Climate Change Blog 1: Brazil GHG Emissions Performance after Rio-92 Convention

Brazil was the first country to sign the United Nations Framework Convention on Climate Change – UNFCCC at Rio-92. From this point institutions have been created to address the issue and voluntary commitments that rep­resent a significant reduction in the emission of greenhouse gases were implemented in the country.¹

Let’s have a look on the Brazilian GHG emission performance since Rio-92 convention.

CO2 Emissions

From 1990 to 2005, emissions from industrial processes increased by 45%, however they represent 4% of total CO2.The largest share of net CO2 emissions comes from change in land-use, especially relating to the conversion of forests into cropland and pasture, change in carbon stock in the soils,  showing  a  net emissions of 77% of total CO2 emissions in 2005.

Change in land use emissions stand out in the country also because Brazil has a large share of renewable energy in its energy matrix and uses ethanol extensively as a source of fuel for vehicles. Therefore emissions related by consumption of fossil fuel are relatively low for a large developing country.

Nonetheless In 2005, CO2 emissions from the Energy sector represented 19% of total CO2 emissions mainly from fugitive emissions of burning gas in platform and refinery torches, and the inadvertent burning in coal waste piles, showing an increase of 74% in comparison to 1990 emissions. The transport sector accounted for 8.1% of total CO2 emissions in the same year.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CH4 Emissions

Similarly with the CO2 case, the most responsible CH4 emissions is the Agriculture sector 71% in 2005, almost all referring to non-dairy cattle, the second largest herd in the world. In2005. Manure management, irrigated rice crops and burning of agriculture residues were responsible for the remaining emissions. In relation change in Land-Use, CH4 emissions occur from burning biomass in deforestation areas, representing 17% of total CH4 emissions in 2005.²

 

 

 

 

 

 

 

 

 

 

 

 

N2O Emissions

In Brazil, N2O emissions also occur predominantly in the Agri­culture sector, 87% in 2005, as from deposition of animal manure in pasture and from ap­plication of fertilizers in cropland. Overall N2O emissions grew 43% between 1990 and 2005.² chapter

In order to address the issues of change in land use a Good Practice Guidance LULUCF was published in 2003 in the country, in addition in 2009 a National Policy on Climate Change – PNMC was put into practice with the aim to combine social and economic development with reduction GHG emissions and adaption to climate change.

 

 

 

 

 

 

 

 

 

 

 

 

References

1) Chapter 3 Relevant Institutional Arrangements for Elaborating the National Communication on Permanent Bases.

http://www.mct.gov.br/upd_blob/0215/215075.pdf

2) Chapter 2 Summary of Anthropogenic Emissions by Sources and Removal by Sinks of Greenhouse Gases.

http://www.mct.gov.br/upd_blob/0215/215078.pdf

 

 

2 comentarios / 06 Feb 2012 por Patricia Perez Costa
IMSD /

Climate Change class: Hungary’s vulnerability to climate change

In this entry I would like to show 3 different approaches to define Hungary’s vulnerability to climate change.

According to the Global Adaptation Index (GaIn) Hungary has rank 26 and the score of 75.4 with a negative trend (declining scores). What does this mean?

Vulnerability measures a country’s exposure, sensitivity and ability to cope with climate related hazards, as well as accounting for the overall status of food, water, health and infrastructure within the nation.

Readiness targets those portions of the economy, governance and society that affect the speed and efficiency of absorption and implementation of Adaptation projects.

The low vulnerability score and high readiness score of Hungary means that adaptation challenges may still exist, but the country requires little help in facing them. Hungary is the 29th least vulnerable country and the 13th most ready country.

 

According to the DARA Climate Vulnerability Report Hungary is and will be more vulnerable regarding the habitat loss compared to the Eastern European average. This report shows, that the vulnerability factor is still “moderate” but will increase to the factor “high” by 2030. This will also result in a higher economic stress. The country is not and probably will not be target of many weather disasters or will not loose lives directly due to climate change, but needs to face higher preparation costs and the high cost for the habitat loss. The report does not go deep into details, serves rather as awareness raising.

 

 

The 5th National Communication to the UNFCCC (2009) states that the country’s most affected areas are agriculture and forestry, extreme weather events present a human health risk. The broad range of suggested actions mostly target agriculture, forestry, water management and human health related areas. Below you can see some problems, which can occure in Hungary with their vulnerability levels according to the National Communication.

 

To conclude, the 3 reports put Hungary in slightly different vulnerability phases: GAIN the least, Nat. Comm. the most vulnerable of the 3.

 

References:

GAIN report  2010 – http://index.gain.org/

DARA Climate Vulnerability Monitor 2010

5th National Communication to the UNFCCC 2009

Comments Off on Climate Change class: Hungary’s vulnerability to climate change / 06 Feb 2012 por Ildiko Heim
IMSD /

Climate Change Blog 1: Sources of GHG emissions in France

According to the Kyoto Protocol, 1990, France emissions were set at a level of 563.9 MT CO₂ – e.q. CO2 represents a 75% of the GHG emissions. Between 1990 and 2007, the country’s emissions reached 531 MT CO₂ – e.q, which means that France GHG emissions decreased in a 5%.

The detriment of 5% in the GHG emissions is because of France specific characteristics. The country has a well-developed nuclear base and a low use in carbon and gas for producing electricity. In fact, France is the second European country in producing renewable electricity and it also has one of the smallest car flee.

The Fifth Communication of France to the United Nations Framework Convention on Climate Change establishes that most of the GHG emissions come from transport, with a 35% production of CO_2. Agriculture produces 80% of the methane and a 26% of the total French emissions.

As the figure shows, unlike some European countries, the transportation sector is producing most of the GHG emissions. Even though, France has one of the smallest car flee a 95% of the CO₂ emissions comes from the road, specifically a 54% from private vehilces.

I think this situation will change in the coming years. France is already one of the countries to comply with the Kyoto Protocol and has chosen to set an example by planning a reduction of 75% on its CO2 emissions.  It has serveral  initiatives proposed by the country, in order to reduce the emissions. For instance “Climate Plan 2004-2012″ and the Law of August 2009 for the implementation of Grenelle Environment Forum commitment to reduce the GHG emission on a 3% per year for the 2050.

