ESG: The Future of Sustainability by Topco Media

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SOCIAL

GOVERNANCE

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CONTENTS ENVIRONMENTAL

SOCIAL

GOVERNANCE

68 14 16

The green economy

Success stories in

Water sustainability

Digging deep

- sustainable mining

Traveling the green road

Building our future

Pollution and plastics

42 2

46 48

Sustainable investing

The public sector and

practice in your business

- a South African perspective

entrepreneurship Sustainability in the workplace

A time to give back

Sustainable finance in

ESG moves into mainstream

Corporate fraud and auditing

Climate-smart

- what are the solutions? Powering Ahead

How to embed ESG best-

sustainability

sustainable agriculture

- CSI in the wake of COVID-19 Diversity in the workplace

Africa’s mining sector

investing - a global view challenges - 5 lessons

CONCLUSION 86

The future of sustainability is circular

CREDITS CEO Ralf Fletcher Financial Director Haley Fletcher

FEATURED CLIENTS

TOPCO STUDIO Production Director Van Fletcher

Giantfuse Capital

Group Editor

Kimberly-Clark South Africa

Assistant Editor

Old Mutual Investment Group

Designer

8 37

National Energy Regulator of South Africa

Prescient

Total Serve Facilities Management

(NERSA)

Vodacom Group

Fiona Wakelin

Maxine Volker

Christine Siljeur Traffic Coordinator Daniel Bouwer artwork@topco.co.za

SALES Head of Brand Odelia Fester

Images iStock

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the publishers, editor and contributors accept no responsibility for any consequences arising from any errors or emissions. ISBN: 978-0-992-1778-0-5

E D IT OR’S NOTE

Doing good business for people, profit and planet

ESG criteria are an increasingly popular way for investors to evaluate companies in which they might want to invest - and avoid

Disruption and sustainability are 2 terms

companies that may pose a financial risk

which at first seem contradictory but which

due to their non-sustainable practices.

we need to embrace in order to thrive abundantly. Disruption is being driven

“Environmental, social, and governance

by technology and sustainability by an

(ESG) criteria help investors find companies

understanding that long term solutions and

with values that match their own. However

practices require immediate application.

ESG criteria have a practical purpose beyond ethical concerns. As ESG-minded

This publication – ESG: The Future of

business practices gain more traction,

Sustainability takes a deep dive into its

investment firms are increasingly tracking

three interdependent pillars:

their performance. Financial services companies such as JPMorgan Chase, Wells

Environment

Fargo, and Goldman Sachs have published

• Carbon emissions

annual reports that extensively review

• Energy efficiency

their ESG approaches and the bottom-line

• Climate change • Water scarcity SOCIAL • CSI • Diversity • Green jobs in the green economy GOVERNANCE • Business ethics • Sustainable asset management • How to embed ESG practices

results.” - Investopedia According to Bloomberg, investor interest in ESG funds, alongside market appreciation, drove a 37% annual increase in assets in 2017, outpacing the 23% return for the MSCI World Index. We hope you enjoy the read!

CONTR IB UTOR S

CONTRIBUTORS CHRISTINE MEYER

DHESIGEN NAIDOO

Project Manager

CEO

adelphi

EUGENE VISAGIE Portfolio Specialist

Morningstar Investment Management South Africa.

NIGEL BECK

Head of Sustainable Finance

Water Research Commission

HORTENSE BIOY

MARK BUNCOMBE

CFA, Director

Head of Mining and Metals

Sustainability Research Morningstar, EMEA, APAC

PAUL DAVIES

Standard Bank Group

REINHARDT ARP

MICHAEL GREEN Counsel

Latham & Watkins, Environment, Land & Resources Department, London

REST KANJU

Standard Bank Group

Partner and Chair

Latham & Watkins’ Environment, Land & Resources Department, London

Environmental Economist

Founder, Director and Head

ROBERT LEWENSON

VICTORIA REUVERS

YASMINE MIEMIEC

ZAYNAB SADAN

Head of ESG Engagement

Managing Director

Old Mutual Investment Group

Morningstar Investment Management South Africa.

Policy and Futures Unit WWF South Africa.

5inc

Operations, Indalo Inclusive, South Africa

Project Officer

Circular Plastics Economy Programme World Wide Fund for Nature.

QUOTES

“ The world needs to move away from economic models that value growth for growth’s sake towards a circular economy.” - President Cyril Ramaphosa

“ As the dominant species on this planet, it is our moral duty to protect and preserve all forms of life.” – Sir David Attenborough

“If you put your staff first, your customer second and shareholders third, effectively, in the end, the shareholders do well, the customers do better and you yourself are happy.” – Sir Richard Branson

“ I want you to act as if our house is on fire. Because it is.” ― Greta Thunberg

“ There is no such thing as ‘away’ – when you throw something away it must go somewhere.”

“There is no planet B.” – Mike Berners-Lee

– Annie Leonard

“ It’s going to be up to ordinary superheroes like us to actually change and commit to social responsibility.” – Anjuli Pandit

“2020 is a tipping point for ESG.” – Adena Friedman

“Earth is what we all have in common.” – Wendell Berry

“It is not an investment if it is destroying the planet.” – Vandana Shiva

“ Cabinet has approved three key actions that will contribute to an environment that is not only healthy for all South Africans, but also able to contribute effectively to sustainable economic development and job creation. During its meeting on 9 September 2020, Cabinet approved the Presidential Climate Change Coordinating “ Good governance is perhaps the single

Commission (PCCCC) to coordinate and oversee the

most important factor in eradicating

just transition. Also approved was South Africa’s Low

poverty and promoting development.”

Emissions Development Strategy and the revised

– Kofi Annan

National Waste Management Strategy 2020.” –D epartment of Environment, Forestry and Fisheries 7

THE EVOLUTION OF RESPONSIBLE INVESTING Jon Duncan, Head of Responsible Investment at Old Mutual Investment Group, talks sustainable investment in the wake of the COVID-19 crisis and the valuable lessons learned.

The COVID-19 pandemic has revealed a great deal in recent months, highlighting the shortcomings of society that were vulnerable to begin with, and the interconnected nature of our social, biophysical and market ecosystems. It’s been argued that it represents the watershed moment for working-from-home, as well as under-the-skin surveillance. We believe that it is a defining moment for the active incorporation of Responsible Investing (RI) principles into asset management. The concept of RI – beyond just environmental, social and governance (ESG) considerations The United Nations Principles for Responsible Investment (UNPRI) defines RI as “a strategy and practice to incorporate ESG factors in investment decisions and active ownership”. While ESG investing is a term often used synonymously with sustainable investing, RI, however, is much broader. The concept is not just based on values, ethics or morals – while this may be a consideration. Rather, it aims to maximise long-term risk-adjusted returns by incorporating ESG risk factors into investment decision-making and active ownership. This practice recognises that there are a host of non-financial risks that impact asset allocation and, to be responsible custodians of capital, investment managers need to incorporate active ownership.

ESG incorporation and active ownership can be undertaken in various ways and are informed by the type of investment being considered. Applied RI adds value to clients’ portfolios leveraging its ability to manage their liabilities by hedging interest rate and inflation risk while also providing alpha to client funds. ESG integration ESG integration is the systematic and explicit inclusion of ESG factors in traditional financial analysis. It undertakes ESG risk assessments on each investee company to identify material risks and to establish the financial implications of those risks materialising, with the aim of ascertaining the merits of the investment. Old Mutual Investment Group (OMIG) has evolved in further formalising the approach to screening, as well as becoming more active owners of assets through stewardship. Screening responsible investments Screening utilises a dynamic method whereby portfolio managers run proposed investments through a four-pillar framework before analysts perform their fundamental analysis with ESG incorporation. This four-pillared framework is designed to consider the investing nuances and aims to establish the favourability of an investment from a responsible investing angle, before conducting a deep dive into the fundamentals. The first pillar considers the debt type: is it a

INVESTMENT GROUP 175 YEARS OF DOING GREAT THINGS Old Mutual Investment Group (Pty) Ltd (Reg No 1993/003023/07) is a licensed financial services provider, FSP 604, approved by the Financial Sector Conduct Authority (www.fsca.co.za) to provide intermediary services and advice in terms of the Financial Advisory and Intermediary Services Act 37 of 2002. Old Mutual Investment Group (Pty) Ltd is wholly owned by the Old Mutual Investment Group Holdings (Pty) Ltd

bond or a loan? Loans typically have stronger protections and legal terms are more negotiable than bonds. Having stronger protections and being able to add ESG-related wording to legal agreements increases the favourability of an investment from a responsible investing perspective. The second pillar considers the listing status of the issuer, as both private and public companies can issue debt. JSE-listed issuers tend to have significantly better disclosure than their non-listed counterparts. These companies are also more likely to adhere to voluntary guidelines like the King IV Code, which makes assessing ESG risks easier. The third pillar considers the industry or sector that an issuer belongs to. Certain sectors may be more favourable from an ESG perspective (such as renewable energy). There are also external risks that could impact entire industries; for example, the introduction of a carbon tax can be significant for issuers in the fossil fuels industry. The final pillar in this framework utilises the OMIG RI team’s proprietary model to determine a quantitative ESG profile score of a potential investee company. Using the outcomes of all four pillars, portfolio managers can decide whether the proposed investment is favourable or not from a RI perspective, and could also assist analysts by directing them to specific focus areas when conducting their fundamental analysis.

Stewardship: be an active owner Important components of RI are active ownership or stewardship. Actively engaging with companies on ESG risk factors is necessary to ensure that companies operate sustainably, thereby enhancing risk-adjusted returns for clients. This engagement can be undertaken on an individual basis when engaging management teams on roadshows, or in collaboration with other stakeholders in more open forums. COVID-19 and beyond The pandemic has illustrated that RI practices are a fundamental requirement in risk assessment. For early adopters of ESG incorporation like ourselves, the pandemic has resulted in us viewing these risk factors holistically. The concept of an essential service will now garner more attention and aptly demonstrates the trade-offs one needs to consider when performing these assessments. Our stewardship expertise service is available to institutional investors wanting to be active owners of the assets they manage, while performing fiduciary responsibilities focused on delivering sustainable long-term returns to clients.

14454

To answer more of your investment related questions, contact us at futurematters@oldmutualinvest.com or visit oldmutualinvest.com

VODACOM IN PURSUIT OF CONNECTING

FOR A BETTER FUTURE Takalani Netshitenzhe, Chief Officer for External Affairs at Vodacom South Africa, shares Vodacom’s vision of building an inclusive digital society that transforms communities, embraces everyone, and does not come at the cost of the planet. At Vodacom, we are on a journey to improve the lives of the next 100 million customers and halve our environmental impact by 2025, by focusing on three pillars, namely digital society (connecting people and things to the internet); Inclusion for all (leaving no one behind) and Planet (minimising our impact on the environment). As part of our commitment to creating a digital society, we have invested in increasing our network coverage and developing platforms that provide access to a range of life-enhancing services beyond communications. Vodacom now has 377 rural network sites, extending coverage to communities in South Africa that were previously not connected, and our fibre penetration has reached more than 109 536 homes and businesses in the country.

fu t u re o fs u sta i n a b i l i ty.c o.z a

Through our inclusion for all pillar; we believe that the opportunities and promise of a better digital future should be available to all. Through our education ecosystem and digital platforms for education, such as e-School and Instant Schools, we are making education more accessible, ensuring that even the most vulnerable are not left behind on the journey towards a connected, digital future. With more urgent and sustained action needed to address climate change, we

believe that our business success should not come at a cost to the planet. In

anticipation of the increasing demand for

digital services, which increases Vodacom’s energy consumption, we are securing

alternative energy sources where feasible,

and promoting energy efficiency awareness across our workforce.

Furthermore, we realise that water is a

scarce resource and have implemented

various water-saving measures within our

operations. Our waste management policy prioritises the reuse and recycling

of redundant equipment, minimising

waste across our value chain. Through our commitment to halve our

environmental impact in the next five

years, hope to contribute to a sustainable future for everyone.

VODACOM GROUP LIMITED P ROF IL E

COMPANY STATISTICS / DEMOGRAPHICS / HISTORY

Year founded: 1994 Employees: 7641 Branches: Head Office (Midrand, Gauteng) Memberships: United Nations Global Compact, National Business Initiative, World Wide Fund for Nature Environmental consultants: Carbon Calculated Current customer base: 116 million New products: ConnectU, VodaPay, VodaLend New acquisitions: Safaricom, Vodafone Ghana

BUSINESS & FINANCE

Turnover: R90.7 billion Financial year-end: 31 March 2020 Main Subsidiaries: Vodacom DRC, Vodacom Mozambique, Vodacom Lesotho, Vodacom Tanzania Holding company: Vodafone Sponsor Bank: UBS South Africa (Pty) Limited Auditors: Ernst & Young Inc. Current customer base: 116 million (including Safaricom)

CONTRACTS & AWARDS

Industrial standards: Prescribed by the Regulator ICASA Environmental health & safety standards: ISO14001 Environmental Management System ISO rating: ISO9001 Certified Recent awards: Kantar BrandZ Top 30 Most Valuable South African Brands - Vodacom placed 4th overall in the Top 10, and 1st in the telco industry (September 2020) Recent major contracts: Vodacom Group and the SADC Banking Association have signed a memorandum of understanding that will allow the Vodacom Group to join the South African Development Community’s Transactions Cleared on an Immediate Basis (TCIB) payment scheme.

ESG & TRAINING

ESG initiatives: Vodacom has embarked on a purpose led journey to connect for a better future through focussing on three pillars: Digital Society, Inclusion for All and Planet. Under each of these pillars are dedicated programmes which aim to drive progress towards improving the lives of the next 100 million customers and halving our environmental impact ESG Training programmes: Vodacom has a digital learning platform, Vodafone University with learning content on various ESG aspects. Employees are also encouraged to attend job specific training programmes as part of their learning and development programmes

CORPORATE ACCOUNTABILITY

How do you measure the success of your corporate accountability? We are evaluated by various institutions including ESG rating agencies, investors and analysts throughout the year. Our ESG performance is measured by rating agencies including Sustainalytics, the Financial Times and London Stock Exchange (FTSE), the Carbon Disclosure Project (CDP) and the Johannesburg Stock Exchange (JSE) How do you report your ESG activities to stakeholders? Our performance on ESG activities is disclosed publicly on the company website and in Vodacom’s annual Integrated and Sustainability Reports Which methods do you use to measure the direct and indirect impact of your organisation’s activities on the world? There are various mechanisms which Vodacom uses to measure the direct and indirect impact of its activities including ongoing risk assessments, reputation surveys, media reports, customer feedback surveys and socio-economic impact studies in our operating markets to name a few.

FAST FACTS Sustainable highlights and developments Vodacom has a significant role to play in contributing to society. Our purpose journey aims to improve the lives of the next 100 million customers and halve our environmental impact by 2025 which will be delivered across three pillars: Digital Society; Inclusion for All; and Planet. We aspire to enable an inclusive and sustainable digital society and remain dedicated to ensuring that Vodacom operates responsibly and ethically. This is an area, which we believe is more important than ever, given the ongoing COVID-19 crisis and the role business plays in supporting society during this period of uncertainty and change.

CONTACT INFORMATION CEO: Mohammed Shameel Aziz Joosub Managing Director: Balesh Sharma Financial Director: Raisibe Morathi Physical address: Vodacom Corporate Park, 082 Vodacom Boulevard, Midrand, 1685 Postal address: Private Bag X9904, Sandton, 2146 Telephone: +27 (0) 11 653 5000 Website: https://www.vodacom.com Toll-free / call centre / customer care number: 082 135

CHANNEL AFRICA THE AFRICAN PERSPECTIVE

Channel Africa is South Africa’s international public broadcast radio station whose primary audience is the entire African continent. Our secondary audience is the rest of the world, where we harvest our news and information. As an International Public Broadcaster, our core values subscribe to the highest journalistic ethics which find expression in fairness, accuracy, and impartiality. Channel Africa is a platform through which Africa is engaged in debate with itself, and recognises South Africa as a role player in continental and international affairs.

Vision: “The African Perspective” Mission: “to promote the regeneration, revival, and rejuvenation of Africa, through the production and broadcast of dynamic, stimulating, and interesting programmes”. Contact Information: Tel: 011 714 2997 Fax: 011 714 2072 Email: info@channelafrica.co.za Web: www.channelafrica.co.za Twitter: channelafrica1 Instagram: channelafricaradio DSTV:802

GIANTFUSE CAPITAL PARTNERS IN T ERVIEW

INTERVIEW

GIANTFUSE How does your organisation champion sustainable development?

Giantfuse is conscious of the environmental effects of its activities and those of its investments and recognises the need to minimise avoidable adverse environmental impacts where possible. We recognise the importance of ensuring that our own and our investments’ labour conditions, health and

LENNsafety AHguidelines C and wages are fair and are than those required by local laws. ACnot IRless FA EVITCEPSREP NACIRFA EHT

How does your organisation plan to respond to climate change?

We strive to lessen our imprint and to

What role do you think local business

Our message to investors looking to

innovative responses to social and

In today’s hyper-efficient markets, the

can play in the development of environmental challenges?

Local businesses can make a difference by continuously working towards improving our business practices to reduce environmental impact, and to develop customised investment solutions across

possible, to continuously work towards improving our business practices to reduce

,noitarenany egenvironmental er eht etoimpact. morp ot“ :noissiM ,acirfA fo noitanevujer dna ,laviver tsacdaoWhat rb dn noithink tcudare orp ht hgand uorht doa you theetrends accountability? gnitseredrivers tni dnof a corporate ,gnitalum its ,cimanyd fo • Green Technologynatural resources .”semmargorp are rapidly depleted and as our world

:noitamroreaches fnI tcathe tntipping oC point of a two-degree 7992 417 rise 110 in:le T average temperature, socially 2702 417 responsible 110 :xaF companies are investing in az.oc.acirfgreen alentechnologies. nahc@ofni :liamE • Diversity and inclusion- recognition of

az.oc.acirfinequalities alennahc wand w :economic beW burdens in.w pay 1acirfalenn hc :rettiiswan T emerging trend in ofaemployees oidaracirfcorporate alennahsocial c :mresponsibility. argatsnI 208:VTSD f uture of su sta i n a b ilit y.co .za

The institutional investor playbook is changing. We envision a future where there is far more productive and greater wellbeing, and wealth for the next generations.

communities and the environment. And to constantly Increase the awareness of environmental, social and governance within their corporate structures and to all stakeholders within their organizations. How do you achieve good financial

returns while contributing to the world’s

is the embodiment of an investment

”evitcepsreP nacirfA ehT“ :noisiV

enough, especially in developing markets.

and the risk and return spectrum to support

,dlrow egeneral ht fo tconsidering ser eht sthe i eimpact cneidofuour a ydaily radnoces ruO premise that looks forward to tomorrow’s operations and those of our investments. In sA .noitamrofni dna swen ruo tsevrah ew eopportunities, rehw like deploying capital to governing our work on sustainability, we hold seulav eroc ruo ,retsacdaorB cilbuP lanoitainvestment nretnI nstrategies a that seek to generate ourselves to the same principles of creating dnfi hcihvalue w sand cihtbeing e cieffective tsilanru o j t s e h g i h e h t o t e b i r c s b u s positive environmental or social outcomes and efficient in our .ytilaitraexecution pmi dna , y c a r u c c a , s s e n r i a f n i n o i s s e r p x e alongside financial returns On the impact of the Giantfuse Green projects acirfA hc ihw hguorhstrategy t mrofand talp si acirfA linvesting ennahC side, we invest in advancing and sustainability ourabroader women sesingocwork er d a ,flesti htGiantfuse iw etabCapital ed niisdegag ne siin the workplace to increase gender onnsustainability. environmental dna latnconscious enitnocofnthe i re yalp elor effects a sa aofcits irfA hdiversity tuoS in company leadership teams, and capture the potential benefits from activities .sriaffa la noitanand retthose ni of its investments and adverse environmental impacts where

traditional value-creation levers aren’t good

both the continuum of ESG approaches

lanoitanavoid retndamaging i s’acirfA htuoS si acirfA lennawell-being? hC the environment by yramirpminimising esohw n o i t a t s o i d a r t s a c d a o r b c i l b upis possible by thematic or Impact This waste, reducing packaging .tnenitno c nacirpromoting fA eritnrecycling e eht sand, i ecinneidua Investing: A thematic investment approach materials,

recognises the need to minimise avoidable

invest in South Africa.

enhanced diversity.

How does your company successfully manage ESG to strengthen its performance?

Giantfuse Capital‘s founders and

SIBONELO NKOSI Qualifications: Bachelors of Law Occupation and position: Co-Founder and Fund Manager

Steps to success: Discipline, Goal oriented Stand-out achievements: Sibonelo Nkosi has a number of awards recognising his

philanthropy and development of communities in rural areas of South Africa – these include the Premier’s Service Excellence Awards

Business Philosophy (in one sentence): Spend more time working on your own

winning culture. No one can take that away from you.

Best decision: Being an entrepreneur from the very young age of 12. Worst decision: Once upon a time, I mixed friendship with business and it came back and bit me.

employees helped in establishing the GiantGreen Foundation to support communities and conservation efforts – locally and beyond. The Foundation, with a dual commitment to working with communities (mostly children at risk and environmental degradation), allows us to view needs first-hand and to act on perceived imbalances. The Foundation emphasises Giantfuse Capital‘s commitment to social and environmental standards.

Address: 155 West Street Sandown Johannesburg, 2093

Email: info@giantfusecapitalpartners.co.za Telephone: +27 64 227 0970 Website:

http://www.giantfusecapitalpartners.co.za/

ENVIRON THE FUTURE OF SUSTAINABILITY

SECTION

NMENTAL

E NVIRONMENTAL

THE GREEN

LET’S MAKE IT WORK By Fiona Wakelin

The Partnership for Action on Green

These agencies offer integrated and

Economy (PAGE) was launched in 2013

holistic support to countries looking

as a response to the call at Rio+20

to participate in an inclusive green

to support those countries wishing to

economy, ensuring coherence and

embark on greener and more inclusive

avoiding duplication.

growth trajectories. The Partnership brings together five UN agencies:

PAGE aims to put sustainability at the heart of economic policies and

UN Environment

practices to advance the 2030 Agenda for Sustainable Development and

International Labour Organization

supports nations and regions in reframing economic policies and practices around

UN Development Programme

sustainability to foster economic growth, create income and jobs, reduce poverty

UN Industrial Development Organization

and inequality, and strengthen the ecological foundations of their economies.

