01 October 2010

Are There Too Many Eco-Labels and Green Ratings?

Reposted in full from Greenbiz, September 2010

'Every day, each and every one of us is faced with an overwhelming number of choices. From when we wake up in the morning until we go to bed, we make hundreds of decisions among the thousands of choices we have. Grocery stores now carry over 30,000 unique products and many big box retailers carry over 100,000. And as a society, we love choices. In fact, the United States was founded on individuals' autonomy to choose, dating back to the Declaration of Independence.
But having so many choices isn't always good for us. Thomas Jefferson's declaration of our inalienable right to liberty has gotten a bit out of control. We spend a large amount of our time making irrelevant and unimportant decisions. Such complex decision making causes stress, anxiety and self-doubt.

When faced with the choice of 300 different types of cookies in the store aisle, whether I choose to buy Chips Ahoy or Oreos will have no impact on my well-being, but yet I still spend three minutes agonizing over each package.

Likewise, we face a similar conundrum with ecolabels. With over 300 ecolabels and many more being added each year, consumers and businesses have to make increasingly complex and convoluted decisions. Manufacturers must weigh many different factors when making their choice of what ecolabels to get for their products, including cost, ROI, and credibility of the label.
Businesses of all types must decide what, if any, ecolabels they trust for purchasing. In the business world, especially at product companies, managing sustainability certifications, standards and labels requires at least a full-time position.

But businesses have an easier decision-making process than consumers. Businesses make a significant financial investment in choosing the "correct" ecolabel(s) and therefore spend time evaluating their myriad of options, weighing the pros and cons, and meeting with the various certification organizations to hear why their program is better than the others.

Consumers only have the luxury of a few seconds to make their choice while in a store aisle. Although mobile technology now makes it easier to access information anywhere, an ordinary consumer in the store aisle isn't going to spend thirty minutes evaluating cleaning products with three different certification labels to learn which one is best.

A small percentage of consumers are willing to dig into the details and do their research to decide which one is better for them, but most consumers that are willing to make a purchasing decision based on sustainability just want one recommendation on what they should buy. That is why Energy Star has been so successful in the consumer market; one authoritative body provides a simple way to make a choice.

By no means am I advocating for the elimination of all ecolabels and development a system with one choice. That would be even more disastrous. A competitive market is necessary in order to keep raising the bar on all ecolabels in the market. Having various programs compete on transparency, rigor, credibility, service and price, ensure all stakeholders receive maximum value from the market.

What we need is an oligopoly with larger barriers to entry. A handful of credible certification programs, labels and rating systems to dominate the market. This will minimize consumer confusion while working to ensure labels and ratings are held to high standards. Despite the hundreds of ecolabels that exist, this scenario isn't actually too far from where we are now.

While there may be hundreds of labels, any given decision requires no more than a few choices. Ecolabels are segmented by product category, industry or geography. When I go to buy paper, or glass cleaner, or seafood in the supermarket, I'm not choosing among hundreds of ecolabels, I'm choosing among a small subset for each of my decisions.

And while there are more and more ecolabels being introduced by many different organizations, from nonprofits to retailers, there is also consolidation starting to happen. UL recently acquired the Canadian certification program TerraChoice. In the past year we have also seen considerable consolidation in the SRI industry, with MSCI ultimately swooping up RiskMetrics, KLD, and Innovest.

There is little doubt that the sustainability labeling and ratings space may now be heading down a path of further collaboration and consolidation. Consumers will continue to become more concerned with the products they buy, businesses will invest more in green marketing to communicate with their customers, and credible labeling and ratings schemes will continue to grow as a key aspect in all product purchasing decisions.'

29 September 2010

Treasury Admits GDP Used Inappropriately

...much hilarity about this, as the official's name is Gruen, as in Gruen Transfer!

'The Gruen Transfer is a show about advertising, how it works, and how it works on us...[it] is named after Victor Gruen, the guy who designed the very first shopping mall. The term describes that split second when the mall's intentionally confusing layout makes our eyes glaze and our jaws slacken... the moment when we forget what we came for and become impulse buyers...'

Reposted in full from ABC Online, 17 September 2010

A senior Treasury official has admitted that his department has been guilty of overusing gross domestic product (GDP), after recognising that it is a flawed measure of economic wellbeing and social progress.

The Treasury's macroeconomics director Dr David Gruen told an audience at the NatStats conference in Sydney today that the body uses gross domestic product to measure economic wealth despite knowing its limitations.

"Economists and statisticians have long known that GDP is not and was never intended to be a measure of wellbeing or progress. While we have long known its limitations, we as a discipline, have not done enough to discourage its use in inappropriate places," Dr Gruen admitted.

