Tag Archives: climate change

How Uber, Airbnb and Amazon Can Help Combat Climate Change

Can we use the disruptive model pioneered by Amazon, Uber and Airbnb in the struggle against climate change?

Uber is the world’s biggest taxi company, but doesn’t own a single taxi cab. Airbnb and Booking.com are the world’s largest hoteliers, but don’t possess any hotels. 

And after being in business for a quarter of a century, Amazon – the world’s biggest bookseller – is only now experimenting with physical bookshops.

There are many lessons to be learnt from such examples. Chief among them, perhaps, is that being disruptive does work. 

These days, businesses and consumers are far more receptive to ‘early-stage’ disruptive ideas. They have seen for themselves how easy it is to be overtaken and left behind by clever ideas whose time has come.

I’ve been thinking a lot about disruptive ideas in recent weeks. And in particular, I’ve been thinking about disruptive ideas in the context of sustainability.

And the conclusion I’ve come to? 

We may need some fresh disruptive ideas and business models if the sustainability agenda is to make much more progress.

Report card

That may sound mad. Since – say – the 1970s and 1980s, the world’s environmental protection initiatives have made huge progress.

Sustainability is high on both corporate and government agendas. Cars are far more fuel-efficient. Houses, offices and factories are far more energy-efficient.

Skies are clearer, water cleaner – especially in the developed world, although progress is being made elsewhere, too.

And yet, and yet. Waters are clearer, yes. But visible pollution has been replaced with microplastic fibres.

Smoke from coal-burning has gone from our skies. Yet CO2 emissions are at record levels. The Amazon’s rainforests are vanishing. Sea levels are rising. And average temperatures are increasing.

Is it any wonder that groups such as Extinction Rebellion are protesting so vociferously? Or that the activism of teenage protesters is so widely applauded?

Lip service

For me, personally, one of the most persuasive signs that current approaches to sustainability aren’t delivering fast enough has come from the Harvard Business Review

Late last year, influential management thinker John Elkington took to its pages to officially ‘recall’ – that is, take back – a concept he first launched 25 years ago: the Triple Bottom Line.

Simply put, he argued, the Triple Bottom Line was no longer enough. Something else was needed. Something bolder.

The idea behind the Triple Bottom Line was simple. Instead of focusing on just profit, the Triple Bottom Line sought to get businesses to view their performance in a broader context.

They should examine their social, environmental and economic impact.

The idea has had a powerful effect. Twenty-five years on, it’s made a big difference. 

But it isn’t enough, acknowledged Elkington. Too many businesses see it as a trade-off mechanism, rather than as an absolute test.

Something else is required if we are to really ‘shift the needle’.

As he eloquently put it: ‘We have a hard‑wired cultural problem in business, finance and markets. Whereas CEOs, CFOs and other corporate leaders move heaven and earth to ensure that they hit their profit targets, the same is very rarely true of their people and planet targets.’

The ugly side of fashion

Which is why I’ve been thinking about disruptive ideas, and alternative business models.

Could they do enough to ‘shift the needle’?

I’m excited about their potential, to be sure.

Take the fashion industry. It’s been described as the second-most polluting industry in the world.

In water-scarce countries, water goes to produce cotton, not food. Microplastics from synthetic textiles fill our rivers and oceans.

According to the United Nations, the fashion industry consumes more energy than the aviation and shipping industries combined. It is responsible for up to 20% of global wastewater, and 10% of global carbon emissions. 

Container ships full of cheap clothes ply the world’s shipping lanes. They belch out vast amounts of the sulphur-laden black smoke that comes from burning bunker oil, the world’s dirtiest fuel.

And yet, at the end of it all, a lot of ‘fast fashion’ simply gets thrown away. The UK sent around 300,000 tons of clothing to landfill in 2016, for instance.

What can be done? 

Instinctively, most people think about some form of clothes recycling. But they are forced to conclude that the technology to cost-effectively turn unwanted clothing into useable yarn doesn’t yet exist.

But there’s another form of clothes recycling that doesn’t need technology. Or rather, the technology that it needs is already developed and with us.

The sharing economy

I’m talking about clothing rental, which is catching on fast.

Names such as Girl Meets Dress, My Wardrobe HQ, By Rotation, Rent the Runway.

These and others are offering affordable clothing rental services, either on their own account (they own the clothes), or as intermediaries (other people own the clothes).

At the moment, a lot of the activity is at the high end, in designerwear. Fast fashion it isn’t – yet.

That said, there are experiments underway. H&M, for instance, is trialling a rental scheme at its flagship store in Stockholm. In the United States, Banana Republic has recently launched a rental service.

Even so, it’s clear that what’s going on has the potential to evolve and grow.