UN Institute for Training and Research

(GREEN ECONOMY COALITION)

T H E G R EEN EC O N O MY – L ET ’ S M AK E IT WOR K

N ECONOMY THIRD PAGE MINISTERIAL CONFERENCE HOSTED IN CAPE TOWN

“After all, it is above all else by advancing action for an inclusive green economy that we can address simultaneously all three dimensions of sustainability

Hosted by the Department of

– the economic, the social and the

Environmental Affairs, South Africa,

environmental. We have learned that

the Third PAGE Ministerial Conference

to progress in the future on any one

took place at the International

dimension of sustainability is likely to

Convention Centre in Cape Town from

be compromised if we don’t advance on

10 to 11 January 2019, highlighting and

all three. We have learned as well that

celebrating drivers of innovation and

there is no necessary trade-off between

entrepreneurship through inclusivity in

these dimensions. But we know well that

advancing green industries for a better

the task ahead of us is also complex

and more sustainable future for all. It

because it requires a major change in the

brought together over 500 leaders from

fundamentals of the way we organize how

more than 50 countries with delegates

we live, how we produce and how

which included representatives from

we consume.”

governments, civil society, private sector, development partners, media

The following is a summary of 5 key calls

and the public.

to action in the document, published by the ILO after the 3rd Ministerial

At the Conference ILO Director-General

Conference looking at key policy

Guy Ryder outlined three key climate

messages and action pathways.

change challenges and put forward a number of proposals stating:

E NVIRONMENTAL

To achieve the 2030 Agenda for Sustainable Development and the targets of the Paris Agreement on climate change, we must: 1. Reinvent our economies as inclusive green economies.

This implies fundamental shifts from linear economic models of production, consumption and investment towards sustainable and circular economies that recognise and account for the value of nature and sustain, rather than consume and perpetually erode, the world’s natural capital basis 2. Anchor green strategies and policies in longterm development frameworks and promote

collaborative governance based on trust, political

will and broad citizen participation and ownership. Long-term strategies and policies for a just transition are indispensable in managing social and employment impacts of moving away from carbon and resourceintensive economic systems. 3. Focus on economic, social and political inclusion to ensure that agendas are shaped, acted on and reviewed by diverse and often left out people

and institutions, and that no one is left behind in

accessing equitably the benefits and opportunities arising from economic, social and environmental progress. Inclusive societies require democratising

the ownership of means of production and engaging those negatively impacted from economic crisis, social disruption and environmental degradation. 4. Create the future of work we want in a changing

climate where we must reorganise our economies

towards greater resource efficiency, sustainability and resilience. Work is a fundamental aspect

of human dignity. It is a means of livelihood and realisation of aspirations of all women and men in their working lives that must be promoted and protected 5. Strengthen partnerships and multilateralism. Broad-based partnerships, cross-ministry Deputy Director, Economy Division, UN Environment, Tim Kasten speaking at the 2019 Page Ministerial Conference (Image from: https://page2019.itcilo.org/)

collaboration, a strengthened multilateral system and effective international cooperation are vital for sustaining and strengthening a collective vision to transform economies and societies.

T H E G R EEN EC O N O MY – L ET ’ S M AK E IT WOR K

GREENCAPE LOOKS AT GROWING

The Atlantis SEZ is a zone dedicated

It is expected that the zone will attract

to the manufacturing and provision of

a further R3.7-billion of investment by

services in the green technology space.

manufacturers of wind blades, smart

Greentech refers to green technologies

The zone welcomes manufacturers,

meters, batteries, wind turbines, solar

that reduce or reverse the impact of

service providers, suppliers and other

PV, and by other players in the waste,

people on the planet. These include

players in the value chains of different

agri-processing, gas and chemicals value

renewable energy technologies. Wind

green technologies. Situated on South

chains. The goal is to create nearly 3 000

turbines, solar panels, insulation, biofuels,

Africa’s West Coast, the Atlantis SEZ

direct jobs in the zone by 2030.

electric vehicles, materials recycling and

capitalises on the Western Cape province’s

green building materials are all examples

already booming renewable energy and

In addition to jobs and investments, the

of green technologies.

green technology sector, tapping into the

people of Atlantis have also benefited in a

$3-trillion global clean technology market.

number of other ways.

manufacturing market is worth at least

Investors have access to extensive

Skills development has been prioritised

R30-billion; with a growing greentech

investment support through the One Stop

to ensure local skills meet the needs of

market in the neighboring countries.

Shop for investor support and the rest of the

industry located in Atlantis. To this end,

South Africa has opportunities in energy,

investor support ecosystem, which includes

the youth has benefited from training,

waste, agriculture, transport and other

InvestSA, GreenCape, the City of Cape

mentoring, exposure to greentech, and

sectors and is a great entry point for the

Town, and Wesgro. Together the ecosystem

participation in the annual Renewable

SADC market.

provides information and advocacy; market

Energy Challenge and career expo, all of

intelligence; facilitated access to permits

which will potentially help them tap into

Special Economic Zones (SEZs) are

and licenses, planning and development

greentech job opportunities emerging

key tools used by the South African

approval; and skills training.

from the SEZ.

economic development. Within SEZs,

Approximately R700-million has

Skills development and training for adults

cluster industries from a particular sector

already been invested in the Atlantis

has taken the form of a training session

locate in geographically designated areas

SEZ, including manufacturers of wind

on solar PV for people from Atlantis and

to get the benefits of scale and co-location.

turbine towers, geotextiles, double-

surrounds, and the recruitment of three

SEZs are governed by the SEZ Act (No.16

glazed windows, wind tower internals

female interns from Atlantis to work

of 2014) and are supported by a range of

and acetylene gas. Because of these

in the SEZ project office. The women

incentives aimed at attracting foreign and

investments more than 320 new jobs have

successfully transitioned into permanent

local investment.

been created in the zone to date.

appointments with the SEZ project office

THE GREEN ECONOMY THROUGH GREENTECH

The South African greentech

government for driving industrial and

in 2016. Other benefits for Atlantis include the upgrade of the power supply, fibre connectivity and MyCiti transport links. The Atlantis SEZ as a physical manifestation of the potential of partnerships to grow the green economy across stakeholder groups, including government (national, provincial and municipal), business and community. Strategic investment into key green Cape Town welcomed 500 innovators and leaders from governments, civil society, private sector, development organizations, media and the public for the 3rd Partnership for Action on Green Economy (PAGE) Ministerial Conference, a unique global forum on green economy. (Image from: https://page2019.itcilo.org/)

economy opportunities will assist to propel South Africa towards the vision set out by the NDP. It’s our future. Let’s make it work.

E NVIRONMENTAL

In a world already grappling with a changing climate, water shortages, famine and disputes over land usage, the future presents new and profound challenges for feeding a growing population. We are slowly reaching a tragic point as food demands are placed on already-strained farmers as well as the entire agriculture industry. Hunger arguably kills more people than AIDS, malaria and tuberculosis combined in Africa. And the problem is only growing worse. Food production must double by 2050 to meet the population growth in developing countries.

CROPS

cooperated with regional organisations to

Organic production of crops is viewed as

develop the organic market, particularly

key to addressing environmental, social

the participatory guarantee system in

and economic challenges. It is known

Zimbabwe and Malawi.

to deliver more nutritious food products, which will help address the significantly

PELUM has been working with smallholder

high levels of malnutrition in Southern

farmers for more than two decades. The

Africa. Its adoption by smallholder

organisation has developed training

farmers would help to build resilience

manuals, delivered training and built

to the effects of climate change.

capacity within its member organisations, and cooperated with regional organisations

Organic production focuses on building

to develop the organic market, particularly

soil health, including its water-retention

the participatory guarantee system in

capacity, which helps mitigate the effects

Zimbabwe and Malawi.

of drought on production. South Africa, Namibia and Zambia have been subject to more frequent and severe droughts in the past few years. It also builds

SAOSO has brought together a fragmented organics sector in South Africa to develop a standard for organic production and

resilience to the emergence of new

processing. This standard has been

pest and disease vectors likely to

accepted by the International Federation

result from a changing climate.

of Organic Agriculture Movements (IFOAM). It will also, with funding from

Participatory Ecological Land Use

GIZ, establish a committee to drive the

Management (PELUM) has been

uptake of a participatory guarantee system

working with smallholder farmers for

in the country to help smallholder farmer’s

more than two decades. The organisation

access organic markets. SAOSO is leading

has developed training manuals,

a process to gain accreditation from

delivered training and built capacity

national qualification boards for an agro-

within its member organisations, and

ecological curriculum.

S U C C ES S S T O R I ES I N S U S TAI N AB LE AGR ICULTUR E

URBAN HARVEST

VERTICAL FARMING

Arable land is a precious resource and as

The urban environment plays a huge role

Traditional agriculture takes a massive toll

soil health depletes, so does the nutrition

in shaping peoples’ health, food security

on the planet’s natural resources. Vertical

of our food. Vertical farms uses less than

and dietary habits, as well as their access

farming may be transforming agriculture to

1% of the land required by conventional

to livelihood opportunities. South Africa

flip the paradigm of exploitation to one of

growing. That means they are over 390

is undergoing a rapid urbanisation, which

preservation and conservation.

times more productive per square foot vs.

places huge demands on land, water,

traditional agriculture, while also ensuring

housing, transport and employment. The

Seventy percent of our water supply

that plants get all of the macro and micro

excessive congestion, unfavourable living

goes to agriculture and 70% of water

nutrients they need all year round.

conditions and insufficient infrastructure

contamination comes from agriculture.

that characterise South African

Current events, future predictions, and

Vertical farmers AeroFarms was the first

urbanisation have led to environmental

common sense tell us we cannot continue

agriculture company to be honored by the

degradation and an increased incidence

on this path. Vertical farms uses +-95%

“Ellen MacArthur Foundation” as one of the

and prevalence in disease.

less water than field farming and has

circular economy 100, because of the part

developed a closed loop water circulation

they playing in sustainable agriculture.

Back in 2005, an acre of land that is now

system that recirculates water to plants.

What we think of as farming is going

a thriving social enterprise was a bone-dry

Imagine the impact if even 10% of produce

through a lot of changes for sustainability.

and barren land that unassumingly blended

was grown this way.

From drilling for water, pumping from

into the rest of Bezuidenhout Park. It took

deeper reserves than ever before,

a dream and lots of hard work for that land

In the field, overuse of pesticides has

operating tractors, tillers, and harvesters,

to become a locally, nationally and globally

decreased the beneficial microorganisms

to washing three times in large scale

recognised hub for knowledge, growth,

in the soil and allowed bad ones to

processing facilities that operate 24/7,

research and social change.

proliferate. Our soil is no longer healthy

traditional commercial farming is quite

enough to filter out pesticides and render

energy intensive.

It all began as a 1-hectare food garden

them inert, leading to toxicity and runoff.

that supplied a wide range of fresh fruits,

Runoff leads to algal blooms and oceanic

Vertical farmers reduce harmful

vegetables, maize, and herbs to local

dead zones. By growing indoors, vertical

transportation emissions by 98% on

Early Childhood Development Centres and

farms can avoid these issues.

average. That is because they build farms

NGOs that provided home-based care to

on major distribution channels and near

HIV+/AIDS patients and their dependents.

Twenty five percent of the world’s land is

population centers to bring local, fresh

Since then, the garden has transformed

now highly degraded, with soil erosion,

greens to communities who wouldn’t

and expanded to become a city, region,

water degradation and biodiversity loss.

normally have them.

nation and even world-wide demonstration site, training and research hub that was named Siyakhana which directly translate to “we are building each-other”. South Africa is in the midst of a food insecurity critical point where many go to bed hungry, and a lack of dietary diversity leads to detrimental health outcomes such as diabetes and obesity. Micronutrient deficiencies cause stunting in children, which compromises future academic ability. What is needed is a change agent that uproots old ideas and changes how people think, learn and practice urban food farming.

E NVIRONMENTAL

FORESTRY South Africa has a responsible and sustainably managed forestry sector that balances productive plantations with sound environmental management and social responsibility. With some 1.2 million hectares of commercially farmed trees and thousands of products made from them, timber plantations not only play an important role in South Africa’s economy, but also in society and our natural environment.

Globally, there are more than 1.3 billion young people ages 12 to 24... These young people can lead the next “Green Revolution” that will build a truly sustainable world.

Trees in both indigenous forests and commercial plantations act as nature’s greatest recyclers. Through

species that call forestry-owned land

photosynthesis, they take in carbon

Local forestry landscapes are a tapestry

dioxide, keep the carbon for their

of commercial timber compartments

growth and release oxygen. The carbon

or crops interwoven with tracts of

stays locked up in the wood, even when

natural vegetation, which enhance

it is converted into other products i.e.

and conserve biodiversity in these

furniture. This is why forestry can help

grasslands, wetlands and indigenous

to mitigate climate change.

forests ecosystems.

The patchwork nature of forestry with

The forestry and forest products sector

South Africa has approximately

and tall trees for nesting lends itself

contributes around R69-billion to the

1.5 million hectares of forestry-owned

South African economy and employs

land, 1.2 million hectares of timber

more than 156 000 people. The majority

plantation and 300 000 hectares of

of forestry’s workforce live in rural

conservation area that stretch from

communities, where unemployment

Limpopo and Mpumalanga to KwaZulu-

levels are high and a single wage

Natal, Eastern and the Western Cape.

supports multiple dependants. The

The country boasts the highest forest

forestry sector invests millions of rands

certification rate in the world, with some

every year in education, health and

80% of South Africa’s forestry landscape

welfare, community infrastructure and

certified by the Forest Stewardship

enterprise development programmes.

Council (FSC), ensuring that the land is managed properly and timber is produced

home. This includes a number of rare, endangered and red list species. One of these species is the “Thunder Bird” or Southern Ground Hornbill. the mixture of insect-rich grasslands as the ideal habitat for these birds. Researchers are now interested to see whether the forestry landscape would offer the potential to create conservation corridors between Mpumalanga and KwaZulu-Natal, the birds’ last great strongholds. Karkloof Blue, one of South Africa’s rarest butterflies, has been protected by conserving important breeding grounds and paying careful attention to site disturbances such as harvesting and burning regimes, and creating a

Ahead of the United Nations’

in line with global environmental and

international day of forests on 21 March

social sustainability standards.

better environment for the host plant

and protection director Dr Ronald

FOREST-OWNED LAND AS A HOME

butterfly lays its eggs.

Heath spoke about how the commercial

Through various research projects,

forestry industry is leading the way in

ranging from public bird surveys to

conserving and rehabilitating areas

camera trap studies, the forestry sector

of high biodiversity value. He also

has identified more than 30 mammal

challenged people to think differently

species, hundreds of bird species and

about plantations.

countless reptile, amphibian and insect

2020, Forestry South Africa research

“Indigofera woodii” upon which the

There is also a mysterious but symbiotic relationship between the butterfly larvae and an ant species “Camponotus natalensis” which means that the ant species also requires protection.

S U C C ES S S T O R I ES I N S U S TAI N AB LE AGR ICULTUR E

LIVESTOCK

must push on because we can make a

On 01 August 2019, the Sernick

difference in agriculture.”

Group welcomed the opening of the Future Farmers office on its premises

The Future Farmers Foundation was

in Kroonstad, Free State. The Future

founded in 2006 by Judy Stuart,

Farmers Foundation has offices in

a farmer from Howick in Kwazulu-

Kwazulu-Natal, Western Cape and

Natal. The organisation is aimed at

now Free State. This new partnership

providing meaningful employment for

between Sernick’s emerging farmers

future farmers and develop them to

programme and the Future Farmers

their full potential. The company uses

Foundation marks the beginning of

an apprenticeship-model to qualify

new opportunities for the youth that

farm managers who are capable of

are interested in agriculture and the

running commercial operations. If

agricultural sector.

candidates shows passion, commitment and potential after the two-year

The Sernick emerging farmers

apprenticeship they are sent overseas

programme is supported by the Jobs

for practical experience.

Fund at National Treasury and is currently assisting 660 emerging

Globally, there are more than 1.3 billion

farmers to become established

young people ages 12 to 24. Many of

commercial farmers.

these are rural youth without access to resources to develop a viable future.

Up until now the model to assist

These young people can lead the next

emerging farmers has not been

“Green Revolution” that will build a truly

focused on youth development. With

sustainable world. Empowering them

this partnership, the company hopes to

to do so should be everyone’s greatest

include more young people from Free

responsibility.

State in its programme and give more people an opportunity to successfully

To ensure global stability there is a lot

enter the agricultural job market with the

of work, to create long-term solutions

necessary knowledge and experience.

to feed a growing world. And within the youth lies the power to change

Nick Serfontein, chairperson of the

the course of history and build a more

Sernick Group said “The Sernick

sustainable future.

Emerging Farmers Programme creates jobs, but more importantly it creates hope”. As a vocal supporter of helping emerging farmers he went on to say, “All commercial farmers want to make a difference, but they don’t know how. This is possibly the last chance to get it right. We must believe we can, and we

Sources: Massey Ferguson Sustainability Institute Sernick FSC Africa Siyakhana Aero Farms

E NVIRONMENTAL

WATER SUSTAINABILIT Y

THE SCIENCE AND TECHNOLOGY DIVIDEND By Dhesigen Naidoo, CEO of Water Research Commission

WAT ER SUSTAINAB ILITY

Water security has been a human occupation since the beginning of time. In fact our transition from a nomadic species to settlement was only possible for Homo Sapiens when our ancestors developed an ability to access and store water to enable year round habitation in one place. This gave confidence to invest in agriculture and the rest, as they say, is history. And yet, all these millennia later water security continues to be elusive. We have just been through a prolonged

are found wanting in terms of last mile

drought episode, on the back of climate

of interventions to get to the goal of

change, with parts of the country

universal access and sustainability of

continuing to experience extreme water

the interventions already implemented.

scarcity. The Global Risk Register of the

With personal and collective hygiene

World Economic Forum has had water

being the cornerstone of the containment

security through the notion of ‘water

strategy – access to safe water,

crisis’ as one of the top five risks to the

hygienic sanitation services and reliable

global economy for nine years in a row.

wastewater treatment become paramount.

We add to this the fact that we are

It emphasises once again the modern

experiencing an unprecedented global

day paradox. Never before have we had

pandemic. This Nouvelle Corona

access to so much scientific knowledge.

Virus, SARS-CoV-2, or COVID 19,

The water science community of practice

has rapidly overwhelmed the global

has been hard at work consistently

agenda. And water has taken centre-

increasing the rate of scientific publications

stage in the containment of infections

in this domain at a rate of thirty percent a

strategy all over the world as we try

year for the past twenty years.

to flatten the infections curve. All the protocols indicate that regular washing

We have the scientific know-how

and personal hygiene is a key line of

to engage the principle challenges

defence against the spread of the virus.

throughout the water and sanitation

And as a consequence, handwashing

value chains. And yet the primary

campaigns have become the highest

obstacle continues to be the fact that

priority in national interventions. This

the water sector is suffering from

crisis has put a magnifying glass on

pathological conservatism. This sector

the issues of water security and safe

continuously tries to solve 21 st century

sanitation access.

problems with 20 th century technologies and 19 th century operating rules.

All of the scorecards associated with the Sustainable Development Goal for water

Add to this COVID-19 with the

and sanitation indicate that progress

important risks associated with this

is not as rapid as we had hoped. And

pandemic, and exacerbated by a

once again, world-wide, but mainly in

sluggish global and local economy, is

the Global South, we are still well off

the almost inevitable decreasing of the

target. Even countries with enviable

momentum in the achieving of many

access track records like South Africa

development targets including the

Sustainable Development Goals. There is a high probability that the SDG6 targets for water and sanitation, will have to be beyond 2030. This together with the concomitant slowing down of the other SDGs means a delaying of the global development agenda to at least ensure the end of global hunger and universal access to the basic services that South Africa deems basic human rights. But, with brave choices and a courageous strategy we have the opportunity to do exactly the opposite. We can, in fact, accelerate our efforts toward the SDGs in the medium term, and be firmly on the pathway to sustainable development and a lower carbon economy in the long term. The catalyst will be the mainstreaming of revolutionary and innovative water and sanitation management. The technology toolbox is deep and promising. We have better water augmentation options with smarter water harvesting systems that are integrated for economies of scale. Advances in materials technology ensure tank linings that are safer and better oriented to deal with water storage quality risks. Advanced manufacturing means that new tanks make for better building fit both functionally and aesthetically. The 4IR suite of tools mean that water management can finally enter the 21st century. A combination of remote sensing, earth observation and digitalisation means better and more accurate detection of groundwater. The remote sensing suite combined with the Internet of Things and big data management will organise for pragmatic

E NVIRONMENTAL

WATE R SU STA IN A BIL IT Y

and empowering real time management

But we are in the midst of a global

of the water system. From monitoring

emergency. This is the moment when all

of crop water use to the digital management of wastewater treatment plants to leaks detection and repair. From the monitoring of the integrity of pipes to ensure on time maintenance to prevent major breaks and downtime, to intelligent pressure management. Smart meters and intelligent billing will also enable demand management in the hands of the consumer for better

“Clean water and safe sanitation and wastewater treatment are core to the containment strategy... This is therefore the right time to engage in catalytic actions to leap-frog the current situation toward achieving universal access to safe water and sanitation.”

efficiencies and higher water security.

around the world countries are investing in strategies to deal with unsafe water and poor sanitation, the key COVID risk factors. Clean water and safe sanitation and wastewater treatment are core to the containment strategy. This is enjoying political attention in the public sector and huge focus in the private sector as we brace ourselves to deal with this crisis. This is therefore the right time to engage in catalytic actions to leap-frog the current situation toward achieving

The Brown revolution and the Sanitation

universal access to safe water and

Transformation Initiative or SaniTITM is

sanitation with concomitant, smarter, eco-

our best option to achieve and sustain

friendly waste and wastewater treatment.

the SDG6 goal of universal access

This should be complemented by the

to safe and dignified sanitation.

industrialisation of the beneficiation

Innovative toilet systems that are

of waste and wastewater to produce

either dry or low flush catalysed by

fertilizers, energy, high value

the Bill and Melinda Gates Reinvent

chemicals, lipids and proteins. These

the Toilet Programme, and the smart

actions will prove transformative

research and innovation investments

- economically, socially and

by the Water Research Commission,

environmentally.

will eventually become the mainstream toilet solution for all. The real innovation

There are some critical success factors.

that will accelerate the both rollout of

Firstly, we have to heighten our efforts to

sanitation to all, as well industrialise the

translate the vast repository of scientific

sector, lies at the back end. Non-sewered sanitation is a technology platform whose time has come. It immediately deals with water and energy limitations as a conventional high cost water borne sewerage system will no longer be required in favour of local decentralised waste treatment. And the attractive prospect of beneficiation of the waste into high value products that will seed businesses and industrial platforms. The foundation for the achievement of sustainability lies in the adoption of the Water Sensitive Design approach in planning new settlements from rural towns to large cities. Core to the ideology is the water self-sufficiency. Implementation of the full suite of water

and technological knowledge in this harvesting, water demand management and recycling measures means that the urban environment draws less water out of the catchment. Through the installation of local wastewater treatment works and artificially wetlands, the quality of water leaving the town should be as good or even better to what was abstracted in the first place. The possibility is high for both higher levels of water security with respect to both quantity and quality. If we add to the mix renewable energy dominance and general waste recycling the ecological footprints of towns and cities will be dramatically reduced with big pluses for the environment and the sustainable development agenda.

domain to tangible products and services for immediate use on the ground. There will have to be substantive support to product and business development and an overhaul of our archaic regulatory rules and operating procedures. Secondly, we need new economic models to effect large scale implementation and sustainable operations and maintenance. Thirdly, we need to bolster our partnerships between science and society, governments and business, local and international. Using these intervention the transformation of water and sanitation could catalyse our development trajectory into one of sustainable development. Now is the right moment to invest in this change.

