19. 77% of SME manufacturers are receiving ESG-related requirements from their customers

Welcome to the nineteenth edition of the xtonnes? Sustainability Scoop, your gateway to the latest insights and updates on climate change, carbon regulations and green industry practices. Providing you with bitesize chunks of the latest headlines, it's designed to support you in your journey to decarbonise with confidence.?

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Let’s dig in...? ?

??Climate check-in????

New data suggests that global warming has exceeded 1.5°C across an entire 12-month period “for the first time” . This year-long breach, as recorded by the EU’s Copernicus Climate Change Service (C3S), does not break the Paris Agreement?1.5°C?limit – as that refers to long term warming – but it “does bring the world closer to doing so”. The temperature rise in the past year has been influenced by El Ni?o,?a regularly occurring global climate phenomenon that triggers warmer ocean temperatures in the tropical Pacific. ?

A new “global megastudy” of more than 59,000 participants in 63 countries investigates whether different types of “intervention” have an impact on peoples’ beliefs and behaviour with respect to climate change. The authors found that making climate change feel more geographically, socially and temporally close – reducing an effect known as “psychological distancing” – increases belief in the threat of climate change by 2.3%. Support for climate change policies increased most, by 2.6%, when participants were asked to write a letter to someone from a future generation. ?

The Atlantic Meridional Overturning Circulation (AMOC) , a large system of ocean currents that helps keep temperatures in western Europe milder, “may already be on course to a tipping point”. The AMOC plays a key role in regulating Earth’s climate by transporting heat from the Equator towards the poles. But as global temperatures rise due to warming, freshwater is pouring into the system from the melting ice from Antarctica, Greenland and other sources, risking disruption to the circulation patterns that drive the AMOC.

?The China Meteorological Administration (CMA) has released the China climate bulletin 2023 ,?which?says that in 2023, China saw “prominent flood and drought disasters”. The national average temperature reached its “highest in history, while precipitation levels were at the second lowest since 2012”. The national average number of hot days and extreme heat events ranked “second and fourth highest in history respectively, while the national average number of rainy days was the second lowest in history”. ?

More than a fifth of the world’s migrating species are at risk of going extinct as a result of climate change and human encroachment , according to findings of the United Nation’s first-ever report on migrating animals. Of the 1,189 species covered by a 1979 UN convention to protect migratory animals, 44% have seen numbers decline, and as many as 22% could vanish altogether. The numbers were based on assessments and data provided by the International Union for the Conservation of Nature (IUCN) as well as the Living Planet Index, which collates population numbers for more than 5,000 species from 1970 onwards. ?

There have been more than 1,000 “huge leaks” of methane from landfill sites since 2019 . Landfills emit methane when organic waste decomposes in the absence of oxygen – in fact, decomposing waste is responsible for around 20% of human-caused methane emissions. A total of 1,256 methane super-emitter events occurred between January 2019 and June 2023, according to the new data. Pakistan, India and Bangladesh lead the list of nations with the most large leaks, followed by Argentina, Uzbekistan and Spain. ?

Introducing green roofs in cities can have a cooling effect , leading to lower energy use for aircon, according to new research. Green roofs are roofs on buildings that are covered by a range of plants. To investigate how green roofs could help to address urban heat and air con use, the researchers used “a comprehensive framework integrating urban climate modelling, urban building energy modelling and statistical analysis with empirical data”. They found that the cooling effect of urban green roofs can reduce monthly urban building energy use intensity by up to 8%. ?

According to a new survey conducted by Salesforce and GlobeScan , only around one in four senior business executives report that they have access to high quality sustainability data. In addition, nearly 60% anticipate difficulty complying with new sustainability reporting regulations and almost all agree that sustainability is crucial to the success of their organisations. For the study, over 230 senior professionals were surveyed across North America, Europe, Asia Pacific and other regions and a broad range of industries, in functions including finance, information technology and sustainability. The report highlighted several key factors limiting progress on sustainability, including data, a lack of collaboration with finance and technology, limited capital allocation, and perceptions of value creation. ?

??Industry insights?????

