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Sustainability basics: video shorts for GuruOnline and IBM

Jyoti Banerjee has just done a series of video shorts for GuruOnline and IBM, exploring the answers to some basic questions businesses need to engage with when it comes to sustainability.

KiteBlue - GuruOnline Interview - What are the main business drivers impacting sustainability?

You can check out the full series of questions (and their answers) here:

Climate change and sustainability

Business regulations regarding climate change  

Business drivers for sustainability

Sustainability and the investor

Sustainability and business performance  

Sustainability and the supply chain  

IT and sustainability  

Next steps in sustainability 

Ecosystem economics: how economics can trump politics

Julie Meyer of Ariadne Capital has laid a strong case why entrepreneurial capitalism is enabling economics to trump politics. Jyoti Banerjee listened to find out more.

At yesterday's Future of Work roundtable at IBM South Bank, keynote speaker Julie Meyer of Ariadne Capital (and co-founder of early Web start-up First Tuesday) pointed to the billion or so people in Asia and Africa that have come out of poverty, thanks to individuals turning to entrepreneurship, and benefiting from globalisation's spread. And she spoke of how aid (a non-entrepreneurial government configuration) has ruined Africa.

But its not the magic of economics that is dazzling Julie. What she really likes is a specific application of entrepreneurship to economics, which she calls ecosystem economics. Now there happens to be a sustainability consultancy in Oregon with just that name, but that's not what Julie is referring to.

By ecosystem economics, Julie is referencing the approach where a digital economy start-up comes alongside a traditional company with a large userbase and ecosystem, and provides products and services in concert with the large enterprise.

Environmental failure causes investment risk, says UNPRI

The annual cost to our blue planet from human activity amounted to 11% of global GDP in 2008 - so says a new report from UNPRI.  The 3000 largest companies in the world accounted for a third of that cost. Jyoti Banerjee asks what can be done.

The entire environmental crisis facing Planet Earth and its inhabitants can be summarised in one word: externalities. It is an economist's way of stating that companies do not normally pay the full costs of the environmental costs they inflict on our planet as a result of their business activities.  These environmental costs are largely "external" to the financial accounts of these businesses, and the lack of information means that markets and companies fail to account appropriately for the dependence of these businesses on ecosystems services, such as stable climate and access to water.

As long as these environmental costs are not being priced in to the transactions these companies participate in,  the market generates wrong decisions on resource allocation. We should all care, but some need to pay attention more than others. The latter are the group of global investors known as "Universal Owners" - large diversified institutional investors, such as pension funds, mutuals and insurance companies, whose holdings are broadly representative of global capital markets, but who also hold their investments for a long period of time. It is this group that are the targets of a new report, Universal Ownership: Why Externalities Matter to Institutional Investors, commissioned by UNPRI and UNEP FI, and written by Trucost. [Conflict of interest alert: I helped Trucost reshape its business strategy].

Here are some key take-aways from the report:

Cricket needs a broom - and quick

As Pakistan slipped to its worst cricketing defeat ever, the focus was not on the game but on the match-fixing accusations against some of the team's stars. For the sake of the game and its passionate fans, this situation must be resolved immediately, says Jyoti Banerjee.

Once news broke of the allegations by the News of the World journalists that they had managed to do a match-fixing deal with a Pakistani agent, no one cared about the cricket any more. The cricket itself, by any standards, was absolutely remarkable. First, Amir's superb bowling spell that knocked England back from 38-1 to 47-5. Then a minor recovery as England crossed 100, and then two quick wickets. Who would bet on England crossing 150?

Then we get two massive centuries and a world record is broken as England make it to nearly 450. In response,the Pakistani batsmen bat as if they are facing hand-grenades, and are bowled out twice for next to nothing.

We should have been celebrating Amir's unbelievable spell, centuries by Trott and Broad, and then fantastic bowling by Anderson and Swann. Instead, all the focus was on certain no-balls bowled by the Pakistanis, allegedly to order. It seems £150,000 is enough to procure no-balls in Test matches.

Blue planet turns red

Our little blue planet moved into the red, environmentally speaking, on August 21 this year. That was the day, says Jyoti Banerjee, when humanity blew its ecological budget for the year.

According to research by nef and Global Footprint Network, the world's over-consumption of resources resulted in the planet going into ecological debt a whole month earlier than last year. Even in a world of consumptive excess, this takes some doing.

The researchers call this Ecological Debt Day. I wonder if we should call it Planet Slavery Day.

This has some resonance for me with Tax Freedom Day, the day that a nation earns enough income to pay for its tax burden. Tax Freedom Day is a concept that started in the US just after WWII but is now calculated in many countries across the world. It provides a neat snapshot of the scale of government in a nation. In the US, Tax Freedom Day happened on April 9th in 2010, according to the Tax Foundation, reflecting a major rise in the scale of government there compared to 1900 when the date was reached by January 22.

In the UK, the think tank Adam Smith Institute, calculated that Tax Freedom Day arrived on May 30th, somewhat ahead of its European peers, but long after countries such as India and Australia, apart from the US.

Ecological Debt Day is coming sooner every year, partly because our knowledge of what is happening to our planet continues to improve, but also because we continue to ignore the withering depletion of the planet's resources that is taking place under this generation's stewardship.

I would love to see national numbers for Ecological Debt Day. Any research outfit ready for this challenge? And what about Ecological Debt Day on a corporate level? Now, that would really be something. Our little blue planet deserves a lot less red.