Fertilizer producer Yara and Northern Lights have signed the world’s first commercial agreement on cross border CO2 transport and storage. This is groundbreaking for the decarbonization of European heavy industry, opening the market for cross border CO2 transport and storage as a service. It is also a major milestone towards achieving Yara’s own net zero targets.
Yara and Northern Lights have agreed on the main commercial terms to transport CO2 captured from Yara Sluiskil, an ammonia and fertilizer plant in the Netherlands, and permanently store it under the seabed off the coast of western Norway. When the final contractual details are firmed up, this will be the first ever cross border CO2 transport and storage agreement. It will set the standard for other industrial companies across Europe looking to use Northern Lights – and other emerging CO2 transport options and stores in the North Sea – as a key part of their decarbonization strategies.
Decarbonizing heavy industry with CCS to reach climate goals
Yara Sluiskil has already cut 3.4 million tonnes of CO2 emissions per year from its ammonia and fertilizer production since 1990. Significant volumes of carbon dioxide are reused in greenhouse plant production, as an ingredient for carbonated drinks and for other purposes such as urea and AdBlue, a high purity urea-based solution for diesel engines. From early 2025, 800,000 tonnes of pure CO2 will be captured, compressed, and liquefied in the Netherlands, and then transported to the Northern Lights store at 2,600 metres under the seabed off the coast of Øygarden.
“Action to decarbonize industry is urgent and Yara is a frontrunner. I am very pleased to announce that we are now on our way to removing CO2 emissions from our production plant in Sluiskil. This will take us a step further towards carbon-free food production and accelerate the supply of clean ammonia for fuel and power production,” said Svein Tore Holsether, CEO Yara International ASA.
“Yara is our first commercial customer, filling our available capacity in Northern Lights. With this we are establishing a market for transport and storage of CO2. From early 2025 we will be shipping the first tonnes of CO2 from the Netherlands to Norway. This will demonstrate that CCS is a climate tool for Europe”, said Børre Jacobsen, Managing Director of Northern Lights.
Safe and proven ccs, capture, transport, and storage of CO2
Northern Lights is the transport and storage part of the Longship project, funded 80% by the Norwegian government. Building on over 20 years of offshore CO2 storage in Norway, the government has worked closely with Norwegian industrial emitters and Northern Lights to create the world’s first open access full value chain CCS model. As part of its funding, the government stipulated that Northern Lights develop a commercial business model and offer its service to the rest of Europe.
The Longship model shows that CCS is doable, safe, and cost-effective. It has also helped to develop a commercial model and a market to support it. Longship provides a platform for Norwegian businesses and service providers to innovate, leveraging experience, first-mover advantage, and significant offshore storage capacity – and it offers European industry a crucial decarbonization option and solutions to replicate.
However, the press info does not address the remaining problems with CCS so far.
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The first-ever larger hydrogen powered aircraft for passengers (40-80 seats) is scheduled to fly between the Netherlands and London in 2028. A Dutch partnership is building a hydrogen system for aircraft, all green, from fuel to propulsion. The system is scalable to larger aircraft. And is entirely of Dutch origin. This makes the Netherlands the world’s leading supplier of hydrogen powered aircraft.
No more CO2 or nitrogen from the exhaust, fully zero CO2 emission air travel. And this first flight will not be a one-day wonder: the intention is to have several commercial flights worldwide from 2028 onwards. Hydrogen Aircraft Powertrain and Storage System (HAPSS) is an entirely Dutch public-private partnership, set up by Unified International and InnovationQuarter with 17 companies, including Fokker, TU Delft, the Dutch government and the Royal Dutch Aerospace Center. From the National Growth Fund, €383 million was allocated to the Aviation in Transition program, of which the HAPSS project is the largest component. The system will be ready at lab scale by 2025.
Contribution to the green economy
An international survey shows that more than 90% of consumers are willing to pay more for a flight, provided it is completely green. The HAPSS program achieves zero emission air travel and helps the Netherlands to become the leading supplier of such systems worldwide. The system will initially be built into an existing turboprop aircraft with 40-80 seats and can then be used in new zero-emission aircraft with even more passengers.
1200 jobs and a global market of €16 billion
“This is unique worldwide according to experts. And the best part: above this project flies a completely Dutch flag, so this project contributes directly and one-to-one to the Dutch GDP,” says Michel van Ierland of Unified International. As of 2028, HAPSS will provide 1,200 jobs. “We are providing structural employment in the green economy with this program. In addition, we are opening up a €16 billion world market for the Netherlands. This is very interesting for Scandinavia and New Zealand, for example, where for shorter distances battery-electric technology is currently still being targeted.”
How does a hydrogen powered aircraft work?
The entire chain in an hydrogen powered aircraft, from fuel to propulsion, will be fully and completely greened. Where fuel is currently stored in the wings, in the new aircraft the storage will be replaced by hydrogen capsules in the tail of the aircraft. The hydrogen is then transported to the engine and converted into electricity. In the engine, the electricity is converted into motion and sent to the propellers.
