Published on January 24th, 2012 | by Stephen Lacey5
The State of Sustainability (Illustrated)
It’s hard to rally around the term “sustainability” these days. When we consider the record amount of emissions we’re spewing into the atmosphere and the slow pace of change relative to our compounding environmental problems, the term “sustainable” has lost much of its meaning.
At the same time, however, businesses are getting focused on the problem. Many of the top companies in the world are investing trillions of dollars to change farming practices, reduce packaging, make operations more efficient, and deploy renewable energy. These are real, necessary, and positive steps. But they’re not nearly enough.
Last week, GreenBiz released its latest “State of Green Business” report. And it shows a very mixed picture for sustainability practices in the business community. In this post, we feature some of the best charts from the report on energy production, efficiency and corporate accounting.
1. U.S. carbon intensity is flat lining. In 2010, our economy increased emissions per dollar of GDP. That may decline slightly in 2011, but it still shows worrisome stagnation.
In the United States, energy-related CO2 emissions rose 4 percent in 2010 after declining for several years. Early estimates for 2011 show a slight stabilization, with emissions from increased natural gas activity offset by the decommissioning of coal-fired power plants. Don’t cheer quite yet, however: The Energy Information Administration estimates only a 0.7 percent decrease in emissions between 2010 and 2011.
2. Our economy is still very inefficient. Commercial and industrial efficiency is something that companies are taking more seriously. But the fact is, we waste around 85% of the energy produced in the U.S. And we’re not getting much better.
The energy consumed per dollar of gross domestic product grew slightly in 2010, the first increase after steady declines for more than half a century. We should see a small increase in efficiency for 2011, once the data is available, but it’s not likely to be a sizable one.
3. Vehicle emissions are growing slightly. Last year, the Obama Administration brokered aggressive fuel standards for trucks and cars that will increase the average efficiency of the nation’s vehicle fleet to 54.5 mpg by 2025. But even with more consumers thinking about fuel efficient transportation, automobile emissions rose in 2011.
Greenhouse gas emissions per fleet vehicle rose 13.8 percent in 2011, after falling steadily since we first tracked this indicator in 2007. It’s hard to know exactly what led to the per-vehicle emissions increase in 2011, but the total number of fleet vehicles fell from 2010 to 2011, indicating that more miles were put on each vehicle.
4. U.S. renewable electricity is increasing steadily. Renewables like wind, solar, geothermal and biomass still make up only a small part of our electrical mix. But they’ve been growing at steady rate. Assuming consistent tax incentives are in place, that growth looks like it will continue.
Renewable energy installations are still far behind where they need to be to stem the rise of greenhouse gases, but the market is maturing and 2011 saw rapid growth in the sector thanks largely to plummeting prices for photovoltaic (PV) panels.
5. Investors are demanding more social and environmental performance. Sustainability doesn’t have the same “buzz” in the business world like it did a few years ago. According to the GreenBiz report, that’s because the issue is becoming more deeply ingrained in corporate performance indicators.
Forty-eight percent of S&P 500 Companies now report non-financial environmental and social performance indicators, up 4 percent from 2010.
Companies are keeping up with those demands. The KPMG International Survey of Corporate Responsibility Reporting 2011 found that 95 percent of Global Fortune 250 companies are reporting on corporate responsibility.
More importantly, the survey showed that over half of the reporting Global 250 companies said they gain financial value from their sustainability initiatives. Companies in the Dow Jones and Nasdaq sustainability indexes are required to issue sustainability reports and they are currently outperforming non-reporting companies.
When it comes to corporate sustainability, it’s safe to say we’re very far from achieving true “sustainability” — whatever that may mean. And these indicators show us that the glass is neither half empty, nor half full.
For more on what these indicators mean, check out the video below featuring Joel Makower, executive editor of GreenBiz. And for more great illustrations with far more detailed explanations, you can read the whole report here.
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