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E NVIRONMENTAL

SUSTAINABLE MINING GIVING BACK TO PEOPLE AND PLANET The Mineral and Petroleum Resources Development Act No 28 of 2002 (MPRDA) which came into force in May 2004 provides the regulatory framework for South Africa‘s mining and minerals industry. What are some of the most pressing sustainability challenges faced by the mining sector? How is the industry giving back to people and the planet?

Mining companies are adopting new, more sustainable approaches. South Africa is no exception, with several mines taking worldleading approaches to environmental and community sustainability. Adopting these practices will not only benefit the environment and local communities, but also would also contribute to mining’s long-term viability.

D IG G IN G D EEP - S U S TAI N AB L E MI N I N G G I VI N G B AC K T O P EO P L E AND PLANE T

Commitment to address challenges of access to quality and affordable healthcare for miners and the surrounding communities is a healthy and sustainable step to take for a sustainable mining practice. ZERO HARM: ELIMINATING MINING INJURIES

Exxaro has committed to the principle of zero harm, with the goal that every worker should return home unharmed every day. Zero Harm remains the key safety objective, aiming to consistently achieve this through collective responsibility, commitment and ongoing focus. On 3 March 2020 this year Exxaro celebrated a three-year fatality-free milestone. “The safety and well-being of our people continues to be a key focus area for us. We, therefore, commit ourselves to providing the best in healthcare services to ensure that our employees MINING FOR GOOD HEALTH

employee assistance programme, the

Exxaro coal mine situated in Mpumalanga

treatment plans to strengthen the prevention

- A CASE STUDY

has protocols in place for the future of their workers and the communities they come from. Exxaro has ongoing initiatives to combat TB and HIV/AIDS prevention and treatment thus ensuring that workers remain in good health. Their current health offerings include HIV/AIDS awareness training and testing, X-rays, hearing and lung function tests as well as DNA analysis and health coaching. Importantly, these services are in line with the United Nations #Envision2030 Goal of Good Health and Well-being aimed at ending the epidemics of AIDS, tuberculosis, malaria and other communicable diseases by 2030. Mental health and substance abuse also form part of these services where they offer general counselling to address depression, addiction and anxiety. As part of this

practice provides advice, counselling and and treatment of these diseases. The overall approach to health and wellbeing is based on three pillars namely: Diagnose, Manage and Prevent. During diagnosis the focus is on extending clinical tests including ECG and riskbased cancer screenings. The ultimate vision is to have 100% of Exxaro employees receive analysis, which will make it easy to recommend disease management programmes based on the valuable data retrieved from the DNA testing in order for the employees to manage their

are well taken care of and able to perform to the best of their abilities.” - Mxolisi Mgojo, President of the Minerals Council South Africa Mining practices have a huge responsibility to safeguard the environment they are working in and the people working for them. Keeping a safety system aligned with its purpose and ensuring the system respond appropriately to change requires conscious effort. Risk management processes are fundamental to the Mine Safety Act. The underlying propositions of risk management is that improvements in health and safety can be made by

health against certain conditions.

correctly identifying and addressing

To prevent diseases from developing or

risk. The main components of risk

worsening, mandatory comprehensive wellness and healthy lifestyle coaching programmes are also in place. Vaccines, supplements and prophylaxes are also distributed to ensure health and well-being.

hazards that contribute to occupational management are hazard identification, risk assessment, implementation of controls, monitoring of controls, review, and adjustment or redesign of controls as necessary. 29

E NVIRONMENTAL

D IG G IN G D E E P - SU STAI N AB L E MI N I N G G I VI N G B AC K T O P EO P LE AN D P LAN ET

ENVIRONMENT The mining industry competes with other sectors for precious natural resources like land and water. In South Africa, the situation is exacerbated by a legacy of more than 100 years of mining, which has led to various environmental challenges like acid mine drainage and dust from dumps. Environmental impacts of mining occur at local, regional, and global scales through direct and indirect mining practices. Impacts may result in erosion, sinkholes, loss of biodiversity, or the contamination of soil, groundwater, and surface water by the chemicals emitted from mining processes. Exxaro has invested in a wind farm situated in Eastern Cape which supplies approximately 450 559MWh of electricity a year to Eskom’s electricity network and is expected to offset approximately 445 152 tons of carbon dioxide (CO 2) a year from the atmosphere and over the past five years the mine reduced its greenhouse gas (GMG) emissions by 17% per copper equivalent unit. Mining companies have six main emission reduction levers at their disposal and should try to work several simultaneously. For example, European steel players are investigating processes to avoid, reduce, and reuse CO2 emissions. They “avoid” through innovative replacement of carbon with hydrogen from water electrolysis. They “reduce” by adopting more CO2 efficient technologies. And they “reuse” by utilising process gases for chemical products, such as bioethanol, fertilizer, synthetic fuel and polymers. While many mining companies have programmes aimed at reducing greenhouse gas emissions and fossil-fuel burning several have taken additional steps and focused on process innovation - including the extraction of lithium with less energy-intensive and contaminating processes for lithium mines. 30

Exxaro is also committed to using water as efficiently as possible. Their Grootegeluk Mine has constructed cyclic ponds that reclaim all water and material from the mine’s fines complex and Matla coal mine uses desalination technology to convert water from its underground mine into drinking water. In doing so, Matla has released over 3 million kilolitres of safe water into the Olifants catchment. Mining practices should never have to do it alone. The right partners can bring valuable expertise and capital to develop and accelerate new technologies, which in turn can help the company respond faster

Mining Charter III has been amended to introduce the requirements for locally manufactured mining goods, with a view to leverage procurement capacity of domestic mining to create a market of locally manufactured goods.” - Xolile Mbonambi, Department of Mineral Resources representative at the launch of Mining Charter III

to market changes.

DIGGING DEEP

Mining charter III targets

deep transformation. The use of hybrid

One of the targets of Mining Charter III is its support for supplier development in South Africa, which aims to grow and transform the local mining supply chain. The Mining Charter stipulates that a minimum of 70% (by value) of mining goods must be manufactured or assembled in South Africa – this requires that at least 60% local content be used during manufacture

It is clear that mining is a sector undergoing power solutions at mines is set to increase, while investment will continue to be driven by innovation in green technology. Mining companies are in the unique position of needing to find their own solutions to green energy whilst being a key component in the supply chain for new low-carbon technology. Finding nimble solutions, such as hybrids or micro grids, provides companies with the agility needed

or assembly.

to respond to the quickly-evolving energy

The Mining Charter further states that

is playing an important role in the transition

goods must be procured in line with a

landscape. It is worth noting that the sector to a lower-carbon economy.

standardised product identification coding system developed by the Department of Trade and Industry.

Sources

Exxaro; Modern Mining

E NVIRONMENTAL

TRAVELING THE

GREEN ROAD

ROADMAP

policies to curb such emissions. Currently

As the world continues to urbanise

With global energy demands on the

the world is in the process of greening

rapidly, the importance of developing

increase, coupled with the depletion of

the transport sector and South Africa is

sustainable and smart cities is becoming

our natural resources and the negative

participating in these initiatives.

increasingly important. Nevertheless, this

impact of fossil based energy sources

accelerated urbanisation will continue

on the environment, the issues of clean,

“The Department of Trade and Industry

to exert pressure on resources like

sustainable energy have become a reality.

(the dti) is collaborating with the United

energy and water, as well as on the

Nations Industry Development Organization

environment’s carrying capacity to

Energy innovation and the efficient use

(UNIDO) to facilitate and promote the

absorb waste and emissions.

of energy are two key components of

introduction of Electric Vehicles (EVs)

mitigating these challenges. This article

through the South African Low-Carbon

Mobility is a key issue in cities.

serves as a catalyst for sustainable

Transport Project. This project will culminate

Sustainable transport is vital for

transport systems in supporting sustainable

among others in the erection of EV charging

maintaining good air quality, reducing

development that benefits our needs.

infrastructure and awareness raising

energy-use and greenhouse gas

campaigns targeting this technology.

emissions, and enabling inhabitants to

In the wake of global efforts to curb the

commute efficiently and according to

emission of climate change impacting

“However, this is not the first instance of

their needs. Having adequate transport

greenhouse gases and the emission of

electrifying transportation modes in South

infrastructure, together with inclusive

exhaust gases that are detrimental to

Africa, the Class 1 E electric locomotives

and sustainable industrialisation, is

human health, these are important times

was introduced to the market as early as

a precursor to economic development,

for South Africa to continue demonstrating

mid-1920s. Continued improvement in the

job creation and prosperity for all.

to the world its capabilities.

rail infrastructure led to the recent addition of high-speed locomotives like the Gautrain,

UNIDO supports countries in jointly

the local manufacturing of a prototype

addressing their urban and industrial

as the second

electric car – the joule and gas-driven Bus

development challenges through its work

largest contributor

rapid Transit Systems that South Africans

in fostering sustainable cities. UNIDO’s

to Greenhouse Gas

are so proud of today.” - EVIA Foreword,

interventions focus on promoting higher

Transport is identified

(GHG) emissions

Lionel October, DG, dti

efficiency, low-carbon

both domestically and

production throughout

globally and hence cannot

the vehicle

be ignored when developing

T R AVEL I N G THE GR E E N R OAD

manufacturing supply chain, fostering enabling policy frameworks, building

E ELECTRIC VEHICLE JOURNEY IN SOUTH AFRICA

growing concern from politicians about carbon pollution have helped the drive

and strengthening local capacities

The first oil crises during 1970s sparked

and enhancing knowledge transfer

the first interest in electric vehicles (EVs)

and innovation.

and alternatives to petroleum fuels. This

One of the early problems which the

was evidently an energy issue presented

EV consumers were still faced with was

to the country and the then Department

where to charge their vehicles on the go?

The focus on urban transport and clean

of Mineral and Energy Affairs (DMEA).

Many countries around the world have

mobility is pertinent in Africa. Its urban

The department, together with the CSIR,

involved their governments in helping to

share is likely to be more than double by

researched and demonstrated the use of

build public charging infrastructure.

2030 (African Development Bank, 2017).

EVs as an alternative to imported oil.

URBAN TRANSPORT

Africa is urbanising faster than any

of EVs globally.

Smart charging would make EVs an

other region in the world and is

More than 150 research papers resulted

asset to the grid. Development of IT

undergoing a mobility revolution.

from the research and produced a few

infrastructure to support a range of

vehicles converted to electric propulsion.

smart grid applications would ensure

The transport sector, made up of

Although quiet, easy to drive and with

reliable service to homes and other

passenger and commercial/industrial

no smelly pollutant, these were very

charging locations. While we introduce

transport, dominates urban energy

slow and had a low range. What came

electric propulsion technologies,

consumption, accounting for 60–70%

out as highlight of the programme was

renewables used as alternative energy

of total energy consumption in metros.

the development of the ZEBRA (Zero

generation would make sense to

South African cities are some of the least

Emission Battery Research Activity) and

achieve charging efficiencies.

dense cities in the world, giving rise to

the Lithium ion battery technologies. The

a heavy reliance on transport fuels to

focus for this programme was on local

Both residential, as well as fast and

ensure the mobility of people and freight.

development and commercialisation of

inexpensive public charging stations

Local combustion of transport fuels

these technologies, but as the oil crises

need charging infrastructure.

directly affects the levels of local

faded so did the focus on EVs.

air pollution of the city.

Most EV charging take place at home Yet again from 1988 - 2002 high oil prices

overnight, but early on, accessible

Electric vehicle (EV) is not a new

triggered the interest in alternatives to

public charging facilities are critically

invention. Electric motors have been

petrol and diesel. This time it was the

important in order to increase

in use as far back as the late 1800s.

National Energy Council (NEC), created by

consumer confidence. There is nothing

During these times, the internal

the DMEA, which initiated various projects

complicated about smart charging

combustion engine (ICE) vehicles used

to investigate potential solutions. Ethanol,

or feeding renewable energy into

benzene for fuel. There were no fuel

methanol and EVs were some of the

electricity grids. What is challenging

stations, but a visit to the local pharmacy

alternatives considered. When the NEC

though is the clustering of EVs

got you a refill for the car. In order to start

closed in 1992, Eskom continued flying

when charging – will they be evenly

this car, you needed to crank the engine

the flag by adopting the EV programme.

distributed or concentrated in specific

by hand. Only after the electric starter motor was developed and refueling for longer distances for the ICE car became possible, did electric cars lose

THE FUTURE LOOKS ELECTRIC FOR SOUTH AFRICA

areas – and also what will be the basic mode and power of charging?

With all the ongoing starts and stops

Across the world, the history of electric

their appeal. At that time, the

of the electric vehicle (EV) industry,

mobility has been a demonstration

negative impacts of the petrol

the true revival of the EV did not

of persistence of creativity from

car were unknown and not

happen until around the start of the

generation to generation on the

yet perceived as a problem.

21st century. Rising petrol prices and

adaptation of transportation.

E NVIRONMENTAL

BUILDING OUR FUTURE

ENVIRONMENTALLY FRIENDLY CONSTRUCTION IN SOUTH AFRICA By Maxine Volker

In the last decade, South Africa’s construction industry has taken substantial steps towards going green. November 2011 saw new energy-efficient building regulations come into place, boosting a growing trend of cutting-edge green architecture throughout the country. The implementation of these regulations included a strict set of rules which construction companies had to follow. New buildings are now required to use solar water heaters, heat pumps or similar technologies. It is also now compulsory for walls, ceilings and windows to meet the minimum requirements in insulation in order to minimise heating in winter and cooling in summer. These are just a few of the parameters which have been set out in recent years. They are laid out in the South African Bureau of Standards and are enforceable in terms of the National Building Regulations and Building Standards Act. The regulations apply to all future energy-consuming structures, both residential and commercial. Local authorities are now responsible for the administration of the regulations as well as on-site inspections.

Currently, South Africa is one of the global

with World Bank Group member, the

leaders in green building, implementing a

International Finance Corporation (IFC).

number of sustainable practices, methods,

The primary aim of EDGE is to facilitate

materials and technologies.

a transformation of the property sector in rapidly urbanising countries through

If we look at environmentally friendly

influencing design considerations. To

construction as a pyramid, sustainable

achieve the EDGE standard, minimum

practices essentially from the base of the

savings of 20% energy, water, and

structure. The way these practices are put

embodied energy in materials must be

into place set the tone for the eventual

met. EDGE has been adapted for the

outcome. The practice of green building

local South African context, especially in

in South Africa is overseen by The Green

light of the SANS 10400 Part XA energy

Building Council of South Africa (GBCSA)

efficiency building code. This code was

which was launched 2007 and works

promulgated for all new buildings in 2011.

with its membership community in an

The total number of green-construction

effort to encourage a built environment in

projects certified by the GBCSA has

which both people and planet thrive. The

increased by 121% since 2009.

GBCSA has developed Green Star SA rating tools, an initiative aimed at providing

When it comes to going green within

the property industry with an objective

the construction industry, the methods

measurement for green buildings and

and materials used are a vital element.

to recognise and reward environmental

As we move toward efficiency and

leadership in the property industry. Each

sustainability, industry experts are utilising

Green Star SA rating tool reflects a

new, innovative materials as well as a

different market sector. These include

resurgence in certain age-old materials

retail, office, multi-unit and residential.

which have naturally environmentally friendly properties. These days, the list of

September 2014 saw the launch of the

eco-friendly building materials is extensive

EDGE (Excellence in Design for Greater

and ever-growing. Environmentally

Efficiencies) rating system. EDGE

friendly or sustainable building materials

has been implemented in South Africa

refer to those that are reused or natural,

thanks to the GBCSA and its partnership

minimising environmental impact.

BU IL D IN G O U R F U T U R E – EN VI R O N MEN TAL LY F R I EN D LY C O N S T R U C T I O N I N SOUTH AFR ICA

The distinguishing factor between building

reaching and having massive impacts on

materials that are sustainable and those that

the construction industry. One process

are not, is the amount of embodied energy

which is making leaps and bounds in

the material has. The term ‘embodied

sustainable construction in South Africa

energy’ refers to the sum of all the energy

is 3-D printing. 3-D printing, or additive

required to mine, manufacture and then

manufacturing, is essentially where 3-D

transport the material. Ultimately, the lower

objects are created from a digital file. In

the level of embodied energy a material has,

the context of construction, 3-D printing

the more sustainable it is for use.

is used in a variety of ways. It may be

POPULAR SUSTAINABLE BUILDING MATERIALS

used to create construction components or even ‘print’ entire buildings. The construction industry as whole generates

Wood is one of the most popular eco friendly

a huge amount of waste and because it

building alternatives as it is able to provide

is so multidimensional, progress towards

durable and solid insulation structures.

sustainability can often be slow. When

Straw bales are utilised as a renewable

looking at eco friendly construction as a

energy source because if efforts to keep

whole, we know that supply chains in the

them dry are put in place, they can last many

industry are complex, often resulting in

years. Although an effective alternative, it

sustainable practices having little impact.

is important that when utilising this material

There are numerous companies involved in

steps are taken to prevent rodent and

a single construction project. This can make

insect infestation. Additionally, appropriate

it extremely difficult to ensure a sustainable

measures to prevent damp must also be

approach is employed throughout the entire

taken. Sandbag construction, essentially

supply chain. This is where 3-D printing

a technology in which bags are filled with

comes in. These disruptive technologies

locally sourced natural materials, lowers

have the potential to change the way that

the embodied energy that comes with the

products are not only designed, but also

manufacturing and transportation of regular

manufactured. Basically, they can change

building materials. Utilising sandbags

the structure of supply chains.

requires no cement or binder and also has the advantage of being versatile − the bags

The construction industry, which has been

can also be filled with rubble, gravel or clay.

known to impact harshly on the environment, has taken massive strides

Other eco friendly building materials

towards being environmentally friendly in

being used in South Africa are recycled

recent years. With a growing worldwide

steel, mycelium, thatch and bamboo.

emphasis on the need for climate-change

‘Hempcrete’, which combines hemp fibre,

mitigation, South Africa has become one

water and lime which are then moulded

of the global leaders in green building. As

into lightweight blocks, has seen massive

built-environment professionals become

popularity worldwide as it a renewable

more inventive and resourceful, eco friendly

building material that can be grown and

technologies and methods only seem to be

replenished quickly. Hempcrete has not yet

evolving. However, having a lower carbon

been legalised in South Africa, but efforts

footprint requires more than simply following

to commercialise it are being explored and

a set of procedures. It requires an innovative

proposals being put forward to government.

approach and open-mindedness. We need to look towards the future we wish to build

Green building technologies have seen a

for generations to come, and then implement

surge in popularity in recent years. These

the strategies needed to sustain it.

technologies, which make buildings more sustainable and energy-efficient, are far-

Comment from construction companies

Despite the dynamics of challenges experienced while

operating under the far reaching impact of the COVID-19 pandemic, the National Energy Regulator of South Africa (NERSA) is able to continue with its operations to ensure the orderly development of the energy sector, mainly

Jacob Modise, through licensing, setting and approving ofJacob pricesModise, and tariffs, Chairperson Chairperson compliance monitoring and enforcement, and dispute resolution

