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Blekinge Inst. of Tech. SE-371 79 Karlskrona +46 455 38 50 00 www.bth.se/eng Sustainable Financing - More about competence than values – Prof. Karl-Henrik Robèrt The Natural Step Blekinge Institute of Technology Real Change, Chairman TBLI, Amsterdam, 12 Nov 2009
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Sustainable Financing More about competence than values

Dec 12, 2014

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Economy & Finance

TBLI CONFERENCE

Prof. Karl-Henrik Robèrt, The Natural Step
Blekinge Institute of Technology
Real Change, Chairman
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Page 1: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Sustainable Financing

- More about competence than values –

Prof. Karl-Henrik Robèrt

The Natural Step

Blekinge Institute of Technology

Real Change, Chairman

TBLI, Amsterdam, 12 Nov 2009

Page 2: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

The Real Change founding partners

Blekinge Institute of Technology (BTH)

Lund Institute of Technology (LTH)

The Natural Step International (TNSI)

Page 3: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Real Change - International Research Program

CORE

…Only Unifying Framework

…Largest and longest process

…Core explores and refines the framework, and elaborates tools for analyses, decision support, planning and monitoring.

…Multi-stakeholder base funding including Swedish EPA, Swedish Energy Agency, Vinnova, Formas, Nutec

…Petals are thematic programs from across the globe.

…10 Million USD funding/year

(over and above actions and education from all participants)

Page 4: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Copyright © 2004 The Natural Step

Individuals Groups

Systems thinking

Page 5: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Threats Forests Agriculture Fisheries Ground water Climate Metals Chemicals Global justice Trust Stories of meaning

Sustainability is a dynamic challenge

Opportunities Largest financial potential Resource costs Waste management costs Tax, legislation, insurance, loans International agreements Innovation/design/new markets Brand

Page 6: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Copyright © 2004 The Natural Step

So, what’s the problem?

Page 7: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Copyright © 2004 The Natural Step

Reductionism

Page 8: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Page 9: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng ???

Page 10: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Copyright © 2004 The Natural Step

Structuredoverview

Page 11: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Backcasting!

Page 12: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Sustainable Vision

Page 13: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

- Necessary- Enough- General- Concrete- Distinct

Such principles must be...

Page 14: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Sounds complicated but is the opposite!

Page 15: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Just ask three magic questions:

Do you have a definition of sustainability?

What is your gap?

How do you bridge it?

Page 16: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Sustainable energy potential, Thermodynamics, Linkage to material flows, biogeochemical cycles, interdependencies, resilience and adaptivity…

From System: Society in Biosphere…

Page 17: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

In the Sustainable Society, Nature is not subject to systematically increasing...

* …concentrations of substances

* …degradation by physical means.

and

* … undermining of trust.

…to principles designed for this purpose

Page 18: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Each (large) investment:

Direction right?

Flexible platform to full compliance?

Good ROI?

Page 19: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

IKEA ElectroluxScandic Hilton Sv. McDonalds…

From action in some Swedish business…

Page 20: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

...to spread to 11 countries...

Page 21: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Page 22: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

SuppliersClientsStakeholder dialogues

…to value chains…

Page 23: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Hydro Polymers

• Substances

• Physical encroaching

• Erosion of trust

Page 24: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Sustainability Evaluation of PVC using TNS Framework

Addressed by a leading environmental authority in the UK and chaired by J Porritt of the PVC Coordination Group

Forum for the Future – licensee of TNS Framework in the UK

What would it take to make PVC fully sustainable?

2020 Vision Exercise - Involving 36 stakeholders at Tesco

headquarters, UK

Report Produced in July 2000- Based on TNS methodology- Interviews with Industry and Greenpeace- Identifies 5 key sustainability challenges

Page 25: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

No more fossil carbon to atmosphere

Closed loop recycling

No accumulation from emissions

No accumulation from additives

Challenging the whole value chain…

5 Hydro Polymer Challenges

Five challenges

Page 26: Sustainable Financing More about competence than values

Co-creation of distance learning- throughout value chain -

Page 27: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Distance learning, 10 credits FSSD

Page 28: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Page 29: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Strategic Partnerships The Natural Step ©, 2009

QuickTime™ and aTIFF (Uncompressed) decompressor

are needed to see this picture.

Page 30: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Present

Future

Page 31: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

AgricultureForestryEnergyTrafficMaterials…

…to sectors…

Page 32: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

- The ”Clinical conference” -

… to municipalities and cities…

Page 33: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Time

ÖvertorneåSEKO (70 local gov’s)WhistlerCalgaryFCMPortlandAPAEU Round TableChequamegon BayMadison W IPortsmouth NHLawrence NJPittsburgh/VandergriftEvanston ILDuluth MNJefferson County WICorvallis ORDublin…

Page 34: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Time

WHISTLER

Page 35: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng Time

CompellingVisionCore values

Sustainability principles

Strategic goals

2020 Vision of Whistler – policy, business, civic society

Strategic plansAction programs

CurrentReality

Page 36: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

“This simple, science- and systems-based framework is the best out there. It needs to become part of a new common language, as well understood worldwide as the rules of soccer”.

Ken MelamedMayorWhistler, Canada

Page 37: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

ISO14001

Triple bottom line

Sustainable growthFaktor 4

Cleaner Production

Life Cycle

AnalysisZero

EmissionRenewables

RMA

Ecological Footprinting

Sustainability analysis

Ecoliteracy

Factor 10

Hannover Principles

CSR NaturalCapitalism

Miljömålen

EM

AS

EECA

LCA

Ecoeffici

encyAgenda

21

Sustainability

…to tools and concepts

Page 38: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

System Overview

© 2000 The Natural Step. All rights reserved.

Backcasting from principles(like chess)Organization X

ISO 14001IndicatorsLCAEcological footprintsFactor 10Zero EmissionNatural CapitalismInvestments?

Page 39: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Summary of what we know

We KNOW:• Dynamic game possible to define• Self-benefit inevitable (regardless others)• Problem not if, but how and when• Stepping stones vs. choices between evils• Track-record of competence amongst leaders in business and policy• Mistakes are driven by “cosmetics/penance” (vs. “competence and pragmatism”)

• ONLY one way: leaders LEARN the game so that they can ask the right questions and work across boundaries towards goals

Page 40: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

What we know interpreted into method

The organization’s impacts regarding sustainability (defined)• How serious? (scale of impact and contribution)• How acute? (evidence of emerging market)• How exchangeable? (substitution)• Mission how important for others? (innovation for new markets)

↓• Strategic awareness of above?• Strategic communication in-house and outreach?• Evidence of current change?

Page 41: Sustainable Financing More about competence than values

Blekinge Inst. of Tech.

SE-371 79 Karlskrona

+46 455 38 50 00

www.bth.se/eng

Method interpreted into finance

• Risk assessment of investments, loans, insurance• Assessment of opportunities e.g. new products/markets/alliances • Culturing of clients & long term relationships in general• Recruiting new clients and stakeholder/political dialogues • Staff and education and PR• Track record (Banco Real, Cooperate Bank Manchester, VanCity, Cooperators, Banco Funds, SEB, Fortis CRI portfolio).• Reputation/branding