Renewable energy sources such as solar, wind and hydropower are becoming increasingly popular, and businesses are now starting to embrace them as a way to reduce their carbon footprint, save money and generate revenue.
In this article, we will discuss the ways in which renewable energy can financially benefit businesses, including reducing energy costs, generating revenue and enhancing corporate social responsibility.
Renewables Asset Management
While renewable energy offers numerous financial benefits for businesses, it is essential to remember that these investments require careful management to ensure long-term financial viability. This is where renewables asset management comes in. Renewables asset management involves the strategic management of renewable energy assets to maximise financial returns and minimise risk. This includes managing the operational and financial performance of renewable energy assets, identifying and mitigating risks and developing and implementing strategies to optimise the value of the assets over time.
Renewables asset management is critical to the success of renewable energy investments, as it helps businesses maximize their returns and ensure the long-term financial viability of their investments. By partnering with a renewables asset management firm, businesses can benefit from the expertise and experience of professionals who specialise in managing renewable energy assets.
Reducing Energy Costs
One of the most significant benefits of renewable energy for businesses is the reduction in energy costs. By investing in solar panels, wind turbines (from developers such as Simple Power), or hydropower systems, businesses can generate their own energy and reduce their reliance on grid-supplied electricity. This can result in significant cost savings, as businesses are no longer subject to fluctuating energy prices and are not exposed to the risk of energy price increases.
Moreover, the UK government offers financial incentives to businesses that invest in renewable energy, such as the Feed-in Tariff and the Renewable Heat Incentive. These schemes provide businesses with a steady income stream by paying them for the energy they generate and feed back into the grid.
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Generating Revenue
Renewable energy can also provide businesses with a new revenue stream. By generating their own energy and feeding any surplus energy back into the grid, businesses can earn money through the Feed-in Tariff and other similar schemes. This can provide a steady income stream for businesses and the revenue generated can be reinvested into the company, further driving growth and profitability.
In addition, businesses can also generate revenue by selling renewable energy credits (RECs). RECs represent the environmental benefits of renewable energy and are bought and sold on the open market. By generating renewable energy, businesses can sell RECs to other companies that want to offset their carbon emissions and demonstrate their commitment to sustainability.
Enhancing Corporate Social Responsibility
Renewable energy can also help businesses enhance their corporate social responsibility (CSR) efforts. As consumers become more environmentally aware, they are increasingly demanding that companies operate sustainably and reduce their carbon footprint. By investing in renewable energy, businesses can demonstrate their commitment to sustainability and position themselves as socially responsible companies.
Moreover, businesses can use their investment in renewable energy as a marketing tool to attract environmentally conscious customers. By promoting their use of renewable energy, businesses can differentiate themselves from competitors and appeal to a growing segment of consumers who are willing to pay a premium for environmentally sustainable products and services.
Climate crisis: a year in review
When we reflect on the year just gone by, it remains clear that the world is still not taking the steps it needs to prevent and mitigate climate change. The worrying symptoms of the crisis are being felt across the world, from torrential rainfall in Malaysia to wildfires ravaging the mountains of Greece. The evidence is incontrovertible. Despite the devastation caused by climate change, political and business leaders have been working to turn the tide on the crisis. The three reports released by the IPCC throughout 2021 and into 2022 have all been clear - we all must play a part in tackling the crisis. Just recently, the IPCC released their starkest warning yet, which suggested that we were reaching a point of no return and that if we are to stave off the worst effects of climate change, we would need to significantly strengthen existing targets.
2021 was a big year for climate action, which is the result of an established trend in which climate change has become part of the public consciousness. Each year more people are recognising the devastating effects of climate change – according to a study in the Lancet, for example, more than 60% of young people are 'extremely concerned about climate change'. Alongside an increase in a public outcry for climate change, 2021’s long-anticipated COP26 summit also struck a chord with the public – with commitments made by world leaders being criticised for not going far enough.