Maleho Nkomo, Jacob Modise, Deputy Chairperson Chairperson

in the electricity, piped-gas and petroleum pipelines industries. rnergy of South Regulator Africa (NERSA) of The South National Africa Energy (NERSA) Regulator of South Africa (NERSA) ble to the contribution socio-economic tomakes the socio-economic a valuable contribution to the socio-economic the realisation thatprosperity this pandemic be prevalent and f theprosperity peopleWith ofof South the development people Africa, of South and Africa, of thewill people of South Africa, try he energy in accordance industry by with in regulating accordance the with energy industry in accordance with for the foreseeable future, NERSA endeavours to be more ndards ws, policies, and international standards government and international laws, policies, that standards and international innovative agile in ensuring we continue to make a in tainable support development. ofvaluable sustainable bestcontribution practices development. in to support of sustainable development development.and the socio-economic

prosperity of the people of South Africa, by regulating the gulatory y established authority as a established NERSA juristic is ain regulatory asaccordance a juristicauthority establishedlaws, as a juristic energy industry with government policies, sthe of Section Nationalstandards 3Energy of the person National Regulator ininternational terms Energy of Section Regulator of the National Energy and best3practices in support of Regulator .No. NERSA’s 40 of 2004). mandate NERSA’s Act, is to 2004 mandate (Act No.is40 toof 2004). NERSA’s mandate is to sustainable development. gas ectricity, and petroleum piped-gas regulate pipelines and petroleum the electricity, pipelines piped-gas and petroleum pipelines ricity rms of Regulation the Electricity Act, industries 2006 Regulation in terms Act, of 2006 the Electricity Regulation Act, 2006 NERSA is a regulatory authority established as a juristic 001 006),(Act GasNo. Act,48 2001 of(Act 2001) (Act No.No. 4 of 482006), of 2001) Gas Act, 2001 (Act No. 48 of 2001) person in terms of Section 3 of the National Energy m003 Pipelines (Act No. Act,60 2003 ofand 2003). (Act Petroleum No. 60 of Pipelines 2003). Act, 2003 (Act No. 60 of 2003). Regulator Act, 2004 (Act No. 40 of 2004). NERSA’s mandate is

Nhlanhla Gumede, Full-Time

Nomfundo Maseti, Full-Time

Regulator Member: Electricity

Regulator Member: Piped-Gas

Muzi Mkhize, Full-Time

Smunda Mokoena, Part-Time

to regulate the electricity, piped-gas and petroleum pipelines date rivedisfrom further written derived NERSA’s government from mandate written government is further derived from written government industries in terms of the Electricity Regulation Act, 2006 lssued as regulations by the Minister issued policies of by the as well Minister as regulations of issued by the Minister of (Act No. 4 of 2006), Gas Act, 2001 (Act No. 48 of 2001) rces . NERSA and Energy. is expected NERSA Mineral to isResources expectedand to Energy. NERSA is expected to and Petroleum Pipelines Act, 2003 (Act No. 60 of 2003). ecessary ory actions regulatory in anticipation perform actionsthe in anticipation necessary regulatory actions in anticipation sponse anging to circumstances the changing of and/or incircumstances in responseinto the changing circumstances in NERSA’s is further derived from written government ustry. the mandate energy industry. policies and regulations issued by the Minister of Mineral

Resources and Energy. NERSA is expected perform the fces Mineral and Energy Resources appoints The and Minister Energy ofappoints Mineral Resources andto Energy appoints necessary regulatory actions anticipation of and/or in ator, e Energy comprising Regulator, Part-Time Members comprising of the Part-Time Energy in Regulator, comprising Part-Time response to the Regulator changing in the energy industry. e) (Executive) and Full-Time Regulator (Executive) (Non-Executive) and circumstances Full-Time (Executive) Regulator

Executive uding the Chief Officer Executive (CEO). Members, Officer including (CEO). the Chief Executive Officer (CEO).

gulator rted by is staff supported under The the by Energy staff under Regulator the is supported by staff under the The Minister of Mineral Resources and Energy appoints e CEO. direction ofEnergy the CEO. Members of the Regulator, comprising Part-Time

NERSA_ZA ZA

Regulator Member:

Petroleum Pipelines

Regulator Member

(Non-Executive) and Full-Time (Executive) Regulator Members, including the Chief Executive Officer (CEO). The Energy

Regulator is supported by staff under the direction of the CEO.

@NERSA_ZA @NERSAZA @NERSAZA

@NERSA_ZA @NERSA_ZA

se, Street, 526Arcadia, Madiba Kulawula 0083 Street, Kulawula House, Arcadia, House, 526 0083 Madiba 526 Madiba Street,Street, Arcadia, Arcadia, 0083 0083 , Arcadia, 0007 PO Box PO40343, Box 40343, Arcadia, Arcadia, 0007 0007 600 01 4700 | Fax: 012 Tel:401 012 Tel: 4700 401 0124600 401 4600 | Fax: |012 Fax:401 0124700 401 4700 ersa.org.za Email:Email: info@nersa.org.za info@nersa.org.za .nersa.org.za Website: Website: www.nersa.org.za www.nersa.org.za

Zandile Mpungose, Part-Time Regulator Member

Fungai Sibanda, Part-Time Regulator Member

POLLUTION PLASTIC

E NVIRONMENTAL

WHAT ARE THE SOLUTIONS? By Yasmine Miemiec

P O L L U T I O N , P L AS T I C - WH AT AR E T HE SOLUTIONS?

According to the 2018 South African State

corporates, we know very little about the

are minimal compared to the industrial

of Waste Report, in 2017 South Africans

benefits of upcycling.

processes use for recycling.

generated 42 million tons of general waste,

Upcycling: better quality and higher environmental value

It comes down to upcycling - the

This means that over 37 million tons of waste was sent to landfill to rot and pollute

Upcycling is the process of transforming

Not every waste stream can be upcycled

the atmosphere. With waste and refuse

waste materials or unwanted products

but where material can be transformed

increasing exponentially every year,

into different, new products of higher

there is also a creative benefit for

households and business organisations can

environmental value. When one upcycles,

companies. We have seen offices where

no longer turn a blind eye.

they are not breaking down the materials

all the office décor and furniture is made

of which 4.9 million tons were recycled.

creative benefit

of waste products as with recycling where

from materials which have been upcycled,

Already there are reports that

plastic, for example, is melted down

and this conveys the repurposing message

Johannesburg’s landfills will reach capacity

to create more plastic. With upcycling

to the staff in a subliminal way as well as

within the next six years. In order to combat

the item is refashioned, using the same

sparking their creative juices.

this ever-growing problem of waste, many

materials. A good example here, is using

organisations think that recycling is the best

old tyres to make products like bags,

way to tackle this issue. Conversely, there

dog beds and shoes. The material is

are also other options such as upcycling

still the rubber from the tyres, just used

that can aid in the fight against waste and pollution and companies should bear in mind that both upcycling and recycling have

in new ways. So, what’s the difference really? Both

So, where does recycling and upcycling

fit in with corporate waste management? When a company produces enormous quantities of waste material like wood from construction sites, it may not be feasible to

a place in corporate waste management.

save the planet, right?

However, upcycling and recycling use

In a nutshell, the difference between the

may choose to recycle the bigger volumes

distinctly different processes that feature

two is that recycling involves a shredding,

of waste and upcycle the smaller volumes.

their own benefits, depending on the

melting and/or compressing process,

The benefit of this approach is that both

quantity and type of waste being handled.

usually to recreate the same products as

ends of the value chain are being supported.

the original products. Upcycling involves

The recycling companies are employed but

taking unwanted or used items and

the company also contributes to income

repurposing them to create different items.

generation and job creation through

We all know about recycling – but where does the waste come from?

The biggest waste stream in South Africa is

upcycle all of it. In this case the company

upcycling. Upcycling, however, as a practice

general waste. which is made up of organic

Both processes have an important role

is not as widely used by corporates. South

waste such as food, gardening or animal

to play in the management of waste.

African companies should be consulting with

waste. In addition, we have construction

Recycling is vital because of the volumes

companies to try and see what waste they

waste such as building rubble, sand or

of material that can be processed and

are producing and understand where they

wood and then other waste such

converted. Billions of tin cans are discarded

can make a difference.

as paper, glass, metal, plastic and

each year but this amount of material

electronic materials.

cannot be upcycled into products that people will need. However, the problem with

There are different ways to assist with

recycling lies in the fact that it has a high

decreasing this waste. One of these

energy cost compared to upcycling due to

options is recycling where waste material

the processes involved.

is converted into the raw material for the manufacture of new melted down and used

Upcycling, on the other hand has a

to create new cans. The key differentiator

human element because people

of recycling is the fact that used products

are employed in the transformation

are put through a process to create the

of the products. The energy inputs

new version of the same product. However,

for upcycling are also lower than for

even though most people are familiar

recycling. For example, there is electricity

with recycling, along with the public and

used for sewing or woodwork, but these

E NVIRONMENTAL

SOLUTIONS TO THE PLASTIC SCOURGE

and create jobs at the same time via upcycling. By throwing their support behind

Plastic production over the last half-

projects which seek to remove plastic

century has mushroomed, from 15 million

from the environment and by working with

tonnes in the 1960s to a gobsmacking 311

communities, these organisations can

million tonnes in 2014. It is estimated that

find ground-breaking and original ways

13 000 pieces of plastic litter can be found

to generate incomes from the items that

in every square kilometre of the ocean.

would be normally be thrown in the trash.

South Africans are culprits too and use between 136kg and 139kg of plastic per

An inspiring example of this is the

person per year, 47% of which is recycled.

upcycling of millions of disposable coffee

Given that corporate entities are the

cups that are used in corporate South

largest consumers and disposers of items

Africa. A company has found a simple

such as plastic cups on a daily basis, the

solution that has led to the training

fight to save the environment should start

and employment of many people while

with them. So, what can South African

upcycling their used coffee cups into eco

companies do to assist? The answer may

friendly products in the form of veggie

lie in upcycling.

seed bombs. This process involves

SOUTH AFRICA’S PART IN THE WAR AGAINST PLASTIC

separating the outside paper from the inside plastic of the cup. The paper is then used to make a mould for the veggie seed

South African companies need to look at

bombs. The seeds are put into compost

reducing the amount of plastic packaging

and fertiliser, covered with the mould and

that all consumables are sold in. Where

sold back to corporates and the public to

it is necessary to use plastic packaging,

plant in their veggie gardens. Workers are

recycled plastic can be used in the making

now able to receive the used coffee cups

of the packaging. The highlights the shift

from the company, manufacture the seed

towards ‘reduce and re-use’. However,

bombs and sell them as a different product,

upcycling also plays a major role in the

thereby creating their own income.

fight against plastic. Globally, there is a mass of innovation taking place in the

CORPORATE SOUTH AFRICA SHOULD

repurposing of plastic items. Examples

CONTRIBUTE

of the creative repurposing of plastic

Companies must realise they are not

are floating islands which are helping to

working in a vacuum. Their activities

combat habitat loss and are the basis of

such as the contribution to upcycling

aquaculture farms.

and recycling not only contributes to the

UPCYCLING A TWOFOLD SOLUTION

activities of other companies involved in upcycling but are part of an important

Although there is a global shift, the uptake

chain to keep plastic out of landfills.

of upcycling locally, has been slow.

Obviously not all plastic can be upcycled.

However, in South Africa upcycling can

However, if a company does have waste

also help combat our huge unemployment

material, such as wood or Styrofoam,

problem. Companies can therefore

there may be a product which can be

contribute to the transformation of the

created which in turn will create jobs. It is

plastic that is already in the environment

a win-win situation.

Every year about 8 million metric tons of plastic is dumped into our oceans. That’s as much as a truckload of plastic waste every minute

Everything from plastic bottles and bags to microbeads end up in our oceans. This creates a swamp of large and small plastic pieces that is mistaken for food by marine animals Plastic waste chokes and entangles turtles and seabirds. Tiny pieces of plastic are clogging the stomachs of marine creatures and fish. Scientists have found that we are already eating seafood that is contaminated with plastic. We can help put an end to plastic pollution by choosing not to use single use plastic items, such as plastic bags and straws. Single use plastic items are one of the biggest contributors to ocean pollution.

P O L L U T I O N , P L AS T I C - WH AT AR E T HE SOLUTIONS?

PLASTICS BY THE NUMBERS

14% of all litter comes Annually

from beverage containers

approximately

(plastic bottles).

500 billion plastic bags

SOME KEY FACTS Half of all plastics ever

manufactured have been made

are used worldwide.

in the last 15

More than 1 million bags are

YEARS

used every minute. Production increased exponentially,

Packaging accounts for just over 40% of total plastic usage.

from 2.3 million tons in 1950 to 448 million tons by 2015. Production is expected to

DOUBLE BY 2050 Every year, about

Plastic takes 500 years to break down.

TONS

8 MILLION

of plastic waste escapes

into the oceans from coastal nations. That’s the equivalent of setting five garbage bags full of trash on every foot of coastline around the world.

Plastics often contain additives making them stronger, more flexible, and A plastic bag has an average “working life” of 15 minutes.

durable. But many of these additives can extend the life of products if they become litter, with some estimates ranging to at least

400 YEARS to break down. Source: National geographic

Sources: (www.westerncape.gov.za ) That is 0.0000057% of 500 years

https://plasticoceans.org/the-facts/

E NVIRONMENTAL

POWERING AHEAD

GREEN AND CLEAN By Fiona Wakelin

The Renewable Energy Independent Power Producer Programme

renewable energy and in 2010, after

on non-renewable coal-based Eskom-

Energy Independent Power

Over the last year the country’s reliance generated power nearly brought the economy to a standstill with rolling load shedding taking place day and night. Many people downloaded the app Eskom se Push, not only for the alerts it provided but because the name of the app represented the general public outrage at being held hostage to a nonrenewable energy source provided by

the necessary legislation had been passed, the Department of Energy launched the Renewable Producer Programme (REIPPP) to enhance South Africa’s powergeneration capacity. This programme encourages independent power producers (IPPs) to generate power

ailing infrastructure.

using renewable

Eleven years ago, in 2009, we

the Government

started investigating how to increase and sustain private investment in

techniques which then buys for Eskom.

P OWE R ING AHE AD

RENEWABLE ENERGY SOURCES INCLUDE:

SOLAR

ONSHORE WIND

photo voltaic cells

The REIPPP was also structured

HYDRO

What is an independent power

to contribute to broader national

producer?

development objectives:

An IPP is a company established

• Job creation

by a range of shareholders to bid

• Social upliftment • Broadening economic ownership “South Africa’s renewable energy

from procurement and construction, government policy places specific requirements on independent power producers (IPPs) to foster community

projects, an average of 2 000 people were employed on the sites

• Black industrialists

the local communities where the projects are located • Foreign shareholders An example of IPPs Globeleq South Africa Management Services, operates and majority owns

ownership in the form of shareholding

three IPPs:

in RE projects, local employment, as

• De Aar Solar Power

well as annual monetary contributions to stimulate local development” - Cobenefits Study 2019.

138 000 South African homes.

shareholders typically could include:

• Community Trusts representing

benefits for communities, deriving

clean renewable energy to power over

During construction of the three

emphasis on stimulating socio-economic

projects. In addition to potential indirect

Together these three generate enough

of an independent power plant. The

• Other South African shareholders

in the vicinity of renewable energy (RE)

LANDFILL GAS

for the construction and operation

procurement policy is unique in its benefits at the local level for communities

BIOMASS

• Droogfontein Solar Power • Jeffreys Bay Wind Farm

from local communities and 1.5% of project revenues were invested in socioeconomic and enterprise development programmes and skills development to ensure the sustainability of the renewable energy industry. How successful has the Programme been to date?

The Department of Mineral Resources and Energy’s Integrated Resource Plan (IRP) 2019 reported that a total 6 422 MW under the Renewable Energy Independent Power Producers Programme had been procured, with 3 876 MW operational and made available to the grid.

E NVIRONMENTAL

PO W E RIN G A H E A D

Electric vehicles The global shift towards electric mobility has been a result of three major shifts – the volatility of the oil price, the COP agreements regarding carbon emission reduction commitments and overall pollution concerns. And while South Africa does not yet have the policy framework in place for the industry to grow, if battery prices continue to fall the price of electric vehicles (EVs) will become competitive in the country. This will be a natural progression for the automotive sector which is a key contributor to the GDP. “For South Africa, a thriving EV market supported by the robust local manufacturing capacity, holds the promise of economic growth and job creation in South Africa. It will also counteract the inevitable decline

The EV market brings with it a number of possible opportunities: •

Lithium iron batteries

engine (ICE) vehicles globally,”

•

Passenger vehicles

says Khanyiselo Kumalo, Energy

•

Electric busses

in demand for internal combustion

Analyst at GreenCape. “The 2019

Electric Vehicles MIR highlights

“ For SA, a thriving EV market supported

notable investment opportunities

by local manufacturing holds the

that are emerging in passenger

promise of economic growth and job

vehicle manufacturing, electric bus

creation. It will also counteract the

manufacturing and Lithium ion battery

inevitable decline in demand for ICE

(LIB) production,” she added.

vehicles globally.” - Green Cape

We are committed to helping our customers exceed their environmental compliance goals through continual research and identifying areas of improvement regarding all environmental-related waste streams. These key areas of focus include, but are not limted to, reducing waste (hazardous and nonharzardous), increasing recycling and scrap credits, and continous evaluations of optimal landfill/disposal methodologies.

GREEN CLEANING

A major benefit of “green cleaning” is that it minimises the environmental and health concerns associated with conventional cleaning practices. Traditional cleaning products are derived from non-renewable resources and that can be toxic to human health with long-term negative environmental impact. Whilst cleaning less might solve the severity of the problem, it doesn’t eliminate it and reduces the frequency of care for your facilities. Rather, the solution is the selection and use of appropriate cleaning and maintenance products. Using cleaning technologies that utilise rapidly renewable derived resources without sacrificing quality, performance or adding additional cost improves the life cycle of your facilities. TSFM is committed to the stewardship of the environment as well as the reduction of exposure of our employees, your tenants and visitors to any potentially harmful chemicals, particulates and biological contaminants.

ENERGY EFFICIENCY

We work with clients on the implementation of energy-efficient lighting systems for new and existing facilities. Our energy cost reduction analysis includes energy-efficient lighting design and upgrade; HVAC and motor control upgrades and modifications; and evaluations of alternate sources of energy.

CONTACT DETAILS:

Telephone: 031 827 0982

Email: admin@totalserve.co.za

Website: https://totalserve.co.za/

SOCIAL THE FUTURE OF SUSTAINABILITY

SECTION

SOCIAL

CLIMATE-SMART ENTREPRENEURSHIP REAPING THE POTENTIAL OF ENTREPRENEURSHIP FOR A CLIMATESMART INCLUSIVE GREEN ECONOMY IN SOUTH AFRICA

By Rest Kanju and Christine Meyer Take a moment for a thought experiment.

Droughts exacerbate electricity

Imagine South Africa in summer 2030.

shortages, disproportionately affecting

Climate change is an increasing reality.

the rural and urban poor (or other

Extreme heat is challenging South Africa’s

vulnerable population?) and widening

population; imagine the thermometer

inequalities.

hardly falls below 35°C. It is hot and dusty. Severe thunderstorms hit the country every

This scenario demonstrates that solutions

now and then; floods cause soil runoffs

to mitigate and adapt to the impacts of

and degradation. Both water quality and

climate change are desperately needed.

availability is a challenge for communities, agriculture, the tourism and manufacturing

The good news is that South

sectors, and many more. This results

Africa’s entrepreneurs have

in crop losses, water restrictions, and

already developed solutions

threatens food security and human health.

for climate change

The impacts of climate change on food

mitigation and

production, agricultural and subsistence

adaptation at the

livelihoods will be of high concern.

grassroots level.

C LI MAT E-S MART EN T R E PR E NE UR SHIP These market-based solutions effectively

and the potential for solar energy in South

challenges range from a lack of access

build the resilience of South African

Africa, innovative solutions are needed to

to adequate and appropriate financing

communities and showcase the enormous

offer access to renewable, clean energy

for their business, difficulty accessing

potential of small and medium enterprises

to communities that are currently not

markets, and regulatory and administrative

to contribute to a climate-smart, inclusive

connected to the grid.

burdens that impose additional costs on the

green South African economy.

Solar Turtle is an example of an eco-

enterprise. SMEs must also build technical and entrepreneurial skills, and take on

BN Aqua is an eco-inclusive enterprise

inclusive enterprise that is effectively

significant risks to access the human

that has developed a technological system

addressing this gap by developing small

resources needed to scale their enterprise.

for acid mine drainage treatment. The

mobile solar charging kiosks for use in

These challenges are cross-cutting, and

term “eco-inclusive enterprises” refers to

communities that do not have access

affect small and growing businesses in

enterprises with business models that are

to electricity, and specifically aiming

different ways, depending on the sector,

from the outset ecological and inclusive.

at equipping youth and women with

geography and scale of the enterprise.

Ecological action often refers to business

entrepreneurship skills. Using a franchise

activities that implement sustainable

model, the SEED 2016 Award Winner trains

production methods, contribute to efficient

youth to use the solar kiosks, replaces

use of resources and waste reduction,

the primary use of paraffin and kerosene

conserve biodiversity, or support climate

in the communities with a source of clean

change adaptation and mitigation efforts.

energy, in turn promoting health, enhancing

Inclusive action includes the creation of local

security, and providing electricity to schools.

jobs, in particular for often-marginalised

The vision of an inclusive green economy that mitigates climate change and is adapted and resilient to climate risks depends not only on SMEs, but on an ecosystem that supports them to grow.

populations like youth, women and low-

Small and medium-sized enterprises

income households and through integrating

(SMEs) like BN Aqua and Solar Turtle are

these communities into local and global

well suited to sustainably tackle future

value chains of their enterprises by engaging

challenges. They develop market-based

them as suppliers, distributors or customers.

solutions, are innovative, versatile, agile

sustainable business practices requires ecosystem players to create an enabling

Inclusivity, and or community inclusion, in

and demand-driven. More specifically, eco-

collaborative efforts by and among

BN Aqua’s product prototype uses a

inclusive enterprises have the potential to

metallurgical waste product to treat

play a significant role in achieving South

environment in which these enterprises can

acidic water to potable stage for human

African national agendas on climate change

consumption. The treated acid mine water

and the green economy, such as the 2011

is then sold to mines to save on drinking

Green Economy Accord, the National

water costs and reduces dependency on

Climate Change Bill and the National

water resources from the municipalities.

