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Mindy Lubber of Ceres hopes that C-suites will heed the IPCC report and make 2019 the year they give the environment the attention it deserves This article originally appeared on Ethical Corporation. In what has been a landmark year for corporate leadership on sustainability, one of the most interesting and important developments has been the progress in the world of corporate governance. Momentum has been building steadily throughout recent years toward what I see as a potential tipping point in 2019, when sustainability will take its rightful place as a key priority for corporate boards. The urgency could not be greater. In 2018, two major reports underscored the scope and scale of the climate challenge, sounding the alarm for the entire global economy. The National Climate Assessment warned that climate change could wipe out 10% of the US economy, costing $500bn per year by the turn of the century. Earlier, the landmark Intergovernmental Panel on Climate Change report revealed a vanishingly small window of opportunity to avoid the worst impacts of climate change, prescribing nothing short of an overhaul of the world economy to protect against the devastation that lies in wait should we stay the course. If we didn’t know it before, we sure know it now: we must rapidly decarbonise the global economy, slash emissions, and invest in solutions that will sustain us for generations to come, and we’re going to need unprecedented corporate leadership – starting at the very top – to get us there. Sustainability cannot be cordoned off to one department, the purview of one or two corporate sustainability officers. It must be tackled at the board level by sustainability-competent directors who understand how and why these issues are material to the business and critical to a company’s long-term success.   Investors have woken up to the need for sustainability-competent boards. (Credit: NicoElNino /Shutterstock) Climate change poses disruptive risks to businesses. As explained in our Lead from the Top report, boards, as stewards of corporate performance in the long term, have the responsibility to work with management to build the resilience of their business for this changed reality. With their ability to hire, fire and incentivise management, corporate boards can drive the establishment of measures that reduce their company’s contributions to climate change, lower its exposure to climate risk, and position it to capture the opportunities embedded in the low-carbon transition. Through their oversight, boards have a tremendous opportunity to reinforce leadership on climate change that ripples throughout their companies, out into their supply chains, and beyond to the wider economy. As stewards for corporate performance in the long term, they have a responsibility to lead in this way. "Despite a clear business case, most public company directors don’t see sustainability issues as board-relevant" To be clear, we still have a long way to go. Many corporate boards still don’t get it. Despite a clear business case, most public company directors don’t currently see sustainability issues as board-relevant: 53% say environmental and sustainability expertise is “not very” or “not at all important” to have on their board, and 39% think climate change should not impact company strategy at all, according to a 2018 PwC Annual Corporate Directors Survey. Meanwhile, 74% say disclosure of sustainability issues is not important to understanding a company’s business or helping investors make informed decisions, according to a 2018 BDO Board Survey. The 2017-2018 National Association of Corporate Directors (NACD) Public Company Governance Survey asked directors to choose what top trends they think will have the biggest impact on their companies in the coming year. Just 6% put climate change in the top five. But while many corporate boards have not yet seen the writing on the wall, that doesn’t mean that it isn’t there or that those around them aren’t underlining it with big red markers. In fact, the powerful forces that shape the ecosystem surrounding corporate boards have come to understand the importance of sustainability-competent boards, and they’re helping push us toward the tipping point in 2019. Bank of England Governor Mark Carney at the annual A4S meeting in November 2018. (Credit: Ian Jones) In recent years, investors have woken up to the need for sustainability-competent boards like never before. In 2015, the Bank of England’s Mark Carney sent a shot heard round the world when he proclaimed climate change a financial risk that threatened the stability of the entire global market. BlackRock’s Larry Fink doubled down in his 2017 and 2018 letters to investors, insisting that companies must have a sense of purpose in order to be sustainable in the long term. Last year, nearly 400 investors representing $32trn in assets supported The Investor Agenda to provide disclosure on climate change risk, while just under 300 investors with $31trn in assets under management launched Climate Action 100+, a five-year initiative to engage the most carbon-intensive companies in the world on their climate change strategies, governance and disclosure. In the last two proxy seasons, we’ve seen major asset owners (including BlackRock and Vanguard) deliver historic majorities during shareholder votes on climate risk proposals at fossil fuel companies like Exxon and Occidental Petroleum. Investors want their assets protected by corporate boards that incorporate considerations of climate change into decision-making Whether through direct engagement or the shareholder resolution process, many investors are making it clear that they want their assets protected by corporate boards that incorporate