However, it would be remiss to ignore the important steps international leaders made to help achieve our shared objective of keeping the planet's warming below 1.5C. For example, 153 countries strengthened existing or made new emissions targets; 137 countries pledged to end deforestation by 2030, and more than 100 countries have committed to reducing methane emissions by 30% by 2030. While further action is needed, the work achieved in Glasgow has kept the 1.5C goal alive.
Encouraging corporate decarbonisation: time to change tactics?
Now that political leaders have come together to double down on decarbonisation targets, the time has come for public authorities to design bold policies to tackle climate change. At the same time, businesses have a crucial role to play in decarbonising as fast as possible to prevent global warming and stay relevant. Many companies are already rising to the challenge. For example, in March of 2021, 30 of the UK's biggest companies signed up to the United Nations Race to Zero campaign and many have been making good on their commitments. For example, both BT and Vodafone reached their goal of powering 100% of their UK network by renewable sources, while AstraZeneca more than halved their greenhouse gas emissions (scope 1 and 2).
However, while more than 1,000 companies, including 82 Global Fortune 500 companies, have announced Net Zero targets, committing to ambitious goals is far from enough to accomplish a meaningful sustainability transformation and a significant reduction in global emissions. There is great momentum in setting targets but achieving Net Zero implies a transformation journey far beyond the incremental change most companies are accustomed to.
Engie Impact’s own research shows that while several companies have set goals, few have proposed a detailed strategy to reach them. I don’t believe that the lack of planning and foresight is a reflection of their attitude to climate change. It instead highlights the complexity of overhauling the existing setup. It is, undoubtedly, a huge challenge, but businesses must not bury their heads in the sand. Technology, skills and knowledge on sustainability are available and advancing rapidly – it's in a business’s best interests to adopt them and tackle climate change head-on.
To encourage businesses to design and implement effective decarbonisation strategies, we must look beyond the method of attempting to force companies to change through government legislation. The recent introduction of mandatory climate risk reporting in April should inspire more companies to get their sustainability house in order. The regulatory pressure will only increase.
However, while new regulations are essential, they are not a silver bullet, so companies must recognise the tremendous value in introducing sustainable business practices. Ultimately, it is in their best interests to invest in sustainability transformation. Those companies that engage in sustainability transformation will improve their bottom line as they reduce costs, by consuming less, unlock new revenue streams, retain and attract the best talent, create a competitive advantage compared to their peers, increase client loyalty, be financed through cheaper capital etc. And on top, they will help mitigate the effects of climate change.
Looking back … and forward
Since the last Earth Day, the spotlight on climate change has gained further momentum, with more of the world's largest companies announcing ambitious Net Zero targets and investing in their sustainability transformation. Meeting these targets will not be easy, but the good news is that investing in sustainability has become cheaper, with companies now able to take advantage of funds allocated for sustainable projects and a significant reduction in the cost of technologies. These changes have also coincided with advancements in sustainability digital platforms to enable a seamless transformation at enterprise scale. Businesses can now leverage data to simulate precisely how much carbon they can reduce by implementing new internal processes, saving time and enabling companies to expedite their journey to Net Zero.
Sustainability transformation is not a choice, it is a business imperative. Companies that refuse to invest in sustainability transformation will quickly become irrelevant as consumers opt for their greener competitors. While Earth Day continues to shine a positive spotlight on sustainability each year, the fight against climate change is happening every second of every hour. We still have a chance to win the battle, but the time is NOW.
Mathias Lelievre is the CEO of ENGIE Impact.
The analysis comes from the Office of Management and Budget (OMB), responsible for administering the federal budget. It also warned that the US government may need to spend an additional $25 billion to $128 billion per year in areas including flood insurance, coastal disaster relief, and crop insurance.
“The fiscal risk of climate change is immense,” Candace Vahlsing, the OMB’s associate director for climate and chief economist Danny Yagan, wrote in a White House blog post.
“The need for urgent action is why the President called on Congress in the State of the Union and through the Budget to advance legislation that decreases energy prices, combats climate change, and grows the clean economy.”