Adaptation Plan. Yet, small and growing

This innovative process will lead to

enterprises do not feature strongly – if at all

pollution remediation of the waste material

– in these agendas.

financial and policy framework conditions

increasing South Africa’s drinking water

On average, an SME in South Africa

to start and scale their solutions. The

capacity and contributing to climate change

employs two to five employees. With

adaptation. By encouraging the treatment

over 2 million such enterprises on the

of waste water at mines and reducing mine

market as of 2018, these enterprises bear

dependency on municipal water services,

an enormous potential, both in terms

BN Aqua’s solution reduces the vulnerability

of providing employment, and creating

of the sector to climate change, and builds

significant green impacts, like the reduction

resilience in surrounding communities

of greenhouse gas emission, water savings

through increased drinking water capacity.

and the reduction of waste. Small and

BN Aqua is a 2019 SEED South Africa

growing enterprises are well placed to

Climate Adaptation Award Winner.

drive growth in the green economy from

and recover saleable minerals while

within traditionally large-business sectors. Given issues accessing electricity, the

However, they face major challenges to

high reliance on coal as an energy source,

build and scale their solutions. These

thrive, and to grow a sustainable social and green economy in South Africa. Through over fifteen years of supporting eco-inclusive SMEs across the world, SEED has drawn insights on the advisory, that enable eco-inclusive enterprises recommendations shared below draw on learnings and conversations from a SEED Practitioner Labs for Policy Prototyping process in South Africa in 2019, where SEED collaborated with the Department of Environment, Forestry and Fisheries (DEFF), Trade & Industrial Policy Strategies (TIPS) and the South African Renewable Energy Business Incubator (SAREBI) to develop innovative policy solutions to strengthen the potential of eco-inclusive enterprises in South Africa’s transition to a green and inclusive economy.

SOCIAL

A CALL TO ACTION TO SUPPORT ECO-INCLUSIVE ENTERPRISES IN SOUTH AFRICA’S TRANSITION TO A GREEN AND INCLUSIVE ECONOMY RECOMMENDATION 1 Increase (accessibility of) information

private support programmes, and fill gaps

Intermediaries can leverage the

where support is needed.

expertise of working with multiple businesses and a familiarity with

on market demand

Different stages of business growth

the kinds of challenges they face

require different support needs -

when accessing markets, and share

Increased enterprise activity in

varying types and amounts of funding,

that information with policy makers.

mentors, and different markets. At an

Intermediaries can also facilitate timely

early pilot stage, businesses need

feedback from relevant enterprises

to test their product or service with a

through their networks. Furthermore,

core target market to gather feedback

intermediaries can bridge the gap

and develop a viable product. When

between the policy environment and

scaling, enterprises need to tap into

small business environment by linking

larger distribution channels, supply

the activities of small businesses to

chains (B2B), and consumer markets

the transition to a green and inclusive

(B2C). They might want to diversify

economy in South Africa.

adaptation to climate change, including exploiting opportunities that arise from adapting to new environmental conditions will result in new markets. Information on the current and expected market size and demand can support enterprises to understand their potential target market and opportunities to scale their product. The provision and dissemination of this information should be facilitated by

their offerings, segment their markets to cross-subsidise or meet a variety of

Think again about the 2030 scenario.

support entrepreneurship.

needs through extending their product

In fact, some climate change related

line. Various support programmes can

impacts have already taken place and

Access to information on market

therefore be pieced together to support

adversely affected communities. Month-

an enterprise along its path and ensure

long droughts affecting most of southern

transition between programmes.

Africa have led to serious food shortages

governments to effectively stimulate and

demand and size reduces the costs of undertaking a feasibility study in a

for millions of people. In 2019, farmers in

nascent market and mitigates risks in scaling. It also helps the enterprise to identify gaps in supply to meet the demand, leading to business model and product/service innovations.

RECOMMENDATION 2 Create and reinforce linkages between

RECOMMENDATION 3 Leverage intermediaries as

contributors to the implementation and evaluation of policies and adaptation strategies

The integration of enterprise voices into

public and private support programmes

policy design and implementation helps

Existing public and private market access

are targeted and accessible to their target

programmes for SMEs, supported by corporate incubators, government and intermediaries, can be leveraged to support enterprises to scale. Often, a lack of coordination between these support programmes lead to a valley of death, in which businesses experience a gap in support between the pilot and scaling stage of their enterprise. Equipped with an oversight of the sector and support programmes, policy makers can build pipelines between public and

to ensure that programmes and policies group. Regular communication with multiple enterprises, however, is difficult for policy makers who often have limited time and resources. Instead, policy makers might leverage the experience and expertise of incubators, accelerators, enterprise support organisations and networks, who can provide insight into enterprise challenges in accessing markets in adaptation-related sectors, and can help to connect enterprises to the appropriate support.

South Africa were experiencing the worst drought in 40 years.

C LI MAT E-S MART EN T R E PR E NE UR SHIP Aqua Green and Projects developed

Eco-inclusive enterprises are at the

an integrated and streamlined farming

centre of global sustainable development

technology to grow catfish and crops

initiatives through their resource-efficient

through a self-designed water pond

and socially inclusive value chains

that can withstand floods and harsh

and low-carbon products and services,

weather conditions. The idea came

which help communities to adapt to and

from an unexpected loss of crops from

mitigate the impacts of climate change.

their farm following a heavy storm

In coordination, ecosystem builders

that ravaged a small community in the

– key stakeholders from the private,

Limpopo province. This eco-inclusive

public, and social sectors – possess

enterprise now helps to improve

tremendous potential to ensure that

the livelihoods of the community it

eco-inclusive enterprises receive the

operates in through catfish farming and

necessary support to realise their social,

production. It focuses on catfish as it

economic and environmental objectives

can grow in high densities and is less

and drive the global transition to an

expensive to farm. The fish is marketed

inclusive, green economy.

and sold to the local community including middle class and migrant

SEED is a global partnership for action on

customers. Among other economic,

sustainable development and the green

social and environmental impacts, the

economy, based on the understanding

enterprise is conserving water through

that the promotion of social and

the use of aquaculture production

environmental entrepreneurship is pivotal for

systems which re-use water and reduce

environmentally friendly and socially inclusive

its loss. Using fish waste fertiliser for its

development and poverty reduction.

vegetable growing aquaponics system, it helps prevent the use of chemical

We work directly with growing

fertiliser. Aqua Green and Projects is a

enterprises and aspiring entrepreneurs

2019 SEED South Africa Award Finalist.

in our Enterprise Support programmes to strategise, optimise and award achievements in eco-inclusive entrepreneurship. All our participating enterprises receive a comprehensive SEED Support Package of tailored business and capacity-building support, networking, and profiling at the national and international level. Complimentary to our direct Enterprise Support programmes, we offer programmes to build an ecosystem of supporters and advocators necessary to the success of growing enterprises. Our Ecosystem Building activities fortify a global network of local business development

environmental and economic impacts of entrepreneurship. SEED at the moment works in nine countries around the globe and is hosted by adelphi research. SEED’s programmes in South Africa are funded by the Government of Flanders and the Federal Ministry for the Environment, Nature Conservation and Nuclear Safety. Indalo Inclusive is a South African nonprofit company aiming at strengthening a more environmentally friendly and socially inclusive economy in the country through capacity building, dialogue and policy consulting. Indalo stands for “creation”, “nature” and “ecology” in isiZulu. The Government of Flanders, in partnership with the Department of Environmental Affairs, supports Indalo Inclusive South Africa towards their “Reaping the Potential of Entrepreneurship for a Climate-Smart Inclusive Green Economy in South Africa” project. Indalo partners with the Climate Innovation Center SA and adelphi research on this project which aims to enhance climate resilience in rural communities. Indalo Inclusive and SEED hosted by adelphi have implemented various programmes to directly support ecoinclusive enterprises and create an enabling environment in South Africa in the last years.

services providers and offer platforms for coordination between key local, national and international stakeholders. Our facilitation of multi-stakeholder engagement through SEED programmes generates policy, financing and collaboration instruments that multiply the social,

Sources www.environment.gov.za

https://climateknowledgeportal.worldbank.org https://businesstech.co.za https://seed.uno

https://www.dw.com

SOCIAL

SUSTAINABILIT Y

IN THE WORKPLACE By Maxine Volker

the health and safety of employees to implementing responsible supply chain practises contributes to the sustainability of a workplace. These values result in a happier, more productive and beneficial environment for all. The first quarter of

Put simply, a sustainable workplace is a workplace which takes into account a regard for people and the planet.

2020 saw a dramatic shift in workplace dimensions - COVID-19 has taken the world by storm and resulted in many companies having to implement remote working. While this certainly presents its own challenges, sustainability does not need to go out the window. A sustainable workplace - which may now mean home contributes to viability in the long run, not

A business that employs sustainable

only for businesses and their employees,

practices is one that looks past

but for the environment at large. So,

profitability and revenue as the only key

what practices can companies implement

drivers and considers how they can make

both inside and outside the workplace to

a difference both inside and outside their

ensure sustainability?

workspace. Everything from ensuring

S U S TAI N AB I L I T Y I N T HE WOR K PLACE

A workplace that employs sustainable

place where businesses have an opportunity

practises is ultimately a win-win for all.

to truly make meaningful environmental

Sustainability may be in the form of a regard

impacts. Although complex and often

for environmental impact or, on a smaller but equally important scale, the

Sustainability in the workplace strives to balance the triple bottom line of the three Ps - profit, planet and people.

challenging, when a company incorporates sustainability into their supply chain, they

health and safety of workers.

are starting at the source. While in-office

Keeping sustainability in

practises certainly make a difference, the

mind within the workplace reduces the risk of

reality is that until a company is able to involve their entire supply chain, they won’t

mishaps, illnesses

be able to make a big enough impact. Once

and work-related

all parties involved in the supply chain of a

hazards - resulting in a

business practice sustainability, big changes

happier, safer and more

start to happen. Setting goals when it

productive space. Once a

comes to maintaining a sustainable supply

business has established

chain is a great way for a business to spark

a baseline from which to work, they may begin to reduce their environmental impact. By tracking monthly

utility bills, they can get a feel for their energy consumption and then begin

action. These goals can be big or small. Starting from the source by mapping a supply chain can help businesses to identify the areas most in need of sustainable supply practices. By examining each part of the supply chain from beginning to end,

limiting the costs externalised to society.

the company can put more sustainable

Changing wasteful habits is a good place to

strategies in place to ensure a more

start. Simple practises such as turning off

holistic supply chain. Consistently keeping

lights when they are not needed and limiting

a close eye on how the chain functions

heater and aircon use are ways to reduce

allows businesses to monitor its overall

electricity usage. Offices can also make

sustainability. Ensuring ethical sourcing is

sure to turn off computers at the end of the

a vital part of supply chain sustainability. A

day or enable sleep mode and power-saving

supply chain manager needs to be able to

features to reduce power consumption.

see how their suppliers are extracting and

Setting up a recycling program is an efficient

producing raw materials and the overall

way to track how much or how little a

impact this has on the environment. From

business is recycling.

there, changes can be made if needed.

Placing recycling bins in places where

Sustainability in the workplace strives to

workers are reminded to use them, such

balance the triple bottom line of the three Ps

as lunchrooms and next to printers, is

- profit, planet and people. Over the years,

an effective way to make sure recycling

sustainability has become increasingly

practices are implemented. Recycling paper

important to both individuals and businesses

and setting printers to double-sided on default are ways to reduce paper wastage and therefor save costs.

as a whole. We often fall into the trap of thinking that small contributions don’t make a difference, so why bother. However, the truth is, it’s the little things added up that

When it comes to sustainable

make the biggest difference. Integrating

practices outside workspaces,

sustainability practices into workspaces

responsible supply chain

requires having strong values and sticking

management is vital. Supply chains, which are critical links connecting an organization’s inputs and outputs, are a

to them. With a firm plan, strong leadership and teamwork, companies can do their bit to make a difference.

SOCIAL

A TIME TO

GIVE BACK

CORPORATE SOCIAL INVESTMENT IN THE WAKE OF COVID-19 By Maxine Volker

A TIM E TO GIV E B AC K - C O R P O R AT E S O C I AL I N VES T MEN T I N T H E WA K E OF COV ID- 1 9

These days successful companies are

However, CSR in terms of employees

invested in doing good in the world

extends beyond providing security. Giving

around them. Looking beyond, yet not past, increasing profits and productivity, companies are exploring how to give back in meaningful and sustainable ways. Dedicating their resources and time to various environmental, social and economic causes means they are making important corporate social investments. However, the recent global

CSR is often viewed as giving back to the community at large, but in these times, giving back to staff is a key social responsibility.

employees flexibility regarding working hours and revisiting requirements are also ways in which companies can look out for the wellbeing of their staff in light of the recent changes to work structure. Taking into account things like childcare and elder care are important, as workers are now having to juggle family obligations on top of work priorities. Employee wellbeing

pandemic has swept nations off their

needs to be a top priority, this will benefit

collective feet and turned the world

both parties.

upside down. COVID-19 has changed life as we know it and businesses have been structurally shaken. So how exactly are companies giving back during this time and what does this mean for those

the globe, employee security needs to be a top priority. Businesses need to be focusing on those they depend

they are trying to support? We explore.

on most, and this is not only for

Without knowing the way things will be

When someone feels uncertain

post-COVID-19, companies are faced with uncertainty on all fronts. With no economy or sector beyond the reach of this devastating pandemic, businesses are having to look at strategies for longterm survival. Facing the challenges of dealing with prolonged global and local instability, the anxiety and possible retrenchment of staff, as well as possible loss of clients and customers, in many ways, the idea of corporate social responsibility has taken on a

the benefit of the employee. about financial security, they are going to do everything in their power to put this insecurity at bay. Employers should understand that in the absence of financial security from their employers - where possible - workers are going to seek safety elsewhere. If this results in leaving their current place of work, companies will suffer a loss when the world does eventually go back to normal.

wider meaning in terms of including the wellbeing of staff. CSR is often viewed as giving back to the community at large, but in these times, giving back to staff is a key social responsibility. COVID-19 has created uncertainty for everyone. Businesses are faced with economic challenges, resulting in individual employee insecurity - it’s ultimately a domino effect. With a dangerous health crisis threatening

SOCIAL

A TIME TO GIV E BA C K - C O RPO R AT E S O C I AL I N VES T MEN T I N T H E WAK E O F C O VI D -1 9

Many big companies are devoting their resources to aiding the world at large during this time. Whether this be in the form of supporting small at-risk businesses or donating to relief funds, there are many ways that companies can do their bit.

• Standard Bank’s CSI initiatives are

• Unilever’s Enterprise and Supplier Development Fund assists small

positive social development of the

businesses – crucial in this time of

stress has been placed not only on

communities they operate in. Through

uncertainty

companies as a whole and the world at

various community interventions, effective community re-investment reinforces their values and achieves business objectives. Standard Bank Group’s Corporate Social Investment

• Starbucks has given all employees

• Uber and Uber Eats have taken the

expenditure is funded by an annual

decision to provide their employees who

allocation of not less than one percent

are either diagnosed with the virus or at

of previous year’s after-tax income

risk, with 14 days of financial assistance.

• Nedbank is doing their part by

• Companies have also become creative in the way they are giving

providing emergency relief to the most

back and creating awareness during

vulnerable South African communities.

this time. For example, clothing

They have pledged a R12 million

brands are now manufacturing and

donation in aid of hunger relief as

selling masks. Although this does

well as to help mobilise, train and

serve as a form of creating

equip volunteers with the necessary

revenue, it also promotes

information to drive awareness across

awareness around

the country.

the importance of

• Discovery and Vodacom have formed a partnership which enables free COVID-19 online doctor consultations. This platform allows South Africans to access professional healthcare without having to travel to healthcare facilities. • The Sasol foundation is now offering free online primary and high school textbooks and resources during lockdown. In addition, Sasol, in partnership with the Department of Basic Education and Africa Teen Geeks, has launched free science, technology, engineering and mathematics (STEM) “Lockdown School”, which provides online classes on STEM subjects.

have been widespread. An unprecedented

large. However, it is vital that businesses do not disregard CSI during this time.

access to therapy during COVID-19.

from its South African operations.

The devastating effects of COVID-19

aimed at achieving and sustaining

staying safe.

Every bit helps.

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SOCIAL

DIVERSIT Y IN THE WORKPLACE

ESG REPORTING INCREASINGLY CONSIDERED FOR INVESTMENT DECISION MAKING Refinitiv tracks the trend Refinitiv reports that investors are

Companies reporting gender metrics report

increasingly considering companies that

that they have an average of 37% female

engage in ESG reporting as part of their

managers and 52% female employees.

investment decision making. Amongst

in the 2017 financial year compared to 12.17% in the 2013 financial year; • Female Managers averaged 26.41%

2. Changes at the top

other highlights, Refinitiv identifies five

• Female Executives averaged 18.07%

in the 2017 financial year compared to

key gender metrics findings based on the

24.75% in the 2013 financial year; and

ESG reporting of over 4000 companies

While still significantly underrepresented,

in a five-year period (2013 – 2017) from

in the last five years there has been

in the 2017 financial year compared

all over the world including South Africa.

improvement among women at board

to 33.49% in the 2013 financial year.

and executive levels. Little has changed 1. Investors consider companies

at lower employee level, however. The

which report gender metrics

• Female Employees averaged 34.92%

3. The Corporate Ladder Gender Gap

recent improvements at board and

Overall, on a global scale, we see companies more willing to report granular data on gender diversity than

executive ranks reflect the increasing

There are still some significant

focus on gender diversity at the corporate

barriers when it comes to promotion

leadership level, with a 5.57% increase in

of women to more senior levels. In an

female executives between 2016-2017.

ideal world, we would see comparable average percentages of female

ever before. In the last five years, we have seen a 6% increase of companies reporting female manager numbers.

An analysis of the female composition

representation across all levels, but

of the workforce reveals the following:

the reality is starkly different. Using female employee percentages as

Companies reporting female employee

• Female board members averaged

numbers is also seen as a positive sign for investors looking for transparency as now almost half of companies report on this metric globally.

a baseline for comparison against

13.35% in the 2017 financial year

board, executive and non-executive

compared to 11.34% in the 2013

levels, the gender gap is substantial

financial year;

at all levels.

The Gender Gap: US

Japan

Aust

Canada

Taiwan

South Africa

China

Female Board Members (%)

20.6

4.7

17.7

22.9

20.2

11.0

23.7

10.3

8.4

42.8

Female Executives (%)

15.1

1.3

17.9

15.5

13.7

20.3

10.6

8.6

14.4

Female Managers (%)

33.3

9.6

28.2

25.2

31.1

28.6

31.5

26.3

29.1

13.1

D I VER S I T Y I N THE WOR K PLACE

4. Gender Diversity by Region When comparing countries with the highest GDP, Japanese companies with female board members, executives and managers are conspicuously absent. It is also worth noting that six of the top ten regions have a deficit in female executives, meaning it could be a challenge to keep the board level diverse in the future if there isn’t a healthy pipeline of female executives to promote onto the board. Female Representation for Six Countries:

China

Board Members – 20.62%

Board Members – 10.29%

Executives – 15.11% Managers – 33.27% Employees – 38.33%

Japan Board Members – 4.68%

Executives – 10.57%

Executives – 1.29%

Managers – 26.31%

Managers – 9.56%

Employees – 35.91%

Employees – 26.28%

5. Gender Diversity by Industry Our data shows that globally, gender composition of the workforce has changed

Germany

South Africa

Board Members – 27.83%

Board Members – 22.93%

Board Members – 23.67%

Managers – 24.66%

Managers – 25.19%

Managers – 31.54%

over the years based on industry group. Although changes have been consistent in the top business sectors, we still see

Executives – 7.90%

Employees – 36.00%

Executives – 15.54%

Executives – 20.27%

Employees – 26.59%

Employees – 39.65%

severe underrepresentation of female employees in industries that have been traditionally male dominated. Top Five Business Sectors Ranked by Female Employee Percentage:

Top Ten Countries with Highest Female Board Representation by GDP:

1. Drug and Food Retailing – 56.39% 2. Retailers – 55.90% 3. Insurance – 54.54%

Country

Female Board Percentage in 2017

Refinitiv ESG Company Coverage

GDP Ranking

France

42.80

Italy

33.50

Germany

27.85

United Kingdom

22.93

269

United States of America

20.62

875

Canada

20.21

259

1. Mineral Resources – 15.39%

India

13.61

2. Automobile and Auto Parts – 17.73%

China

10.29

101

3. Chemicals – 19.73%

Brazil

8.39

4. Applied Resources – 21.54%

Japan

4.68

413

5. Industrial Goods – 21.55%

4. Healthcare Services and Equipment – 51.51% 5. Banking and Investment Services - 49.42% Bottom Five Business Sectors Ranked by Female Employee Percentage:

SOCIAL

Business Sectors Ranked by the 2017 Female Employee Percentage: Female Board Representation

Top 5 Groups

Female Managers (Non-Executive)

Female Executives

Female Employees

2013

2017

Delta

2013

2017

Delta

2013

2017

Delta

2013

2017

Delta

Food and Drug Retailers

15.60

23.13

7.5

12.59

17.11

4.5

34.59

33.98

-0.6

52.30

56.39

4.1

Retailers

15.35

21.76

6.5

14.56

18.02

3.5

37.04

38.64

1.6

57.00

55.90

-1.1

Insurance

16.31

22.03

5.7

11.00

13.64

2.6

31.49

35.21

3.7

53.42

54.54

1.1

Healthcare Services and Equipment

15.11

25.21

10.1

12.70

15.29

2.6

37.29

34.38

-2.9

55.93

51.51

-4.4

Banking and Investment Services

13.56

19.16

5.6

13.78

16.00

2.7

34.25

35.98

1.7

49.08

49.42

0.3

The financial sector represents two

controversy and attention for their

of the top five economic sectors by

lack of gender transformation in

female employment with the banking

recent years and we are yet to see if

and investment services being ranked

they fulfil their commitment to have

at the top by female employees and

more female representation in the

managers.

near future.

Some improvements have been

The increasing focus on ESG by

seen by female employees in the

investors and the movement to

retail sector appears in the top

regulation around sustainable finance

five for female employees, female

means asset managers are needing

managers and female executives.

more data and analytics than ever

Insurance, and healthcare services

before to build sustainability into

and equipment industries show high

their investment strategy. We have

representation in female employees

highlighted some of the bright spots

and female board members;

that investors can look at when

however, the healthcare services and

deciding on industries and counties to

equipment industry has had a gradual

make up their sustainable portfolio.

decrease in female managers over the last five years.