 

Reference:

Fifth National Communication under the UN Framework Convention on Climate Change, 2009  http://unfccc.int/resource/docs/natc/pol_nc5.pdf

 

 

 

Comments Off on Climate Change Blog 1: Sources of GHG emissions in France / 05 Feb 2012 por Natalia Diaz Zamora
IMSD /

Climate Change class: GHG emissions in Hungary

In 2007, the total emissions of greenhouse gases in Hungary were 75.9 million tons carbon dioxide equivalent (excluding the LULUCF (= Land use, land-use change and forestry) sector). That number is the lowest value in the whole inventory period. Taking into account the carbon absorbing processes in the LULUCF sector, the net emissions of Hungary were 71.8 million tons CO2 eq. in 2007. By ratifying the Kyoto Protocol, Hungary committed to reducing its GHG emissions by 6% compared to the average of 1985-87 as its chosen base period figures. In 2007, Hungary’s emissions were 34% lower than in the base year.

Emissions decreased mainly due to processes in the energy sector. The total fuel consumption in the residential sector decreased by 20% – mainly due to extreme mild winters in past years but the growing energy prices and the support for modernisation of buildings played a role as well (panel insulation program). In contrast with the above trends, the emissions from energy industries grew by 6% in line with the growing tendency of electricity generation. The growth in the transport sector slowed down.
Emissions from industrial processes decreased by 8%. This change is mainly due to the modernization of nitric acid production. Through putting the new acid plant into service in Nitrogénművek PLC, which was the most up-to-date plant in Europe at the time of building, the company’s N2O emission volumes have considerably fallen back.

Emissions were reduced in the Energy, Agriculture and Industry sectors compared to the  base year. In contrast to this, in the waste sector emissions increased by 35% compared to base year.

Since the graphs above show values excluding LULUCF it could be interesting to mention that in 2007, the net removal by the LULUCF sector (mainly by Forest Land) was -4.1 million tons CO2.

It is worth to mention, that the total fuel consumption in the residential/commercial sector has changed significantly: solid fuels almost disappeared and the share of natural gas increased.

The evaluation of the F-gases (HFC’s, PFC’s, SF6′s) shows an interesting trend, although they represent only 1% of the total GHG emissions (as shown in Fig. 3.2) The use of HFCs in the refrigeration and airconditioning industry got widespread and their emission increased ten times. Most of PFCs were emitted by aluminium production (stopped in 2006). SF6 emissions primarily depend on their use in the power generation industry and they show an increasing trend.

To conclude, Hungary expects to overachieve its Kyoto target. Although this should be a good news, the part for critic is the choice for the base period (1985-87), where Hungarian heavy industry was still strong, and high emitter. This means, that not too much will be done to decrease the current emissions as there is no pressure from the Kyoto protocoll.

References:

http://unfccc.int/files/ghg_emissions_data/application/pdf/hun_ghg_profile.pdf

5th National Communication to the UNFCCC (2009)

Comments Off on Climate Change class: GHG emissions in Hungary / 05 Feb 2012 por Ildiko Heim
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Sustainability. Repsol Case. Group No. 2

Group no. 2:
Alberto Renegel, Carlos Cerdán, Pablo Gonzalez, Diana Sánchez

Repsol case study

Introduction

Nowadays, one of the main concerns refers to trade off between the future energy supply and the sustainability of the resources. The depletion of natural sources (fossil fuels), the climate change threat, plus the increasing growth in population, presents one of the main economical and political challenges.

The private sector plays a major role in this scenario. Their decisions and priorities will determine the direction of the energetic path. We want to focus our attention in this sphere, analyzing the specific case of Repsol, one of the most important industrial Spanish companies, with worldwide presence.

Business case

Repsol is an oil and gas company with operations in 29 countries, including Argentina, Brazil, Mexico, Chile and Colombia. It has more than 36.300 employees from more then 70 different nationalities, being 27% women and 62% under collective agreement.

Map world presence

The National Institute of hydrocarbon, INH, funded Repsol in 1987 in order to accomplish the privatization of CAMPSA, the monopolistic Spanish petroleum company since 1927. Now, it is Spain’s largest industrial company and the sixth-largest oil company in Europe in terms of sales. It is also the 15th largest petroleum refining company, according to Fortune Global 500 List.

Its business consists mainly in the exploration, production, transport and refine of oil and gas. REPSOL also promotes and researches for new renewable energies such as bio-fuels.

The Company’s activities are divided into five business areas:

1. Upstream, which is responsible for oil and gas exploration, and production activities
2. LNG (Liquefied Natural Gas), which manages LNG midstream and marketing activities
3. Downstream, which is responsible for refining and marketing of oil, chemicals and LPG.
4. YPF, which is responsible for the integrated value chain activities (exploration, production, refining, logistics, marketing, and chemicals) undertaken by YPF.
5. Gas Natural, which corresponds to the company’s stake in Gas Natural

In 2010, was created the New Energies business line with the aim to promote the diversification of the energy portfolio, with a special emphasis on the low-carbon and more efficient alternatives.

All these activities had important impacts on the financial performance of the Company. In 2010 the net profit was tree times more than one registered in 2009, reaching E 4.693 billion.

All the business lines experienced significant growth in its recurrent operating income: upstream +66%, downstream +45,5% and Gas Natural Fenosa +14%.

Even the crisis, Repsol has maintained a solid financial position. The net debt had decreased a 65% during the last year, in order to be ready for uncertain future crisis forecasts.

In this context, Repsol performance was good. The new starting projects in Brasil and Venezuela, as weel as in Spain are the ones that will ensures the Company’s future growth.

Stakeholder analysis

One of the main issues of Corporate Responsibility model of Repsol is related to the stakeholders engagement. The identification of each one of the expectations in line with sustainable development of the stakeholders set the base for this job. However, recognizing who is who, and delimit the scope is not at simple at it sounds .

The identification of Repsol’s stakeholders allowsclassifying them in the following groups: employees, suppliers, customers, community, government and shareholders. This case does not differ from this proposal.

In this case is possible to affirm that the interests of most stakeholders can be related to the social responsibility of the organization. The challenge is to address the link between the stakeholders’ interests and the responsibilities of the organization to society at large.