"In fact, we arguably, if inadvertently, do much to promote GDP as a measure of progress. For example, speaking of my own institution, in the budget papers we present detailed analysis on the level and growth of GDP as well as its determinants."

As Dr Gruen reflected on the use and importance of the GDP, he cautioned institutions to be more mindful of how it is utilised.

He went on to say that the GDP has a lot of limitations, particularly because it does not take into account most household production.

It also does not factor in many goods and services produced by the public sector, thus in effect favouring the private sector and privatisation.

"It is largely a measure of market production and therefore misses a significant amount of household activity as it excludes home production of goods and services other than imputed rents," Dr Gruen explained.

"It doesn't appropriately measure the goods and services produced by the public sector, and it can also sometimes give a misleading picture of how well the economy is performing."

Dr Gruen's views were echoed across the NatStats panel which included OECD chief statistician Martine Durand, United Nations statistics division director Professor Paul Cheung and Griffith University's Associate Professor Geoff Woolcock.

Ms Durand preceded Dr Gruen's speech by saying that governments need to stop using GDP as the primary measure of wellbeing and instead use a range of indicators with broader coverage.

She also added that whilst statisticians recognise the limitations presented to them by using GDP as a measure, they should not be hasty to replace it with another indicator, but rather to find measures that complement it.

"We know GDP is not a good measure of wellbeing. What we need now is not something to replace GDP, but to compliment GDP in order to address the right issue," Ms Durand said in her address.

"Don't start by saying throw away GDP and replace it with something else, I think that will be wrong."

Professor Cheung reinforced this notion by urging governments to first define progress in a way that can be applicable across the country.

He said the same should be done with sustainability.

Professor Cheung says people should not leave it up to statisticians to define such complex and politically charged words that ultimately have a resounding impact of the way in which we view the economy.

But he said that broadly, GDP does its job well.

"Is there a conspiracy to get us in trouble?" Professor Cheung joked.

"We all know what GDP is about. It is a measure of output, it has its problems, but as an index it serves its purpose. So why don't we just leave it at that?"

He reiterated that the job of the statisticians is to ultimately provide undisputed benchmarks for national trends and not be coerced in to the political process.

Dr Gruen also addressed the global financial crisis, saying the lead-up was perversely masked by the use of GDP.

"In the lead-up to the global financial crisis, measures of GDP did little to warn us of the increasing fragility of the global financial system," he told the audience.

"In the period before the crisis, much of the strong growth in GDP in many countries was driven by unsustainable asset price inflation and strong growth in consumption, funded by increased borrowing that turned out to be unsustainable."

Such distortions are visible in the way GDP measures activity in the banking sector.

Dr Gruen drew the conference's attention to the fact that when using GDP, compensation for bearing risk is included as output in the finance sector.

"When banks increased interest margins in late 2008, in response to a radical reassessment of expected defaults and liquidity risks, this increase was booked as an increase in the output of the financial sector rather than a correction in the price of risk as it should have been," he told the audience.

This essentially overstated the output from the financial sector.

This distortion is not only limited to the finance sector, but also extends to the natural resources sector.

"The value of natural resources when they are extracted is treated as production and an increase in GDP. However, natural resources are assets already owned by the community. Their extraction and sale represents the transformation of an asset, the natural resource, into another asset - cash."

"By not counting the depletion of the natural resource asset, production or value added is measured by GDP is overstated, possibly at the expense of the wellbeing of future generations," Dr Gruen stated.

NYC To Curb Water Runoff With Blue And Green Roofs

[NYC Mayor] Bloomberg estimates the city could save $2.4 billion over 20 years if the state allows it to use this kind of green [roof] technology instead of relying on so-called grey infrastructure, such as storage tanks and tunnels.

Oh, so going green actually saves money? Well, I never!!

Reposted in full from
Planet Ark, 29 September 2010

'New York City wants to catch and store rainwater temporarily in new roof systems to stop heavy storms sending sewage spilling into city waterways.

The catchment systems would consist of "blue" roofs that have a series of drainage pools and "green" or grass- or ivy-covered roofs, under a plan unveiled by Mayor Michael Bloomberg.

Bloomberg estimates the city could save $2.4 billion over 20 years if the state allows it to use this kind of green technology instead of relying on so-called grey infrastructure, such as storage tanks and tunnels.

"Our PlaNYC goal of making 90 percent of City waterways suitable for recreations requires us to do more, and that means reducing the combined sewer overflows that have plagued the City for decades," Bloomberg said in a statement.