In addition, looking at emissions and CO 2 production, one could answer the

Another area to keep an eye on is

question which companies, industries

STEM industries. The technology

and countries are positioning

and engineering economic industries

themselves for success in the

are not represented in the top five

transition to low-carbon economies.

business sectors based on female

We then turn to waste, water, and

employees. The only STEM business

the impact on biodiversity to see

sector that has more than 40%

which nations are leading the way

female employees is pharmaceuticals

with recycling and protecting wildlife.

and medical research. STEM is an

Finally, we consider energy use and

area which has received a lot of

the impact of supply chain.

D I VER S I T Y I N THE WOR K PLACE Some key findings that Refinitiv data has extracted include the following:

“ ...It is critical the industry promotes data transparency and standardization to empower and inform investors which companies are improving their impact on the environment and re-direct capital towards the winning sectors, companies and asset classes...”

• 63% of companies have a policy to reduce emissions (up from 56%

ABOUT

REFINITIV ESG

five years previously); however, only 35% of companies have specific reduction targets around emissions. • Japan, Europe and Africa & Middle East have the highest percentage of companies reporting on target emissions. Asia is the region with the highest average CO2 emissions per company. • Hong Kong produced more than double the amount of CO2 per $ million revenue compared to the closest polluting country and 17 times more than the lowest polluting country, France. • 78% of companies have resource reduction policies, however only 30% are putting tangible targets in place, and only 26% have both. • Over the last 5 years, we have seen a 25% increase in companies with water efficiency policies and 34% more companies setting specific water efficiency targets • The top 5 industry groups in terms of percentage of companies with policies on emissions are: •

Automobiles & Auto Parts

•

Food & Drug Retailing

•

Telecom Services

•

Chemicals

•

Transportation

“This is a pivotal moment for capital markets and the role investors have to play in order to sustain and finance

At Refinitiv, we strive to be the trusted and preferred partner for environmental, social and governance (ESG) data and solutions, and are committed to bringing to the market an array of best in class data, analytics and fully integrated workflow solutions. We understand the increasingly critical need for ESG information and the solutions we offer enable customers to act with confidence on consistently captured and standardized transparent information and insights. We have deep domain expertise and have been providing ESG solutions to the financial industry since the early 2000s. Designed to help you make sound, sustainable investment decisions, our ESG data covers nearly 70% of global market cap and over 400 metrics. Our ESG data is available through Eikon, Excel® add-in, Datastream®, Datastream Data Loader (DDL), QA Direct® and the Elektron Data Platform Cloud API. For more information, visit us online at www.refinitiv.com/esg

prosperous economies in the future. It is critical the industry promotes data transparency and standardization to empower and inform investors which companies are improving their impact on the environment and re-direct capital towards the winning sectors, companies and asset classes of the sustainable future,” said Global Head of ESG at

MEDIA CONTACT: Sonwabise Sebata

Africa Head, Communications and Public Relations, Refinitiv Email: sonwabise.sebata@refinitiv.com Telephone: +27664727593

Refinitiv, Elena Philipova.

INVESTING IN A BETTER FUTURE FOR OUR COUNTRY AND OUR INVESTORS

Prescient Investment Management is one of the country’s largest black-empowered asset managers and has been managing money for over 21 years.

During this time, our primary investment aim has been to give our clients the certainty of knowing that their capital will be preserved. We do this by consistently managing relative and absolute downside investment risk, with the ultimate aim of achieving superior risk-adjusted returns for our clients. To achieve these sustainable returns, we recognise how important it is to take environmental, social and governance (ESG) issues into consideration. We also understand that, as a guardian of clients’ savings, we have the responsibility of ensuring the capital we invest is put to work contributing to the greater good of the economy, environment and broader society. This commitment is reflected in our corporate philosophy, which embraces the mutually reinforcing values of commercial success and long-term sustainability. Internationally, climate change, corporate governance crises and social inequalities are posing severe challenges that world leaders and other economic stakeholders need to address as a matter or urgency.

fu t u re o fs u sta i n a b i l i ty.c o.z a

Against this backdrop, there is a growing awareness of just how crucial it is to incorporate ESG considerations into investment decisions. In South Africa, economic inequality and governance challenges are particularly acute, and thus, we believe it is imperative to integrate ESG considerations seamlessly into our investment decision making processes.

OUR APPROACH TO SUSTAINABLE INVESTING To achieve this, Prescient has adopted a holistic and integrative approach to sustainable investing, embedding ESG considerations into our corporate activities, product development and security selection and portfolio construction processes. This three-pillared approach ensures that we deliberately and systematically include all material ESG factors in our investment and corporate activities. Our approach to ESG goes beyond traditional financial factors by considering overall sustainability and the alignment of all stakeholder interests in the investments we make.

At the product development level, Prescient offers a range of retail unit trusts for individual investors, as well as institutional investment products that comply with Regulation 28, which makes them appropriate investment options for retirement. Our product range enables clients to choose funds that best suit their investment needs and aspirations, while aligning with their appetite for risk.

INVESTING IN CLEAN ENERGY AND INFRASTRUCTURE The Prescient Clean Energy and Infrastructure Debt Fund has been specifically established to address the environmental and energy challenges South Africa is currently confronting. The Fund invests in clean energy and other infrastructure that is specifically designed to have a positive social and environmental impact, while also improving the sustainability of the country’s energy supply. The projects in which the Fund invests will provide the infrastructure that is so vital for the development of South Africa by reducing carbon emissions, creating jobs and providing socio-economic and enterprise development.

PRESCIENT A D VERT ORIA L

Addressing social considerations is particularly material in South Africa, given the country’s history of inequality and increasing unemployment. The Prescient Foundation undertakes Prescient’s social upliftment initiatives. The Foundation’s main objective is to create a better, sustainable future for South Africans by investing in, primarily, education and leadershipfocused initiatives. The various projects the Foundation supports include a leadership programme in partnership with the Sakhikamva Foundation, IT-related programmes, a school support programme, community involvement, bursaries and individual financial support.

a compliance exercise but reflects our sincere desire to facilitate economic inclusion and have a positive impact on all of our stakeholders and the broader economy.

We have also been significant contributors to enterprise development within the South African investment landscape, both through fostering upcoming investment talent, as well as through our initiative to support black stockbrokers in their business endeavours by allocating almost 80% of our brokerage services to blackowned stockbrokers.

There is no doubt that good governance is critical in determining the long-term performance of companies in which we invest. For that reason, governance considerations are firmly embedded in our investment process, including our investment research and idea generation, security selection and portfolio construction and portfolio monitoring.

TRANSFORMATION, EMPOWERMENT AND GOOD GOVERNANCE Prescient considers transformation and the creation of sustainable Broadbased Black Economic Empowerment as a critical imperative within the South African business landscape. We became the second-largest black empowered asset management company in the country, with a level one B-BBEE status, when financial services investment holding company, Sithega, became a significant shareholder and partner in the business in April 2019. We are passionate about fostering empowerment through what we do as a business. Thus fulfilling our B-BBEE requirements is not merely

“...we have the responsibility of ensuring the capital we invest is put to work contributing to the greater good of the economy, environment and broader society.”

We engage investees and stakeholders on material ESG issues across all asset classes, intending to balance short-term financial gain with longerterm sustainability goals. The types of governance engagements we involve ourselves in include engagement with investees, other stakeholders and proxy voting. Where there is a governance issue that requires urgent attention, we engage with the investee directly to gather the information we need to form an opinion. We also subscribe to the Code of

Corporate Practices and Conduct as set out in King III. As a signatory to the United Nations Principles of Responsible Investing (UNPRI) and Code for Responsible Investing in

South Africa (CRISA), we engage with

other industry stakeholders around governance considerations.

Prescient understands that the way we, and other investment firms, deal with

ESG issues as investors and corporate citizens will have a meaningful

impact on the long-term consistency and sustainability of the country’s

economic growth and the investment returns generated by different asset

classes. For these reasons, we have firmly embedded ESG principles and engagements around these issues

in all our investment and corporate decision-making processes.

CONTACT DETAILS Tel: +27 21 700 3600 MANCO toll-free: 0800 111 899 Email: info@prescient.co.za Physical Address: Block B, Silverwood, Silverwood Lane, Steenberg Office Park, Tokai, 7945 Website: www.prescient.co.za

Prescient Investment Management is an authorised Financial Services Provider (FSP 612).

KIMBERLY-CLARK A D VERT ORIA L

KIMBERLY-CLARK

CARING FOR THE PLANET Kimberly-Clark (K-C), makers of Kleenex R , Huggies R , Kotex R and Baby Soft R are an indispensable part of life for people in more than 175 countries. Fueled by ingenuity, creativity, and an understanding of people’s most essential needs, the company creates products that help individuals experience more of what’s important to them and uses

sustainable practices that support a healthy planet, stronger communities, and ensures their business thrives for decades to come. K-C recently announced its 2030 sustainability strategy which will address key social and environmental challenges of the next decade. In South Africa, this strategy comes to life through one of the many initiatives at Enstra Mill, K-C’s mill in Springs. Enstra recently and successfully switched from coal to gas fired boilers, an ambitious project that will deliver a reduction of around 16,500 metric tons of carbon dioxide, and the teams have had to do that whilst maintaining the energy security because the mills run 24/7. Ensuring the gas availability and reliability of supply has been one of the project complexities. The coal phase-out throughout KimberlyClark EMEA is an important milestone for the company’s decarbonisation journey and represents a critical steppingstone towards decarbonising the thermal energy needs of the South-African operations while exploring solutions to decarbonise its electricity needs as well. “The Enstra Mill team have achieved a fantastic accomplishment in phasing out coal in our EMEA operations; despite the significant project complexity, it is a clear kick-off signal of a significant energy transition for Kimberly-Clark in the years to come,” says Oriol Margó, Energy and Climate Leader for Europe, Middle East and Africa. Kimberly-Clark believes in ‘making lives better-with the smallest environmental

footprint’ - a statement that is lived daily by the business, ensuring they control, measure and reduce the impact on the environment. “We monitor our emissions, waste disposal to landfill and use fibre that is sourced responsibly. We do weekly, monthly and annual reporting and we raise non-conformances up to the Global

Environment Team to account when we have deviated from the limits. These ensure that we produce responsibly and that we comply daily,” says Ntokozo Sithole, Enstra Mill Manager. “We are audited every year on environmental and legal compliance by local bodies and can get our systems certification withdrawn if we do not adhere to the company policies and procedures.” Looking to the future for Enstra Mill – there are 5-year plans which include investments in energy conservation, water recycling, reduction of energy usage and using natural energy sources with goals to move to 100% aversion of waste to landfill by 2022. “The drivers are trying to balance providing for human needs while reducing the impact on natural resources by using sustainable development goals, by-laws, company policies and procedures to ensure companies are held accountable,” says Sithole, “corporate responsibilities and reputation are defined and protected by how business conserves the environment. Our sustainability goals are linked to corporate strategies.” The energy transition to decarbonised technologies is probably the biggest of the century following transitions from wood to coal, coal to oil, oil to gas and now gas to renewables and Kimberly-Clark is working hard to make it possible with 2030 goals that have been approved by the Science Based Targets initiative which are in line with the latest climate science.

K-C employees from Enstra Mill at a community clean up and tree planting event in Daveyton, Benoni.

CONTACT DETAILS Head Office - South Africa

Kimberly-Clark House, 8 Leicester Road, Bedford Gardens, Bedfordview, Gauteng Telephone: +27 (0) 11 456-5700 Fax: +27 (0) 11 456-5917 Website: kimberly-clark.com/en/

GOVERNA THE FUTURE OF SUSTAINABILITY

SECTION

ANCE

GOVERNANCE

HOW TO EMBED ESG BESTPRACTICE IN YOUR BUSINESS

PURPOSE DRIVEN COMPANIES OUTSHINE THE REST By Victoria Reuvers

“Purpose is not the sole pursuit of profits but the animating force for achieving them … In fact, profits and purpose are inextricably linked.” – Larry Fink

In contrast, not offering ESG may

Sustainable investing is growing, both

In a Morningstar study of 948 people,

in supply and demand, but several

72% of investors are likely to consider

advisers are still confused on how best to

sustainably-minded solutions; with

execute. At a high level, many advisers

broad-based interest across millennials,

acknowledge the need to future-proof their

generation-X and baby boomers:

actually isolate your business from a significant and growing portion of the market (as evidenced in the following table), where 72% of investors are at least moderately interested in ESG investing.

KEY EXECUTION MATTERS The far more difficult question—and one we seek to advance in this article —is how to execute using ESG solutions. For example, you may like the idea of offering ESG in your practice, but there is little evidence available to tell you the best way to structure the financial planning process. With this in mind, we break down three of the building blocks that are likely to be foundational in a great execution plan.

practice and/or attract new types of clients. However, implementing an environmental, social and governance (ESG) solution

Distribution of My Sustainability Profile Preference Score (weighted)

for a client is still problematic for some. Questions like “how do I raise it with my clients?” remain commonplace, so we explore the road ahead and seek a reasoned approach to execution. When evaluating your value proposition, it is useful to think about balancing monetary goals with client values:

Client Money Goals

Great Financial Advice

Client Life Goals

Under the “value proposition” lens, it is hard to argue that sustainable-investing solutions—including ESG portfolios—are a fad and should thus be excluded from your toolkit.

My Sustainability Profile Score Source: Morningstar research paper, April 2019: “The True Faces of Sustainable Investing: Busting the Myths Around ESG Investors”.

H O W T O EMB ED ES G B ES T-P R AC T I C E I N Y OUR B USINE SS

Raising ESG preferences with clients

At the heart of the financial planning profession is the concept of knowing your client. To date, most practices have adopted risk profiling and fact-finding tools to build a repeatable and robust framework that not only matches gaps to solutions but also meets the requirements of the regulators. But rarely has the factfinding process included ESG or valuesbased preferences. Whilst the debate about the best way to incorporate ESG into advisory practices continues, one observation from behavioural science appears clear—just asking the question is unlikely to be enough. The rationale demanding a more thorough approach is that asking clients value-based questions will tempt them to answer in a way that reflects what they think others want to hear, not what they really want. That is, no one wants to say I’m not interested, because that seems cold-hearted. But no one wants to invest in something that doesn’t align to what

effective ways to raise it with existing clients will likely require more thought.

value-adding exercise. This may express that ESG often appeals to

that is one-size-fits-all. Not only are

older generations too, with an option

each clients’ financial goals different, but

to enquire if they are interested.

the adviser process must be capable of handling the change necessary to adapt to

The key is to deepen the

ESG-related goals. That does not mean it

understanding of where clients’ see

isn’t worth exploring—quite the opposite—

themselves on the returns-driven to

as it may create an opportunity to deepen

sustainably-driven spectrum, then

the client-adviser relationship and possibly

making sure there is the capability to

drive new business. But we need to be

tailor the financial plan accordingly.

realistic as to the challenges it presents. While this is an area ripe for development, to help make it practical, we offer three examples of ways advisers are currently raising ESG capabilities with existing clients. This is not conclusive, nor suggestive as such, but intended to be thought provoking. Examples include: • An upfront announcement to the client base regarding a new capability or function, with the option to enquire if they are interested. • A structured approach to client annual reviews, perhaps using a premeeting checklist that asks the client

To overcome the challenge this poses,

setting and whether their financial

expect some great ESG preference tools

clients, perhaps as a marketing or

In this sense, it’s hard to see an approach

they really want either.

the industry has some work to do. We

• An offer to the children of existing

to review their risk tolerance, goal plan is aligned to their life values (including ESG preferences).

Find unique ways to show the impact

Take two investors with the same age, the same savings patterns and the same retirement goal—yet one is sustainably minded while the other is returns driven. They share a lot in common, but the messaging will not resonate equally. If you can bring the ESG impact to life, you are well on your way to changing the past performance conversation into a well-rounded assessment of value. Tying into the United Nations Sustainable Development Goals is one such effective way this may be done.

to become available as the product supply increases (for example, Morningstar’s Behavioural Science team are developing one such version to support the Morningstar

Demonstrating the impact is important. While the right approach depends on the goals of the client, it may change the way they think about value

ESG Portfolio Range at present), which should go a long way in bridging the divide. However, even with the addition of great ESG preference tools, it seems clear

Your Portfolio Performance = 9.8%

Benchmark Performance = 10.2%

that many of the ESG preference tools will be better suited to prospects rather than existing clients. For prospects, you can easily establish a clients’ ESG

Unclear impact

preferences via the fact-finding process, perhaps by adding it to the questionnaire or risk tolerance assessment. Finding

GOVERNANCE

Get to know your product implementation options

Do you really understand how sustainable a given company is? Or tougher, how sustainable a portfolio of companies might be? This is extremely difficult, even for the experts, as corporate and governmental policies change over time. For instance, it might be easy to say that a tobacco company ranks poorly on the ESG front, but what about an oildriven emerging market that offers government bonds? Having an ESG portfolio capability function will likely require outsourcing of some kind—at a minimum, having a research provider on your side. More advanced solutions include a managed portfolio offering, taking the burden of misallocation risks out of your hands. Only you can decide what products are most suitable for a given client, but whichever way you go, it is likely you’ll need to develop a relationship with trusted ESG specialists that can help provide the solutions your clients need. This has the added advantage as a means to stay on top of a quicklygrowing field. THE DOWNSIDE TO OFFERING ESG PORTFOLIOS

Offering ESG portfolios is theoretically easy—using the client, impact and product foundations—however it is worth elaborating on potential downsides. For example, a common mistake we are already seeing in the industry is something we can simplistically label the “plug and play” approach to ESG. That is, a client shows a preference for ESG, so

the adviser picks a handful of ESG

CONCLUSION

funds and replaces the conventional holdings like-for-like. Such an

Ask your everyday person on the

approach is sub-optimal for many

street and they are increasingly

reasons, leading to a portfolio profile

preferring companies with a strong

that can deviate considerably (both

environmental record or those that

in risk and return) from the desired

embrace other developments such

outcomes. For example, the ESG

as gender equality.

indexes tend to carry meaningfully different sector and size biases

This movement is certainly not a fad,

than traditional indexes, which can

it is very real, and raises the

impact everything from credit

interesting prospect to differentiate

quality to liquidity.

your value proposition.

This leads to another important

The development of ESG products is

point. While we believe offering an

likely to grow further and you have

ESG portfolio range has the ability to

a great opportunity to strengthen

strengthen your practice, you do need

your practice by using them. While

to be ready for different conversations.

the industry continues to grapple

Some of these conversations will

with the best way to incorporate

be meaningfully positive (such as

ESG preferences into previously

developing a deeper understanding of

standardised practices, a foundational

your clients’ opinions and values), but

approach could see you step ahead.

others will be more challenging. One such example is that ESG portfolios

The benefits of offering ESG

can be expected to behave differently

solutions are likely to far outweigh

from conventional portfolios (tracking

the drawbacks, but there will be

error from conventional benchmarks

challenges. To support adviser’s

may be higher), so it does raise the

in their journey, Morningstar have

prospect of how you’ll handle relative

decided to offer ESG Managed

performance-based queries.

Portfolios, which comprise five portfolios aligned to Morningstar’s

As with most things, setting

established risk profiles and

expectations upfront will be

compatible with other leading risk

paramount, but so will the ongoing

tools. The portfolios are managed

communication. For those that already

using Morningstar’s distinctive

use an individually-documented

long-term valuation-driven approach

investment strategy with each client

and use both active and passive

(usually involving a statement of

funds with the aim to maximise the

principle, purpose and expected

potential reward for risk while reducing

behaviour), you may need to evolve

the cost as far as possible. The

this thinking to consider ESG factors.

portfolio management team draws on

For those that don’t, you’ll need to be

expertise from over 100 investment

clear with your client on why an ESG

professionals around the world and

solution is fit for purpose and think

are supported by Morningstar’s

carefully about how to reinforce this

industry-leading research, data, and

message across the journey.

thinking around ESG considerations.

H O W T O EMB ED ES G B ES T-P R AC T I C E I N Y OUR B USINE SS

To successfully embed ESG into your practice, one must start by getting the foundations right

THE WAY FORWARD

To successfully embed ESG into your

Like anything, there are likely to be

practice, one must start by getting the

some challenges to offering ESG

Future proofing your business—by

foundations right. While there is no one-

portfolios. You can expect client

evolving your “value proposition”—can

size-fits-all approach, it is likely to revolve

conversations to change—mostly for

be improved by including a focus on

around at least three key variables:

the better, but possibly for the worse

environmental, social and governance

1) f inding a way to raise it with your

at times. For example, ESG funds

(ESG) investments. This is a great opportunity to change the way your clients perceive success, moving from performance-driven expectations to rounded goals.

clients in an effective manner 2) f inding ways to visualise the ongoing impact, and 3) knowing your products of choice.

carry higher tracking error against conventional portfolios (even if there is no change in overall risk), which may create perceived disappointment if ESG funds experience a weak period.

GOVERNANCE

SUSTAINABLE INVESTING

A SOUTH AFRICAN PERSPECTIVE By Hortense Bioy, Eugene Visagie and Victoria Reuvers

In South Africa, ESG investing is still in

likely to move into sustainable funds.

its early days. But there’s no doubt that

Asset managers are taking note of these

it’s here to stay and is only going to grow

dynamics and accounting for them in

in importance. Globally, it’s estimated that

their investment processes.