The White House’s warning was published on the same day as the United Nations’ climate report which warns that the fight against climate change must come “now or never”. It stated that limiting climate change to 1.5 degrees Celsius above pre-industrial levels will require greenhouse gas emissions to peak before 2025 and be reduced by 43% by 2030.
The £1 million fund was raised from the department store’s sale of 10p plastic bags and will give out grants ranging from £150,000 to £300,000 to eligible projects. For one year, the new Circular Future Fund will provide for projects that "demonstrate trailblazing, scalable innovations that can accelerate the transition towards a more circular economy," the John Lewis Partnership said.
The John Lewis Partnership is calling on innovators who are challenging the throwaway mindset of most retailers to apply for the grants, seeking projects across organisations such as charities, social enterprises, start-ups, and young businesses. It is aimed at projects in areas including textiles, food, and household products.
“Climate change, biodiversity loss, waste and pollution are unquestionably among the biggest challenges we will face in our lifetime and tackling them will require a different kind of thinking,” Marija Rompani, Director of Ethics and Sustainability at the John Lewis Partnership said.
“By creating this fund, we’re hoping to unearth some of the world’s leading innovators, who have built their business models, products and services around the concept of circularity. We live in a world of finite materials and we need to start protecting them before it’s too late. This is why we’re particularly looking for projects that are regenerative and can eliminate waste or pollution from the design stage and ultimately protect nature.”
Finance and the banking sector, more often than not, get credit for, or have the infamy of being the destroyers of the planet, rather than a force for good. Corporate social responsibility initiatives make small gestures, very frequently for the sake of public relations or to appease a certain contingent of investors, but banks and the financial services industry are still very much in the business of making money for their executives and shareholders at all costs.
Because the global economy and political order is so dependent upon finance, however, rather than being an unavoidable destroyer of the planet - in fact, very much to the contrary - finance is actually, perhaps uniquely, positioned to save it.
Investing in Renewable Energy
Many of the more sustainable banks and green energy funds around the world already invest a significant amount in renewable energy. The world’s biggest and most influential banks, unfortunately, continue to put a tremendous amount of their capital into fossil fuels because it remains profitable. Barclays, BNP Paribas, Chase Bank and Goldman Sachs are all key players in international finance and they are all, for the time being, inextricably linked with the perpetuation of the global fossil fuel industry.
Helping Developing Countries Revamp Agriculture
The World Bank and other development banks around the world are already focused on and investing in ways to make agriculture more efficient and sustainable in developing countries. Climate change, population grown and accompanying land use changes are all putting strain on not only the ability of countries to feed their populations, but also on the surrounding ecosystems and biodiversity.
From international finance’s perspective, investments in sustainable agriculture aren’t just good for the environment, but they can also have a positive impact on the bottom line. Investment in better agricultural techniques is not only something that will help the global south, but stands to have significant positive economic and environmental impacts in northern countries as well.
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Capitalise Domestic Waste Management in Developing Countries
90% of waste is openly dumped or burned in low-income countries. This inevitably means that much of it either ends up polluting the earth, becoming a major health hazard for the surrounding, largely poor communities, and making its way into rivers and oceans, contributing to the degradation of marine ecosystems, threatening commercial fisheries, tourism industries and much more.
Finance could make it part of their corporate social responsibility mission to help provide governments and communities with the means to better handle solid waste and it could be done in a way that reflects both a social and environmental conscience, as well as an interest in a positive return on investment.
Help Develop a Market for Ecosystem Management and Restoration
It is difficult to quantify the economic value of a rainforest or a coral reef. Difficult, but not impossible. The worth of a healthy reef or forest can be measured in its contributions to local livelihoods and economies through tourism and fishing; the amount of carbon it captures; and the protection it offers against land and ocean-based natural disasters like soil erosion, coastal erosion and tsunamis, among other ways. Investments in projects which seek to repair and preserve don’t need to be thought of as purely philanthropic ventures, but sound business investments as well.