More than three-quarters of SME manufacturing firms are receiving enhanced requirements from their customers relating to environmental, social and governance (ESG) topics – but half say they lack the resources required to meet them. These are findings from a survey of 150 UK-based manufacturing companies conducted by Lloyds Bank and Make UK.?Three in four (74%) of these firms said they have built ESG-related conditions into supplier contracts as part of revamped procurement strategies. Similarly, 77% of the SME manufacturers polled said they are receiving ESG-related requirements from their customers. ?

According to a new global consumer survey released by EY , more than two thirds of consumers report being unwilling to spend more time or money on sustainable energy actions, despite high levels of energy sustainability awareness, as affordability and access perceptions hold back clean energy behaviours. Overall, the survey found that while 65% of consumers reported knowing how to start making sustainable energy choices, only 31% said that they are currently willing to invest more time and money in sustainable energy actions. Similarly, while consumers report that they are interested in new energy products, such as rooftop solar or electric vehicles, two thirds have no plans to invest in these over the next three years. ?

The first of the roll-on/roll-off (RORO) ships carrying “more than 5,000 electric vehicles” ,?ordered by BYD, are due to land in the Netherlands and Germany this month.?According to news sources, Chinese scientists have developed a “calcium-based battery” which could be “cheaper and safer than lithium-ion batteries”. China has emerged as the predominant force across every phase of the long, complex manufacturing process for solar panels, calculating that “China can make solar panels 44% cheaper than the US can”. ?

National Grid has collaborated with Octopus to implement process changes that should speed up the installation of low-carbon technologies at homes and businesses . Octopus Energy engineers now have permission to upgrade the fuses themselves at the same time as the technology installation. Additionally, heat pumps installed by Octopus have been pre-approved for connection, mitigating the need for checks on whether the local energy grid could accommodate the additional power demand. National Grid claims that the changes will knock up to five weeks off the installation times for heat pumps, rising to 10 weeks maximum for home solar, batteries and EV charging. ?

England’s Premier League football clubs have committed to developing their own environmental sustainability policies by the end of next season , in a bid to establish a minimum standard of sustainable action across the clubs and the League. The Premier League stated late last week that this is now a requirement for all clubs, by the end of the 2024-5 season. Policies will build on existing progress made by the football clubs to reduce their environmental impact. Moreover, the commitment requires the clubs to appoint a designated senior employee to spearhead the sustainability action. ?

MG Motor has been rapped by the UK’s advertising watchdog for marketing its plug-in hybrid range as “zero emissions” , despite the fact that they will generate some tailpipe emissions when not driven on their electric motor. MG was also accused of failing to communicate that while pure electric vehicles and hybrids, when driven on their electric motor, generate no tailpipe emissions, they are not zero emission across the entire lifecycle. MG is now banned from hosting the same advertising campaign again and has been urged to use the term “zero emissions” with more caution. The brand has been advised not to badge hybrid vehicles with a petrol or diesel engine using this term. ?

??Regulatory round-up???

The Commission welcomed the provisional political agreement reached between the European Parliament and the Council on the Net-Zero Industry Act (NZIA) . This agreement is set to help the EU become home to clean technologies and make significant strides towards building a strong domestic manufacturing capacity of those technologies in the EU. The aim for NZIA is to enhance the competitiveness and resilience of the European industry and support the creation of green, quality jobs as the EU seeks to reach climate neutrality by 2050. ?

Lawmakers in the European Parliament and Council announced that they have reached a provisional agreement on a directive to delay the adoption of standards for companies to provide sector-specific sustainability disclosures and for sustainability reporting from companies outside of the EU under the Corporate Sustainability Reporting Directive (CSRD). The delay is aimed at providing more time for companies to time to prepare for the increased reporting requirement and for the European Financial Reporting Advisory Group (EFRAG) to develop the new standards. However, calls have been made for the new sector standards to be published as soon as they are ready before the new 2026 deadline. ?

China’s three major stock markets , the Shanghai Stock Exchange (SSE), Shenzhen Stock Exchange (SZSE) and Beijing Stock Exchange (BSE), announced the publication of new sustainability reporting guidelines for listed companies, including a new requirement for hundreds of larger cap and dual-listed issuers to begin mandatory disclosure on a broad range of ESG topics in 2026. The listed topics indicate that the exchanges are adopting a “double materiality” approach to sustainability reporting, which includes reporting both on the risks and impact of sustainability issues on an enterprise, as well as on the enterprises’ impacts on environment and society. ?

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