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Kolk’s article was discussing about different sustainability certificates in coffee market. The same thing happens in many other markets, that there are several competing organizations selling the certification to companies. This whole system sounds pretty absurd. Firstly, many different organizations “compete” against each other, who can offer the best certification. Nevertheless the criteria for these certifications might be close to each other or even same. Which certification is the best then?  Is there are difference between these?

Most well known sustainability standards are Fairtrade, Rainforest Alliance, Utz certified, and organic.. Criteria for Fairtrade is to offer minimum prices that are paid to producers. Rainforest Alliance is more concerned by the conserving use of rainforest and its biodiversity. It does not require price floor but it seeks to improve economic situation of producers. Utz Certified aims  to create an open and transparent marketplace for socially and environmentally responsible agricultural products by traceability system and code of conducts. Organic standard provides a framework of minimum requirements of operations. There are also several smaller organisation’s certifications, i.e. 4Cs, or coalitions of private firms

The organizations are assessed by international peers against the ISO 17011 standard, which are general requirements for accreditation bodies accrediting conformity. Most of the certificates demands constant auditing, not just in initial period, some companies might be audited even on yearly basis, to make sure that sustainable habits are carried year around.

secondly you need to buy the certification. This opens a change for corruption. Yes, clearly these organizations needs money for operations, but when the money is enough to operate, and what these organizations do with the “extra” money?

What is the best certifications on consumers side, how about on the organizations side? In Kulk article SL chose the certification according to the variance of the beans it provided. Price is the other factor that companies look for. It is more dilemmatic on the consumers’ side; there are not really differences between, more over preferences.

Does the certifications pays off? According to a study by Canadian public research firm GlobeScan, 73 percent of consumers that are familiar with the Fair Trade label also trust it.”As far as the beneficial impact of different standards on producers is concerned, no definite conclusions can be drawn, despite several studies on the implications of certification systems” (Kolk, 2010). “The few studies that compare multiple standards tend to find positive effects across the board, albeit in different ways: Fairtrade more often in the short run in terms of income and demand-side market creation, others concerning increased supply-side production efficiency and quality improvement” (Kolk 2012).

 

 

 

http://www.inc.com/guides/201101/how-to-obtain-fair-trade-certification.html

http://www.fairtrade.net/

ImageOn the last blog post I talked a little about the doomsday clock, and I got little bit interested about the idea. So the doomsday clock is a concept invented by bulletin of the Atomic Scientists during cold war in 1947. During the cold war the fear of nuclear war was immediate the group of scientists came up with this concept of measuring the minutes to midnight. It is a a symbolic clock face counting minutes towards midnight which means that the closer the clock is to midnight, the closer the world is to the doomsday.  Originally it measured the nuclear threat, but in 2007 it reflected first time to climate changes, “Climate change also presents a dire challenge to humanity. Damage to ecosystems is already taking place; flooding, destructive storms, increased drought, and polar ice melt are causing loss of life and property” (http://www.thebulletin.org/content/doomsday-clock/timeline). In 2010 the clock went one minute backwards, there were couple reasons for it, but one of those was: “Most notably, at Copenhagen, the developing and industrialized countries agree to take responsibility for carbon emissions and to limit global temperature rise to 2 degrees Celsius.” At the moment the clock point outs to 5 minutes to midnight.

Sustainability is just a one minor aspect of this “clock”, so I thought that it would be really useful to have similar kind of clock totally with sustainable aspects and indicators. When the doomsday clock was launched it covered a massive media attention. Creation of the similar kind of clock could raise people awareness to the sustainability also.