The Netherlands finally takes the lead in aviation again
The Netherlands has 100 years of experience in aviation. But with the demise of Fokker as an Original Equipment Manufacturer (OEM) in 1996, the demand for Dutch-made aircraft components came to an end. In the meantime, the ecosystem has only been used for aircraft platforms such as Airbus, Boeing, and Lockheed Martin (F35). This is now going to change. With the HAPSS project, the Netherlands is positioning itself worldwide as a supplier for airlines that need to start flying sustainably. Potential customers include Airbus, Boeing, Embraer and De Havilland.
Other countries are experimenting, but not competing
In the US and the United Kingdom, experiments with hydrogen-powered flying are also taking place, but mainly by parties that have their origins in commercial, sustainable energy supply. “Those have a different focus. They are potential customers and partners for us, rather than competitors.” Parties like Airbus/Leonardo, Embraer are also working on hydrogen technology for their future aircraft. However, their horizon is a bit further away and is on the period after 2035.
Earth Day, April 22 2022 marked the emergence of the Zoöp, a model for organizing institutions and businesses in a zoölogical coöperative. This way, humans and other-than-human life collaborate to counter the climate catastrophe.
The Zoönomic Institute just signed the paperwork that turned Het Nieuwe Instituut in Rotterdam, the Netherlands’ national museum for architecture, design, and digital culture, into the very first Zoöp in the world. Zoöps are organizations that collaborate with other-than-human life to foster ecological regeneration. The legal structure for the Zoöp model was developed in close collaboration with the renowned Dutch law firm De Brauw Blackstone Westbroek.
6th extinction wave
We are in the midst of a rapidly escalating climate catastrophe and the 6th extinction wave. These are the result of a society and economic system that systematically put human interests above other-than-human interests. With Zoöp, The Zoönomic Institute wants to contribute to the development of alternative logic. The term Zoöp is short for Zoöperation and is a combination of the Greek word for life – zoë – and the word cooperation.
Zoöp is inspired by and complementary to recent developments in the field of rights of nature and works with the insights of the Doughnut Economy. “If governments and corporate leaders get on board, the Zoöp model could be the game-changer we are all seeking,” says Margaret Satya Rose, Vice-Chair of the Zoönomic Foundation.
The Zoöp governance model
The Zoöp model is an innovative governance model that cultivates a practice of ecological regeneration in organizations by fostering collaboration between humans and other-than-human life. It is a radical model that enables any organization to contribute to ecological regeneration. The Zoöp model anchors the realization of ecological regeneration within an organization in a robust way, without changing its existing goals. An organization becomes a Zoöp by including a Speaker for the Living as Board Observer and committing to the Zoönomic Annual Cycle.
The Speaker for the Living has the sole task of representing the interests of other-than-human life in the operational sphere of Zoöps. The Zoönomic Annual Cycle ensures that ecological regeneration is realized, measured, and monitored. Ernestien Idenburg, Chair of the Zoönomic Foundation: “What’s exciting about the Zoöp model is that it can be implemented right now! No change of law is required to have an immediate positive impact. In addition, it could provide legislators with a framework for implementing regenerative policy, leading to systemic change.”
Het Nieuwe Instituut wanted to become a Zoöp to take concrete steps toward a climate-positive future, involving all layers of the institute. Now that Het Nieuwe Instituut is officially inaugurated as a Zoöp, over 20 other organizations in the Netherlands and abroad are ready to become Zoöps as well. They will be supported by The Zoönomic Institute, the driving force behind the Zoöp movement.
Klaas Kuitenbrouwer, initiator of the Zoöp project: “We aim to create a growing network of Zoöps with the Zoönomic Institute as the knowledge steward and accelerator of the wider Zoöp movement. Our goal is to transform as much of the economy as possible into a regenerative, human-inclusive, Zoönomy: a network of exchange of matter, energy, and meaning that supports all bodies in their existence.”
More initiatives to give nature a legal status
The Spanish parliament, the Congress of Deputies, has approved initiating the processing of a law that allows the Mar Menor and its entire basin to have legal personality. As such, it will be the first ecosystem in Europe with its own rights, as if it were a person or a company. A large majority has said yes to converting the popular legislative initiative (ILP) endorsed by more than 600,000 signatures into a law proposal and thus begin its parliamentary process.
The initiative defends a “radical change” in the paradigm applied until now, so that nature, in this case, the Mar Menor, goes from being treated as “an object at the service of humanity” to being “a subject of rights”, “from being a slave to being a citizen”, explains the professor of Philosophy of Law at the University of Murcia Teresa Vicente, one of the promoters of this measure and in charge of presenting it to the deputies on March 15, to El Pais.
Around the world, activists are pushing to protect their rivers by giving them legal personhood. Is this just symbolism, or can it drive lasting environmental change? That was the central question in a major article in The Guardian, July 2021.
The Magpie River in Canada was granted legal personhood by local authorities, and given nine rights, including the right to flow, the right to be safe from pollution – and the right to sue.
Uapukun Mestokosho, a member of the Innu community who campaigned for the recognition of the Magpie’s rights said spending time on the river was “a form of healing” for indigenous people who could revive their traditional land-based practices that had been abandoned during the violence of the colonial era.