Customers. Repsol customersare drivers, haulage contractors, households, industrial clients, airlines, civil construction, workshops, farmers, ship owners, fishermen and charterers. There are 4 main issues for the Company in the relation with its clients: satisfaction, product quality and safety, and transparency and veracity in their communications. For this, Repsol has mechanisms to measure and manage this subjects, such as surveys, specialized units to monitor the health and environmental risks of the products they market, voluntary mechanisms and codes to ensure the transparency and veracity of advertising communications, and Self-Regulatory Code on Environmental Claims in Commercial Communications and the Ethical Code of Online Trust. At the end, the customers are the main reason for a company; taking care about their concerns and necessities is vital for their business success.

Employees. Repsol has policies and programs that go furtherfulfilthe legal obligations and look for the welfare and security of their people. For instance, those related to fair wages that include extra-social benefits, equal opportunities, work-life balance, and health and safety programs. Also, it provides different communication channels, such as Employee Service Desk (SAE). All this initiatives point to the same goal: attract and maintain the best people, and bring the best labour conditions for improve worker’s productivity and performance.

Shareholders and investors.They are an integral part of the organization. They set the roadmap for Repsol performance and decision- making. Their main interest relies on the company’s success. The relation between the Organization and shareholders is characterized by the transparency of information and good governance. Repsol has the shareholder information office (SIO) and Investor Relations Department, relevant channels to share information. Also, it has a corporate governance system the structure and operations of its corporate bodies in the interest of the Company and its shareholders.

Local communities. This is a critical actor for Repsol. Not only for their, in many cases, opposite interests, but also because they are the main reason for the demands and reputational problems that the Company face.

Repsol consider that community relations contribute to the company’s success over the long term as well as to the development of the communities where we operate. For this, they have several programs, besides mechanisms that promote dialogue between both parties. Their effort is concentrated in 4 main areas: (i) work with affected communities (in 2010 for example, its upstream activities and industrial complexes affected more than 300 communities and 20 cities), (ii) dialogue; (iii) social investment; and (iv) indigenous communities.

The interest of the community relies on two main issues. First, the protection of their habitat (including all the environmental, social and cultural heritage), which in many cases is against Repsol’sexploration activities. Second, the consequences (and future responsibility) that the Company’s activity has on the development and quality of life of people.

Government. The policies related to the energy sector affect directly Repsol’s decisions and achievements. At the same time, the company’s performance has important impact on the economic situation of Spain (employment generation, taxes, etc), which is a major concern for the Government.

Partners, suppliers and contractors: Repsol has more than 24.000 suppliers and contractors from 79 countries. The importance of these actors is higher because it affects the whole supply chain and the possibility to accomplish the customer requirements. The relations between the company and the partners are governed by joint operating agreements (JOA), which define the responsibilities of each partner, and in particular, the operating partner, based on the regulation and values (ethical) that Repsol had established. Indeed, for Repsol is requires to its partners the implementation of ethical, social and environmental standards in their operations similar to its own. Furthermore, the contractors are required to meet internationally recognized standards such as the United Nations universal Declaration of Human Rights and the International Labour Organization (ILO) Declaration on Fundamental Principles and Rights at Work. This help to prevent any possible abuse or breach of law, which could be transformed into a reputational or even financial risk for the Company.

The interest of suppliers could be divided in tow categories: those who are current suppliers, and those who are potential ones. In the first case, their interest relies on having win-win conditions that avoid abuses from the biggest party. On the second case, the main interest relies on the opportunity that the Repsol gives to them. In this case Repsol gives preference to local suppliers of products and services with the aim to contribute to local supplier development where possible.

CSR analysis and opinion

One of the major risks that the extractive companies use to face are those related to human rights abuses (deliberate or not) within the community in which it operates, and the negative impacts on environment, which at the end takes a shape of reputational menace. Managing and minimizing this impacts, are main reason behind the increasing interest towards corporate social responsibility programs. Of course, Repsol can’t escape from this scenario.

Repsol’s CSR policies and programs, among other issues, look to enhance the reputation of the organization and fostering greater public trust. Repsol has implemented a Model of Corporate Responsibility that seeks to connect the stakeholder’s expectations (mainly from the communities) with the real performance and interest of the company. In fact, the model presents tree connected elements: (i) the company’s values and principles for action stemming from the Corporate Responsibility commitments it has assumed; (ii) the Corporate Responsibility coordination system; and (iii) the governance and coordination bodies.The entire model is based on the identification of expectations and opportunities of each one of the stakeholders, specially the communities, with the aim to addresses into their expectations and real performance. The main goal of the model regards on reputational indexes.

Regarding to environment, Repslhave adopted several measures such as impact identification, analysis and mitigation, improvement in the design of installations, processes and management systems, as well as continual investment in the best available technology.

Nevertheless they are being involved in some public scandals related to abuses of their operation in, Peru Bolivia and Ecuador.

One of the major scandals is related to the exploration of oil in the Peruvian Amazon known as Lot 39, home to at least two of the world’s last uncontacted tribes. Repsol currently claims there is not enough evidence to prove the existence of any uncontacted Indians in Lot 39. It says their existence is ‘extremely improbable’ and bases this claim on the ‘observations and studies available to the company to date. However the international scientific and ad anthropological communities have collected a great deal of evidence (pieces, testimonies, and photographs) demonstrating the existence of these tribes.

In Bolivia the natural gas extraction have created a state restructuring and political mobilization among indigenous peoples. The Guaraní community have borne the brunt of much of the oil and natural gas development in Bolivia. They denounced to be affected by fumes, noise and water pollution emanating from gas extraction activities. Their crops and livestock have also been harm. It was denounced that Repsol YPF and its subcontractors did not adequately consult with Guaraní community members regarding plans to extract natural gas from their lands.This situation has led to several protests by Guaraní residents who have demanded that Repsol pay restitution.

Is evident that these scandals harmed not only the Repsol image, but also its credibility and its license-to operate.

These kinds of situations have important implications on the efficiency and efficacy of the projects, as well as on the productivity and “loyalty” of the employees. Work in a company that are in eye of the hurricane is something that affects motivation. Moreover, it had severe impacts on the social value of Repsol, not only determined by the price of the share in the stock market, but also by what people thinks about the role and contribution that the company has in society.