As a business model, it’s different and disruptive. And it addresses many of the sustainability issues of the traditional ownership model. 

Instead of being hung up in a wardrobe, clothes are worn again and again – just by different people.

So could such a model ‘shift the needle’ in terms of fashion’s impact on the environment?

No one, including me, yet knows: it’s far too soon. Right now, fashion rental is far from becoming mainstream.

But don’t forget: so too, once, were Uber, Amazon and Airbnb.

Disrupting accepted business models in fashion – and other areas – could really help in the struggle to combat climate change.

This article was written by London Roundtable attendee, Omera Khan. If you are also interested in attending our next Roundtable in London, you can contact [email protected]

Sorry Kids: Easter Chocolate To Be Cancelled After 2050

The world is running out of chocolate… And if procurement pros can’t find a way to save the day, no one can! 

Most of us like to indulge in a little (or a lot of!) chocolate over Easter.

In Britain alone, the projected Easter spend for 2018 is $892.6 million.

And in the US, 2018 Easter spending is expected to total a whopping $18.2 billion.

But, depending on how attached you are to your Creme Eggs, Lindt Gold Bunnies or your Waitrose chocolate avocados , you might need to stockpiling now; in preparation for a very uncertain future!

Why climate change is claiming our chocolate?

More than 50 per cent of the world’s cocoa comes from West African countries, primarily Côte d’Ivoire and Ghana, whose climates have traditionally best-accommodated the cacao tree.

But,  in recent years, drying conditions, long draughts and rising temperatures, are making it harder to grow cocoa beans.

Warmer, dryer climates “will suck moisture from the soil and make it impossible to produce a good crop in many regions around the world.”

In short, climate change could destroy the chocolate industry within 30- 50 years.

What can procurement professionals do?

All is not lost! Procurement teams around the world are already investing in alternative, and more sustainable options, for their cocoa sourcing.

  • Developing a sturdier cacao plant

Last year, Mars unveiled their Sustainable in Generation Plan stating:

“We’ll invest $1 billion over the next few years to tackle urgent threats facing our business and the society we operate in – threats like climate change, poverty in our value chain and a scarcity of resources.”

Part of that investment will go towards “recruiting University of California researchers to develop a sturdier cacao plant that won’t wilt in drier climates.”

  • Changing farming approach

The majority of farms in Côte d’Ivoire and Ghana are run by poorer families who cannot afford fertilisers and pesticides. If modern farming techniques were made available to the farmers in Western Africa; cocoa production might be easier.

The Rainforest Alliance is working with smallholder cocoa farmers to manage climate change and protect their livelihoods and way of life.

  • Relocating suppliers

Farmers in Western Africa have the option to move their crops to higher ground; but there is limited space and many upland areas are protected for wildlife.

Organisations could look to source their cocoa beans from a different region entirely.

Dr Barry  Kitchen, executive chairman of Daintree Estates, told the New Daily that “Cairns generally had ‘ideal’ conditions for cocoa trees, which need consistent rain, warm temperatures, and shade with dappled light.”

“You’ve got to be continually innovative and continually looking at ways that you’re preparing yourself for the future.” he said.

But, given the much higher labour costs in Australia, it’s unlikely that the industry could ever migrate to Australia.

  • Changing the nature of chocolate

Research by The Conversation suggests wild mango butter, made from the fruit’s stone, has a very similar chemical, physical and thermal profile to cocoa butter.

If procurement teams decide to invest in the science behind it,  it mightn’t be too long before we’re eating mango butter Easter eggs.

Personally, Procurious thinks it’s an egg-cellent idea!

In other procurement news this week…

Starbucks Testing Blockchain

  • Starbucks is piloting the use of data technology, including blockchain, to make its coffee supply chains more transparent
  • The firm hopes the technology will provide real time information about the beans within the supply chain and help financially empower rural farmers
  • Kevin Johnson, chief executive officer at Starbucks, said: “Over the next two years, we will look to demonstrate how technology and innovative data platforms can give coffee farmers even more financial empowerment

Read more on Supply Management 

Amazon’s Latest Drone Patent

  • Amazon’s latest patent is a delivery drone that understands when you shout at it
  • The drone is designed to recognise human gestures, and then respond accordingly. Gestures the drone would recognise include, for example, waving arms, pointing, the flashing of lights, and speech
  • An illustration demonstrating the drone’s functionality shows a man wildly waving his arms and with a speech bubble next to his mouth

Read more on The Verge 

From Pittsburgh to Paris – Let’s Clear the Air

It’s all very well putting Pittsburgh before Paris, but did you know that modern anti-pollution laws first started in Pennsylvania? Tania Seary gives the run-down on steel cities, “death-fogs” and Pittsburgh’s incredible transformation into an innovation hub.      