The Magpie River in Canada has got the right to flow, but how you enforce that right is very unclear
The Magpie is one of a growing number of rivers to be recognized as a living entity across the world. The burgeoning rights-of-nature movement is pushing local, national and international authorities to recognize natural features – from lakes to mountains – in law, giving them either legal personhood or an independent right to flourish.
In New Zealand, the Whanganui treaty did not address this key issue, with a water company continuing to divert 80% of the river’s flow for hydropower until its license expires in 2039. Even if this fact makes rights for rivers appear to be symbolism without legal teeth, experts argue that the concept still possesses real transformative power.
In Canada, David Boyd, a professor of law and the UN Special Rapporteur on Human Rights and Environment, has said that legal personhood could succeed where decades of environmental laws have failed, kickstarting a cultural shift away from conceiving of nature as a “warehouse of commodities for human use”.
In India, a state high court tried to give the Ganges and Yamuna River legal personhood in 2017, but the decision was appealed to the supreme court. Campaigners are still waiting for the verdict while the rivers continue to be polluted and exploited.
The origins of the idea
An in-depth article in The New Yorker mentioned that the notion that “natural objects” like woods and streams should have rights was first put forward half a century ago, by Christopher Stone. Stone, a law professor at the University of Southern California, who died last year, was a son of the crusading journalist I. F. Stone, and as a kid, in the nineteen-fifties, he sometimes helped put out his father’s newspaper, I. F. Stone’s Weekly. In the fall of 1971, the younger Stone was assigned to teach U.S.C.’s introductory course on property law, and in one class he delivered a lecture on how ownership rights had evolved over time.
Near the end of the hour, sensing that his students’ minds were wandering, he decided to shake things up. What would happen, he asked, if the law were to further evolve to grant rights to, say, trees or even rocks? “This little thought experiment,” he later recalled, created an “uproar.”
Meanwhile, Europe is lagging behind. The Enlightenment thinking placed man above nature. Nature is an object, it can be owned and exploited, is the idea. Many other cultures are thinking biocentric. Mountains, lakes, rocks, and air are ‘alive’ as well. Discussions to change this way of thinking have reached the level of the European Union. Worldwide, case law is developing. When pushed too far, Gaia goes to court.
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“Behind sustainable choices is not the actual sustainability of the company, organization, or brand, but the sustainability experience,” writes Timo Järvinen, CEO of the Finnish empathy analytics company NayaDaya Inc.
If we split the core of sustainability, in addition to the ecological, social, and economical consequences of our actions, we will find something that has a decisive impact on people’s behavior, business success, and sustainable development.
This other aspect of sustainability is experience. Sustainability is an increasingly important part of the customer and employee experience. Customers and employees appraise the sustainability of companies, organizations, and brands in relation to their own values. Appraisals lead to subjective meanings and emotions – thus creating an emotional experience of sustainability.
People respond to their own experiences not to sustainable actions
Emotional experiences have a decisive impact on behavior – as do sustainability experiences. We have seen this especially recently. Emotions make us ignite, participate, and commit to things that represent the world we believe in. The emotions within the experiences of sustainability can also cause the opposite: avoidance, resistance, and even aggressive behavior.
From the point of view of companies and organizations, the effects of sustainability experiences are at best seen as traction and retention, or even as a competitive edge. At worst, they can cause loss of customers and employees.
If a company, organization, or brand wants to succeed and be a part of change toward a better world, sustainability experiences are critical to the success of its mission. We must accept that, for example, behind sustainable consumer choices is not product sustainability but rather consumer sustainability experience.
People are not able to react to anything other than the experiences produced by their own judgment.
How do customers and employees experience sustainability?
A company or an organization needs to identify the essential parts of its sustainability to its customers and employees. It is beneficial to find out how elements of the sustainability experience affect behavior. By strengthening engaging elements and fixing or transforming the causes of stagnation, avoidance, and resistance, people are involved – this way it’s possible to create value for customers and employees, strengthen loyalty, and promote a sustainable, profitable growth.
Sustainability must be built, and the sustainability experience managed responsibly. However, this self-evident idea is not so self-evident after all. As people do not react to sustainable actions but rather to their sustainability experiences, it is possible to influence their experiences and emotions in ways that are not responsible but aim only to create images.
Recognition of authenticity contributes to healthy development. Companies, organizations, and brands that embrace sustainability as a key guideline and a part of their DNA implement these principles in all their operations and communications. When deeds and words meet each other and people’s values, the result is hope for the better, trust, change, and ultimately, success.
Sustainability is not pleasing
Sustainability is the way to a better future and competitive edge, but it is often full of curves and pitfalls. We must accept that sustainable actions do not always evoke positive, engaging emotions. It is not sustainable to always do and say what people wish and want to hear.
The consequences of acts of sustainability can be contradictory. Sometimes they mean cutting personal interests, which causes negative reactions. Sometimes the public and social media deal with events in ways that don’t do justice to real efforts.