This highlight not only the difficulties (intrinsic, related to their core business) that the extractive sector usually have, but also the focus given to the Corporate Social Responsibility practice. In our opinion, the reputational argument, valid of course, limits the practical perspective of CSR, putting all the attention on satisfying external audiences. Even this approach fosters dialogue with governments and local citizens, it represent huge challenge. Sometimes stakeholders can never fully understand the company’s capabilities and the real trade-off that the must make, that ends on short-term actions, without attacking the main problems. At the end, they focus on the tension between business and society, instead than on their interdependence.

The real social impact and effectiveness of the investment on social programs made by Repsol is quite diffuse. In many cases this kind of investments lacks of a deep understanding of the problem and could cause a misinterpretation of the real role of the Company in society. Some of these initiatives are not coordinated with the necessities of the community (through the government guidelines), which dissipates the possibility to create social benefit.

What we want to point out is that even there is no universal and acceptable definition of CSR (what is completely normal), companies should address’s their efforts in a sustained and sustainable way. The best way of doing it is connecting their “CSR initiatives” with their strategy and core business. The point is to reinforce the corporate strategy through social progress. Repsol CSR policies is not to far way from this approach, but is necessary to address look beyond the reputational goal, always with a basis of ethics and sustainable values. For example, increasing the investment on R&D towards a new ways of energy sources (renewable) is a way to create shared value between Repsol and worldwide society.

The challeneg becomes more complex regarding to the relation with the comminuty. Repsol has an opportunity to improve the effectiveness and transparency of the communicational channels, the management of human rights impacts, and to find win- win agreements. However, any Company, including Repsl, should start from strong ethical bases, which requires in some cases sacrifices towards the common welfare.

References:

– Perreault, Thomas: “Natural Gas, Indigenous Mobilization and the Bolivian State”.
Identities, Conflict and Cohesion Programme. Paper Number 12. United Nations Research Institute for Social Development. New York. July 2008
– Repsol. Corporate Social Responsibility Report, 2010. http://www.repsol.com/es_en/corporacion/

https://imagenes.repsol.com/es_en/Local_communities_tcm11-593936.pdf

https://imagenes.repsol.com/es_en/Minimizing_environmental_impact_tcm11-593979.pdf

Survival: “39 Things Repsol Doesn’t Want You To Know” Survival International Report.April. 2011

1 comentario / 04 Feb 2012 por Diana Patricia Sanchez Barajas
IMSD /

CLIMATE CHANGE – GHG SOURCES IN MALAWI

Malawi is one of the least developing countries in the Southern Africa with a population of 13 million people with 80% of its population living in the rural areas.. Its is largely an agricultural country, and it grows mostly tobacco, sugar, and maize, besides other crops.Malawi is one of the countries that have ratified the United Nations Framework Convention on Climate Change (UNFCCC). Under this Convention, parties to the Convention must communicate to the Conference of the Parties (COP) their national inventories of anthropogenic emissions of all greenhouse gases by sources and sinks using comparative methodology.

According to the results of the 1994 inventories Malawi is a net emitter of Carbon dioxide (CO2). This is largely attributed to socio-economic pressures in Land Use Change and Forestry sector such as deforestation and conversion of prime forestry land to agricultural uses. In addition there are few plantations in Malawi and also the forestry per capita in the country is low. Thus in future GHG inventories acquisition of high quality activity data in land use change and forestry must be a priority. The contribution from Energy sector is also an important GHG source and needs quality activity data.

TABLE 2:  Summary Report for National Greenhouse Gas (GHG)

GHG sources	CO2	CH4	N2O	NOx	CO
Land Use Change and Forestry	18528.00	0.02	0.01	0.04	0.02
Agriculture	0 .00	48.50	7.05	2.24	72.20
Industrial Processes	58.38	0.00	0.00	0.00	0.00
Energy Industry	660.88	135.09	0.71	24.03	897.58
Watse	0.00	4.29	0.00	0.00	0.00

 

Table 2 Shows the 1994 sectoral emissions by gas type converted to their CO2 equivalents. The net CO2 equivalent emitted was 29230 Gg.

TABLE 2: Summary Report for National GHG Inventories in CO2-equivalents for 1994 (Gg)

GHG sources	CO2	CH4	N2O	NOx	CO	CO2
Land Use Change and Forestry	18526.00	6.49	3.20	1.60	0.06	17517.37
Agriculture	0 .00	1188.25	2256.00	89.60	216.60	3750.45
Industrial Processes	58.38	0.00	0.00	0.00	0.00	58.38
Energy Industry	660.88	3309.71	227.81	961.20	2658.34	7798.34
Watse	0.00	0	105.11	0.00	0.00	105.11

 

From the table it is clear we see the total CO2 emissions made up 66% of total CO2-equivalent emissions, followed by about 25% from methane. Analysis by sector, Land Use and Forestry contributed 60% followed by Energy (27%) and Agriculture (13%). Thus in future GHG inventories acquisition of high quality activity data in land use change and forestry must be a priority. The contribution from Energy sector is also an important GHG source and needs quality activity data.

 

Source

http://unfccc.int/essential_background/library/items/3599.php?such

 

 

 

 

Comments Off on CLIMATE CHANGE – GHG SOURCES IN MALAWI / 03 Feb 2012 por Tabithah Mkandawire Kaluwa
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Sostenibilidad y Responsabilidad Social Corporativa: El aporte venezolano

Empresas Polar es una empresa dedicada al sector alimentación en Venezuela. Su gran tamaño abarca distintas áreas dentro del sector, teniendo numerosas marcas para cerveza, refrescos y comida per se. Desde su fundación (hace más de 70 años)  la empresa ha estado comprometida con la labor social, ampliando su campo de acción a medida que ha ido creciendo paralelamente.

Desde que la compañía arrancó operaciones en Caracas con una planta de cerveza, estuvo comprometida con sus empleados mediante programas educativos y de salud. En la década de los 70 ya contaba con una fundación (Fundación Empresas Polar), hoy en día los esfuerzos pasados han probado ser sostenibles considerando que los mismos se siguen haciendo, e inclusive, se ha incluido el deporte, la ecología y el fortalecimiento emprendedor de las comunidades dentro de su estrategia social.