ESG investing has more than $23-trillion

How do publicly listed companies deal with environmental issues and climate change? How do they manage carbon risk? How do they treat their workers, and do they have effective health and safety policies? Do they manage their supply chains in a sustainable way? Do they have a corporate culture that builds trust and fosters innovation? These are the types of questions increasingly being asked by South African investors as part of a growing trend towards sustainable investing, where investors and institutions look for strong ESG (environmental, social and governance) credentials as a key part of their decision-making.

in assets under management (AUM)

Additionally, in the South African market,

- or around a quarter of all professionally

multiple corporate governance failures

managed assets around the world.

have fostered a growing awareness around the governance angle, resulting in

This is being driven by several factors.

more pressure on investment managers

In many important markets, including

to incorporate ESG into their investment

the U.S. and the EU, ESG integration is

strategies. If the growth of ESG focused

increasingly seen as part of fiduciary duty.

assets in the global market is anything to

There’s also a growing body of research

go by, the movement isn’t a fad—instead,

which suggests that good environmental,

we’re viewing it as a real opportunity

social and governance practices translate

for advisers to differentiate a client’s

into good business results, and lead to

investment experience.

more sustainable markets and better outcomes for societies. A company with

As ESG awareness grows, the industry is

good ESG credentials is a company

grappling with the best way to incorporate

that’s well-positioned to deal with the

these preferences into previously

challenges of the future.

standardised practices. In the US, we’ve observed that this isn’t just about meeting

Increasingly, investors prefer to put

growing investor demand—instead,

their money into companies with a

fund managers are incorporating ESG

demonstrated social conscience—that

because they believe it can improve their

may be a strong environmental record

overall investment process and results.

or companies that embrace other

As stakeholders hold public companies to

developments, such as gender equality.

higher standards for corporate behaviour and performance, these issues become

Globally, this has been driven by

central to a company’s sustainability and

millennials, an increasingly powerful

ethical impact.

investor segment with a higher level of confidence in the long-term investment

Climate change is real, and it’s a serious

value of strong ESG practices. As their

challenge for investors who want to

investable assets grow, more assets are

balance their desire for high returns with

S U S TAI N AB L E I N VES T I N G - A S O U T H AFR I C AN PE R SPE CTIV E

a commitment to a positive environmental

bad for the environment can get a more

factors and often screen out certain

impact. This means investors will need to

positive score by establishing practices

industries or companies. Impact

be more precise than ever in analysing their

that partially offset their carbon footprints.

funds look at measurable social and

portfolio exposures to ensure they meet the realities of a carbon-constrained future. To help them gear up for this new reality, South African investment advisors and asset managers are going to have to raise their ESG capabilities. This is getting easier all the time, with several resources available to help investors determine ESG factors, like

environmental impacts alongside financial This is broadly done in three ways:

return, while sustainable sector funds

•

focus on the growing green economy.

Values alignment: screening out or excluding certain stocks

•

ESG integration: mitigating

•

investing: mission-

It’s important to note that individuals

solutions to

exposure to certain industries (tobacco, gambling, weapons), while others are more concerned about incorporating best practice values when it comes

into the broader ESG

Impact or thematic driven companies

differently. Some investors won’t want any

conventional funds to move

risk and generating alpha

the potential carbon exposure in markets.

will prioritise ESG pillars/principals

Going forward, we expect more

searching for large-scale environmental and social issues.

consideration

A company with good ESG credentials is a company that’s well-positioned to deal with the challenges of the future.

group and more ESG integration funds to move towards impact investing. Sustainable sector funds

to board composition and staff

should also

wellbeing. A more recent wave

experience growth

of ESG, impact investing,

as more investors see

looks at investing solely

opportunities in the low-carbon transition

into projects that focus

to a green economy.

on renewable energy, recycling and similar.

ESG incorporation and sustainable funds have plenty of room to grow. Assets under

Historically, ESG

management and flows, though both higher

approaches have

than ever before, remain tiny compared

excluded companies

with the overall investment universe. While

with apparent shakier

many financial intermediaries are yet to

ethical standing.

fully embrace sustainable investing, asset

Next, companies that

managers are recognising the fiduciary

didn’t incorporate best

benefits – not to mention satisfying investor

practices were screened out

demand – that come from incorporating

(i.e. companies lacking board

sustainable practices.

diversity, such as ones with low female representation, or companies without

Ultimately, though, it doesn’t matter which

independent boards).

tool you use. The bottom line is that ESG Sustainable funds and ESG integration

is coming, and local investment advisors

As investors are increasingly led by their

come in several forms. As ESG

and asset managers should make sure

social values, more listed companies have

considerations grow, more asset

they’re up to speed. We’re already seeing

been incorporating ESG principles (some

managers are starting to recognise

instances in Europe and the US where

even establishing an ESG sub-committees

sustainability issues in their investment

institutions give their business exclusively

to the board) to address some of these

processes. By contrast, ESG integration

to asset managers with ESG credentials

concerns. This way, companies that

funds take a more thorough approach,

and capabilities. This is not a boat we

operate in sectors that are perceived to be

building portfolios that reflect sustainability

want to miss.

GOVERNANCE

THE PUBLIC SECTOR AND SUSTAINABILIT Y By Fiona Wakelin

“ Government is key in driving and creating demand for the green economy in order to create opportunities and sustainable jobs.” - Gerhard Fourie, dti

South Africa’s green economy initiatives are built on the National Development Plan (Vision 2030), the National Strategy for Sustainable Development and Action Plan and the New Growth Path. The sustainable development vision is intrinsically linked to the green economy which has two interlinked developmental outcomes: • The growth of economic activity, which leads to investment, jobs and competitiveness • A shift in the economy as a whole towards cleaner industries and sectors

T H E P U B L I C S EC T O R AN D SUSTAINAB ILITY

NINE KEY AREAS IDENTIFIED IN THE GREEN ECONOMY PROGRAMMES The green economy action plan has a number of crosscutting roles and responsibilities and its implementation is significantly decentralised and includes private sector, civil society and all levels of government. The nine key focus areas identified in the green economy programmes include:

Green buildings and the built environment

Sustainable transport and infrastructure

Clean energy and energy efficiency

Resource conservation and management

Sustainable waste management practices

Agriculture, food production and forestry

Water management

Sustainable consumption and production

Environmental sustainability

GOVERNANCE

PUBLIC SECTOR GREEN INITIATIVES

127,000 new direct and indirect jobs. The

In 2019, President Cyril Ramaphosa

plans also include providing support to

launched the Good Green Deeds

Campaign to mobilise citizens, business,

4 300 SMMEs with 70% targeted at youth and at least 30% targeted at women; and

industry, labour and civil society at large

ultimately seeing more than 20 million

towards a common goal – cleaning up

tonnes of waste diverted from landfill.

South Africa:

DEPARTMENT OF ENVIRONMENTAL

“By performing just one Good Green Deed

AFFAIRS

a day, you can make all the difference.

The dea is responsible for the

Whether it is in recycling your waste, or

implementation of the Expanded

conducting clean-up activities in your

Public Works Programme (EPWP)

street, in your neighbourhood, school,

and the National Green Fund projects.

or municipality, you must be the agent of

The EPWP includes 8 programmes

change we want and need…

focusing on sustainability, job creation and the environment.

“We hope the Good Green Deeds campaign will be embraced with vigour and enthusiasm

However, to ensure systemic sustainability,

in all municipalities around South Africa.

cooperation between departments, sectors

We are all too aware of the challenges our

and internationally is key:

municipalities face with waste management.

Co-operation between government

“Our population is growing, and more

departments

and more people are moving to the cities,

The Department of Trade and

leading to more waste being generated

Industry (dti) is working closely with

despite diminishing space for landfills…

the Department Environment Affairs (dea) to align the Industrialisation and

“Currently the number of South African

Environmental policy objectives in order

households with access to waste services

to achieve environmental benefits.

is close to 80%, compared to 55% in 2001.

Speaking at the Green Economy

The number of households that have

Investment Dialogue, Chief Director of

refuse removal at least once a week is on

Green Industries and Energy Efficiency at

the rise, increasing from 56% in 2002 to

dti, Mr Gerhard Fourie outlined how this

approximately 66% in 2017. The increase is

collaboration is bearing green fruit:

a step in the right direction; yet we know we can still do more…” - President Ramaphosa The government’s National Waste

Management Strategy has the potential

“The first sector that we looked at to optimise alignment was the steel and petro chemical sector. We often find that instead of re-investing in new equipment

to create 69,000 new jobs and empower

and processes within the sector itself,

SMMEs and cooperatives.

significant benefits can be achieved by

Operation Phakisa on Chemicals and Waste includes a number of detailed

optimising the value chain (for example increasing the recycling of scrap metal). We are also looking at diversifying the

action plans that will deliver results by

local sugar market and working with

2023 - these include increasing the total

CSIR’s Energy Centre to identify and

contribution of the waste economy from

model electricity generation and transport

R24.3- billion to R35.8- billion and creating

fuel solution to support this diversification.”

T H E P U B L I C S EC T O R AN D SUSTAINAB ILITY

Co-operation between government and international agencies

leadership of the Water Research Council, the Sanitation Transformative Initiative (SaniTI):

In January 2020, more than 130 participants from across sectors - public,

“In this new and transformative approach,

private and civil society - gathered at the

the circular economy of sanitation sees

CSIR International Convention Centre

human waste as a resource, which allows

in Pretoria at the launch of UNDP South

a whole ecosystem of beneficiation to

Africa’s Accelerator Lab – one of 60

be derived from processing, byproducts

across the world, serving 78 countries.

and servicing models that support self-

The labs test and scale new solutions to

sustaining businesses.

global challenges by bringing together grassroots ideas with new sources of

“The circular economy has the catalytic

real-time data and experimentation to

effect of stimulating and developing a

meet the fast-changing realities of 21st

series and variety of logistics and supply

century development.

chain models, which brings greater convenience to the user and the much-

Minister of Higher Education, Science and

Innovation, Blade Nzimande in his speech at the

launch of UNDP South Africa’s Accelerator Lab

UNDP South Africa has partnered with the

required capacity, which is a weakness

Department of Science and Innovation

in the public model.”

These smart grids will provide opportunity

initiative. “Ground-breaking innovation is

Honourable Nzimande indicated that

but can also address local government

not new to South Africa. The country has

government is adopting a similar

played a pace-setting role in the global

approach with respect to energy access

innovation ecosystem, which led to the

and security (with a focus on off-grid

invention of several devices that continue

solutions using hydrogen fuel cells and

to shape the world innovation landscape

renewable energy sources) and in internet

till today” - Dr Ayodele Odusola, Resident

access and connectivity.

(dsi) to implement this innovative global

Representative, UNDP South Africa “Potentially the biggest industry that can In his keynote address, the Minister of

also develop especially looking at the

Higher Education, Science and Innovation,

infrastructure demand is the electric car

Blade Nzimande referred to the strategic

market. Investment in smarter electricity

partnership with the Bill and Melinda Gates

grids will be a pre-requisite for a future

Foundation) which has initiated, under the

electric vehicle roll-out.

for private investors in infrastructure revenue challenges. The integration of information and telecommunications technologies and the electricity sector can be lead to a significant new growth in these sectors”. Together we can This statement in South Africa’s National Framework for Sustainable Development reflects government policy towards sustainability: “South Africa aspires to be a sustainable, economically prosperous and self-reliant nation state that safeguards its democracy by meeting the fundamental human needs of its people, by managing its limited ecological resources responsibly for current and future generations, and by advancing efficient and effective integrated planning and governance through national, regional and global collaboration.”

Sources UNDP South Africa www.dea.gov.za Launch of UNDP South Africa’s Accelerator Lab

www.dti.gov.za www.dsi.gov.za

GOVERNANCE

2020 WILL LIKELY BE A TURNING POINT FOR

SUSTAINABLE FINANCE IN AFRICA’S MINING SECTOR The continent’s mining sector is likely

purposes of developing environmentally

to be among the adopters of sustainable

friendly student accommodation in Nairobi.

finance products, particularly as mining

By Nigel Beck, Head of Sustainable Finance for Standard Bank Group and Mark Buncombe, Head: Mining and Metals for Standard Bank Group

As corporates proactively implement measures to operate more responsibly and improve their Environmental, Social and Governance (ESG) performance, 2020 is shaping up to be a watershed year for sustainable finance in Africa

groups and their supply chains seek to

But a step change in activity in coming

demonstrate their positive societal and

months is anticipated. Standard

environmental impacts – and secure their

Bank’s sustainable finance unit has

social licenses to operate for the long-term.

seen a surge in interest from all sectors, including mining, and that

In fact, pursuing ESG policies and

momentum is expected to continue

responding to the challenges of climate

as investors demand action and

change are both seen as more important

transparency and corporates globally

priority areas than growth for the global

take more responsibility for uplifting and

mining and metals sector this year,

safeguarding society. The sharp rise in

according to law firm White & Case’s

interest, points to pent-up demand for

latest annual survey. Less than 9% of

sustainable finance solutions in Africa.

respondents are pursuing growth as their leading goal for 2020.

These unique funding solutions will play an important role in helping

While the sustainable finance market

Africa’s mining industry to overcome

has started to gain serious traction in

common challenges – such as energy

developed economies, it remains in its

supply, water treatment, environmental

infancy in Africa, with only a few notable

protection and mine rehabilitation,

deals having been executed. Among those

impending carbon taxes, community

being East Africa’s first ever green bond,

development, health and safety, and

issued in late 2019 by Acorn Group for the

resilient infrastructure development.

2020 WILL LIKELY BE A TURNING POINT FOR SUSTAINABLE FINANCE IN AFRICA’S MINING SECTOR

And as regulatory requirements tighten

Green bonds remain the most popular

and investor demands increase,

form of sustainable financing product,

corporates that avoid ESG issues face

although sustainability loans, green

material risks. KPMG warned in a 2019

loans, social bonds and sustainability

report that companies that fail to act could

bonds are all garnering more attention.

in time find it difficult to access capital.

As enablers of trade

and investment, banks have an important role

in encouraging the shift

Furthermore, their stock valuations

This comes amid an increasing

could be affected by their lack of ESG

focus on ESG issues, particularly as

transparency, potential regulatory action,

institutions move to win back the trust

and weaker long-term performances.

of the societies in which they operate.

Those that do take action have an

With confidence in governments low in

opportunity to improve their ESG ratings,

many instances, the public is looking

which in turn can lower their cost of

to the corporate world for solutions to

capital. As such, sustainable finance not

societal problems. Those companies

only enables future-proofing initiatives,

that fail to position themselves

but it also makes commercial sense.

accordingly – by basing their decisions on long-term sustainability rather

Local miners are considering funding instruments such as social bonds to develop employee housing and infrastructure, or green bonds and loans to fund water treatment plants and renewable energy units. These projects are not nice-to-haves – they are crucial for the sustainability of the industry. Consider how dependent mines are on water – a resource that is highly sensitive to climate change – and the urgency of such initiatives become clear. According to EY’s 2020 report on the biggest risks and opportunities across the industry, ‘license to operate’

There is a growing body of evidence that

than short-term considerations – risk

a stronger commitment to ESG issues is

falling behind.

linked to a company’s outperformance over the long term, partly because

Like its peers, the mining industry has

operational risks are reduced.

some way to go to change perceptions about its impact on the environment.

As enablers of trade and investment, banks

Nevertheless, it is worth noting that the

have an important role in encouraging

sector is playing an important role in the

the shift, which also needs to happen in

transition to a lower-carbon economy.

the short-term supply and trade finance arena. This is why Standard Bank has been

Platinum group metals and other

working with the International Chamber

metals such as manganese, cobalt

of Commerce’s Banking Commission to

and copper, for instance, are key

develop a framework that helps banks to

components of electric vehicles

develop sustainable trade finance practices.

and batteries.

GLOBALLY, THE SUSTAINABLE FINANCE MARKET IS EXPANDING AT A RAPID PACE.

remains the most significant risk to the sector. Reducing the industry’s carbon footprint ranks fourth, while the need for innovation – to ensure access to energy and infrastructure, and to improve water management, among other needs – also features as a prominent theme.

According to Bloomberg data, 2019

And as mines become more

was a record year for sustainable debt

sustainable, their products will

issuances, with transactions worth at

contribute to the development of

least $380 billion. This is an increase

sustainable cities.

of 46.2% from 2018, with European governments and corporates driving much of the demand.

Sustainable finance will catalyse the transformation.

GOVERNANCE

WHY ARE INVESTORS FIXATED ON SUSTAINABILITY?

ESG MOVES INTO MAINSTREAM INVESTING

A GLOBAL VIEW

By Paul Davies and Michael Green

Recent studies show ESG implementation in mainstream finance has improved significantly, presenting opportunities for sustainable, long-term returns. In recent years, Environmental, Social and Governance (ESG) implementation has transformed from a niche to mainstream activity, as asset managers, asset owners, and pension funds increasingly recognize the importance of ESG factors to investors, stakeholders, and shareholders. Issues such as climate change, remuneration, modern slavery, and equal pay have led to the integration of ESG into investment processes. INCORPORATING ESG FACTORS AND METRICS

ESG factors include:

ESG metrics can be used

ENVIRONMENTAL FACTORS Climate change Resource depletion Waste and pollution Deforestation

analysis, into investment and decisionmaking processes to better manage risk and

to ESG risks. Environmental metrics may

land, disposal of hazardous

SOCIAL FACTORS

waste, or reduction of toxic emissions.

Working conditions Local communities Health and safety Employee relations Diversity

Social metrics may examine a company’s business relationships (e.g., if the company works with suppliers that hold similar values) and working conditions (e.g., if the company shows a high regard for workers’ health and safety). Governance metrics may examine how the company is run (e.g., if the company uses accurate and

GOVERNANCE FACTORS Executive pay Bribery and corruption Political contributions and lobbying

ESG factors and metrics are numerous

Board diversity and structure

financial metrics.

with regard

ownership of contaminated

generate sustainable, long-term returns.

but external to the traditional canon of

performance

company manages

(PRI) describe “responsible investing” as which are not traditionally part of financial

a company’s

examine how a

The Principles of Responsible Investment an approach to integrating ESG factors,

to evaluate

Taxation

transparent accounting methods, eschews illegal practices, and avoids conflicts of interest in board member selection). MONITORING THE TRENDS THAT ARE SHAPING ESG

Several major events and trends have influenced ESG’s shift toward the mainstream in recent years. First, the 2008 financial crisis underlined how important

ES G MO VES I N T O MAI N S T R EAM I N VES T I N G - A GLOB AL V IE W

good governance practices are, and how

management. BNP found that 75% of asset

empirical links between ESG factors,

culture and conduct have a major effect on

owners and 62% of asset managers held

mitigation, and financial performance.

company success and market perception.

greater than 25% of their funds in ESG-

Climate change has driven a move toward

related funds — a significant increase from

sustainable investment largely due to

48% of asset owners and 53% of asset

TO GREATER ESG IMPLEMENTATION

the fact that it has become a present

managers in 2017.

To embed ESG further into investment

challenge, rather than a distant threat.

UNDERSTANDING THE CHALLENGES

processes, procedures, and activities, Asset owners and managers also see

many challenges need to be met. According

Second, ESG reporting is increasing,

responsible investing as a method

to the BNP Paribas report, respondents

with a recent LP Footprint

of positively contributing to the UN

considered data to be the top barrier

Sustainable Development Goals (SDGs)

to ESG integration. Inconsistent data,

and related key performance indicators that

conflicting ESG ratings or indices, data

are being built into investment frameworks,

gaps, and inconsistent coverage across

and 65% of respondents stated that their

asset classes all contribute to poor scenario

investment framework is aligned with

analysis. Better quality and more consistent

the SDGs. Motivations for ESG investing

data is required to ensure that effective

included improved long-term returns (52%

scenario analysis can be conducted.

Project report finding that 63% of limited partners have ESG policies, 59% have selfselected to be signatories with the PRI, and 40% publicly

of respondents), positive impact on brand

publish annual

and reputation (47%), and decreased

The next barrier was costs. Respondents

ESG reports.

investment risk (37%).

appreciated the need to spend on

Third, market

Standard & Poor’s

participants

In April 2019, Standard & Poor’s released

performance, produce profiles, and create

have begun

a report titled Exploring Links to Corporate

new sustainability-based products. Investing

Financial Performance. The report notes

in smart technologies has the potential to take

that companies focusing on ESG issues

ESG to the next level and allow investors to

have reduced costs, improved worker

assess the performance and sustainability of

productivity, mitigated risk potential, and

investee companies with improved accuracy.

to recognize the value in ESG reporting. ESG metrics help manage risk by enabling a deeper assessment

technology in order to better aggregate data, produce ESG reports, benchmark

created revenue-generating opportunities. In turn, the report shows, ESG-related

Respondents overwhelmingly found the

investments have benefitted greatly from

“social” factor of ESG to be the most

high-profile market participants pushing

challenging to analyse and subsequently

investment period. ESG reporting can

ESG into the spotlight and the momentum

incorporate into investment analysis.

indicate strong corporate oversight and

generated by the PRI.

Investors continue to grapple with the

and understanding of risk, and close monitoring during the

clear, transparent engagement with

complexity of Social factors, and the lack

investors, which can drive value and

The report notes that assets invested

of a definite, industry-wide definition of

confidence in the organization.

according to ESG strategies reached

what Social factors are, and what they

US$30-trillion in 2018, following a 25%

encompass, creates confusion.

ANALYSING THE STUDIES SHOWING INCREASED ESG IMPLEMENTATION

increase to US$24-trillion between 2014 and 2016. ESG factors and metrics can

CONCLUSION

provide valuable insight into possible

ESG has clearly crossed over to the

In April 2019, BNP Paribas Securities

current and future ESG risks that may have

mainstream, with increasing adoption

Services published The ESG Global Survey

the potential to directly or indirectly impact

by asset owners, asset managers, and

2019 examining 350 asset owners and

profits and returns. The early-warning

pension funds, but there is more to come.

managers and their attitudes toward ESG

nature of ESG factors can also contribute

Greater ESG integration depends on

issues and strategies. The survey found that

to long-term financial performance.

market participants finding solutions to the

BNP Paribas

ESG factors are increasingly embedded in

challenges outlined above, which will bring

asset owner and manager activities due to

The report considers that while ESG

a broader and deeper understanding of

the benefits of effective ESG performance,

implementation is strong, further academic

data trends, and allow better analysis of

such as increased returns and better risk

research is required to confirm definitive

risk going forward.