Conclusion
Reorienting and redeploying significant amounts of international capital, controlled and managed by the world’s largest banks and financial institutions, will require both a philosophical shift as well as the legitimisation of the idea that saving the planet is something that can and perhaps should be done with a profit motive in mind. The above examples are by no means exhaustive, but they represent some of the most meaningful things we, as a species, could do with the considerable amount of wealth our economic activities generate every year.
JPMorgan Chase & Co said on Thursday that it will commit $2.5 trillion towards sustainability and development initiatives over the next decade.
$1 trillion of the pledged funding has been earmarked solely for investment in green projects, including renewable energy and clean technologies.
The $2.5 trillion target for investment, which begins in 2021 and will run through to the end of 2030, will also be concerned with facilitating transactions to support socioeconomic progress in developing nations.
In 2020, the bank said it facilitated $220 billion worth of transactions that it designated as supporting sustainable development, which included $55 billion in green initiatives. The total exceeded its $200 billion target for the year.
Last week, JPMorgan CEO Jamie Dimon issued a letter to shareholders naming climate change as one of the world’s biggest issues alongside poverty, economic development and racial inequality, which he said the bank was engaged in trying to solve.
“Reducing greenhouse gas (GHG) emissions — the main cause of climate change — requires collective ambition and cooperation across the public and private sectors,” he wrote.
ESG investment rose to greater prominence in 2020, with many asset managers launching funds to capitalise on the wave of interest. JPMorgan launched its first green ETF in December 2020 and in February it revealed that global sales of “green bonds” might hit $150 billion this year.
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However, some climate organisations remain concerned that JPMorgan is not doing as much as it could to support climate action. In 2020, the company’s total fossil fuel financing came to $317 billion, greater than any other major US bank.
HSBC has acceded to investor pressure by tabling a shareholder vote on new plans to phase out the bank’s financing of the coal industry by 2040.
HSBC announced on Thursday that it would propose a special resolution to “set out the next phase” of its net zero plans. The special resolution will pledge to phase out all financing for coal-fired power and thermal coal mining in the EU and OECD by 2030, and globally by 2040.
Last October, HSBC committed to ensuring carbon neutrality across its client base by 2050, a move which environmental campaigners slammed as “baseline” for the banking industry. HSBC was also criticised for vagueness on the steps it would take to reach its goal.
Campaign group ShareAction coordinated with fifteen pension and investment funds earlier this year to organise a shareholder vote calling on HSBC to set clearer targets for reducing its financing for fossil fuel-affiliated companies, beginning with coal. Members of the investment group included prominent international asset managers and hedge funds such as Amundi and Man Group.
HSBC said in its Thursday statement that ShareAction and its allies had agreed to withdraw their resolution ahead of the annual general meeting to be held on 28 May.
HSBC CEO Noel Quinn hailed the agreement reached between the bank and campaigners. “This represents an unprecedented level of cooperation between a bank, shareholders and NGOs on a critical issue,” he said.
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The new special resolution will be binding if 75% of shareholders vote in favour.
HSBC is the second-largest financier of fossil fuels in Europe, according to the Rainforest Action Network, surpassed only by Barclays.
Institutional investors have maintained more than $1 trillion worth of investments in the thermal coal industry despite the sector’s significant contribution to climate change and green commitments from many top investors.
New research from 25 climate groups including 350.org Japan, Rainforest Action Network, Reclaim Finance and Urgewald discovered that around $1.03 trillion was invested in the thermal coal sector by the end of last year across 4,500 institutional investors.
Of the funding, 60% came from US-based organisations, with BlackRock and Vanguard alone making up 17%. Researchers described the two asset management companies as “in a class of their own” on coal investment.
Looking into the banking industry, researchers found that 381 banks have lent a total of $315 billion to the coal industry in the past two years, with commercial banks also helping the sector to raise more than $800 billion on share sales and bond issues.
The three most significant coal lenders were based in Japan, but Citigroup and Barclays ranked as fourth- and fifth-biggest respectively. Both banks have lent over $13 billion to companies involved in the coal industry.