Aún cuando la empresa ha tenido conexión social mucho antes que la concepto de Responsabilidad Social Corporativa saliera al mundo, el tema ecológico- aún cuando tiene poco tiempo formando parte de su estrategia de RSE- necesita más impulso. Normalmente contribuyen con la recolección y reutilización de botellas de vidrio y plástico, depuradoras para sus plantas distribuidas en el país y realización de compost con estos desechos. Aún cuando su estrategia de botellas de vidrio es altamente efectiva, pareciera más bien que es un tema de competencia, ya que el resto de las empresas cerveceras lo hacen igual con ánimos de disminuir costos. Respecto al tema de las botellas de plástico, el porcentaje de recolección es bajo y éstas terminan regadas por el territorio nacional, pudiéndose potenciar esta estrategia mediante los programas educativos que ya le ofrecen a las comunidades y publicidades más agresivas, ya que tienen el poder mediático y los puentes educativos establecidos con las comunidades (igualmente, al estar todo creado incorporar esto en su estrategia resulta económico). El compromiso que mantiene la empresa con el resto de los programas no es tan cognoscible, ya que sus balances generales no están publicados o son de difícil acceso. Esto puede estar respondiendo a circunstancias políticas o a elementos que quieren esconderse. Puede sólo especularse al respecto, no obstante, es un elemento que despierta dudas.

En síntesis, es celebrable todo lo que está haciendo esta compañía a nivel nacional, e históricamente, el impacto en el país ha sido grande y positivo. Más compañías desde sus fundaciones deberían incluir esto no como una estrategia de venta sino de convicción accionaria, más si se trata de contextos tan desiguales como el venezolano. Aún cuando Empresas Polar S.A. ha sido exitosa no solo en desde el punto de vista empresarial sino social, conviene que impulse su iniciativa ecológica como un compromiso transversal dentro de su RSE, su impacto puede ser tremendo por su tamaño. Aún cuando pueda hacerse más, es justo decir que su contribución histórica resalta su entendimiento de la realidad venezolana desde el inicio, ya que se ha dedicado esfuerzos a fortalecer políticas que impulsan a un país, entiéndase, educación, salud, deporte, cultura y ecología. Conviene que se conozca más sobre este caso, es un claro de ejemplo cómo una estrategia de RSE puede ser sostenible en conjunto con una actividad económica rentable dentro de contextos volátiles como el venezolano.

 

Por: Pilar Aranda, Adolfina Cruz- Auñón, Jorge Lewis y Rodrigo Capriles

Fuentes:

Adriana Pedroza (2007). Responsabilidad Social Empresarial. Caso Empresas Polar. Publicado en Veneconomía. Disponible en http://www.veneconomy.com/site/files/articulos/artEsp4648_3261.PDF . Consultado el 02/02/2012.

Juan Carlos Figueroa (2011). Empresas Polar y Parmalat desmienten acaparamiento. Publicado en el Diario El Tiempo. Disponible en http://eltiempo.com.ve/venezuela/industria/empresas-polar-y-parmalat-desmienten-acaparamiento/38457 . Consultado el 02/02/2012.

Empresas Polar S. A (S.F). Gente Polar. Disponible en http://www.empresas-polar.com/movil/gente.html . Consultado el 02/02/2012.

Empresas Polar S. A (2010). Reporte de compromiso social. Síntesis del ejercicio 2009 – 2010. Disponible en http://www.empresas-polar.com/docs/POLAR_4web.pdf . Consultado el 02/02/2012.

ND (2011). Inflación se ubicó en Octubre en 1,8% y la acumulada en 22,7%. Publicado en Noticiero Digital. Disponible en http://www.noticierodigital.com/2011/11/bcv-inflacion-se-ubico-en-octubre-en-18/ . Consultado el 02/02/2012.

Maye Primera (2010). Algo huele a podrido en Venezuela. Diario El País. Disponible en http://www.elpais.com/articulo/internacional/Algo/huele/podrido/Venezuela/elpepiint/20100622elpepiint_4/Tes . Consultado el 13/01/12.

 

Comments Off on Sostenibilidad y Responsabilidad Social Corporativa: El aporte venezolano / 03 Feb 2012 por Rodrigo Capriles Mazzei
IMSD /

Climate Change: an insight on Australia’s vulnerability

Australian National 5th Communication on Climate Change

Due to its unique biodiversity wealth and high climate variability along the immense continent, Australia is supposed to experience consistent effects even with small changes in climate patterns. Such vulnerability to climate change is reflected also when considering the risk which threats its population, as it is highly concentrated in coastal areas. Specifically, in Australia evidences are already existing to confirm overall projections expecting:

• drier conditions • coastal inundation • loss of biodiversity • endangered water security • intensification of extreme events as floods, storms, droughts.

Australian precipitation variation

 

To further analyze vulnerability, let’s take into account two interesting tools:

 

Climate Vulnerability Monitor

The principal focus is about impacts on people according to 4 main area: health, weather disasters, habitat loss, and economic stress.

Analysis shows how in 2030 Australia will face increase economic stress and habitat loss: the first is explicable by the high importance of agricultural sector and in general of primary sector activities, which involve transformation of natural resources; the second by the increasing risk of desertification inland and by the high concentration of people in coastal areas, likely to face more extreme events and inundations; water scarcity affects both. In term of casualties derived by health risks and weather disasters, projections claim high capacity of the population to withstand: the status of high-developed country (infrastructures, potential of mitigation and prevention of risks, etc.) is likely to maintain the population safe.

 

 

Global Adaptation Index

Here the focus is on the extent of the population to cope with changes, according to territory exposure to changes, sensitivity of people to be affected by such changes, capacity of people to respond thanks to development considerations (infrastructures, services, efficiency, productivity, etc.) The country is considered to have great potential to overcome challenges derived by climate change as it holds the 4^th position in the global list. Itmeans that the real vulnerability of the population is lower than expected by the changes, and overall the potential to adapt is so big that even physical looming consequences won’t affect consistently people life style. Nonetheless, mayor concerns are presented by food security which aligns with the mentioned water scarcity and primary sector production decrease.