In all circumstances, it is helpful to identify the customer and employee experiences and reactions. Collective empathy and data are needed to identify emotions as well as their root causes and consequences. The answers are not found on social media, where the loudest voice is often held by a relatively small number of people.
Communication is needed to manage sustainability experiences – not just to evoke images but to portray boldly and uncompromisingly the reality. From time to time, we all need to be steered in the right direction. Sometimes we must give up our own interests here and now so that all people, including future generations, will have hope.
The power of compassion should be better harnessed to engage and involve customers and employees.
The author of the blog post is Timo Järvinen, CEO of the Finnish empathy analytics company NayaDaya Inc.
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How can a sector that is responsible for 30% of global carbon emissions be held to account for its impacts, including ensuring that coal companies meet growing stakeholder demands for transparency in how they align with the low-carbon transition?
GRI 12: Coal Sector 2022 is the authoritative, internationally applicable standard for coal organizations to communicate their impacts on the economy, environment and people. GRI is developing new standards to enhance accountability on the issues that matter most within sectors. As demonstrated by coal – which remains a significant source of energy and revenue generation – these issues are often complex and inter-linked, highlighting the urgency of improved reporting.
The Sector Standard for Coal enables comprehensive and comparable disclosure on:
How companies respond to climate change mitigation demands, as reflected in the Paris Agreement, including plans to transition away from coal mining.
Accountability for social impacts that span human rights issues and the safety and wellbeing of employees and communities – with added focus on assessing risks related to catastrophic incidents, such as tailings facility failure.
Measures to effectively manage impacts on the environment and biodiversity, given the coal sector is a major contributor to water, air and soil pollution.
Robust reporting on the closure of coal mines and the ways this affects communities and workers, with the focus on how organizations contribute to a just transition.
Fulfilling financial obligations and steps to tackle corruption – recognizing coal mining often takes place in developing economies or areas of poverty – including transparency on payments, ownership structures and contracts.
Transition challenges
Judy Kuszewski is Chair of the Global Sustainability Standards Board, the independent entity that sets the GRI Standards. She said:
“It is abundantly clear that, to reach the ambition in the Paris Agreement, an urgent transition away from coal has to be a part of the solution. Indeed, as the UN Secretary-General set out in response to the new assessment from the Intergovernmental Panel on Climate Change, coal and fossil fuels are “choking humanity”.
That is why more scrutiny is needed on the companies that remain in the coal sector, with accountability for their impacts. GRI’s Coal Standard reflects these challenges – not only in terms of climate change and a just transition, but across the full socio-economic and environmental spectrum. From minimizing waste to corruption-free operations, GRI 12 guides companies to deliver comprehensive and comparable reporting.
Global challenges call for different actions from different sectors. Numerous stakeholders – including investors, governments and civil society – require decision-useful data to assess the sustainability performance of companies. That is why we are growing the family of GRI Standards, with coal now added alongside our Oil and Gas Sector Standard, and more to come soon.”
Applicable for any organization in coal mining, exploration, processing, transport and storage, GRI 12 was developed by a working group that ensures multi-stakeholder and global legitimacy. This expert group includes representatives from the UNEP World Conservation Monitoring Centre, standard setters EITI and SASB, and investment institutions FTSE Russell and S&P Global. The working group emphasized climate change as the most critical issue for the sector, requiring enhanced disclosure.
Sector standard
The project to deliver a Sector Standard for Coal was initiated and approved by the Global Sustainability Standards Board. Prior to finalization, an exposure draft of the Sector Standard underwent a global public comment period. GRI 12: Coal Sector 2022 comes into effect for reporting from January 2024, with early adoption encouraged.
An assessment by the International Energy Agency estimates that coal-fired energy generation accounts for 30% of CO2 emissions. While coal’s position in the global energy mix is diminishing, IEA research finds production is growing in China, India, Australia, Indonesia and South Africa. The outcome of the UN Climate Change Conference (COP26) in November saw agreement by countries to ‘phase down’ (rather than ‘phase out’) use of coal.
GRI Sector Standards will initially cover 40 sectors, starting with those with the highest sustainability impacts. The first completed Sector Standard – for oil and gas – published in October 2021. A Sector Standard for agriculture, aquaculture & fishing is expected to launch this summer, with standards for mining, textiles & apparel, and food & beverage next in the pipeline.
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For green products to be successful, there have to be markets. For PHAs, a family of plastics that are both bio-based and biodegradable, there appear to be many. Invest-NL and Wageningen University & Research are joining forces to accelerate the market introduction of PHAs. They have developed a roadmap that shows which PHAs are appropriate for specific applications, what the characteristics of logical early adapter products are, and what developments are still needed.
PHAs are made by micro-organisms from raw materials such as sugars and vegetable oils and from various waste streams such as food waste and sewage sludge. Although production volumes are still limited and production costs are high, the market demand is clearly growing. When the production volumes go up, the costs may also go down, which in turn can open up new markets. What complicates the market implementation is the fact that the production of PHAs requires a different production process than the processes used to make conventional plastics such as PE, PP, and PET. This will require substantial investments and a lot of research.