Researchers concluded that the actions of major banks and asset managers were not in line with the goals set out by the 2015 Paris Agreement, where leaders agreed to take action to limit global temperature increases to 2°C this century. Part of the agreement involved cutting back fossil fuels, including coal – and especially thermal coal, which is one of the worst fuel sources for climate change.
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Paddy McCully, Rainforest Action Network’s climate and energy program director, described Wall Street as “a huge driver of climate pollution around the world” and identified its coal industry investments as driving the planet deeper into its climate crisis.
“Vague net zero announcements for 2050 – an entire generation into the future – are masking financial institutions’ refusal to take decisive action now,” he said.
BlackRock, the world’s largest asset manager, has been accused of “greenwashing” its investment activities in a report showing that it continues to hold as much as $85 billion worth of investments in coal companies.
The report, which was published by NGOs Reclaim Finance and Urgewald on Wednesday, revealed that the company’s climate policy contains a loophole allowing it to hold shares in companies that earn less than a quarter of their revenues from coal. As a result, it has retained shares or bonds in many notable coalminers and polluters.
BlackRock still holds investments in BHP, Glencore, RWE, Adani and other companies involved in the fossil fuel industry.
The findings come a year after BlackRock chairman and CEO Larry Fink wrote a letter to clients claiming that sustainability had become the firm’s “new standard for investing.” As part of its new climate policies, it abandoned all of its actively managed investments in companies making more than 25% of their revenues from coal and introduced a range of new ESG fund options for clients to invest in.
However, the campaigners who carried out the latest research are now calling for BlackRock to divest fully from coal, including from companies like Japan’s Sumitomo and Korea’s Kepco that are planning to expand coal production. BlackRock holds $24 billion in assets in such companies.
Lara Cuvelier, a sustainable investment campaigner at Reclaim Finance, said BlackRock should fully distance itself from coal as a “bare minimum” change as global temperatures rise.
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“One year on, it’s hard to see Larry Fink’s sustainability commitment as anything other than greenwashing,” Cuvelier said in a statement. “If he really wants BlackRock to be a climate leader instead of a climate pariah, he needs to start aligning green words with green deeds, and direct BlackRock’s awesome financial power towards a sustainable future.”
Today, the world of finance and investment is being held accountable to a new standard. And its colour is green.
Global institutions, such as the United Nations, World Bank, World Economic Forum and International Monetary Fund, and activist agencies are the driving force behind the adoption of ESG (Environmental, Social and Governance) Standards in socially responsible investing. Worldwide sustainable investments, covering environmental, social and governance, and impact investing, have grown sharply in the last few years to exceed US$ 30 trillion as at the start of 2018. But this is only the beginning.
ESG investing needs to grow, not only for the greater good but also because it is good for business. Here are some reasons why sustainable finance and investment are the right way forward.
Climate change is not only a reality, it is an emergency in some countries. While international accords, such as the Paris Agreement, and domestic regulators battle the crisis through legislation, it is also incumbent upon private enterprises to do their bit by adopting sustainable practices, making impactful investments and improving transparency and governance.
Neglecting the last can have extremely painful consequences, as we know from the 2008 Financial Crisis. What’s more, for corporations with global operations, any lapse in compliance with human rights regulations, labour norms or ethical practices can result in investor backlash, reputation loss, and punitive damages.
Today, the world of finance and investment is being held accountable to a new standard. And its colour is green.
Business economics is slowly shifting towards green resources as natural gas becomes cheaper than coal and other renewable forms of energy become more economical, predictable and scalable. Digital technologies are also supporting the shift to environment-friendly, cost-saving options such as online channels, digitised documentation, robo-wealth advisers, chatbots, smart assistants and cloud computing.
The generations of today and tomorrow are socially conscious and expect enterprises to espouse the same values. Many teenagers are already at the forefront of environmental activism. Millennial consumers, who will inherit wealth worth US$ 16 trillion over the next few decades, are exerting their influence to push financial service companies towards ESG compliant practices. Wealth managers, banks, and other financial institutions have no option but to meet the expectations of this important customer constituency.