GOVERNANCE

CORPORATE FRAUD AND AUDITING CHALLENGES

LESSONS By Robert Lewenson, Head of ESG Engagement, Old Mutual Investment Group

At the very core of King IV is the principle of ethical leadership of the governing body. This highlights the critical role that a board plays in interrogating financial statements and the correct use of the different audit functions and resources.

C O R P O R ATE GOV E R NANCE

Combatting corruption lies in sound ethics, governance and authentic leadership LESSON #1:

LESSON #3:

their attention and earn their respect.

COMPLIANCE; IT IS A MIND-SET

brimming with charm and goodwill.

Most organisations extol the virtues

world has borne witness to many brutal

ABOUT FINANCIAL AND REGULATORY

of strong governance, as evidenced

STICKING TO A STRATEGIC VISION Strategy theory suggests that strategy

accountable executive team and board.

making wise choices initially and deepening one’s competitive position than going too broad and trying to be all things to everyone. Although the diversity of businesses might give some people the impression that the company lacks a core identity and has chased acquisitions, the company’s long-term vision should be to control its various value chains, thereby moderating costs, keeping competitors at bay and striving for ever-higher levels of

transparent reporting, and an engaged and However, all too often compliance ends up being a box-ticking exercise, with the goal being to meet minimum standards, mostly only to satisfy the relevant authorities. Basic compliance may satisfy shareholders on an elementary level but can lead to operational mediocrity if not backed up by committed management, which is key to sustainable profits and a satisfactory return on investment.

efficiency and market share.

An important dimension of sound

This is an important element in

business practices that are based on

fundamental strategy in sourcing and manufacturing goods in low-cost countries and selling them to value-conscious buyers in more lucrative markets.

LESSON #2: GROWTH DOES NOT ALWAYS

EQUATE TO PROFIT OR SUCCESS Organisations that deliver consistently strong performance over extended

management is a commitment to ethical values, not just rules. Values should be entrenched in the moral fiber of any business, helping people to distinguish between right and wrong and therefore, regulating their behaviour. Rules provide behavioural guidelines but are susceptible to being challenged, manipulated or ignored. Strong governance in an organisation is heavily dependent on an accountable and capable board to exercise rigorous oversight while also motivating the executive team to follow their vision.

periods of time, invariably practice a

LESSON #4:

controlled growth strategy in which future expansion and investments are carefully planned and executed. The hallmark of truly great companies is that they have the discipline to hold back and moderate their growth plans to avoid experiencing resource constraints and fatigue, or end up in financial difficulties during lean times when the cash they accumulated during bumper years is depleted.

at all levels, speak their language, keep

STRONG GOVERNANCE IS NOT JUST

in prudent financial management,

development over time is more about

Charismatic leaders can engage people

Yet charismatic leaders are not always They are also capable of extortion. The dictators that have kept populations under control by projecting a charisma that is laced with menace. Charismatic leadership is often viewed as ambiguous because the extraordinary power and influence that go with it can be used in either a positive or a destructive way.

LESSON #5: EVEN ETHICAL BUSINESS PEOPLE ARE CORRUPTIBLE

Human morality is fragile, notwithstanding most people’s good intentions. Deep-seated stirrings of envy, greed, self-absorption, arrogance or a sense of entitlement could infiltrate people’s moral fibre at any stage – even those who appear to have strong value systems and are the least likely to be swayed. To be human is to continually wrestle with one’s conscience when presented with opportunities to win friends, favours or influence without putting in the usual slog. It is, as Freud described it, a “tragic fate of humanity”. No skimping Of course, this does not mean that wrongdoing should simply be pardoned – particularly when, in an organisational sense, the culpable

A CHARISMATIC LEADER CAN EITHER

parties are savvy or senior enough to

COMPANY

no organisation can afford to skimp

There is a general belief that if an

and balances, particularly where

BE VERY GOOD OR VERY BAD FOR A

organisation is fortunate enough to have a charismatic leader, its chances of

know better. What it does mean is that on introducing the appropriate checks organisational finances are at stake.

success improve dramatically.

C ONCLUS ION

THE FUTURE OF

SUSTAINABILIT Y IS CIRCULAR By Reinhardt Arp and Zaynab Sadan

The Anthropocene – or the age of humans – is underpinned by the pursuit of perpetual economic growth and characterised by environmental degradation on numerous fronts. According to conventional wisdom, economic growth is supposed to deliver prosperity, higher incomes and improved quality of life for all of us. However, this certainly isn’t the case in reality. Economic growth has, at best, delivered these benefits unequally and at the expense of the natural environment upon which economic growth itself depends. To continue on this business-as-usual pathway, paved with climate change, ecosystem degradation and biodiversity loss, is simply inconceivable. fu t u re of su sta i n a b i l i ty.c o .za

The world is in desperate need of some

World Wide Fund for Nature (WWF) 2018

kind of “green stimulus”, something that is

Living Planet Report, we have wiped out

increasingly being referred to as the ‘Green

60% of mammals, birds, fish and reptiles

New Deal’ in the USA and the ‘Green

since 1970, and human activity is said to

Deal’ in Europe. We need a complete

directly affect over 70% of global ice-free

refurbishment of the global economy – one

land surface2. These pressures are pushing

that creates jobs and improves livelihoods

the integrity of our biosphere beyond its

in the short-term; provides equitable food,

planetary boundary and into the high risk,

energy, water and economic security in

red zone. Our fossil fuel addiction has

the medium-term; and crafts a sustainable

increased global greenhouse gas (GHG)

future for all in the long-term. Transitioning

emissions by 41%3 over the last 30 years,

to a just, low-carbon and circular economy

pushing climate change beyond its safe

provides a promising roadmap for building

planetary boundary. The global agricultural

a sustainable macroeconomic policy and

system, which, in its current form, fails

garnering such a green stimulus.

to provide adequate nutrition for all and

Refurbishing our economic model for circular sustainability

generates vast amounts of food waste, has pushed both the global land-system and biochemical flows beyond their planetary boundaries as well. Continued

Since the industrial revolution the global

and unrestrained pressure on the planetary

economy has expanded exponentially,

system from anthropogenic activities is

often at the cost of significant ecological

dangerous and risks pushing the global

resource degradation. In 2009 the

system into uncharted territory.

planetary boundaries concept was proposed as a means of understanding

The structure of the global economy

and measuring our impact on the planet.

needs a drastic refurbishment. Call it

Nine planetary boundaries define

a green new deal, a just transition, a

the environmental limits within which

green stimulus, whatever we choose to

humanity can safely operate and provide

call it, it needs to improve resource use

science-based analyses of anthropogenic

efficiency, decouple material use from

pressures on Earth’s ecological system1.

economic growth, promote sustainable production and consumption, address

Driven by uncensored consumerism, our

persistent inequities, and eliminate

continuing quest for economic growth has

waste and pollution. To sum it up, it

pushed four of Earth’s critical ecological

needs to deliver on both socio-economic

processes beyond their safe planetary

and environmental agendas of the

boundaries (Figure 1). According to the

Sustainable Development Goals.

T H E F U T U R E O F S U S TAI N AB I LITY IS CIR CULAR

These green economic transitions are not to be confused as new, additional green sectors to those that already exist today. Rather, these are cross-cutting macroeconomic policy initiatives that take advantage of technological developments and seek to transition our existing economy to one that is more sustainable – a green metamorphosis if you will – and the circular economy model provides a promising concept from which to design such a green metamorphosis.2

A circular model also improves natural resource use efficiency, enhances the value of natural capital and avoids unnecessary waste and pollution. In doing so, the circular economy model reduces anthropogenic impacts on the environment and our planetary boundaries. Furthermore, secondary material use lowers the carbon intensity of the system and if (ideally) powered by renewable energy, the circular economy can help realise a low-carbon economy. In fact, according to an EMF study6,

Figure 1: Planetary boundaries

transitioning to a circular economy is

critical for achieving deep emissions 1: Planetary boundaries From: Steffen, Figure W., Richardson, K., Rockström, J., Cornell, S.E., Fetzer, I., Bennett, E.M., Biggs, R., Carpenter, S.R., de Vries, reductions and transitioning to a lowW., de Wit, C.A.,From: Folke,Steffen, C., Gerten, D., Heinke, J., Mace, G.M., Persson, L.M., Ramanathan, V., Reyers, B. AND Sörlin, S. 2015. W., Richardson, K., Rockström, J., Cornell, S.E., Fetzer, I., Bennett, E.M., Planetary boundaries: Guiding human development on a changing planet. Science, 347 (6223). DOI: 10.1126/science. carbon economy. Biggs, R., Carpenter, 1259855. S.R., de Reprinted Vries, W.,with de Wit, C.A., Folke, C., Gerten, D., Heinke, J., permission from AAAS. Mace, G.M., Persson, L.M., Ramanathan, V., Reyers, B. AND Sörlin, S. 2015. Planetary 4 addition to environmental benefits, boundaries: humanfor development on athat changing planet. Science, 347 (6223).by design”In The circular economy is aGuiding “framework an economy is restorative and regenerative . This DOI: 1259855. with permission from AAAS. thefrom circular economy carries several concept is rooted in10.1126/science. the functioning of nature,Reprinted which is itself built on a circular model. Plants take nutrients the soil, energy from the sun and provide food for other animals. When they die, they decompose and replace potential socio-economic benefits. those nutrients back into the soil. Despite having biological examples of regenerative, sustainable and circular The repurposing of waste into systems, we The havecircular not yeteconomy replicated how nature functions into our systems. Instead we have embedded the take, is a “framework The circular economic model counters the secondary resources can provide make and dispose model within many, if not all, of our systems. for an economy that is restorative and

current linear economy model and aims

cost savings, create new markets for

and replace those nutrients back into the

is prevented/minimised/eliminated or can

management sectors respectively 7. These

4 The circularregenerative economic model counters current lineartoeconomy model and aims toand limit of new by design” . This the concept limit the use of new resources the the use secondary resources and generate resources and the amount waste produced by the system, while of accounting for allbyflows of materials within it. opportunities. According to an is rooted in the of functioning of nature, amount waste produced the system, new job The circular which economy achieves this by re-engineering or redesigning the system and its components so thatInternational waste is itself built on a circular model. while accounting for all flows of materials Labour Organisation (ILO) is prevented/minimised/eliminated or can become a “secondary resources” or input. The expansion of a domestic3 Plants take nutrients from the soil, energy within it. The circular economy achieves report, the circular economy model could secondary resource market has the benefit of reducing reliance on critical primary/virgin material inputs that are from the sun and provide food for other this by re-engineering or redesigning the create approximately 50 and 45 million often imported and, therefore, can improve supply chain resilience to future climate disasters or geopolitical animals. When they die, they decompose system and its components so that waste jobs globally in the services and waste shocks5.

A circular model also improves natural resource use efficiency, enhances the value of natural capital and avoids soil. Despite having biological examples become a “secondary resources” or input. benefits are derived from new activities unnecessary waste and pollution. In doing so, the circular economy model reduces anthropogenic impacts on the of regenerative, sustainable and circular The expansion of a domestic secondary born from redesigning the system and environment and our planetary boundaries. Furthermore, secondary material use lowers the carbon intensity of systems, we have not yet replicated resource market has the benefit of reducing reskilling workers from carbon intensive the system and if (ideally) powered by renewable energy, the circular economy can help realize a low-carbon 6 functions our study systems. reliance on criticaleconomy primary/virgin material industries, which could provide a buffer economy. Inhow fact,nature according to aninto EMF , transitioning to a circular is critical for achieving deep emissions reductions and transitioning low-carbon economy. Instead we have embedded to thea take, inputs that are often imported and, therefore, against potential negative implications

make and dispose model within many, improve supply chain resilience to future from the contraction of unsustainable or In addition to environmental benefits, the circular economycan carries several potential socio-economic benefits. The 5 if not all, of our systems. climate disasters or geopolitical shocks . carbon-intensive activities. repurposing of waste into secondary resources can provide cost savings, create new markets for secondary resources and generate new job opportunities. According to an International Labour Organisation (ILO) report, 87 4

EMF. 2017. Concept: What is a circular economy? A framework for an economy that is restorative and regenerative by design. Ellen MacArthur Foundation. [Online]. Available: https://www.ellenmacarthurfoundation.org/circular-economy/concept.

C ONCLUS ION

Case study: Imagining a Circular Plastics Economy

in recycling processes; economic

interventions could be to shift towards

and market structures; poor or limited

manufacturing and recycling system

waste collection, sorting and recycling

that uses renewable energy in order to

The plastics sector provides a

infrastructure; and legislative barriers. As

decouple from fossil fuels entirely.

timely case study for illustrating the

a result, this linear model has generated

opportunities presented by the transition

and leaked large volumes of plastic

However, kick-starting the transition to

to a circular economy. Plastics are

pollution in our natural environment.

a circular economic model will require

used across multiple industries and

a number of additional supporting

sectors, including packaging, fast-

This problem will only worsen if we fail

interventions. Firstly, the circular

moving consumer goods, textiles,

to shift to a circular plastics economy.

economy needs to be institutionalized

the automotive industry, as well as

With a growing global population, there

by establishing voluntary Extended

building and construction. Plastic

will be an increase in the demand and

Producer Responsibility (EPR) initiatives

waste, however, is polluting terrestrial,

consumption of plastics. With current

or through an enabling regulatory

freshwater and marine ecosystems in

trends, the plastics sector is projected

environment to ensure accountability

large volumes, which not only pose a

to account for 20% of global fossil fuels

among stakeholders throughout the

threat to biodiversity, ecotourism and

consumption by 2050, amounting to

plastics value chain. For example,

livelihoods in affected areas, but also

15% of the global carbon budget4.

primary plastic producers and packaging

induce knock-on effects on other distant

users (such as retailers and brand

geographical areas that depend on the

A circular plastics economy (Figure 2)

owners) should bear the bulk of the cost

well-being of the affected areas.

would be one that first and foremost

of end-of-life material management,

limits the amount of virgin material

brand-owners and retailers must

Under the current linear model, plastic

entering the system by redesigning

redesign their products to be 100%

products are primarily made from virgin,

products to use less virgin material

recyclable and use as much recycled

fossil fuel feedstocks, which accounts for

and more recycled material. It also

content as possible; consumers

6% of global fossil fuel consumption8. Not

encourages the use of more sustainable

must take responsibility for reducing

all plastic products are designed to be

feedstocks, such as renewable plant-

consumption, reusing and/or recycling

reused by the consumer, particularly food

based and waste material-based

their plastic, and waste collectors must

and beverage packaging, and while some

feedstocks rather than fossil fuel-based

ensure that all recyclable plastic finds its

products are designed to be recycled,

feedstocks. Redesigning products to be

way back to recycling plants instead of

only a small percentage of plastics are

reused/refilled, and/or easily recycled

landfill. If any of these stakeholders do

actually recycled in practice. This is due

and remanufactured into new products,

not fulfil their role in the circular system

to a number of reasons, including product

will also reduce the generation of

then it is at risk of failure.

design and the use of multi-layer materials

plastic waste and it’s leakage into the

and additives causing technical difficulties

environment. An additional layer to these

Interventions to achieve this include, amongst others: establishing a global agreement on plastics pollution and a circular plastics economy; promoting EPR schemes; introducing pricing mechanisms that increase the price competitiveness and creation of end-use markets for secondary resources (reused or recycled material) relative to virgin or primary resources; product standards and certification and the phasing out of unnecessary and problematic plastic products. The OECD RE-CIRCLE project provides guidance materials on a suit of interventions, regulations and policies for transitioning to a circular economy.

fu t u re of su sta i n a b i l i ty.c o .za

T H E F U T U R E O F S U S TAI N AB I LITY IS CIR CULAR Sources: 1. Steffen, W., Richardson, K., Rockström, J., Cornell, S.E., Fetzer, I., Bennett, E.M., Biggs, R., Carpenter, S.R., de Vries, W., de Wit, C.A., Folke, C., Gerten, D., Heinke, J., Mace, G.M., Persson, L.M., Ramanathan, V., Reyers, B. and Sörlin, S. 2015. Planetary boundaries: Guiding human development on a changing planet. Science, 347(6223): 736. 2. IPCC. 2019. Climate Change and Land: an IPCC special report on climate change, desertification, land degradation, sustainable land management, food security, and greenhouse gas fluxes in terrestrial ecosystems. Summary for Policymakers. [Online]. Available: https://www. ipcc.ch/site/assets/uploads/sites/4/2019/12/02_ Summary-for-Policymakers_SPM.pdf. Accessed 18 December 2019. 3. NOAA. 2019. NOAA’s greenhouse gas index

Figure 2: Interventions for a circular plastics economy

Source: WWF (2019)

up 41 percent since 1990. National Oceanic and Atmospheric Administration. [Online]. Available: https://research.noaa.gov/article/ArtMID/587/ ArticleID/2359/NOAA%E2%80%99s-greenhouse-

Accessed ndly, substantial investment into physical, digital and logistical network infrastructure is required gas-index-up-41-percent-since-1990. to enable 26 November 2019 Secondly, substantial investment intotransportation, materials to stimulate circular material of materials, such as tive and efficient identification, collection, sorting and reuse/recycling EMF. 2017. physical, digital andThis logistical networkintegrating flow. Consumer awareness also critical -back schemes, for example. includes informal waste pickersis into the plastics 4. economy as Concept: What is a circular economy? A framework for an economy that is infrastructure is required enable effective promoting behaviour - from needs to be lowplay a critical role in the circularto model, particularlyinin South sustainable Africa. Such investment restorative and regenerative by design. Ellen efficient identification, collection, thoseand whoelectric buy the product rightItup to the on, relying onand new technologies, such as renewable energy vehicles. also has the added benefit MacArthur Foundation. [Online]. Available: https:// transportation, sorting and reuse/recycling brandthe owner packages the product. roviding a much needed stimulus to the economy,ofkey being jobwho creation potential that comes with it. www.ellenmacarthurfoundation.org/circular-

materials, such as take-back schemes, for

Accessed 18 December 2019. dly, capacity building, skills development, education and awareness are critical in activatingeconomy/concept. digital, example. This includes integrating informal Conclusion 5. McCarthy, A., Dellink, R. and Bibas, R. 2018. nological and logistics infrastructure within the circular economy model, from collection to remanufacturing. waste pickers into the plastics economy as We urgently need sustainable The Macroeconomics of the Circular Economy cies, regulations and incentives are needed to encourage stakeholders along the value chain to build core they play a critical role in the circular model, macroeconomic policy if we are to reduce Transition: A Critical Review of Modelling petencies in circular and multi-life cycle design, including expertise required to redesign products and their particularly in South Africa. Such investment our anthropogenic impact on the planet Approaches. OECD Environment Working ponents, rationalise materials, and create markets for secondary resource materials to stimulate circular needs to be low-carbon, relying on new and ensure a sustainable future. The Papers, No. 130, OECD Publishing, Paris. erial flow. Consumer awareness is also critical in promoting sustainable behaviour - from those who buy the [Online]. Available: https://doi.org/10.1787/ technologies, such as renewable energy circular economy model provides us with duct right up to the brand owner who packages the product.

nclusion

and electric vehicles. It also has the added

a promising roadmap for developing

benefit of providing a much needed stimulus

sustainable macroeconomic policies

to the economy, key being the job creation

and measures for transition to a just,

af983f9a-en. Accessed 17 December 2019.

6. EMF. 2019. Completing the picture: How the circular economy tackles climate change. Ellen MacArthur

Foundation. urgently need potential sustainable macroeconomic policy if we are to reduce our anthropogenic impact on the planet[Online]. Available:https://www. that comes with it. sustainable and low-carbon economy. It not ellenmacarthurfoundation.org/assets/downloads/ ensure a sustainable future. The circular economy only model provides us with a promising roadmap for improves resource use efficiency but Completing_The_Picture_How_The_Circular_ loping sustainable macroeconomic policies and measures for transition to a just, sustainable and low-carbon Thirdly, capacity building, skills development, also limits waste generation and pollution. Economy-_Tackles_Climate_Change_V3_26_ omy. It not only improves resource use efficiency but also limits waste generation and pollution. Improving education and awareness are critical in Improving and expanding secondary expanding secondary resource supply and decouplingresource from primary resource requirements, theSeptember.pdf. circular Accessed 17 December 2019. activating digital, technological and logistics supply and decoupling from 7. ILO, 2018. World employment and social outlook omy enhances supply chain resilience to unexpected primary climate or geopolitical shocks. Finally, the circular infrastructure within the circular economy resource requirements, the circular 2018: Greening with jobs. International Labour omy providesmodel, opportunities to address additional climate and socio-economic challenges, develop new skills from collection to remanufacturing. economy enhances supply chain resilience Organisation. [Online]. Available: https://www.ilo. create jobs. This circular future is sustainable and the future of sustainability is circular. Policies, regulations and incentives are to unexpected climate or geopolitical

org/weso-greening/documents/WESO_Greening_

needed to encourage stakeholders along the

shocks. Finally, the circular economy

value chain to build core competencies in

provides opportunities to address additional

circular and multi-life cycle design, including

climate and socio-economic challenges,

expertise required to redesign products and

develop new skills and create jobs. This

their components, rationalise materials, and

circular future is sustainable and the future

create markets for secondary resource

of sustainability is circular.

EN_web2.pdf. Accessed 15 January 2020. 8. WEF. 2016. The New Plastics Economy — Rethinking the future of plastics. World Economic Forum, Ellen MacArthur Foundation and McKinsey & Company. [Online]. Available: http:// www.ellenmacarthurfoundation.org/publications. Accessed 10 December 2019

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ESG: The Future of Sustainability

Articles inside

THE PUBLIC SECTOR AND SUSTAINABILITY

The future of sustainability is circular

Diversity in the Workplace

A time to give back

Water Sustainability

Corporate fraud and auditing challenges

Why are investors fixiated on sustainability

Sustainable investing - a South African perspective

The Public Sector and Sustainability

Sustainable finance in Africa’s mining sector

How to embed ESG as best practice

Sustainability in the workplace

Climate-smart Entrepreneurship

Powering Ahead

Traveling the green road

Digging Deep

Pollution and plastics

Success stories in sustainable agriculture

Building our future

The green economy