ESG Bi Weekly Update-2 11 Sep.2022

ESG-World updates are:

In the Ramayan, when Shri Ram was building the bridge to Lanka, a small squirrel also came forward to help. Shri Ram immensely appreciated even this small contribution.? Let us be inspired by this squirrel for the ESG initiatives, and let us all collaborate every effort and attempt are welcoming and well appreciated.

ESG is my Ph.D. topic and I closely observe this topic across sources with my daily dose of four newspapers, google, and multiple other newsletter subscriptions subscribed. I am seeing a lot of momentum across Governments, large and small corporates, and on the top common man. I am digging for some official statistics that how many ESG topics are being searched on Google, and how much it is figuring on social media. If you have any insights, please share them with us.

Another observation is the very encouraging approach of academics on ESG in India, I have seen at least 4 institutes have started ESG as a course and a few more are putting ESG study as an elective subject in diversified courses of B. Tech across branches, MBA, etc. ESG and allied topics were also discussed in induction programs.

We have a problem in hand well, which is well substantiated, acknowledged, and agreed upon, now we need concrete efforts, collaborations, reporting, and commitment toward corrective and preventive actions. Toward this, I have started this fortnightly update to gradually build a crisp view of global and India-specific updates to motivate, challenge, and follow what’s happening in this wide space of ESG.

Enclosed is a comprehensive summary of the last two weeks of ESG developments – a collated view to inspire, appreciate and follow. In my second newsletter, I have added a global view, updates on Net Zero targets, and an Indian view on all happenings.

1)? Global Corporate Updates

a.? Index provider S&P Dow Jones Indices (S&P DJI) and S&P Global’ s ESG and sustainability-focused group Sustainable1 announced the launch of the S&P Net Zero 2050 Carbon Budget, measuring the performance of securities from key S&P indices selected to target a defined carbon emissions reduction ‘budget’ to achieve net zero emissions by 2050.

b.? In continuation to last week’s media news about increasing jobs in ESG space, an update received that McDonald’s has appointed Executive Vice President and Global Chief Impact Officer - Jon Banner (he was earlier with Pepsi is similar profile) ESG: Companies scout for top ESG talent to drive sustainability plans - The Economic Times (indiatimes.com)

c.? Germany has launched the world's first fleet of hydrogen-powered passenger trains in the state of Lower Saxony. According to reports, 14 trains with hydrogen fuel cell drive - produced by French manufacturer Alstom - are to replace diesel trains at a cost of $92 Million and save 1.6 million liters of diesel fuel a year. I see it as a reasonably good business case, India too has an ambitious plan along similar line.

d.? Oxy to build the world’s biggest Direct Air Capture plant - Occidental Petroleum and its subsidiary 1PointFive announced plans to begin detailed engineering and early site construction on their first large-scale Direct Air Capture (DAC) plant in Ector County, near Occidental’s acreage and infrastructure.

??????????????????????????????????????????i. Once operational, the plant is expected to capture up to 500,000 metric tons of carbon dioxide per year with the capability to scale up to 1 million metric tons per year. It will be the world’s largest of its kind.

e.? Largest Coca-Cola bottler Europacific partners set up a sustainability-linked supply chain finance program.

f. ? Amazon announced that it would adopt green hydrogen – starting in 2025 to decarbonize its operations. The contract will provide power for 30,000 forklifts or 800 heavy-duty trucks. Even though ocean shipping was mentioned in the announcement, Amazon did not give a firm commitment to when it would green its ocean cargo shipping operations.

2)? Global Regulatory and other Updates

a.? According to a new study by climate research provider and environmental disclosure platform CDP, and management consulting firm Oliver Wyman, corporate emissions reduction targets across G7 countries are only ambitious enough to align with limiting global average temperature increase to 2.7°C above pre-industrial levels, falling well short of the Paris Agreement’s 1.5°C ambition needed to avoid the most significant effects of global warming.

b.? Environment Adverse Impact - Pakistan is experiencing a serious climate catastrophe, one of the hardest in the decade with flooding in major parts of the country.

c.? Canada signs EV & battery supply chain agreements with VW and Mercedes Benz

d.? California bans gas-powered car sales from 2035

3)? Net Zero Commitments

a.? Global semiconductor equipment and services company KLA Corporation announced a target to reduce Scope 1 and 2 emissions by 50% by 2030 from a 2021 baseline and reach net zero Scope 1 and 2 emissions by 2050. (company’s 2021 Global Impact Report)

b.? Global management consultancy Kearney announced a series of climate goals, including a commitment to achieve net zero emissions by 2050, with 90% reductions in absolute emissions across the value chain by that time.