During heavy storms, the city's 14 wastewater treatment plants turn into major polluters. That is because much of the city's water system was built 150 years ago when it was common practice to let rainwater drain into the sewage system.

To prevent treatment plants from flooding, bypasses kick in when there are major rainfalls, spewing sewage into harbors, canals and rivers.

New York City could capture an inch of rain in 10 percent of the older neighborhoods by using a variety of green methods, such as rain barrels and porous parking lots. Sidewalks could be planted with strips of greenery which also could absorb rainwater and release it slowly.

Bloomberg said his strategy could reduce sewer overflows into waterways by 40 percent by 2030. It also would curb increases in water bills paid by businesses and residents.

Now in his third term, Bloomberg has progressed from banning smoking in restaurants in his first terms to unveiling PlaNYC in his second term, which aims to cut the city's carbon emissions, and cleanse its air and water by 2030.

Should the state reject the city's new green water strategy, New York City will have to spend $6.8 billion to fix the decades-old problem of flooded treatment plants, he said.'

Mesh - Making Sharing Irresistable

Reposted in full from Boing Boing, 23 September 2010

'The "Mesh" describes businesses and organizations that share stuff, fueled in part by the mobile web & social networks. Mesh lifestyles and businesses embrace a world in which access to things trumps owning them. In my book, The Mesh: Why the Future of Business is Sharing, I talk about dozens of these new outfits, and why they are growing at such a prodigious rate. There are a couple of thousand more at www.meshing.it.

Well-known examples include car & bike sharing, (Zipcar , B Cycle & GetAround) and vacation home-sharing services. (AirBnB & VRBO). But there are lots of more surprising ideas brought to market - fashion & craft exchanges, tools libraries, p2p energy, co-working, rooftop farming, p2p money lending, technology driven by sharing, and support for the arts. Mesh companies leverage billions of dollars of investment in tech and physical infrastructure, and are relatively inexpensive to start and run.

For many people, the Mesh will provide opportunities to generate extra income (through "meshing" your possessions on sites that help with all the details), and to save money by only accessing goods and services only when you need them, rather than aspiring to own one of everything. In the next decade, I predict, this model will conspicuously shape how we think about our lives and work and will shake-up the buy-and-throw-away economy. (hint: it already has) By re-using, repairing, and recycling goods, the Mesh also makes sense as the global population zooms toward 9 billion persons.

Meshing It'

Provocative GrowthBusters Film about the 'End of Growth' Taps Crowd Power

...very proud of my virtual colleagues Dave Gardner and Donnie Maclurcan!

Please get in touch with Dave if you have any means to help source funding to assist with the completion of this film:

Dave Gardner

Reposted in full from
Yahoo! News, 28 September 2010

'A groundbreaking documentary about the end of growth promises to shake things up when released next year. But it’s already turning heads by virtue of the way it’s being made.

A few recent films, such as Age of Stupid, have been “crowd-funded,” in which the general public pitches in to finance films they want to see made. “Crowd-distribution” of independent films has also come into vogue. Robert Greenwald’s Wal-Mart: The High Cost of Low Price, was seen by 500,000 people in one week by way of 7,000 house parties and community screenings.

Filmmaker Dave Gardner is adding “crowd-produced” to the lexicon. His upcoming documentary, GrowthBusters: Hooked on Growth, is relying on a team of highly-motivated volunteers to actually produce the film and offset much of the film’s $500,000 budget. So far, footage has been contributed by filmmakers in Ethiopia, India, the U.S. and Great Britain. The film’s voluntary co-producer, Donnie Maclurcan, resides in Sydney, Australia. Edmonton, Canada’s Alexandra Billings serves as the film’s voluntary project manager. Everywhere Gardner shoots, volunteers serve as members of the film crew.

Gardner has converted the basement of his Colorado home into offices and an editing suite, and a spare bedroom houses visiting volunteers who spend anywhere from a few weeks to a few months working on the project. “One volunteer even offered to pitch a tent in my backyard while working on the project,” Gardner adds. A team of virtual volunteers around the world is busy transcribing interviews, conducting research, assisting with distribution and publicity plans, and contributing financially when they can.

Why such an unorthodox method of producing a film? “As a non-profit project, we’ve so far not attracted large foundation grants,” Gardner explains. “GrowthBusters questions one of our most basic beliefs: that growth brings prosperity and well-being. It takes a real visionary to write a check for this project.”