considerations of climate change into their decision-making. They’re not satisfied with simple disclosure of climate change’s impact on a given company, they want companies to address these risks in the long term and they want to know how they factor into corporate strategy. We all know that as fiduciaries to corporations and their shareholders, boards should and do pay close attention to investor concerns. Beyond investors, professional associations, corporate secretaries, general counsels, and consultants are helping elevate sustainability to the board level as well. While the survey figures from PwC, NACD, and BDO mentioned earlier are indeed disappointing, the fact that these questions are now being asked is progress in and of itself. In 2018, we saw sustainability make its way into the materials produced by these bodies like never before. Shareholders have been voting actively at fossil fuel firms like Exxon. (Credit: Joe Belanger/Shutterstock) Here are some examples: The NACD, the US’s largest membership group of corporate directors, is increasingly featuring sustainability in its conferences, training and blogs. Ceres regularly contributes to the NACD. The Society for Corporate Governance, the United States’ largest professional association of corporate secretaries, has issued educational materials on sustainability to its membership. Lawyers are getting into the game. Noted corporate governance law firm Wachtell, Lipton, Rosen & Katz, published a memo that begins: “Be aware that sustainability has become a major, mainstream governance topic” and recommends that “boards should consider how their risk oversight role specifically applies to various ESG-related risks”. Proxy adviser Glass Lewis is now explicitly tracking which board committees or directors are charged with sustainability oversight, and in instances where a company does not manage sustainability risks well, may consider recommending that shareholders vote against the directors in relevant committees, or absent this, the audit committee.# In the coming year, the business case for climate action will become even more clear We at Ceres are also working hard to build sustainability competence at the corporate board level. As companies look to develop climate-competent boards, they can use our recently released Getting Climate Smart tool. All of this amounts to strong evidence that the mainstream corporate governance community is coming to understand that climate change as a board issue, and we expect to see increased uptake from corporate directors themselves as we work toward a breakthrough in 2019. In the coming year, the business case for climate action will become even more clear as companies are forced to respond to the ever-intensifying impacts of extreme weather events, and as they position themselves to take advantage of the opportunities embedded in the transition to a low-carbon economy. Their investors, their advisors, and their governing bodies will all demand corporate boards oversee sustainability directly. I’m hopeful that they’ll heed the call. This article originally appeared on Ethical Corporation.

Companies are underreporting to the SEC, when stronger filings would help business, investors and workers In September 2018, a Taiwanese fishing boat called the Fuh Sheng 11 made international headlines when it was found to have forced 27 men to work 22 hours a day fishing for tuna off the coast of South Africa. The boat was a sadly familiar example of the issues which plague fishing and many other industries: forced labour, under-payment and dire working conditions for men, women and children around the world.  According to the International Labour Organization (ILO), an estimated 24.9 million adults were in forced labour in 2016, while around 152 million children aged 5 to 17 were in child labour. This exposure of just one of a thousand boats in the Taiwanese fishing industry underscores what stakeholders have known for a long time: companies need to be more proactive on human rights. In a globalized world, news of corporate abuses travel fast, and investors have a crucial role to play in stemming these abuses and their reputational damage. For many years, investors have pushed companies to improve their practices and transparency on human rights. Due to international pressure, Taiwan worked to overhaul its regulations in 2017 and create safe working conditions and equal pay regulations for migrant fishermen, who often hail from Indonesia. In the United States, investors filed 31 shareholder resolutions on human rights in 2018, most of them focused on supply chain standards, ethical recruitment, human trafficking, indigenous people, and weapons and the penal system. Under the leadership of the Interfaith Center on Corporate Responsibility (ICCR), nearly 120 investors representing more than $2 trillion in assets have launched the Investor Alliance for Human Rights (IAHR) - of which Ceres is a partner - creating a platform for investors to engage companies and hold them accountable when they fail to prevent human rights abuse. Just last week, the IAHR supported the first ever business statement on the need to protect human rights defenders, civic freedoms and the rule of law.   