It’s not every day Pittsburgh hits the news, but it certainly did last week with the comment, “I was elected to represent the citizens of Pittsburgh, not Paris”. The subtext is that there’s an obligation to protect the steel industry before the climate.

I’m not a political analyst, nor a climate change expert, but I have lived in Pittsburgh, visited Paris and worked in the metals industry. I therefore wanted to share some of my own personal learnings (and give some historical context) for those of who are trying to catch up with all the news.    

The Donora Death Fog

Ironically, Pittsburgh is only 30 miles north of a town which famously claims to have kick-started modern anti-pollution laws.

You may not have heard of the Donora Death Fog (actually a smog), where the deadly combination of an atmospheric inversion, toxic gases from the town’s zinc and steel works led to the death of 20 people and half a town hospitalised in 1948.

Comparable to the Great Smog of London and perhaps even modern-day Shanghai, the Death Fog played a big part in opening the eyes of Americans to the hazards of air pollution. The tagline at the Donora Smog Museum is “Clean Air Started Here”, because concerted political action saw the first act concerning air pollution being put into law in 1959. Pennsylvania passed legislation that afforded the state the authority to prevent the “pollution of the air by smokes, dusts, fumes, gases, odours, mists, vapours, pollens and similar matter, or any combination thereof”.

Modern Pittsburgh is a tech hub, not a steel city

The jobs that the administration wants to save left Pittsburgh in the 1970s. Since then, Pittsburgh has built itself into a great example of a city that has thrived on new opportunities.

I had the pleasure of working in Pittsburgh for a couple of years around the turn of the century – in fact, I was there during the Y2K frenzy. For those of you who weren’t in the workforce then, the “Y2K bug” caused a panic when people thought the world’s computing systems would go into a meltdown when dates changed from 1999 to 2000. The consulting companies made a fortune!

Although it was once among the most polluted cities in the country, Pittsburgh has reinvented itself from a steel town to a centre of “eds and meds”. It has become a hub of technical innovation and medical research. The city even has its own Google outpost, along with a test track for autonomous cars.

In reinventing itself, Pittsburgh has benefited from flagship universities like Carnegie Mellon and the University of Pittsburgh, which produce their own tech entrepreneurs and medical breakthroughs.

Pittsburgh nurtures entrepreneurs

I have to mention two of the city’s most famous entrepreneurs – both named Andrew. Andrew Carnegie and Andrew Mellon were huge drivers and beneficiaries of the steel industry (like the U.S. itself) and then spent the large majority of their lives giving their money away.

Born in 1835, Andrew Carnegie was a Scottish-American industrialist who is still identified as one of the richest Americans ever. By the time he was 50, he had almost total control of steel production in Pennsylvania. He squeezed every penny out of his mills, living by a famous motto that every procurement professional can relate to: “Watch the costs, and the profits will take care of themselves.”

He sold Pittsburgh’s Carnegie Steel Company to J.P. Morgan in 1901 for half a billion dollars, propelling him to the position of richest American (surpassing even John D Rockefeller). While J.P. Morgan transformed his company into the U.S. Steel Corporation, Carnegie devoted the rest of his life to large-scale philanthropy, with Pittsburgh itself benefiting enormously with stunning libraries, a university, museums, a gilded concert hall and more.

It seems like the state governors and city mayors who are committed to upholding the 2015 Paris agreement agree with Andrew Carnegie’s quote: “Do your duty, and a little more, and the future will take care of itself.”

Or, in Andrew Mellon’s words, “Every man wants to connect his life with something he thinks eternal”.

Andrew Mellon built up a financial-industrial empire throughout the late nineteenth century by supplying capital for Pittsburgh-based corporations. He founded the Aluminium Company of America (Alcoa) and branched into industrial activities including oil, steel, shipbuilding and construction. Mellon also reformed the US Government’s tax structure while he was secretary of the treasury. Like Carnegie, he gave back an enormous amount of his wealth, with his philanthropy making possible the the building of the National Gallery of Art in Washington, D.C.

These days, Pittsburgh is home to one of the procurement profession’s all-time entrepreneurs, the legendary Glen Meakem. Meakem founded Freemarkets Inc., the first online auction technology, which was later purchased by Ariba. Keeping with tradition, Meakem has also invested a lot of his resources into philanthropy.

Giving back

The story of these entrepreneurs all point to a wider trend as Pittsburgh continues to evolve. Like Carnegie and Mellon, the city grew rich on the steel industry, but now it’s giving back. Firstly, by producing a new generation of entrepreneurs whose success ultimately benefits the community, and secondly, by being part of a climate alliance that is looking for future opportunities rather than trying to bring back the past.