PHAs when biodegradability is essential
Wageningen Food & Biobased Research has been conducting technological research for 30 years into the production and usage possibilities of PHAs for various applications. They are currently participating in the European Urbiofin project, which aims to make PHAs from urban waste for use in packaging materials. In collaboration with Invest-NL they studied the market opportunities that will arise in the coming decades for the various types of PHA materials and the developments that are still required.
“These materials are a perfect fit for markets for which biodegradability in various natural environments is essential,” says Wouter Post, researcher at Wageningen Food & Biobased Research. These applications are included in the roadmap in phase 1 of the market implementation. “There are currently various types of PHA entering the market which each have their own specific set of material properties. As a result, unique market opportunities arise for each individual PHA type. This means that the market now needs clarity on which PHAs are appropriate for specific applications, such as products like paper coatings and agricultural plastics.
Opportunities for coffee and tea packaging
There are significantly fewer direct matches among the available PHAs for applications that require more specific mechanical properties (phase 2). Still, there seem to be opportunities for specific PHA materials for plant plugs, coffee and tea packaging, and artificial reefs. According to the researchers, there are technical opportunities for biodegradable tableware (plates, cups, cutlery) in the near future. But there are strict legal regulations for the production of these materials that make the use of plastics (and therefore also PHAs) more difficult. It is therefore still unclear whether it is interesting for this industry to enter this market with PHA products.
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With the UN climate change conference COP26, it’s obvious that there is consensus among a majority of world leaders and key stakeholders that much more needs to be done ( and avoid carbon tunnel vision ) if the ambition of keeping global warming to a 1.5-degree increase is to have any chance of being met. Yet talk, as they say, is cheap. Or, in the words of Greta: too much “blah, blah, blah” and not enough action.
Responding to the global climate crisis demands a global response, with public commitments backed up by resources and collaboration. We cannot have countries or organizations working in silos. And we cannot de-couple climate considerations from the broader sustainability agenda, as exemplified by the Sustainable Development Goals – and SDG 13 (climate action), in particular.
Widening perspectives to understand all impacts
Lately, a catch-phrase doing the rounds on social media, coined by Jan Konietzko of Cognizant, is ‘carbon tunnel vision’. A clever play on words, yes, but beyond that, it is a highly pertinent observation. If we achieve net-zero emissions yet overlook human rights, or fail to safeguard biodiversity, what will this mean for the wellbeing of people and the planet?
At the heart of this is strengthening and highlighting the synergies between the Paris Agreement and the 2030 Agenda. It will only be through concerted and connected action on these commitments, informed by evidence and data, that we can seize the opportunities for an inclusive and sustainable future for all.
Collaboration between public and private sectors
Alongside transnational coordination between governments, we need to further engage the private sector as a key partner in realizing and implementing the SDGs and the Paris Agreement. Working closely with the UN Global Compact and other international organizations, GRI strives to highlight and increase the importance of corporate sustainability reporting for the SDGs.
Encouragingly, the Climate Confidence Barometer, published in September by WBCSD and FREUDS, highlights that 98% of companies surveyed reported confidence that they will meet net-zero targets by 2050. In addition, 55% are confident that the global business community will do so as well.
However, the transition does not stop at emissions; as identified in a recent report from the Future of Sustainable Data Alliance, there is an ‘ESG data hole’ when it comes to biodiversity and nature. KPMG research from December 2020 also found that less than a quarter of large companies at risk from biodiversity loss disclose the topic. In this context, GRI’s plans to launch a new Biodiversity Standard in 2022 are timely and much needed, while October’s UN Biodiversity Conference set the stage for work to resume next year to adopt a post-2020 global biodiversity framework.
Action that delivers tangible results
It is encouraging as well, that over 100 countries (representing over 85% of the world’s forests) have signed the Glasgow Leaders’ Declaration on Forests and Land Use, committing to work collectively to halt and reverse forestry loss and land degradation by 2030, while promoting an inclusive rural transformation. This is a commendable vision and helps to prevent carbon tunnel vision – but we need to hold all parties to these commitments.
The action needs to start today to secure tangible results – from safeguarding the environment to wider progress on the sustainability agenda. It cannot become a carte blanche to maintain ‘business as usual until 2030. Regular and comprehensive reporting on sustainability impacts, with accountability from all organizations with an involvement, is essential to measure progress.
Effective sustainability reporting offers a unique perspective on the role of the private sector, helping countries to work towards the Paris Agreement and the 2030 Agenda. While a multi-faceted approach is needed to reach these goals, we should by no means downplay the significance of reaching net-zero. It is not a matter of either/or – we need to dramatically cut emissions and secure broader sustainable development in the process to prevent carbon tunnel vision.
It’s time for true leadership
There are strong signs that business is already convinced of the urgency of the situation – and is pressing governments to do much more. The We Mean Business Coalition call to action urges the G20 to limit average global temperature rise to 1.5°C. It has been signed so far by 778 business leaders – representing US$2.7 trillion in annual revenue. Furthermore, one-in-five companies around the world have set net-zero targets.