However, investors are not only creating their own platforms. They’re also looking to regulatory agencies to enforce the rules and demand transparency from these companies. One such opportunity is financial filings to the US Securities and Exchange Commission (SEC), for which the rules mandate disclosure of all material risks. Investors representing $1.15 trillion in assets wrote to the SEC in 2016 asking for better disclosure of human rights issues in corporate supply chains, climate risks and water risks in these financial filings. And for good reason. A recent update to a search tool released by Ceres and CookESG Research, which analyses more than 5,000 US and foreign companies, found corporate disclosure on human rights in financial filings provides inadequate information for investors and stakeholders. The tool captures information (if disclosed) about internationally recognized human rights, such as freedom of association, the right to collective bargaining, non-discrimination, and the elimination of forced and child labour. The analysis reveals that across all sectors, human rights disclosures in financial filings suffer from underreporting, and do not link the financial implications of human rights risks to a company’s bottom line. The filings offered scant useful information for investors seeking to compare companies and understand progress year-on-year, which can be an obstacle when looking into the number of human rights victims across industries. Despite this, the tool reveals some pockets of good disclosure practice in financial filings, including from Nokia, National Grid and Intercontinental Hotels. However, in most cases human rights disclosures in financial filings are inconsistent and spotty. Investors are looking for ‘decision-useful’ disclosures which can help shed light on company performance, especially when looking at industries dependent on labourers, the people who help make their business viable. So, how can companies improve it? 1. Provide ‘decision-useful’ disclosures in financial filings Businesses need to give investors access to management’s views about salient human rights issues. The United Nations Guiding Principles Reporting Framework defines these issues as “the human rights at risk of the most severe negative impact through the company’s activities and business relationships.” Today, investors have to search multiple reports and web pages to find corporate human rights information, and it’s difficult to tell which issues are most important. Including salient information in financial filings, and providing links to sources of more detailed information, would be an important step towards demonstrating to investors effective management on human rights. 2. Make information clearer Companies should act now to make information clearer. By focusing their SEC disclosures on robust discussions of salient human rights issues, businesses can comply with SEC rules while providing investors a better sense of where the greatest risks and opportunities lie. 3. Be consistent Companies should also carefully compare their voluntary and SEC reporting on human rights. Both kinds of disclosure should provide consistent messages about the importance of human rights to a company and the actions the company is taking to protect them. Both companies and investors benefit from strong disclosures on human rights, especially when those disclosures are clear, comparable and consistent. As the tides turn in markets, companies which disclose human rights risks and opportunities increase market efficiency and their own viability. Thriving markets would not be possible without the dignified and important work of the labourers who deserve to have their working conditions protected and regulated. Companies and investors build their businesses on the backs of these labourers. When companies provide decent wages and humane working conditions - and are transparent about human rights risks and successes - all global markets can thrive. This content was originally posted on Business & Human Rights Resource Center.

Most food companies are tackling only a tiny fraction of their greenhouse gas emissions, despite the fact the sector produces more climate-causing gases than transport and buildings sectors combined. Be honest: when you’re thinking about lowering your carbon footprint at home, your mind jumps first to driving less and turning down the thermostat.But do you ever think about the food you’re eating? You should. The agriculture sector produces nearly one-quarter of the world’s greenhouse gas emissions. That’s more than the transportation and building sectors combined, according to the latest climate change report by the Intergovernmental Panel on Climate Change (IPCC). And by 2050, agriculture-related emissions are expected to be 80% higher due to population growth and global diets shifting to more carbon-intensive foods – ie meat. "Efforts to date to mitigate greenhouse gas emissions in agricultural supply chains are only baby steps" To be sure, major food companies are aware of these greenhouse gas impacts and are starting to address them, beginning with their direct operations. A far smaller number are also pursuing mitigation measures in their agricultural supply chains, such as curbing excessive fertilizer use, improving management of livestock, and reducing forest conversion/deforestation impacts. But efforts to date are only baby steps. Faster, broader, more ambitious changes across the entire agriculture sector are needed if we want to achieve the Paris climate agreement goal of limiting global temperature rise to well below 2 degrees Celsius, with an aim of achieving no more than 1.5 degrees Celsius, as the new IPCC report recommends.  ​ Soybean harvesting in the Mato Grosso in Brazil. Credit: Alf Ribeiro/Shutterstock  Here are a few of the biggest problem areas that require more attention:  A recent Ceres survey found that 86% of food companies’ overall carbon footprint comes from purchased goods and services – the vast majority being their agriculture supply chains. Yet, only 15 of the top 50 companies that were surveyed assess and disclose these indirect emissions, known as Scope 3 emissions. Fewer still, only eight companies, set explicit targets to reduce these emissions. In effect, most food companies are disclosing and managing only a tiny fraction of their greenhouse gas emissions.  