In the absence of substantial institutional funding, the producers are turning to volunteers and like-minded film professionals to cut the cash budget by more than half. Gardner and Maclurcan are harnessing the power of fans who believe the world needs to see this film. “There is a growing movement of people who are restless with ‘business as usual’ and intrigued by the possibilities of a post-growth world,” notes Maclurcan.

“Of course, we still need to raise additional funding, as there are some things volunteers cannot do, like manufacture a DVD,” adds Gardner. With a little more power from the crowd, the filmmakers are confident GrowthBusters: Hooked on Growth will be finished in the coming six months, ready to be shared with the wider world.

GrowthBusters: Hooked on Growth is a non-profit, feature-length documentary planned for release in the first half of 2010. Produced by Citizen-Powered Media, the film examines the sustainability of modern society’s worship of unending economic, population, urban and consumption growth.

Photos, logo and other media information at www.growthbusters.org/media-and-bloggers

For a description of the film, see www.growthbusters.org/find-out-more/about-the-film

For more, see www.growthbusters.org

Vulnerable Arab World Lags On Climate Change Action

'"The entrepreneur and the economist need to see some revenue prospects from addressing climate change. Without them, nothing will happen...'

Nature has begun instigating bankruptcy proceedings against human industrial society - find some revenue in THAT.

Reposted in full from Planet Ark, 23 September 2010

'The Arab world will be one of the regions worst hit by climate change but still lacks any coordinated response to its potentially devastating effects, experts said at a conference this week.

With hotter, drier and less predictable climates, the amount of water running into the region's streams and rivers is set to fall 20 to 30 percent by 2050, worsening desertification and food insecurity, the United Nations Development Programme says.

Arab states, many rich in petroleum and grappling with fast-growing populations, lack the political will to act, experts said at the UNDP regional meeting that ended on Tuesday.

"They are leaving entire generations who will wake up and find a disaster on their hands that they will be completely unequipped to handle," Mostafa Tolba, former executive director of the United Nations Environment Programme, told Reuters.

The region is home to six of the world's ten most water-scarce countries. Its citizens have access to an average of 1,000 cubic meters of water a year, a figure seven times below the world average and expected to shrink to 460 cubic meters by 2025.

Another looming concern for many countries in the region is rising sea waters that threat small-island states like Bahrain as well as natural and man-made islands in the Arabian Gulf.

In Egypt, where over 50 percent of the population lives within 100 kilometers of the coast line, 6 to 8 million people could be displaced, said Mohamed El Raey, Executive Director of the Regional Center for Disaster Risk Reduction.

Egypt is already the world's biggest wheat importer and rising waters on its low-lying Nile Delta, where nearly half of the country's crops grow, could submerge or soak the land in salt water.

"Climate change will render many of our coastal zones redundant or obsolete," Shaden Abdel Gawad, president of Egypt's National Water Research Center, told the conference.

The prospective damage of rising sea waters could chip off 16 percent of Egypt's gross domestic product, the worst potential damage in the region, El Raey said, citing World Bank figures. Qatar and Tunisia follow closely behind.

Arab world greenhouse gas emissions are growing at one of the fastest rates in the world, with Kuwait, the United Arab Emirates, and Qatar the biggest emitters per capita, although the region only accounts for 5 percent of the world total.

Experts said climate change was on Arab government agendas but they called for measures to engage the private sector, saying the only way was to target the pockets of businesses.

"The entrepreneur and the economist need to see some revenue prospects from addressing climate change. Without them, nothing will happen," Tolba said.'

Democratizing Money

Excerpt from new economics foundation, 28 September 2010

'...But one area that is not prominent on the agenda of the Banking Commission’s review, nor across any mainstream debate on the financial crisis is an analysis of money itself, how it is produced and allocated.

The first point to make here is that money is not, as orthodox economics would have us believe, a natural phenomenon. Contrary to what you will read in most the textbooks, modern money did not naturally ‘emerge’ through market forces as a more effective tool for exchange than bartering. Whilst it’s true that money does enable more efficient exchange, modern money is a creation of the state and has only been with us, in its current form, for less than 160 years. In 1844, the Bank of England Act outlawed the creation of money (then mainly coins and notes) by anyone other than the Bank. Prior to this, a range of private regional and local currencies circulated. Today, there remain a range of ‘complementary currencies’ existing independently of the state, including commercial currencies such as Air Miles and loyalty points schemes and social currencies that nef has promoted, such as time-banking and the Transition currencies, not to mention a rapidly increasing virtual money scene enabled by the internet. Money is as much a socially and politically constructed institution as the health service, the welfare state, the police or the education system.