Last week, WBCSD launched a manifesto that calls for a new ‘Corporate Determined Contributions’ mechanism to measure the private sector’s role in global climate recovery. With a core focus on the imperatives to reduce, remove and report GHG emissions, this reflects a growing and welcome trend of responsible companies pressing for greater influence in support of climate action.
As COP26 draws to a close, GRI calls on all stakeholders to raise their ambitions, act now on their commitments, and work together to deliver a holistic approach to the challenges of climate change. One that takes account of the environment and society – cutting emissions while also securing sustainable development. Failure on either front will mean tragic consequences for all.
Tina Nybo Jensen, International Policy Manager, GRI
Tina Nybo Jensen is International Policy Manager at GRI. She leads on the development, management, and implementation of GRI’s Sustainable Development Program, with a special focus on the SDGs and engagement with multilateral organizations, against carbon tunnel vision.
The realization of a hyperloop network for goods between the provinces of North and South Holland in the Netherlands will cause a one-million-tonne reduction in CO2 emissions and could lead to a significant improvement in air quality. This is one of the main conclusions of the research conducted by Hardt Hyperloop. Transporting goods by hyperloop also has a positive economic impact on the logistics sector and allows for better utilization and freed up capacity of the current infrastructure.
Hardt Hyperloop, which is working on the development of the hyperloop, sees great opportunities for the logistics sector to make use of this sustainable and rapid means of transport. First at a regional level and later at a national and European level. Dominik Härtl of Hardt Hyperloop who led the Cargo-hyperloop Holland study explains: “We approached this research differently from previously performed hyperloop studies by directly involving the future users of the system as well as other key stakeholders. For this project, we established a collaboration of 35 stakeholders from the private and public sectors, including some of the largest Dutch exporters from the horticultural and fresh food industry.
1,100 fewer trucks on the A4 motorway every day in 2030 between Rotterdam and Amsterdam
They not only provided crucial input to the product requirements but also contributed to selecting the locations of the hubs as well as the route alignment. The project largely follows the A4 motorway, which connects cities such as Amsterdam, The Hague and Rotterdam. The A4 is crucial to the economic performance of this region. However, it also ranks among the most congested in The Netherlands. Currently proposed solutions will only partially solve this issue. Hyperloop could add capacity and therefore ease congestion on existing infrastructure while also increasing connectivity and productivity.”
Demand for sustainable solutions
A very important result of the research is that the realization of Cargo-hyperloop Holland contributes to a substantial reduction of CO2 emissions. Dominik Härtl elaborates: “In the calculations, we took into account the construction of the infrastructure and the associated hubs. Even then, we can achieve a large net positive effect of 0.6 million tonnes CO2 after 30 years of operations. The hyperloop is, therefore, the answer to the growing demand for sustainable solutions for (high-speed) transport of goods while also being able to create a system for transporting people in the near future.”
Fewer accidents, noise and traffic jams
The research also shows that building a hyperloop network for freight contributes to reducing many of the negative side effects associated with the logistics sector. “Think of fewer accidents, less noise, and less congestion at a time when not all freight transportation will have to be carried via the highway,” Härtl explains. In 2030, by only realising the corridor, it could already mean that almost 1,100 fewer trucks would need to use the A4 every day. With further expansion of the hyperloop network in Europe, hyperloop could replace over 2,500 trucks daily in 2050 and offer a sustainable alternative to flights within Europe.
An investment that pays off
The construction of a hyperloop network requires a substantial investment. Härtl: “The costs for the project are estimated at approximately EUR 1.5 billion. This is far less than the road investments made and planned for the region in the recent past. In return, the economic gains are significant. For example, it gives the industry a boost and provides employment for at least 13,000 people. Together with the CO2 savings and improvements in transportation time and reliability that can be achieved, it makes a very good investment.”
Route between the Greenports as a potential pilot
To leverage the full potential of economic benefits, the implementation of the entire Cargo-hyperloop Holland corridor is recommended. By optimizing logistic processes and introducing hyperloop transport services, the project can generate benefits of about EUR 3.2 billion. Comparing the benefits and costs with each other shows that the project delivers a net present value of almost EUR 2 billion and has a Benefit to Cost Ratio of 2.62. This can be considered as very high for transport infrastructure projects. Those benefits could be even higher when transporting passengers within the same infrastructure.
The study also examined various sections of the corridor individually to assess their viability as a pilot. Here, the connection between the Greenports is particularly promising and shows strong economic performance even as a stand-alone route. Härtl: ” A Greenport route could serve as a technology demonstrator and show how hyperloop would function during commercial operations. In turn, this route could help to create public support and also encourage people to travel by hyperloop by demonstrating its safe operation.”
Ambition
The research shows that the investment is sustainable and economic and contributes to greener cities. Dominik Härtl concludes: “The results of this study are promising and our recommendation is to start with a feasibility study, which would allow for a more detailed assessment of all the aspects relevant to this project before progressing towards implementation. The Dutch MIRT program could serve as the right environment through which this project could be brought to the next stage. Our ambition is to have the first route operational by the end of this decade and this project could very well be one of the first hyperloop routes globally.”