And what they are missing is significant. Reported Scope 3 emissions from just the 15 companies that disclosed last year totalled 629.9 million tons of CO2 emissions, equivalent to the annual emissions from 156 coal-fired power plants or 70.9 billion gallons of gasoline. Deforestation is a big reason why Scope 3 emissions are a significant problem for food companies. Recent data from the University of Maryland found that more tropical forest was lost in 2016 and 2017 than any year since 2001. An estimated 18.7 million acres of forest, equivalent in size to Panama, was lost each year, or about one acre every second, according to Global Forest Watch. The biggest losses are happening in Brazil’s Amazon rainforest, dubbed “the lungs of the Earth” since they hold some 14% of global terrestrial carbon. Their importance for climate stabilization and biodiversity protection is profound. ​ The Amazon has been dubbed the lungs of the Earth. Credit Norad Food companies, via their agriculture and meat supply chains, are one of the causes of deforestation. In the Amazon, deforestation is being driven mostly by cattle-ranching. Brazil has the world’s largest livestock herd, with 209 million head of cattle on 413 million acres. That’s two and a half times bigger than Texas.  While many international food companies have made deforestation commitments in critical commodity supply chains, few have implemented robust traceability and supplier-assurance mechanisms in cattle supply chains. This means food companies are unable to ensure that their products are indeed deforestation-free. "UN experts believe that agriculture and forestry have higher mitigation potential than renewable energy." A growing number of investors understand that traceability and supplier assurance are essential building blocks for understanding and mitigating deforestation risk. That’s why more than 40 institutional investors representing $6trn in assets signed an expectations statement directed at key companies in Brazil’s cattle supply chains requesting that they strengthen traceability and supplier-assurance mechanisms. As more attention is focused on the Amazon and other rainforests, it is important to realize that land-management initiatives have the biggest near-term potential at the lowest cost to help achieve climate stabilization. United Nations experts believe that agriculture and forestry have the highest mitigation potential by 2020, even more than highly visible renewable energy, transport and energy efficiency strategies. From a financial standpoint, investments to reduce tropical deforestation and support forest re-growth are cost-effective ways to protect essential agriculture supply chains while putting us on a path toward climate stabilization. We’re seeing encouraging gains in reducing emissions in the electricity and transportation sectors, but no such transformation is occurring in agriculture. This needs to change. We cannot lose precious ecosystems that are needed to feed more people on an ever-warming planet. This blog was originally posted on Ethical Corporation.

The following is Senior Program Director of Capital Market Systems at Ceres Veena Ramani's introduction to a new NACD report, 2019 Governance Outlook: Projections on Emerging Board Matters. The second publication in this annual report series, provides corporate directors and senior executives with a comprehensive, forward-looking overview of major business and governance issues that are likely to require board focus over the coming year. The report includes insights and projections from four partners—Baker Tilly, Ceres, Deloitte, and Spencer Stuart—on the following themes: business risks, climate change, board refreshment and composition, regulatory updates, and mergers and acquisitions.

EXCERPT: This fall, Gov. Roy Cooper issued an important executive order to reduce carbon emissions and grow North Carolina’s clean energy economy. As one of North Carolina’s 257 craft brewers, New Belgium Brewing supports the governor’s action to address climate change because we know that climate change poses a direct threat to beer, to business, and to our entire state. North Carolina’s craft breweries employ 4,160 people and are responsible for $2.2 billion in economic activity for the state. We need healthy rivers, clean water, and stable barley and hop supplies to craft our beer, and we are already witnessing firsthand the impacts of climate change on our supply chain. The flooding and devastation that North Carolinians experienced as a result of the recent hurricanes are a prime example. Extreme weather events like these along with drought and erratic temperatures harm farmers. This in turn threatens the quality, affordability, and availability of brewing materials such as barley, hops and citrus fruit. These weather events are only expected to increase in frequency and severity if we do not act quickly to reduce emissions from our transportation and electricity systems. Cooper’s executive order sets a positive example and a strong precedent for protecting North Carolina’s environment while growing the economy. By setting targets to reduce statewide greenhouse emissions 40 percent by 2025 and increase the number of registered zero-emission vehicles to at least 80,000 by 2025, North Carolina can take necessary steps required to transition to a low-carbon economy. The governor has also directed state agencies to reduce energy consumption in state-owned buildings by 40 percent by 2025, ensuring that tax dollars go further and that our public buildings are better prepared for more intense storms. Read the full commentary on WRAL.com. The author, Jay Richardson is General Manager at New Belgium Brewing in Asheville, NC.