 

 

 

 

 

Comments Off on Climate Change: an insight on Australia’s vulnerability / 03 Feb 2012 por Francesco Mazzeo
IMSD /

Sustainability, group 5 (Arturo, Fabio, Luca): IBERDROLA CSR

Business study. What the business consists of?

Iberdrola is a spanish energetic company which is focused on all activities throughout the electricity production chain, from the generation to the distribution to final costumer. Since January 1st, the business is divided into 4 main areas, as we can see below.

●      Regulated Business – transmission and distribution businesses.

●      Liberalised Business – generation and retail businesses.

●      Renewables Business – generation of renewable energy.

●      Other Business – energy engineering and real state.

Company position in its industry:

Iberdrola is one of the 5 largest global utilities in the world, and it is present in 40 countries. Furthermore, the group is the worldwide leader in renewable energies, relying on an expressive participation in the US and European markets, besides some important emerging countries, particularly Brazil. In this sense, Iberdrola send a message of a long term-driven company with an increasing participation in the global energy market, especially renewable. As written in its vision: “We aspire to be the preferred Global Energy Company because of our commitment to the creation of value, quality of life, the safety of people and of supply, the protection of the environment and customer focus”.

International presence:

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales evolution & Profits evolution and Company situation in the current crisis context:

Iberdrola has grown very fast since 2001, when the internalization was taken as a strategy for the company. The entrance of a new CEO in 2006 fostered the process, and in 2007 Iberdrola increased its equity through the issuance of new shares, as we can see in the graph about capital structure. That capital was invested in the acquisition of Scottishpower and US utility Energy East Corporation, which promoted the massive penetration of Iberdrola in the UK and US markets. However, the growth trend was broken in 2008, because of the economic crisis. The company then was able to recover from this first blow, but the fact is that the economy stagnation has undermined the expectations of revenues and profits increase, as we can see in the respective graphs above.

Stakeholder Study:

Who are its main stakeholders?

Employees

Shareholders and financial community

Regulatory authorities

Customers

Suppliers –

Media

Society

Environment

What does the company need from these stakeholders?

– Employees: it’s expected that they share the vision of the company and don’t damage its reputation or credibility.

– Shareholders and financial community: they expect from the company net profit to share or to reinvest in R&D or new plants (or farms) and increase the liabylity of the customers.

– Regulatory authorities: they have to be involved and take in account in every new project and continuously to lobby them and try to set up a common framework field where to work on.

– Customers: part of the society and the most important feedback for the company in term of selling power and power to choose betweew different suppliers.

– Suppliers: continuous barganing with them to obtain the goods, in the meanwhile the company need reliablility from them to have a longlasting relation.

– Media: the company should have a good connection with the media because it’s supposed to be the stakeholder that could share and spread the aims and the well done of Iberdrola.

– Society: the society is the main potential customer of the company, and in the same time the main feedback for its reputation; it’s very important to don’t compromise the relationship with this stakeholder.

– Environment: very important source of energy, especially in the renewable energies field, it should be maintain a low impact on that to gain a sustainable development of the company and to reduce the risk of the externalities.

How important are the different stakeholders for the company?

Employees – nowadays Iberdrola has about 30.000 employees spread over the 40 countries in which company has its activities. The corporate responsibility, of course, starts with them.

Shareholders and financial community – as a private company, Iberdrola has to follow shareholders interests. The company has its shares being negotiated in the Madrid Stock Exchange (Bolsa de Madrid), and nowadays there is a small group of companies with relevant participation in the company (basically spanish companies and financial institutions)

Regulatory authorities – This business is marked by an intensive regulation, since electricity is considered a public service and hence Iberdrola is taken as a utility company. Having business in several countries with different regulatory frameworks make it more complex to comply with the requirements.

Customers – Iberdrola’s business model is partly focused on other companies (B2B) and partly in the final customer (B2C), which means that the company can’t overlook all their preferences at the same time it complies with the applied regulation.

Suppliers – Iberdrola wants its suppliers to provide quality products at a good Price. Also, their suppliers should have a respectful behavior with natural and social environment. In order to achieve that goal, Iberdrola promotes selection processes  that are based on transparency and equality principles. Those processes generate competence that increase the efficiency of the suppliers.

Media – it’s very important for the marketing part and selling the Iberdrola brand.

Society – Iberdrola has to take in account the public society opinion to don’t lose the credibility which is very important.

Environment – One of the main stakeholders for Iberdrola, since it’s straight linked with the energy production and it’s externalities.

What are the interests of each stakeholder?

Employees – The most important requirement for employees, particularly in crisis situation, is stability, they need to feel that their jobs are safe. Besides, they want to feel important for the company, earning good salaries. Employees also want to be part of a responsible company that takes cares of the environment.

Shareholders and financial community – In general terms, shareholders want to have a good balance between profit and risk. From that point of view, social and environmental scandals could represent a risk that should be avoided.

Regulatory authorities – In different countries there are different regulatory concepts, but at the end them all want Iberdrola to fit their requirements.

Customers – What clients want from Iberdrola is, mainly, a reliable supply of energy at a competitive price. But customers are also getting more and more involved in fighting against climatic change, and because of that, they are demanding renewable energy supply in their houses.

Suppliers – As well as employees, suppliers want to be sure that they are going to be paid, and prefer stable relationship in order to afford bigger productions and make investments.

Media – Media will put the focus in Iberdrola´s economic performance, and Iberdrola social responsibility if they do well. But if there is a big scandal, media is going to be an enormous speaker, that can damage deeply the company reputation.

Society – Society concept about Iberdrola is going to be very related with the information that they get from media.

Environment – Depending on how governments and big companies like Iberdrola decide to generate energy, this generation can suppose, specially in developing countries, an environmental (social and natural) disaster or an opportunity of employment, development, sustainability and economic growth. It is in their hands to take the good or the bad option.

CSR strategy developed by the company:

Reputational risks for the company.

According to Iberdrola: “From a general viewpoint, a risk is considered to be any threat that an event, action or omission may prevent the Group from reaching its objectives and successfully carrying out its strategies.