 

http://www.thebulletin.org/content/doomsday-clock/timeline

John Doerr, venture capitalist who currently serves on the board of Google and multiple other companies, he was been funding companies like Netscape, amazon.com, said “greentech is the biggest economic opportunity of the 21st century …the next big thing”. Sustainability can be the next big thing, and not just in business, but also for invention in technologies. Sadly but true, that there are limits for natural resources, and especially if the world’s population growth rate is continuing in its current phase, the limit might came faster than we might be able to think. But there are number of promising technologies that might help the population. For example wind, solar, water energy, biofuels in energy production, engineered and low energy materials in production of goods, biotech, transportation and many else. The imagination is just the limit where to take sustainability. Modern trend is that companies and venture capitalists have started to see the potential, but is the current speed enough or it is needed to be done with higher velocity. Do we have time before doomsday clock reaches midnight (http://en.wikipedia.org/wiki/Doomsday_Clock).

the doomsday clock was originally published in 1947, in a fear of nuclear war, but the modern meaning have turned towards environmental, and technological threats. “Changes in population, global warming and climate change, depletion of non-renewable energy and other resources, food production methods and capabilities, water availability and usage, renewable resource adoption and deployment, recycling issues, and technology in various arenas are some of the factors that affect the sustainability of the world.”

John Doerr daughter said to him “your generation created this problem, you better fix it”, True, but us the younger generation can help the older one in fixing it.

Is the Globe hope “foregoer” for sustainable clothing and reusing clothing materials? It has been modern trend for many clothing company to start using recycled the material for modern lines, for example H&M, Patagonia, Freitag, Timberland, etc. Before the companies tried to use recycled material, consumers, who had the ability to make themselves clothes, started the trend to sew clothes from their own “old” material. I see that the idea is harder for companies, than individual consumers, because procurement of material might be dilemmatic. It is relatively easy to cut and sew for example own old jeans to a hand bag, but how about to make 10,000 jackets from old army tent canvas. Forecasting demand for clothing have been most problematic area in clothing industry. Models change twice a year or even more often. Typical companies have huge number of SKU, because all different colors and sizes of each products. Over forecasting will mean piles of unsold products, that represent lost money, time, and material. Under forecasting demand will mean unachieved products, customers are lost to other companies, etc.  Same goes to the issue of buying the raw materials, as the visitor lecturer told us, Globe Hope buys army material as in tons and sails one-by-one. Getting the raw material must be difficult also, at least more difficult than for traditional clothing companies. One does not really know when will be next auction for used army materials, so he/she needs to have safety stock in warehouse. But when and how long the same materials can be stored in warehouses and each stock unit must cost something for the company. It would be really nice to take a deeper look for Globe Hope’s supply chain management strategy.

How many of us really think the total cost when making the purchase? It might be every day in bigger investments like a house or a car, where using cost are big or using cost are easily detected when comparing to the purchase cost. I recently bought a microwave, and during that procurement I didn’t think about total cost, but I can do it now and see did I make good investment. During the buying I did make my decision, according to price, size, and energy usage. Yes, energy usage is part of use cost, so I was somewhat in right tracks. What other cost there are? Of course the price, what amount of money have to be given at the moment of buying the machine. When price was one of the main factors, it was taken in account. purchase cost is the second one, I didn’t spent much time in searching, but I did some research via internet. I have monthly web, so use of the internet didn’t cost me. There is opportunity cost that would I have done something more profitable or more achieving during that time spend in searching a good product. Is there any correlation with time spends investigating and cost of procurement, I think this also depends on the individual needs. Is the main concentration in search the price or some other factor as esthetics?  There was some transportation cost, because I used a car to pick up the microwave, but I should have used the car in other products also. The situation of the store will affect to the transportation cost, but it won’t affect much, or it really depends where the store is, but now we are talking about stores in Helsinki centrum.

Energy cost are stated in each microwave so they are easy to measure and compare, and the are not much difference in modern microwaves. With the using amount that I have, it must be really small.  Switching and maintenance cost is more interesting, how much more should I invest to “high quality” machine that will probably last longer than cheap machine. It is really hard to compare different machines with this aspect, because one can’t really tell how long or when the machine is going to break. One can try to obtain information from seller, importer, of manufacturer, but will these give reliable unscrewed answers. I think that in this, one just needs to trust his/her instincts and rumors heard from other users.

Post-use costs are pretty much the same still with different products, the process is still the same, so not much of effort should be put to this while buying a microwave.