As world leaders convene in Poland for COP24 climate negotiations on implementing the Paris Agreement, a major focus on the discussions will be about financing climate action. Ceres, along with our partners at PRI and Rockefeller Foundation, created the Climate Finance Playbook to educate investors, policymakers and others about the importance of financing climate solutions and the opportunities that lie ahead.  Part Two of our Climate Finance Playbook series explores the roles that different financial institutions can play in financing a clean energy future. From pension funds to family offices to insurance companies to national development banks, each part of the “Climate Finance Community” must step up its game. Part two of the Climate Finance Playbook is reprinted below. Read Part One here, or download the full Playbook here.  The Key Plays Each key player in the climate finance community has its part to play in the years ahead, along an investment continuum from smaller angel investors to big pension funds. Experts looking at how, and if, we can meet the implementation challenge of Paris agree that the climate finance community must step up it's game. Here's how:  The Climate Finance Community Goal: Accelerate towards an annual goal of $1 trillion in private and institutional capital invested annually in low carbon and resilient infrastructure projects and ancillary services. (Read more about the Ceres Clean Trillion here.) ​ Incubators and Accelerators Minimize the so-called 'valley of death' by providing support, advice, training, and networks to start-ups in the climate technology sector.  Identify 'winning' technologies at the earliest stage possible.  Focus on entrepreneurs and companies with highest climate impact and ensure that "Just Transition" solutions benefiting and developed by women and vulnerable communities are an integral part of incubator programming.  Venture Capital Identify and commercialize climate solutions that have an impact for the long term. Consider venture funding for increased marketing efforts, new retail locations, and inclusionary recruiting.  Angel Investors Help start-ups move from ideation into beginning production by providing convertible notes, convertible SAFEs, common equity, preferred equity, warrants or other innovative capital.  Match high rate of return expectation with significant risk tolerance to allow innovative climate companies to strategically expand even though operating at a loss.  Family Offices Align family office members around a climate mission and then set aside a portion of their portfolio for high impact investing in companies or funds.  Work with and engage impact asset managers in traditional asset classes.  Look for alternatives like private equity, venture capital, property, real estate, and hedge funds with a climate focus.  Pension Funds Identify areas where the asset allocation ranges and portfolio structure might evolve in the future, including undertaking scenario analysis and portfolio alignment with the Paris Agreement goals.  Set a carbon neutral target for the real asset classes or a renewable energy target for the listed equity portfolio.  Discuss and identify potential trigger points to consider altering asset allocation ranges.  Set a "Paris-aligned" portfolio goal and invest in green bonds or climate bonds on the fixed income side.  Consider the social dimension of climate change and "Just Transition" strategies for the communities most affected by climate change.  University and Philanthropic Endowments Consider setting a net zero emissions target for portfolios.  Participate in endowments networks focused on sustainability.  Use the Task Force on Climate Related Financial Disclosure (TCFD) framework to disclose progress towards endowments' goals.  Strategic Investment Partners Large construction companies, utilities and big energy companies can provide both equity and strategic private debt to promising start-up companies in energy, water mobility, and agriculture.  Issue transparent, non-binding term sheets to help smaller service providers target emerging market opportunities.  Focus capital expenditures on renewable energy projects and infrastructure utilizing green bonds and/or equity investments while decreasing capital expenditures on carbon intensive assets.  Insurance Companies Work with other institutional investors, like pension funds, to buy green bonds and invest in pooled clean energy infrastructure funds.  Contribute to the climate finance community by providing specialized insurance and reinsurance products to help investors mitigate climate-related risks and move money into climate solutions.  Partner with national development banks to focus on particular risks in emerging markets.  Sovereign Wealth Funds Develop green investment capacity through public-private partnerships, private-private partnerships, and joint investments in climate-friendly projects with multilateral development banks.  Provide seed capital to stimulate the growth of green bond markets in developing and emerging markets.  Be first movers as co-investors by pooling expertise and experience with other investors to evaluate direct investments and share risk and upside potential in new climate innovations.  Identify areas where the asset allocation ranges and portfolio structure might evolve in the future, including undertaking scenario analysis and portfolio alignment with the Paris Agreement goals.  National Development Banks Play on both demand and supply sides to mobilize climate finance at scale.  Support pre-development and de-risking work to grow the investable project pipeline through grants, technical assistance and loan-loss funding in partnership with the public sector.  Provide a combination of financial instruments to facilitate the financing of projects including Tier 1 and 2 loans, direct equity, and guarantees to enable the local finance initiative to attract other capital.  Diversified Asset Managers Engage with portfolio companies to address climate risk through individual and collaborative dialogues, proxy resolutions, and proxy voting.  Emphasize long-term value creation and reward portfolio teams with compensation tied to climate impacts, longer term returns and reduced climate risks.  Consider developing new funds and products.  Private Equity Investors/Limited Partners Engage with Fund General Partners to fully explore both climate-related risks and opportunities.  