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The COVID-19 pandemic has undoubtedly caused the largest economic and societal shock the world and risk management have experienced this century. Yet it was not unforeseen. As far back as 2006, the annual Global Risks Report from the World Economic Forum warned that a pandemic was an ‘acute threat’ across all industries globally. This year’s WEF report expands into new dimensions of risk, such as the consequences of digital inequality and cybersecurity failure. Meanwhile, the 2021 report from the Intergovernmental Panel on Climate Change sounded a ‘code red for humanity’ – setting out in the starkest terms that the risks of inaction on climate change are now irrefutable.
What all of these risks have in common is that they threaten or disrupt not only economies but, more importantly, the wellbeing and sustainability of humanity and the planet. It’s logical, therefore, to conclude that they are challenges that demand global cooperation and societal cohesion to overcome.
Getting to grips with sustainability impacts
At the corporate-level, effective, pre-emptive, and dynamic enterprise risk management is more relevant than ever. That is why the role of risk manager is no longer confined to traditional financial risks and regulatory expectations but progressively is contributing more into how to support a sustainable business model. The GRI Standards – the world’s most widely used and comprehensive sustainability reporting standards – enable organizations to assess and communicate their impacts, which is increasingly relevant from the perspective of risk management. The revised Universal Standards – launched this month – re-emphasized the scope of impact needs to be inclusive of potential risk.
The World Business Council for Sustainable Development (WBCSD) describes sustainability risks as uncertain social or environmental conditions that could cause significant negative impacts on the company. As the pandemic has proven, these risks can pose existential threats to companies. Or, as former US Secretary of State Condoleeza Rice put it: “sustainability is a multiplier of risk”, exponentially increasing volatility and uncertainty.
What this means is that, to be successful over the long-term, businesses must not lose sight of their sustainability risks. Against this backdrop, a recent GRI webinar, Aligning Sustainability and Risk Management, explored the ways that the integration of sustainability was shaping the role of risk managers, increasingly their relevance to the organizational transformation process. Here we share some of the insights from the session, which was the second in our Building Leadership for Sustainable Business Expert Series.
Incentivizing risk analysis
Constant Van Aerschot, Director of WBCSD Asia Pacific, pointed out that many companies tend to treat sustainability issues separately from risk issues. A recent WBCSD report on integrating sustainability and enterprise risk revealed that companies recognize that the material topics in their sustainability reports have a financial impact – yet these same companies often fail to address ESG-related risks in their annual risk filings.
Priya Bellino, Ernst and Young’s ASEAN Head of Sustainability and ESG for Financial Services Consulting, emphasized the role of financial institutions in encouraging companies to manage sustainability risks. The example she shared was in the real estate sector. Climate change and extreme weather events are exposing physical assets to a much higher risk, which affects the value of real estate portfolios. As a consequence we are seeing more incentivization through green building financing and the adoption of green certifications.
To access new opportunities, companies need to measure and monitor “investment-grade sustainability performance”. That cannot be achieved without reliable and comparable disclosure – with Priya acknowledging that GRI reporting helps the company to deliver the required ESG data.
Yet – as Tony Rooke, Director of Climate Transition Risk at Willis Towers Watson, set out – determining the right ESG data points is a crucial step on the journey to understanding risks and achieving sustainable business outcomes. Tony went on to share that, for companies to begin to understand their role in tackling global risks, such as climate change, the market needs to further develop or create a reward system for those who transition to zero carbon business models.
The future of risk management
According to the 2020 State of Risk Oversight report, from the Enterprise Risk Management Initiative, 54% of large organizations and 58% of public companies have appointed a Chief Risk Officer (CRO). With the growth of the role, we have also seen increases in scope – helping organizations identify, analyze and mitigate their risk exposure. So, it is clear that many organizations are recognizing effective risk management as a key ingredient to the long-term wellbeing of the business.
Where the CRO evolution can and must deepen is in the correlation between enterprise risk and sustainability risk. Having a CRO that leads on sustainability is a good sign that a company is resolute in its sustainability commitment. The CRO does not have to be a know-it-all; more important is that they have the competencies to lead and build a team, collaborate with external stakeholders such as investors and regulators, bringing the ESG and conventional risks strands together into a single, meaningful narrative.
As Ricardo Nicanor N. Jacinto, Trustee of the Institute of Corporate Directors Philippines, articulated, the CRO is fast becoming “both the risk culture custodian and champion”. That is increasingly significant as the challenges of COVID-19 underline that we live in a volatile, uncertain and complex world. Therefore, whatever is up next on the risk forecast – be it this pandemic, the climate crisis or a yet to be defined new threat – having the expertise to assess the multiple and concurrent sustainability risks facing the business is more essential than ever before.
Lany Harijanti, ASEAN Regional Program Manager, GRI
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Scientists from two Swedish and one British institution argue that the concept of a circular economy and circular business models are flawed. They claim that the circular economy has diffused limits, unclear theoretical grounds, and that its implementation faces structural obstacles. The paper was published in the Journal of Industrial Ecology.
Circular economy is based on an ideological agenda dominated by technical and economic accounts. That brings uncertain contributions to sustainability and depoliticises sustainable growth.
