Environment and sustainability a major focus this year: Experts

Companies and their partners are facing pressure to adopt sustainable practices or risk losing out in the eyes of consumers, especially after unprecedented levels of haze from forest fires in Indonesia choked the region.
Patrick John Lim Channel NewsAsia 14 Dec 15;

SINGAPORE: Tissue paper and other similar paper products are an integral part of our daily lives, but many people give no thought about how they are produced. However, this changed earlier this year, when unprecedented levels of haze from the forest fires in Indonesia choked the region.

Sustainability has taken a huge focus this year, with some experts describing 2015 as a watershed year when it comes to environment and sustainability.

Singaporeans are becoming more aware of where the products they buy come from, especially forest products related to the haze-causing forest fires. As a result, companies and their partners are facing pressure to adopt sustainable practices or risk losing out in the eyes of consumers.

People, now aware that purchasing even the most mundane item may perpetuate more forest fires, are now beginning to vote with their wallets. This culminated in supermarkets across Singapore pulling products associated with the forest fires, from their shelves.

Global personal care company Kimberly-Clark is one company which hopes to lead by example when it comes to sustainable practices.

In sourcing for materials for its paper products, Kimberly-Clark said it looks only at forests certified by Forest Stewardship Council (FSC) as sustainable. It said credible third-party authorities can help companies identify areas where they can be sustainable.

Said Kimberly-Clark’s director of communications & government affairs (Asia Pacific), Shweta Shukla: “Kimberly-Clark is sourcing its wood pulp or the raw material for its brands like Kleenex from FSC-certified sources or forests. Which essentially means that it is really the gold standard when it comes to picking and choosing suppliers that we source from.

"The FSC is a credible third party and most rigorous standard of responsible forestry and that's why we rely on them for certifying our suppliers and forests.”

Not all companies have direct control of where materials are sourced and how products are produced. Many work with other smaller firms as part of a larger supply chain.

COMPANIES LOOKING AT ENTIRE SUPPLY CHAIN TO ENSURE SUSTAINABILITY

However, increasing consumer pressure on sustainability is forcing corporates to not only look at their own processes but down the entire supply chain.

Said Mr K Sadashiv, partner, climate change and sustainability services at EY: "Supply chain participants intimately impact the way companies operate or its results. So companies have now realised that engaging in their supply chain or at least the material members of their supply chain is truly important for themselves in making sure that they are seen to be responsible not only for their own operations, but also for the operations of those supply chain participants.

"As such, supply chains have become intrinsically a key participating member in the whole sustainability movement.”

Going forward, analysts said this sustainability movement will only gather momentum.

World leaders met in Paris this month for a UN climate change conference to discuss a binding, universal agreement on climate.

"Sustainability is not just all about corporate social responsibility, which was the buzzword a few years ago. It's the lens by which businesses will be judged by consumers, by shareholders and general stakeholders at large. Companies cannot afford to ignore sustainability and need to embed it in their operations to make themselves successful in the longer run,” said Ms Monica Hira, sustainability and climate change partner at PwC Singapore.

Singapore regulators are doing their part to ensure companies are aligned to the environmental trends. Earlier this year, the Singapore Exchange announced that it will require listed companies to publish sustainability reports starting from Financial Year 2017.

- CNA/dl

2015: When NEA, supermarket chains cracked the whip on haze-causing suppliers
This year saw authories using the Transboundary Haze Pollution Act to go after companies that burn land in Indonesia. Other organisations also did their bit to send an unequivocal signal to firms that there will be commercial penalties if they risk the health of citizens.
Channel NewsAsia 14 Dec 15;

SINGAPORE: 2015 was a year which saw the Transboundary Haze Pollution Act being wielded for the first time. The haze episode this year was the longest recorded since 2013, blanketing the Singapore skyline for about three months. The Pollutant Standards Index hit hazardous levels, forcing schools to shut for the first time since the SARS outbreak in 2003.

As in previous years, the culprits were farmers who burned large swaths of land to make way for palm oil, pulp and paper plantations.

Foreign Affairs Minister Vivian Balakrishnan, who tabled the Bill in 2014 when he was the Environment and Water Resources Minister observed that there has overall been a concerted effort to stamp out the haze.

Said Dr Balakrishnan, who is now the Minister for Foreign Affairs: "In fact, there's been another level which I've been very pleased with, and that is the way the civil society organisations like the Environment Council, CASE, supermarkets on their own volition have taken action to send this very clear unequivocal signal to companies, that if they continue to risk our health and the welfare of ordinary citizens, there will be commercial penalties."

The National Environment Agency has served notices to six companies, asking them to take steps to put out the fires. Asia Pulp and Paper Group, one of the companies believed to be behind the land burning, saw its products taken off the shelves in several supermarkets.

Action is also being taken on another part of the supply chain. In an unprecedented move, banks were issued guidelines to ensure the companies they lend to behave responsibly.

MAKING THE ENVIRONMENT A GLOBAL PRIORITY

But while Singapore has toughened its stance, Dr Balakrishnan stressed that other countries in the region must play their part to prevent the haze from recurring.

"This is not a national or transnational argument," he said. "This really ought to be about authorities in the region dealing with errant companies that are releasing unconscionable amounts of greenhouse gases into the environment, and are putting the health of millions of people at risk, and in fact are damaging the regional economies by many billions of dollars by our own estimates. So that's really the context in which this recurrent haze episodes should be viewed. And we must not tolerate business as usual."

The haze aside, there appears to be greater environmental awareness among consumers. Increasingly, they are looking at how companies' activities impact the environment, so it comes as little surprise that the Singapore Exchange has asked all listed companies to publish sustainability reports from 2017.

"Companies now will be beginning to take a look at the impact of their activities and not only their own activities, but interestingly also the impact of their entire supply chain, because an organisation is as good as its supply chain," said Mr K Sadashiv, Southeast Asian leader for Climate Change and Sustainability Services at Ernst and Young.

He added: "Those who have not embarked on some of these performance improvements would have to see this as a fillip to get going and I would dare say that if they ignore this, they will actually fall back compared to their peers, and the markets are shrewd enough and astute enough to recognise this, and potentially such companies who do not carry out the activities and therefore report them might actually be punished by the markets, through impact on share value, through impact on reputation, through being seen as to be behind by their peers and competitors

Globally, countries have woken up to the reality that the planet could warm to dangerous levels unless urgent action is taken to cut greenhouse gas emissions. World leaders recently convened in Paris for COP21 and emerged with a hard-won accord to limit global warming to 2 degrees Celsius above pre-industrial temperatures.

The Paris agreement - which Dr Balakrishnan said, "strikes the right balance" between means of implementation and ambition - is formed based on voluntary action plans from all nations, rich or poor. Singapore, for example, aims to reduce its greenhouse gas emissions intensity by 36 per cent by 2030.

It plans to achieve this by using energy more efficiently. Some measures include harvesting more solar energy, constructing more green buildings, promoting public transport and becoming more energy efficient, both in the industrial sector and at home.

- CNA/hs

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