Reputational Risks: potential negative impact on the value of the Company resulting from behaviors on the part of the Company that are below the expectations created among various stakeholders: shareholders, customers, media,analysts, Government, employees and society in general.”

Source: https://www.iberdrola.es/webibd/gc/prod/en/doc/gobierno_corporativo.pdf

Real or supposed scandals in which the company has been involved in the national and international level.

Political Entrepreneurship: The Case of Iberdrola:

●      http://www.instituteforenergyresearch.org/2011/09/16/political–entrepreneurship–the–case–of–iberdrola/

Obama Caught Sending Stimulus Money Offshore:

●      http://www.freerepublic.com/focus/news/2330663/posts

Iberdrola and CEZ strike peace deal over Romania wind farms:

●      http://www.rechargenews.com/business_area/politics/article241934.ece

Los rumores sobre la operación Iberdrola se colocan en medio de la precampaña electoral:

●      http://www.energiadiario.com/publicacion/spip.php?article5627

Have they affected to its reputation? How can they affect to its sales? Can they affect to its access to capital?

The “scandals” that has been involved Iberdrola seems just supposed scandals and not confirmed ones, some of them are even of international scale; mainly involve Iberdrola as lobbyst of some politicians to obtain new procurements or to install (for instance in Romania, see the example above) new energy farms.

Actually these (supposed) scandals are not affecting the reputation of the company, its sales and its capital; at the end it’s very difficult to find a real scandal that has involved this company and that affected its public reputation.

CSR strategy developed by the company to satisfy the stakeholder’s interests?

1. Comply with applicable law in the countries.

2. Adopt cutting-edge corporate governance practices, based upon corporate transparency.

3. Respect human rights and, in particular, those the violation of which degrades workers, which entails the opposition to child labor and to forced or compulsory labor.

4. Develop a favorable employment relationships.

5. Develop responsible practices in the chain of value.

6. Promote a culture of respect for the natural environment, reducing the environmental impact.

7. Favor transparency and free market rules, rejecting bribery practices.

8. Promote socially responsible actions at those companies in which the Company has control or management capacity.

9. Encourage communication and dialogue with the various groups related to the Company’s activities.

10. Disseminate relevant and truthful information regarding the activities carried out.

Personal opinion:

What kind of policies should the company implement and which of them should be abandoned?

In our opinion, Iberdrola’s CSR policy covers basically all the fields along the companie’s value chain. Our main concern is about its process of internalization toward less developed countries. In these cases, particular topics must be extensively controlled, such as labour rights and environmental issues. Only through this path it will ensure the real sustainability of the company.

 

 

Comments Off on Sustainability, group 5 (Arturo, Fabio, Luca): IBERDROLA CSR / 03 Feb 2012 por Luca Palma
IMSD /

Sustainability class: Banco Santander Analysis

Team 4: Pedro Pernas, Piotr Wielezynski, Rubén Pardo, Ildikó Heim

 

Analysis of the SANTANDER GROUP

 

Business study

Santander, or rather Santander Group is a banking group that is considered to be one of the largest banks in the world as far as market capitalization is concerned. Of course its core company is Banco Santander S.A. It is also the 4th largest bank in the world by profits and 8th by stock market capitalization (1st in Euro zone). According to the Forbes Global 2000 list Santander is at the 13th place with sales at $109.7 bn, profits $12.4 bn and a market value of $94.7 bn. Santander main focus is retail banking which generates around 82% of group’s profits. Besides that it also have branches in corporate, investment and private banking.

Santander has a business model that is based on a customer-focused business. It delivers high quality services even in difficult times such as recent years. The model is based on five pillars:

1. Commercial focus (it is the largest branch network in international banking)
2. Efficiency (one of the most cutting edge technologies and operations platforms; it’s cost-to-income ratio is 41.7%)
3. Geographical diversification (balanced between developed and developing countries)
4. Prudence in risks (very good risk management)
5. Capital discipline and financial strength (solvency and liquidity ratios are very positive)

Besides that Santander gives a lot of commitments to the community where it is present. Its social projects are mostly related to initiatives in Universities. All of those aspects are putting Santander at a very high position in world banking.

Banco Santander was founded in 1857 and in 1999 it started its new strategy by merging with other big players. Obviously the mergers where a win-lose situation, because the name Santander have stayed. Since then its presence and position on the global market was increasing rapidly. Santander operates mostly in Europe and both Americas with a higher focus on Latin America. It is also present in Asia and Australia but the operations share from this region is scarce. The highest number of clients is in the UK (25.6 m), then Brazil (24.7 m), Spain (14.4 m), Mexico (9.1 m) and Germany (6.2 m). Brazil’s operations stand for 25% of all profits, Spanish for 15% and UK’s for 18%.

 

Sales evolution

As it is visible on the image below Santander’s sales in recent years where growing and were slightly higher than expected. It is a very good result referring to crisis times. For the past 6 years the averages grow was over 1%. Santander’s sales are now at the level of $109.7 bn, which gives them the 36th position worldwide, according to Forbes Global 2000.

Profits evolution

Profits also were growing for the past few years with the exemption of the year 2006, when they decreased by a couple of per cents. The most remarkable event is that in 2009 and 2010 Santander’s operational profits grew respectively by 6% and 8.2%, which was an outstanding result for the banking sector. Its profits in 2011 amounted to $12.4 bn.

Stakeholder study

Banco Santander’s main stakeholders are:

–          SHAREHOLDERS – 3.2 million at the end of 2010, an all-time high

–          CUSTOMERS – 97 million

–          EMPLOYEES – 180,000 professionals

–          SUPPLIERS – 3.185

 

Further stakeholders are the analysts, media, universities (wo benefit from the company’s CSR programs)

What does the company need from these stakeholders?