Last but not least, financing ESG compliant projects helps to diversify the investment portfolio into new growth sectors such as clean and efficient energy.
Some financial institutions are taking a lead in adhering to ESG principles in lending and investing. ABN Amro has a comprehensive sustainability strategy focusing on climate change, circular economy and social impact issues. The Bank’s climate change vision aims at financing only “energy label A” real estate by 2030, increasing the share of renewable energy in the energy portfolio to at least 20% by next year, and also doubling sustainably invested assets to €16 billion by that time. It has also built the first bank office based on circular principles in Oosterhout, Netherlands.
The generations of today and tomorrow are socially conscious and expect enterprises to espouse the same values.
Another great example is Nordic Investment Bank, which takes sustainable financing very seriously. In addition to investing in the green bonds of companies in various countries, NIB issues its own environmental bonds and invests those proceeds into sustainable projects. The Bank follows corporate governance best practices to achieve several aims, including fighting corruption and money laundering, managing risk, and procuring ethically.
The 2030 Agenda for Sustainable Development adopted by UN member nations lists 17 sustainable development goals aimed at removing poverty, improving health and education, reducing inequality, and fostering growth while addressing climate change and preserving our oceans and forests. This agenda will succeed only if it has support on the ground, at the level of the enterprise. The financial services industry can make a significant contribution to this cause through sustainable lending and investing.
This week Chief executive and chairman Larry Fink sent a personal letter to clients stating the firm would be focusing on sustainability as BlackRock's "new standard for investing."
“Climate risk is investment risk...Indeed, climate change is almost invariably the top issue that clients around the world raise," Fink wrote.
The firm, which manages $6.9 trillion for investors all aorund the world, communicated that it would pulling out of any "high sustainability-related risk" investments such as fossil fuels and that it would be including questions pertaining to sustainability as part of its process when building new client investment portfolios.
Fink also stated BlackRock will be weighing in its shareholder vote on many sustainability and climate issues that arise in shareholder decision making.
The CEO's letter also read: “Climate change has become a defining factor in companies’ long-term prospects.
"Last September, when millions of people took to the streets to demand action on climate change, many of them emphasized the significant and lasting impact that it will have on economic growth and prosperity – a risk that markets to date have been slower to reflect.
“But awareness is rapidly changing, and I believe we are on the edge of a fundamental reshaping of finance.”
In the letter Fink makes reference to climate change as a highly impacting factor in investment models, claiming that this new approach will destroy existing products and create new markets, ridding traditional investments and creating fresh and new opportunities for investment.
“What will happen to the 30-year mortgage – a key building block of finance – if lenders can’t estimate the impact of climate risk over such a long timeline, and if there is no viable market for flood or fire insurance in impacted areas?” he said. “What happens to inflation, and in turn interest rates, if the cost of food climbs from drought and flooding? How can we model economic growth if emerging markets see their productivity decline due to extreme heat and other climate impacts?”
This statement will have significant impact on the proceedings and discussions that take place at the World Economic Forum in Davos next week, as the drive to protect investor value will turn towards climate change and sustainability as key considerations to factor into each and every investment.
Businesses can engage with SDGs by business solutions that bring solutions to society, rather than causing problems. By adopting what Marga Hoek calls a shared value model, they focus on those activities and products that have both a financial return as well as a positive impact on society. By doing good, businesses can also do well, since it unlocks interesting new market opportunities. At the core of shared value are societal and environmental issues which serve as the drivers in propelling profitable shared value business cases across a wide spectrum of industries.
As a way of celebrating World Ocean Day (8th June), Marga Hoek, author of The Trillion Dollar Shift, looked at some innovative businesses, that have a positive impact on the ocean and people who live off it by taking on the challenge of improving life below water (SDG 14).
ALGIX – Using algae to create new products as plastic alternatives.
Harmful algal growth, known as algae blooms, is increasingly prevalent. At the same time, the world’s plastic consumption continues to increase. ALGIX brings algae from pond to production, utilising algae blooms to produce alternative plastic-free products made from algae, including 3D filaments for 3D printers and plastic foam which has been made into shoes and backpacks.