Policy instruments are only suggested to promote circulation, rather than to obstruct the legacy of the linear economy. Furthermore linear technologies retain their market position despite their inefficiency, and circular innovations are hard to scale up.
With a management and technocentric bias driving the circular economy agenda, a growing body of research has criticised the absence of socio-cultural and political issues.
Their conclusion is that the circular economy is not even close to delivering the goals it claims to achieve. Circularity emerges instead as a theoretically, practically, and ideologically questionable notion. The paper concludes by proposing critical issues that need to be addressed if the circular economy and its business models are to open routes for more sustainable economic development.
We quote them in full:
The paper brings together the critiques addressed to the circular economy, with a focus on the European conception of the circular economy and corresponding circular business models.Researchers in various academic fields bring forth the unaddressed assumptions, blind spots, tensions, contradictions, unthought-of consequences, and taken-for-granted advantages of a circular transition.
The purpose is to make it less easy to make ungrounded claims about the circular economy to bring actual issues raised by a transition to the circular economy and to be at the core of this transition.
Basic principles ignored
Praised by policy makers and many companies who have been instrumental in its recognition as a model for material and sustainable policies, the circular economy is also subject to many critiques in academic and professional circles. The systematic presentation of these critiques shows that despite their strong imaginary appeal, pleas for the circular economy tend to ignore basic principles of biophysics, for example, the tensions between biophysical limits and progress and growth. Therefore, using the circular economy as a buzzword for sustainable development is considered problematic.
Critiques see in the circular economy a reassuring discourse for policy makers about futures made of planned circularity, circular modernism, bottom-up sufficiency, and peer-to-peer circularity. However, despite the revolutionary language, the circular future is not mapped out. In the shadow remain unanswered questions of how to disrupt orthodox social institutions attached with modernity and the connections and dependencies these create.
Equally, wider sustainability concerns such as care or gender equality are lacking, and so too are the impacts of the circular economy that can be beneficial for some but come at a cost to others.
Radical shift is essential
If the desire is for an equitable and truly sustainable economy that is circular, the critiques stress that a radical shift is essential to confront conventional neoliberal governance regimes. There is a danger to the myths surrounding the circular economy because if they become normalized the space for critical reflection will decrease.
Examples include the “risk of increased polarization between city and country and that the countryside is left out with poorer access to welfare services as a result” and the lack of a global approach encouraging neo-colonialism by either side stepping developing countries, not giving agency to people to problems outside of the Global North, or engaging with the informal sectors.
To put it briefly, the circular economy stands as a discourse that focuses on the economy, excludes social dimensions, and simplifies its environmental consequences.
These critiques are more than simply denouncing flaws in a fashionable concept. They also point at the need for questioning how the circular economy is currently conceived, consented, and implemented. The presentation of the critiques above shows there is a need for a renewed, enlarged, and transdisciplinary research agenda on the circular economy in order to support the policy process.
In need of coherence
Each area of the critiques above points at an issue in need of research, policy, and managerial attention. And as academics, let us conclude with a plea for coherence and transdisciplinarity.
Before the circular economy becomes mainstream and moves beyond sustainability and circular economy professionals, there is clearly a need for conceptual coherence about definitions, plans, implementations, and modes of evaluation, because without coherence the expansion of new knowledge could be obstructed by deadlocked debates or can collapse entirely.
Given the scope, speed, and transformation the circular economy agenda is attempting to address, research also needs to come out of disciplinary silos, otherwise solutions will engender weak circularity premised on notions of no limits, secondary resources complementing primary supplies, and governments handing over responsibility to businesses and consumers.
The researchers believe that it is time for producers and the state to reclaim the idea of circularity and to create “a closed, material loop limited in size and space, based on the principle of fair distribution of resources”.
Modest, concrete, inclusive, accountable
Drawing on the critiques listed above, a pathway toward circularity would be a circular economy that is modest, not a panacea but an actual solution to actual problems; concrete, in the sense of being clear about which kind of circularity it sets up and the goal conflicts that it entails; inclusive, in that it takes energy, people, and waste on a global scale into consideration; and transparent, in the sense of being accountable for its achievements and shortcomings, not the least when it comes to economic, social, and environmental changes.
Otherwise, the circular economy risks turning into a hypothetico-normative (but self-serving) utopia that derails actual and well-intended efforts to reorganise production, consumption, and more generally material flows in ways that are more respectful of planetary boundaries and that work in favour of sustainability.
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Fertilizer producer Yara and Northern Lights have signed the world’s first commercial agreement on cross border CO2 transport and storage. This is groundbreaking for the decarbonization of European heavy industry, opening the market for cross border CO2 transport and storage as a service. It is also a major milestone towards achieving Yara’s own net zero targets.
Lately, a catch-phrase doing the rounds on social media, coined by Jan Konietzko of Cognizant, is ‘carbon tunnel vision’. A clever play on words, yes, but beyond that, it is a highly pertinent observation. If we achieve net-zero emissions yet overlook human rights, or fail to safeguard biodiversity, what will this mean for the wellbeing of people and the planet?