?4)? India initiatives and Updates

a.? Environment adverse impact – Globally we had floods in Pakistan and locally we had heavy flooding in Bengaluru. his time, too, Bengaluru’s rainfall pattern has been swinging from average rains (Extracts from Times of India)

1)? 1st Week of August 2022: excess of 119%

2)? 2nd Week of August 2022: deficit of 97%

3)? 3rd Week of August 2022: deficit of 49%

4)? 4th Week of August 2022: excess of 625%

5)? 1st Week of September 2022: excess of 388%

In Karnataka, rainfall variation ranged from 930% excess to 27% deficit in 1st week of September, and we had similar trends in Delhi too.

b.? Updates from Reliance AGM - Company will establish a 20 GW solar energy plant by 2025 and a 100 GW plant by 2030. In 2021, RIL had set aside Rs 75,000 crore to pivot towards the renewable energy sector. In AGM 2022, Chairman said they would "accelerate" the company's commitment to investing Rs 75,000 crore towards establishing a New Energy manufacturing ecosystem in Jamnagar and progressively commence the transition from Grey Hydrogen to Green Hydrogen by 2025.

a.? RIL had already started investing in the renewable energy sector in 2021. Here is a list of the companies it has acquired to take forward the renewable energy vision: SenseHawk Inc, Sterling and Wilson Renewable Energy Ltd (SWERL), Faradion, REC Solar Holdings AS.

?c.? We recently had some good news from Mumbai, where BMC Mumbai disposes of seized plastic it goes recycling way. Around three years back Project Mumbai, a non-profit organization started collecting plastic from the housing societies and recycling it into benches, pencil boxes, and even garbage bins.

?d.? ? ? One of the unique challenges is to start recycling of 30,000 tons of waste generated from the demolition of Supertech's twin towers from next week. The company Re Sustainability has bagged the contract from Noida Authority to recycle waste generated from the demolition of Supertech's twin towers over the next three months. The waste will be converted into construction materials. Total waste generated from the demolition is estimated at 80,000 tons. The outcome of this exercise would be a case study for future learning. Re Sustainability to start recycling of twin towers demolition waste next week - The Economic Times (indiatimes.com)

?e.? ? ? Another Indian case study - Cochin International Airport Ltd (CIAL) confirmed that it has become a power surplus, having achieved power neutrality way back in 2015. This means, CIAL now has a negative carbon footprint. renewables: Cochin International Airport: India's champion in sustainable energy - The Economic Times (indiatimes.com)

?f. ? ? ? Markets regulator Sebi has proposed the concept of blue bonds as a mode of sustainable finance, saying such securities can be utilized for various blue economy-related activities, including oceanic resource mining and sustainable fishing. Also, the watchdog has suggested strengthening the framework for green bonds by amplifying the definition of green debt securities and enhancing disclosures, according to a consultation paper. sebi: Sebi proposes blue bonds concept for sustainable financing activities - The Economic Times (indiatimes.com)

?g.? ? ? Designer’s Eco-Friendly Brand Diverts 1000s of Kilos of Discarded Fabric from Landfills - With her brand Doodlage, Delhi-based designer Kriti Tula decided to make use of discarded fabric from the garment industry and turn it into a successful sustainable venture. Designer’s Brand Diverts 1000s of KGs of Discarded Fabric from Landfills (thebetterindia.com)

?5)? Book Recommendation

a.? Outlast – Authors: Mukund Rajan and Col Rajeev Kumar, Publisher: Harper-Business

How ESG can Benefit your Business I see this book, as nothing short of a useful guide on how attention to the three crucial letters of the English alphabet E – Environmental, S- Social, and G – Governance, can help stem the ecological decline if not return planet earth to its pre-human state. Peppered with examples, the authors have packed 368 pages of thought-provoking discussion backed by case studies that illustrate why corporations and business leaders need to weave ESG into their business plans.?