20 Sustainability Trends:

2010 – 2011

Thomas Eggert, Esq.Founder, WI Sustainable Business Council &Co-Director of the Business, Environment &

Social Responsibility ProgramWI School of Business

The Importance of Tracking Trends We can learn from the past, but we can’t

be successful living there There is often more risk in maintaining

the status quo than in changing This moment in history really might be

unique in that our systems have largely been upset and much greater change is possible.

From economic collapse to a green economic recovery About 34 percent of people are now more likely

to buy environmentally responsible products and 44 percent of consumers indicate their environmental shopping habits have not changed as a result of the economy (Cone Consumer environmental survey 2009)

Venture capitalists and corporate investors invested $4 billion in green start-ups and the Dept of Energy has allocated $36.7 billion to energy efficiency and alternative energy projects in 2009.

From environmental sustainability to embedded sustainability In 2010 we will see stronger links between

sustainability and well-being. The UN Development and Happiness Index, and

the Genuine Progress Index integrate human well-being and environmental impact.

The credibility of these indices will continue to increase, with the $200 billion Lifestyles of Health and Sustainability (LOHAS) market expected to double by 2010 (from 2008 levels) and quadruple by 2015, according to the Natural Marketing Institute

From carbon footprint confusion to carbon regulation More than half of the global population is

aware of the term “carbon footprint,” up from 38 percent in 2007

The US EPA issued their endangerment finding in December, 2009, paving the way for regulating CO2 and requiring reporting on CO2 emissions starting in 2011.

From carbon trading doubt to carbon market development Point Carbon’s Market Outlook expects

the global carbon offset market to grow 20 percent in terms of volume in 2010.

They forecast that 5.9 gigatons (Gt) of carbon dioxide equivalent (CO2e) will trade this year, compared to 4.9 Gt in 2008.

From fossil fuels to renewables According to Morgan Stanley’s Green Market

Penetration forecast (2007), the renewables trend is going to continue developing; revenue from alternative energies could top $500 billion in 2020 and world-wide sales from alternative energy sources could reach $1 trillion by 2030.

The hottest investment sector for Venture Capitalists is CleanTech and Alternative Energy, with over $4 billion flowing into the sector in 2009.

From one renewable success to another Patents in wind, fuel cells, hydroelectric, tidal

and geothermal were up in 2008 over 2007 with hydroelectric and tidal patents being at all time highs.

Solar, hybrid/electric vehicle and biomass/biofuel energy patents fell slightly in 2008

From cheap to costly carbon European taxes on carbon emissions for new cars

are increasing. In late November, 2009, the state of California

announced plans to charge businesses 16.5 cents per metric ton of greenhouse gas emissions. The rule will be implemented starting late 2010.

The industries which will be the most affected by the move include the major refineries in the area, cement factories and power plants but even other businesses like auto shops, restaurants and coffee roasters will also feel the impact of the rule.

From creative carbon labels to consistent carbon labeling Carbon labeling schemes are up and running

on lots of packaging, but there is a lack of transparency in the calculations and no international standardization.

Wal-Mart has brought together a group of academics and suppliers to develop an eco rating system for all products that they will sell. This is to be launched by late 2010.

From Carbon Reduction to Carbon Neutral Kohl's Department Stores has

committed its U.S. stores, distribution centers and corporate offices to operate with net-zero greenhouse gas emissions by the close of 2010.

From carbon-centric to water-centric About 2.6 billion people have no access to

clean water (FairHome 2008), a problem not isolated to developing countries.

This has pushed water issues up the environmental agenda, and will become a new focus for 2010-11.

From direct water use to embedded water use According to Waterwise, the average person

in the UK directly uses about 150 liters of water per day.

But behind this direct use there is an indirect use, which is about 23 times higher at 3400 liters per day.

Of those 3,400 liters, 31 percent is embedded in industrial goods and 65 percent embedded in food, with the other 4 percent relating to drinking water and water used for domestic purposes

From energy excess to energy efficiency The July 2008 edition of The McKinsey

Quarterly estimated that $170 billion a year will be invested in energy efficiency between now and 2020, which could halve forecasted growth in global energy demand.

The International Organization for Standardization (ISO) is planning to create an energy management standard (ISO 50001) by 2011.

From energy efficiency private standards to legal requirements A draft EU rule for energy efficiency services

was published in March 2009 for public comment.

LEED is developing a comparative standard for the US.

These will outline standards for calculating energy consumption and energy audit methodologies

From landfill waste to lack of space Landfill sites are virtually impossible to site in

this country now. As a result, Landfill taxes are increasing and will continue to increase throughout 2010.

Europe has established waste targets that hope to achieve a 75 percent reduction in biodegradable waste between 1995 and 2010, a further 50 percent by 2013 and a further 35 percent by 2020.

From trash to treasure

Trash is being looked at as a new, less expensive feedstock.

People are now opting to reuse, resell, donate or recycle old goods.

Millions of us sell used goods on Ebay, which has recently launched “green team” and “world of good” websites to help users buy, sell and think green

From fast food to slow food Continued pressure on the fast food industry

related to obesity and diabetes Interest among the Lifestyles of Health and

Sustainability (LOHAS) community in health Growth in organic markets (>20%/year over

the last 5 years) Rediscovering the importance of eating

together.

From fast fashion to slow fashion Consumers are beginning to steer away from

cheap, disposable items and ethically-sourced, organic and fair-trade fabric purchases are on the rise.

Luxury fashion will begin to associate environmentally and socially responsible products with status.

From printed papers to digital development the development of online videos, social

networks, podcasts and sales, highlights that the digital marketing space will continue to expand.

Brands will increasingly use online spaces in 2009 to communicate with consumers.

The brands that will win, will be those whose consumers tell the best stories. It’s no longer a one-way narrative, it’s about a two-way conversation.

From offline to online

Consumers can find information about anything, anytime, and they are actively seeking information about the brands with which they interact.

In 2010, it is going to be increasingly important for brand image to match company behavior.

From company claims to external verification

About 64 percent of consumers want third-party verification of green claims according to the GfK-Roper’s 2007 report.

When Clorox launched their GreenWorks line of cleaning products, they enlisted the Sierra Club for their credibility

Some unusual partnerships are already developing between NGO’s and large organizations, for example McDonald’s and Greenpeace and Coca-Cola and WWF.

From greenwashing to green authentication The most common claims being challenged

are those referring to carbon reduction, cradle-to-cradle and green energy sources.

2010 will see the development of advertising standards and an increasing requirement for brands to have claims that are underpinned by fact.

Conclusion

The world is changing and the market is changing

What starts in Europe almost always makes its way to our shores

There will be winners and losers Green is here to stay