Association and more than 100 Fortune 500 firms. She has led negotiating teams of investors, NGOs and Fortune 500 company CEOs who have taken far-reaching positions on corporate practices to minimize carbon emissions, water use and other environmental impacts. She has briefed powerful corporate boards, from Nike to American Electric Power, on how climate change affects shareholder value.

Read More