Described as a ‘code red for humanity’, the UN Intergovernmental Panel on Climate Change’s 6th report underlined the urgency and extent of the climate crisis that the world is currently facing. Leading corporates across the Americas have joined governments and institutions in the global effort to combat this existential challenge, embedding sustainability principles and policies throughout their value chains.
As part of Climate Week NYC 2021, sustainability leaders from several high-profile companies spoke candidly with Anne van Riel, BNP Paribas’ Head of Sustainable Finance Capital Markets Americas, at the virtual panel ”Innovate and Collaborate: Let’s tackle the climate crisis,” about how they are attempting to mitigate the ongoing climate emergency.
Collaboration as an enabler
With more corporates increasingly signing up to the Science-Based Targets Initiative, a coalition that supports business and government to measure and manage greenhouse gas emissions, panellists agree that education and collaboration are vital to achieving climate goals.
Ron Voglewede, Global Sustainability Director at home appliance company Whirlpool, says companies need to bring together and educate stakeholders from across the business [e.g. finance, manufacturing, etc.] on the impacts and outcomes of sustainability goals and collaborate on the internal initiatives that will help drive those targets. Sustainability needs to be viewed as part of a company’s value system and an enabler of the overall business strategy, he added.
Barjouth Aguilar, Head of Global Sustainability Program and Foundation Officer at diversified manufacturer Flex, concurred, adding that internal collaboration and partnerships have been vital in shaping the business’ sustainability strategy.
Accelerating sustainability with efficiency and innovation
In order to reduce emissions, panellists are increasingly leveraging energy-efficiency or renewable energy [wind, solar, etc.] sources in their business operations. Ariel Katz, Corporate Environmental Senior Manager at Latin America e-commerce tech provider Mercado Libre, says the business is looking to green its delivery processes by adding electric vehicles to its fleet and using natural gas/biogas to power larger vehicles that travel longer distances where electrification may not be viable. Katz concedes fleet electrification in Latin America is a logistical challenge due to the limited supply of EVs for the region. Mercado Libre is growing its own private charging infrastructure across the region.
Katz mentioned the focus on energy efficiency and sourcing renewable energy is especially relevant for Mercado Libre as they continue to grow at double-digit pace – adapting its footprint and baselines on an annual basis to match the expansion. Voglewede mentioned that he had faced similar challenges over several years at Whirlpool, where they have used a mix of renewable energy sources and investments in different regions to reduce absolute emissions while continuing the global growth trajectory of the business.
Panellists noted that innovation is critical as companies explore ways to ensure their products are more sustainable. Barjouth commented that Flex is working very actively with automotive customers to leverage technological advancements that help drive energy efficiencies. Flex is supporting the shift to hybrid and electric vehicles by designing and manufacturing advanced power electronics such as inverters, converters, and battery management systems. Voglewede points out technological advancements at Whirlpool now mean that its products are far more efficient than what they once were.
“Compared to washing machines 20 years ago, today’s products are 30 percent larger, but consume up to 70 percent less energy and water,” he said.
Katz added Mercado Libre launched a sustainable products segment on its website, offering customers a wide range of alternative products made from sustainable materials, with a big portion of it coming from impact entrepreneurs. He adds the company is also mapping out new solutions to drive efficiencies in its packaging – something that is being increasingly driven by consumer demand.
Looking toward the future
Through a combination of collaboration and education, product innovation, and diversification beyond traditional energy sources, corporates are now playing an integral role in helping to reduce total GHG emissions, while also engaging stakeholders to join the effort in mitigating the effects of climate change. By embracing a sense of urgency toward sustainability, companies will be able to generate solid profits while also making a positive impact on society for future generations.
Food as an important part of net zero menu
Katerina Elias-Trostmann, Head of Sustainability at BNP Paribas Brazil, participated in a Climate Week NYC panel exploring how nature-positive financial solutions are helping promote zero deforestation and conversion agriculture in the Amazon, Cerrado and Chaco Biomes.
In order to preserve biodiversity and facilitate net zero, banks and financial institutions need to support the agricultural industry in its transition to sustainability through intelligent financing and sensible global policies that govern how financing is provided to corporate clients, said Trostmann.
“At BNP Paribas, we understand that a sustainable agriculture and food system is essential for the long-term prosperity of humanity and biodiversity, and for reaching net zero carbon emissions”, she said.
So how does this work in practice? BNP Paribas is driving change through two main levers – its financing policies and financial commitments – pledging to provide up to €3 billion in financing tied to biodiversity protection by 2025, along with a wholesale review of its corporate clients with a special focus on biodiversity-related criteria.
The Bank has also committed to allocating up to €250 million into start-up companies supporting the ecological transition, thereby doing its part to promote the innovation needed to tackle the climate crisis.