These institutions are the subject of intense and healthy political debate and scrutiny. Moves to remove them from the democratic sphere through privatization tend to be fiercely resisted. Not so with money. Whilst the 1844 Act outlawed the creation of notes and coins by anyone other than the state, it didn’t mention digital money. As advances in ICT developed, more and more of the money in circulation became digital, issued by private banks as IOU’s through fractional reserve banking. Today 97% of money in circulation is ‘created’ by private banks as interest-bearing debt while only 60 years ago, this was closer to 50% with the remainder issued – debt free - as coins and notes by the state.

How does fractional reserve banking work? When you put £100 in the bank a strange thing happens. The bank holds on to a ‘fraction’ of your deposit (say 1/10th) and lends the remainder out, charging interest upon it. This £90 loan is described as an ‘asset’ by the bank – it has created it, as if by magic. It charges interest upon the loan and it must be repaid by the debtor with the interest or they will commit a criminal offence. The debtor pays the £90 in to another bank who can then loan out £81, again at interest. The process goes on and on and eventually through this ‘money multiplier’ process, £987 of completely new debt-money is created.

This capacity of banks to create money on the basis of maintaining very small fractions of deposits is one of the most important elements of modern capitalism. Indeed the great German economist Joseph Schumpeter believed it to be the distinguishing feature of capitalism from all previous economic systems. It certainly helps us to explain the astonishing pace of growth we have seen in the Western world (where this system is most developed) over the past 200 years.

It has become clear, however, that our economies cannot keep on growing at the exponential rate we have seen over the past two centuries. Even if we weren’t facing disastrous climate change, there simply isn’t enough cheap oil to maintain such levels. As economist Herman Daly puts it, fractional reserve banking is not growth neutral, but a ‘growth pusher’:

“…For all those loans to be paid back with interest the borrower must make the money grow by a rate at least as high as the rate of interest… The result is that economic growth is required just to keep the money supply from shrinking as old loans are repaid.” (Daly, H., 1999: 133).

Daly’s quote also points to the inherent instability of our financial system. If virtually all the money in circulation is created as debt by banks then money is effectively, credit (or debt). The problem is that if debtors default on their debt (as with the sub-prime crisis), or, indeed, all suddenly choose to pay off their debts and stop borrowing, suddenly the magical ‘multiplier’ goes in to reverse. This is exactly what is happening now across the western world following the recession. People are tightening their belts, concerned about their jobs. They’ve stopped borrowing, whether it be for holidays, cars or, most importantly in the UK, homes. As a result, the money supply is shrinking.

On top of this, many banks are still attempting to rebuild their capital reserves following the financial crisis so are also reluctant to lend unless they are very sure about their investments. Small businesses are feeling the brunt of this as they tend to be seen as riskier investments by banks. Lacking working capital, they shed jobs or close down, further weakening demand and increasing people’s reluctance to borrow and further shrinking the money supply. We are then caught in the disastrous ‘debt-deflation’ scenario that has afflicted Japan for the last 20 years...

The academic and policy research on alternatives to fractional reserve banking is thin on the ground. This needs to change. nef is working to try and change the way the public and the government thinks about modern money. We’re supporting Positive Money, a new campaign helps build momentum for change and educate the wider public about how the monetary system really works...'

28 September 2010

The Power of 10

Excerpt from Project for Public Spaces via Adelaide City Councillor David Plumridge's notes, 28 September 2010

'The Power of 10 is a concept the organisation “Projects for Public Spaces” uses to highlight principles of the Placemaking Process.

The basic idea is that it’s not enough to have just one great place in a neighborhood—you need a number of them to create a truly lively neighborhood. And it’s not enough to have only one top-notch neighborhood in a city—you need to provide people all over town with close-to-home opportunities to take pleasure in public life. And then it’s not enough to have a single livable community in a region—you need a collection of interesting cities and towns to offer a high quality of life the wider area...

Any Great Place itself needs to offer at least 10 things to do or 10 reasons to be there. These could include a place to sit, playgrounds to enjoy, art to touch, music to hear, food to eat, history to experience, and people to meet. Ideally, some of these activities are unique to that spot and are interesting enough to keep people coming back. Local people who use the space most regularly are the best source of ideas for what uses will work best.

How many quality places are located in the City, and how are they connected? Are there other places that should be more meaningful but aren’t?

Answering these questions can help residents, businesses and stakeholders determine - both individually and collectively - where they need to focus their energies. The Power of 10 offers an easy framework that motivates stakeholders to revitalize urban life, and shows that by starting efforts at the smallest scale you can accomplish big things. The concept also provides people something tangible to strive for and helps them visualize how to make their community great.'