I went to the greenwashingindex.com web site, which was talked on class to see what was the ado about. There were a lot of commercial about the energy companies that stated how much they are investing to sustainable economies and lowering the energy need. In the top 20 commercial there were 5 energy companies.  Viewers criticized a lot about these commercials, because there was not any claims or facts about how the investments were made, and is the company really driving towards sustainability. It is true, these can be accused from green washing. But it made me think that is this the story, are these commercials just fraud to fool consumers, or are these multinational, huge companies looking really for alternatives to improve their impact to triple bottom line? Energy companies like shell and exxon (which commercials were on the top 20) will definitely harm environment, but can modern society live without gas, even for a day. Gas and oil have become mandatory part of everyday living. At the moment there is not any real alternative that could replace those on all-inclusive manner. So I have to assume that we need these companies in this sector. So this leads to the main question, do we really need to blame these for trying to improve their performance? Or are these companies charged just on the base on what they do, without concerning about the actions to “minimize” harmful effects? Is the energy consumption trend really changing or are these just beautiful words, with non-action? With these questions on my mind, I went to study further Exxon’s and Shell’s websites to see, is there more information or data provided to back up their claims. I read “Outlook for Energy, A View to 2030”, from Exxon’s web page, to see what are the company itself telling about the issue.

The first twenty pages or so talked about poverty and energy use of developing countries, how the need for energy is growing, and how Exxon’s will help this by bringing energy to everybody. The first glance really raised my doubts, that other viewers in greenwashingindex.com were right, it did not mention anything how the Exxon was improving its sustainability or green-economy view. Yes, it was about social part of triple bottom line, but still, would bringing energy to new economies make the situation even worse. “In some parts of the world, the challenge is far more basic. Today, globally, about 1.5 billion people lack access to electricity” (Exxon). “Nearly 40 percent of the world’s population – rely on burning wood, dung or other traditional biomass fuels, which can be dangerous to people’s health and harmful to air quality,” (Exxon) yes it can be harmful and yes it will “make” emission, but Exxon didn’t provide anything how they are going to tackle this problem. After continuing reading, I was able to get some answers; “Our world continues to become more energy efficient. From 1980 to 2000, the energy it took to produce one unit of GDP fell by an average 1.2 percent a year”, modern energy is more efficient, but they can be also talking about nuclear power. So any real issues have not been discussed in the report so far. But the later report got the action, they presented couple chapters about investments that Exxon have been made, to tackle to energy issues. One of these sounded interesting. It was about algae based biofuel; “In July 2009, we announced a significant new project to researchand develop algae biofuels. Our partner is Synthetic Genomics Inc (SGI), a California-based biotech firm founded by genome research pioneer Dr. J. Craig Venter. The goal of the program: to produce a commercially scalable, renewable algae-based fuel compatible with today’s gasoline, diesel and jet fuel, “ (Exxon). Exxon have been investing more than $600 million to this project. Algae based biofuels have also environmental advantages, because through photosynthesis, algae absods CO2, and converts it to oils and oxygen. This was just one example from Exxons energy vision report, but there was also bunch more like this.

 

Even though energy industry have been criticized a lot, they are still doing something good, to correct their actions. They are moving to the right directions

 

 

References

 

http://www.greenwashingindex.com/

http://www.exxonmobil.com/Corporate/Files/news_pub_eo_2009.pdf

Does the old dog learn new tricks? Can the once learned habits be changed and how difficult is that? “Habit is behavior that has been repeated many time”, according to our lecture slides. If I am used to go to the McDonalds drive-thru or to Shell gas station for some reasons, and I just discovered that these companies are unethical and they are exploiting natural resources and human resources. Will I be like Pavlov’s dogs and start to salivate every time I see McDonalds golden arches? Will “the tunnel vision” make me blind to other possible actions to fulfill my same needs that these places does? How much I need to be exposed to marketing before I start to change my habits.

If I am able to be conscious of the habits, I might be able, or at least have some chances, to break free from them. So changing the habits will need; consciousness and will power. Consciousness is relatively easy to achieve, one can easily study alternatives and information about consumption. Consciousness about the habit can be harder to detect, but still it is not anything overwhelming. Will power can be harder. What is to motivation or incentive to do the change, that also is very personal question and it can’t be answered in ubiquitous way.