Seek investments in companies whose products and services are aligned with the Paris Agreement goals.  Ask key questions about the GP's core approach towards:  Climate change risk assessment, management and governance in their geography or sector; the GP's ability to actively manage climate issues and ensure regulatory compliance; and the GP's reporting and disclosures to their investors on climate issues.  Investment Banks Set ambitious targets for lending to climate solutions. The investment banks have a significant role in structuring finance and deploying capital to renewable energy projects, with a particular focus on structuring deals to encourage partnerships with institutional investors like pension funds and insurance companies.  Begin to follow the example of the green investment banks and limit lending to heavy emitting companies in every sector.  Bundle loans into green bonds that will be attractive to institutional investors, thereby generating new bank capital for climate positive projects.  Public Sector National and Subnational Governments can pass and implement low-carbon policies, such as "Buy Clean" procurement rules, renewable portfolio standards, energy efficiency standards, carbon pricing mechanisms, and project re-development support for local communities.  Mitigate taxpayer risks through life-cycle asset management and innovative insurance mechanisms that share climate risks across communities so that a catastrophic weather event does not impact one community alone.  Utilize green bonds whenever appropriate when funding infrastructure improvements.  The Missing Ingredient: De-risked Deals Every year, more and more climate-minded investors are allocating funds to invest in low-carbon projects around the globe, but a common refrain is often heard: Where are the deals I can invest in?  Call it concessionary capital, predevelopment funding or project de-risking, often the hardest money to find to get an innovative project off the ground is early funding for feasibility studies, financial analyses, and stakeholder engagement and buy-in. This is unheralded as hard work that NGOs and public sector agencies usually do while investors and their funding wait on the sidelines.  But all is not bleak! One great step forward to close this gap has been taken by the European Union's External Investment Plan, which has set aside $4 billion for de-risking, credit enhancement, and critical local technical assistance to help developing countries prime the pipeline of projects and enhance the capacities of private sector representatives.  ​ Overtime: Embracing the outcomes curve It's always worthwhile to gather and celebrate the amazing growth of the climate finance community while taking stock of the acceleration challenges ahead. From the Global Climate Action Summit in September to the gatherings in Paris, COP24 in Poland and future gatherings yet known, we must continue to combine a deep sense of urgency with a steely-eyed commitment to smart implementation, from the ground up.  We all know in the finance world about the "hockey stick" curve that shoots sharply upward when an investment takes off in value. But now, we must work together to create a new kind of financial paradigm - an outcome curve. Right now, we are at what management guru Charles Handy would describe as 'the zone of paradox'. Progress seems slow, as the incumbent high-carbon business model gives way to a new low-carbon future, and as innovation begins to scale. Guess what -- that's OK. Carry on!  ​ Resources For the most comprehensive taxonomy of climate finance categories and finance flows, don't miss the Climate Policy Initiative's "Global Landscape of Climate Finance" (2017). And find more resources by downloading the complete Climate Finance Playbook (pdf). 

A clean transportation system would have benefits for the state’s public health and economy. It would also create investment opportunities. As New Jersey refocuses on the need to confront climate change and embrace a leading role in the clean energy economy, state leaders must get serious about reducing emissions from transportation. It is time to re-envision the way we move people and goods around the state. The New Jersey Legislature is currently considering major legislation (S-2252) that would help our state usher in a clean transportation future and open up exciting investment opportunities. We believe that New Jersey should lead on climate, and this bill is a key part of that work. Friends Fiduciary is an investment manager serving Quaker organizations across the country, including 48 meetings, schools, and retirement communities in New Jersey. As long-term investors, we seek investments and policy solutions that build business sustainability and protect the environment. That is why we are proud to promote socially responsible investment solutions that will help to reduce emissions and build a clean energy future. It is also why we strongly support efforts to modernize the region’s transportation system and reduce harmful emissions. Transitioning to a clean transportation system will not only improve the public health and prosperity of all New Jerseyans, it also presents a forward-thinking investment opportunity that could make the Garden State a hub for future economic activity. To ensure that the state remains a leader in the low-carbon economy, New Jersey’s leaders should transition to a modern transportation system that expands public transit options and increases investment in electric vehicles — and the state needs smart policies that allow us to do so. Lawmakers, let’s get going S-2252 would set a bold vision for New Jersey by establishing a binding statewide goal for electric vehicles, developing a public-charging infrastructure network throughout the state, and creating a robust rebate program for electric vehicle purchases. Lawmakers should act swiftly to pass this legislation. It has become increasingly clear that the future of transportation is electric. To keep pace, New Jersey should be bold in its commitment to supporting that transition with clear, time-bound goals — like S-2252 proposes. A goal of 90 percent electric vehicle sales by the year 2040 and increased availability of accessible, affordable, and convenient public-charging infrastructure will ensure our state is ready to meet the clean economy of the future. Many companies with a large footprint in New Jersey — including Amazon, IKEA, and Unilever — are already investing in electric vehicle fleets, and this legislation will encourage more businesses to adopt similar policies. In addition, many nearby states already have generous rebate or tax incentive programs to hasten the adoption of electric vehicles, and are increasingly investing in public-charging infrastructure. New Jersey should join its peers in incentivizing consumers to make a choice that benefits the state’s communities, economy, and environment. Keeping millions of dollars in NJ Increasing the number of electric vehicles on the road will allow New Jerseyans to take advantage of the ongoing efforts to clean the electricity grid through wind, solar, energy efficiency, and more. Electrifying the transportation sector and powering that new system with clean energy would prevent the state from sending tens of millions of dollars out of the local economy each year. Instead, that money could be reinvested in local communities and clean-energy jobs. Seven other Northeastern states and Washington, D.C. recently held listening sessions as they consider a regional policy approach to reducing emissions from transportation. Given the importance of New Jersey as a key transportation hub for the entire region, it is critical that we participate in these discussions to ensure that the health, prosperity, and interests of New Jerseyans are represented as we pursue a bold regional approach to reducing emissions. As long-term investors, we think states that take advantage of opportunities will be best positioned for economic success in the future. We recognize that advocating for climate solutions is essential to keeping our communities prosperous and healthy for generations to come. We urge lawmakers to move forward on proposals to advance electric vehicles in our state and applaud Gov. Phil Murphy for advancing climate and clean energy to the top of his agenda. Jeff Perkins is executive director of Friends Fiduciary Corporation, the oldest asset management company providing socially responsible investment management services consistent with Quaker values. This post originally appeared on NJ Spotlight. 

This year’s holiday feasts will feature a bounty of meats, vegetables and other foods, many that people don’t know are big contributors to global warming. But if you’re looking for details on food providers’ carbon footprints to make your meals more sustainable, you’re mostly out of luck. A recent survey conducted by Ceres found that 86 percent of food companies’ carbon footprints come from purchasing raw materials and services used to make the food — in other words, agriculture and meat supply chains. However, only 15 of the top 50 food companies in the US and Canada publicly disclose greenhouse gas (GHG) emissions from agriculture production. And fewer still — only eight — have set targets to reduce these indirect emissions, formally called Scope 3 emissions. This means that a significant source of global warming pollution — the agriculture sector produces nearly one-quarter of the world’s GHG emissions — is not being measured and accounted for. And that makes it all but impossible for food companies to reduce these emissions. Reported Scope 3 emissions from the 15 major food companies that disclosed last year totaled about 629.9 million tons of carbon dioxide, which is equivalent to annual CO2emissions from 156 coal-fired power plants. Most of these emissions are from agricultural practices such as fertilizer use; and land-use impacts such as deforestation, which release carbon into the atmosphere. Measuring carbon emissions across an entire company supply chain is by no means easy. It’s especially challenging for food companies. Most large food companies buy their agricultural products through a complex web of farmers, commodity aggregators and traders. Emissions from farming practices and deforestation impacts are rarely under their direct control, and farmers and traders don’t regularly collect such emissions data. Different geographies and widely varying growing practices further compound these disclosure challenges. But industry shifts and reporting improvements are removing these barriers, making such disclosures easier and more accurate. Several leading food companies are leveraging their massive buying power to bring commodity suppliers to the table to establish more robust GHG monitoring and accounting systems. Measure the Chain: Tools for Assessing GHG Emissions in Agricultural Supply Chains, a new report published by Ceres and the CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS), outlines methods and tools companies can use to calculate and disclose their Scope 3 carbon emissions. The report differentiates among standards, protocols, guidance and publications for estimating emissions and emission reductions from agriculture. For example, companies that want to document carbon sequestration and the influence of environmental factors on agricultural emissions can go to the GHG Protocol Agricultural Guidance. Companies looking to calculate emissions from land use and land-use changes for agriculture and forest commodities are directed to the 2018 Land Use Change Guidance. The report also reviews common online tools and calculators that can be used to estimate emissions, emission reductions and changes in carbon stock in food supply chains. Traceability systems, already critical in ensuring product quality, food safety and other supply chain risks, also improve the ease and accuracy of disclosing Scope 3 emissions. Given these advances, there is a growing expectation from global investors that food companies fully disclose Scope 3 greenhouse gas emissions. Companies should be prepared to discuss the breadth and quality of Scope 3 disclosures, including estimation methods that were used, land use factors that were considered and other issues. The next step is for companies to set ambitious emission reduction targets, as General Mills, Mars and a half-dozen other companies have already done. More than ever, investors view climate change mitigation planning as a business fundamental. And these efforts need to include agricultural supply chain risks, including litigation, market, operational, regulatory and reputational risks. And this is what we all want: knowing that the carbon footprint of our holiday meal is helping — not hindering — global efforts towards a sustainable, low-carbon future. This post first appeared on Sustainable Brands.