Shareholders

–          loyalty to the company with keeping and buying shares

–          participation of shareholders in the bank’s issues with suggestions

 

Customers

–          Usage of social networks as a new vehicle of communication and dialogue between its current and potential customers and the company

–          To reflect and contribute the customer’s voice to businesses and other forums of the bank

–          Confidence and loyalty

 

Employees

–          Each product or service is sold by those who know how to sell it

–          Motivation and loyalty to the company

–          Innovative ideas

–          Leadership qualities

–          Knowledge

–          Accepting and contributing to the corporate culture based on the Group’s values

–          Healthy workforce

 

Suppliers

–          Transparency and mutual respect

–          a declaration by the supplier committing them to respect and comply with the 10 principles of the United Nations Global Compact, which the Group adheres to

–          need to be local (as 98% are): those with operations in the same geographical area where the purchase and invoice are made

–          commitment to society and the environment

 

How important are the different stakeholders for the company?

Customers are the focal point of the Bank’s activity. The focus on the customer and striving for maximum satisfaction are the Group’s priorities. Of course, also the other stakeholders are of importance.

The interest of the stakeholders

SHAREHOLDERS

– Generate financial value for them and provide the maximum transparency in information

– Be profitable and solvent.

CUSTOMERS

– Satisfy their need by receiving customized products and high quality service at flexible times.

– They need quick and efficient solution to their complaints.

EMPLOYEES

-Receive appropriate salaries and benefits in a stable employment keeping the work-life balance. – Require equal development opportunities, training programs and career plans.

– Have a socially responsible employer.

SUPPLIERS

– Require guarantee of equality and transparency in contracting

– stronger communication.

 

 

CSR strategy developed by the company:

 

Reputational risks for the company: BS

–Lack of ethic and moral in products or services offered, It is related with the investment found offered. Profits based on market or price bubble. Do not buy shares in non-transparency companies. The money lend to business. Its behavior on the market.

–Illegal financial activities made by clients, using the bank for illegal activities such as tax haven, money laundering.

–Lack of transparency, related with the information provided by BS to their stakeholders.

The reputational risks are going to have an impact in Lack of solvency and established organization, damaging its REPUTATION.

Real or supposed scandals in where the BS has been involved

–International environment, the investment scandal (Madoff case), the essence of his scheme was to deposit client money into a Chase account, rather than invest it and generate steady returns as clients had believed.  So he paid the interest with the previous money the clients had put into the investment fund. It was based on a pyramid system. The problem appeared when people wanted to take their money out of the account. He deceived a lot of economic institutions like BS. The BS offered their clients to invest in these kinds of funds.

 

–National environment, There were two big scandals. One of them is related with a huge quantity of money the owners’ family had in a Swiss account. Switzerland is a tax haven state. Individuals and  corporate entities can find it attractive to move hidden belongings to areas with reduced or nil taxation levels. This have a wrong impact in the amount of money collected from the richness people to cover the necessities of people. The other impact was related with the property bubble. The BS offered to their clients to invest money in property funds. It was thought that the value of the buildings properties could not go down so they had offered fixed interest. But in the year 2009 the value of the properties decreased, and now the time to take the money out of the account hasn`t got penalties so if people get scare could cause a problem of liquidity in the bank.

 

Have they affected to its reputation? How can they affect to its sales? Can they affect to its access to capital?

 

Yes, they have affected, but not too much. Perhaps the most flagrant BS’s reputation was to do with the money deposited by the Botin family in Switzerland. There are some countries like England, where the reputation counts a lot when doing business. BS certainly did not notice the consequences of Botin’s family were investigated for tax fraud against the state. The other scandals were not properly due to BS though; certainly they could have acted more responsibly, not economic bill passage. It could have seriously affected the time to raise capital, because if people do not trust the good practices of the bank they do not invest their capital in the company, and scandals such as those mentioned above are enough for people and businesses to think twice about investing in BS.

 

CSR strategy developed by the company to satisfy the stakeholder’s interests?

 

The Plan for Corporate Social Responsibility is part of Santander’s business strategy in the belief that socially responsible management contributes to the viability of long-term activity because it satisfies the stakeholders´ interests.

The social and environmental responsibility of BS is based on three pillars: fundamental support for higher education, welfare and protection of environment.

Support to higher education

The impetus to higher education, research and knowledge are signs of identity of the Corporate Social Responsibility Banco Santander. BS invests in education to contribute to progress social and economic development of the communities in which it operates. Therefore, BS develops Santander Universities since years as a collaborative program with a large number of Latin American universities. 

Social Action
BS contributes to the cultural, social and educational communities through social projects that encourage the involving of employees and customers.

Environmental protection
BS has committed to develop its banking preserving environment and to promote initiatives that are committed to the protection, conservation and environmental restoration. To do this, BS developed relevant measures in several areas:
– Training and awareness
– Emission control and internal consumption
– Business development: opportunities in renewable energy sectors
– Social and environmental analysis in operations of credit to customers
Within the latter, are especially relevant in the analysis processes risk and decision making in project finance operations.

 

Personal opinion of our group about what kind of policies should the company implement and which of them should be abandoned?

Santander did manage to have outstanding financial results throughout the recent years. It is even more abnormal, because all other companies, banks included, had huge problems during the crisis. This performance is due to a very good marketing strategy that is focused primarily on the customer. Of course other stakeholders are also important, but from the outside are not possible to see. Marketing strategy together with some social initiatives leads to good reputation. Santander maintains good relations with the communities, where it operates. The bank was the initiator of many social campaigns regarding for example universities.

Although Santander has a very good reputation, some scandals were revealed concerning their operations. It is quite amazing that they haven’t influenced their reputation. Nevertheless they have to be aware of fraud fond investment products as well as laundering money of the clients to cultivate loyalty. Also they should not only focus on the image winning of the CSR policy (Green washing) but also turn them into real and effective policies with long-term impacts.

 

 

References:

• Forbes Global 2000 – www.forbes.com/global2000/#p_4_s_drevenue_All_All_All
• Santander Annual Report 2010
• Santander Sustainability Report 2010
• http://www.elconfidencial.com/en-exclusiva/2011/familia-silencio-fraude-fiscal-consejo-administracion-20110617-80220.html
• http://www.eoi.es/blogs/anabelenromero/2011/12/03/riesgos-reputacionales-banco-santander/
• http://www.abc.es/blogs/urbaneja/public/post/el-santander-y-el-riesgo-moral-del-inversor-478.asp
• http://www.elmundo.es/mundodinero/2008/12/14/economia/1229282291.html

1 comentario / 03 Feb 2012 por Ildiko Heim
IMSD /