The company removes algae blooms from ponds and lakes without causing harm or disturbance to fish and plant life. The algae are dried and processed before being combined with plastic resins for filament production. The filament for 3D printing has an algae content of 20%, while the remaining 80% is made from PLA, a nontoxic resin made of lactic acid derived from plant sugars. In 3D printing, using algae-based filament compared to traditional filament requires less energy because of algae filament prints at a lower temperature.
The solution reduces the environmental impacts of global plastic production, which has increased twenty-fold in a 50-year period, reaching 311 million tons in 2014. Together with local volunteers, ALGIX cleans up toxic algae blooms, providing clean waterways and re-establishing sustainable fisheries, where the company operates.
Interface – An innovative solution to plastic pollution.
It is estimated that 10% of plastic pollution in our oceans is from fishing equipment, such as nets, traps and lines – a huge amount, as an example drinking straws account for less than 1%! In 2012, a cross-sector initiative called Net-Works was created through a collaboration Interface and the Zoological Society of London. Together, they aimed to source material for carpets in a way that would benefit communities and the environment, and develop a new model of community-based conservation, which would bring immediate benefits to local people.
Net-Works is an innovative business that empowers people in coastal communities in the developing world to collect and sell discarded fishing nets, thereby removing these nets from the ocean where they wreak havoc with marine life (SDG 14). The nets are sold into the supply chain and recycled into yarn to make carpet tile. Since 2012, over 125 tons of nets that would otherwise have been waste have been collected through Net-Works. For context, approximately 640,000 tons of fishing nets are wasted in the world’s oceans.
ERRICSON – Bringing in technology to bring back mangrove forests.
In Ericsson’s Connected Mangroves project, they worked with Luimewah, a local technology company, to place sensors in the plant site of the newly- planted mangrove saplings. The sensor system provides near real-time information about the mangrove plantation conditions, enabling ICT to play a key role in managing this important resource. The project ensures up to 50% better maturity rates for the mangrove saplings, which in itself assures that the community will increase its mangrove cover substantially in the next few years.
The mangroves are important in rebuilding the ecosystem, as they serve as breeding grounds for crustaceans and fish which attract migratory birds. Malaysia has a diverse array of mangrove species, with 36 out of the 69 species worldwide native to the country. Today, approximately 50% of Malaysian mangroves have been destroyed due to development, aquaculture farms, fire, wood harvesting and pollution. This has caused coastal areas to be unprotected from environmental risks, especially from flooding and tsunamis. Additionally, a recent study shows 35,594 acres of mangrove habitats can prevent the release into the atmosphere of about 13 million metric tons of carbon, which is equivalent to the carbon emissions of 344,000 cars.
DJI – Affordably mapping sea level rise
As 80% of the world’s islands are at an elevation of one meter above sea level, they are at risk of rising sea levels due to climate change. This includes the coral atolls of the Maldives that are home to nearly 400,000 people dispersed over 200 inhabited islands spread over 90,000 square kilometres. This makes communication and transportation a serious logistical challenge. Sophisticated mapping is needed to design actions to protect the island residents from the threats posed by sea-level rise, as well as climate and weather conditions.
To help people on these islands forecast and combat the dangers caused by climate change, DJI and UNDP have partnered to provide drones to local Maldives response teams. Without the drones, it would take almost a year to map 11 islands; the drone was able to map the island of Maibadhoo in just one day. Three-dimensional risk maps represent an important source of data as visual images of the same area taken over time, or before and after a disaster, can identify changes to the landscape thereby providing much-needed evidence for decision-making.
About the Author:
Marga Hoek is a global thought leader on sustainable business, international speaker and the author of The Trillion Dollar Shift, a new book revealing the business opportunities provided by the UN’s Sustainable Development Goals. The Trillion Dollar Shift is published by Routledge, priced at £30.99 in hardback and free in e-book. To order the book go to www.businessforgood.world