Late last week on the heels of the Thanksgiving holiday, the federal government released the second volume of its Fourth National Climate Assessment. The report details the present and future impacts of climate change in the U.S. by sector and by region.  The main finding? Climate change is already having economic and health impacts across the nation, and time is running out to prevent or minimize even the very worst impacts.  Prepared by the 13 federal agencies that make up the U.S. Global Change Research Program, the assessment reflects the urgency of the recently released report from the Intergovernmental Panel on Climate Change (IPCC), which underscored that avoiding the worst effects of climate change will require dramatically increasing the pace and scale of greenhouse gas emission reductions. This second volume of the Fourth National Climate Assessment also confirms many of the findings from the first volume (released last year).  According to the report, many of the climate impacts we expect to feel by 2050 are largely locked in and unavoidable. However, acting now to dramatically reduce greenhouse gas emissions will prevent far worse impacts from occurring. A combination of voluntary actions and strong federal and state-level policies will be essential to achieve the emissions reductions required to avoid the “worst-case scenario” from occurring.  The case for immediate action is clear. This “worst-case scenario” could add hundreds of billions of dollars in costs to the economy per year by the end of the century. Now more than ever business leaders have an unequivocal case for supporting smart climate and clean energy policies—policies that the National Climate Assessment makes clear are critical to protecting our economy, our health, and our communities. World leaders are now preparing to convene next month in Katowice, Poland, for the 24th Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC), known as COP24, to hammer out the implementation plan for the Paris Agreement. Both in Poland and here in the U.S., investors, companies, and other non-state actors in the U.S. economy will courageously stand up and call for urgent action to accelerate the transition to a low-carbon economy.  Ceres stands in solidarity with all those who are “still in” and “all in” on meeting the goals of the Paris Agreement. We pledge to do our part to move lawmakers at all levels of government to act boldly on tackling climate change. As these recently reports have made clear, the time to act is now. 

by Kirsten Spalding, Senior Director, Investor Network, Ceres and Dan Carol, Senior Advisor for Infrastructure and Energy, Governor Jerry Brown As scientists concluded in the recent UN Intergovernmental Panel on Climate Change report, avoiding the worst effects of climate change will require an all-hand-on-deck transformation of the global economy.    That transformation is going to take innovation and money. Technology developments in energy efficiency, clean energy, and zero-emissions transportation are quickly evolving and require capital in order to reach the scale needed to curb global climate change. Plus, an increasing number of investors are seeking low-carbon opportunities to invest in. In fact, in recent survey responses to The Investor Agenda, 400 major investors indicated they will take at least one of four actions on climate, including moving funds into low-carbon investments this year.  And that’s a very good thing. Experts estimate more than $1 trillion a year of global clean energy investment is needed for us to meet the threshold of avoiding the worse effects of climate change. Ceres calls this climate finance challenge, the Clean Trillion.  But this all begs the question: Are the investors interested in low-carbon opportunities finding  promising low-carbon innovations and project deployments?  Can asset owners, bound by fiduciary duty to maximize returns for clients, find the types of investments they need in the emerging low-carbon landscape? Enter the Climate Finance Playbook.  I sat down with Dan Carol, senior advisor for infrastructure and energy in California Governor’ Jerry Brown’s office as well as friends from Principles for Responsible Investment and The Rockefeller Foundation to put the Climate Finance Playbook together to help investors navigate these questions as investors gathered at the Global Climate Action Summit in September.  Part one of the Climate Finance Playbook is reprinted below. You can download the full playbook here.  The Big Goal Experts looking at how and if we can meet the implementation challenge of the Paris Agreement agree that the "Climate Finance Community" must step up its game.  The goal: accelerate towards an annual goal of $1 trillion in private and institutional capital invested annually in low carbon and resilient infrastructure projects and ancillary services by like...tomorrow.  There is good news. There are many, many promising climate finance solutions emerging on the scene to close key market gaps.  The bad news? Interested investors of all shapes and sizes and emerging innovators of every stripe often struggle to find each other — and often talk past each other. Different investor expectations, lexicons, and geographies need to be clarified fast, and then linked to action.  ​