What in the blistering barnacles is a circular economy?

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“Nothing makes economic sense, unless its continuance for a long time can be projected without running into absurdities.” - Ernst F Schumacher in his book, Small is Beautiful : Economics as if People Mattered.

Essentially, a linear economy is a time-tested absurdity. And a closed loop circular economy can be a marvelous solution, to this malaise. Most importantly, this is not just a “sustainability” agenda, but, quite clearly a “quality of life” and “running a business” agenda. Read on, to know the how and why!

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Tintin comics had long back prophesized atmospheric heating, widespread flooding, the race for oil production and the wasteful nature of a linear society. So, there isn't a better way to start off this piece on circularity, invoking the euphemistic oath of the sea-faring Captain Haddock, of a "billions of bilious blue blistering barnacles!". So now, let's dive in what a Haddock or a Tintin would have to say about circularity today!

So, what is circularity?

It is essentially a “Cradle to Cradle” approach to consumerism. Which is a quality-of-life alternative approach to the concept of the existing cradle to grave, that we all live through; where products are manufactured to be consumed and then thrown away. Rarely was a deeper strategy created to ensure the resources being extracted wasn’t exploitative, the product being assembled could eventually also be dis-assembled or how a re-use of that product could be enabled beyond its first glorious run. Circularity, in essence, is almost zilch without the concept of cradle to cradle embedded in its creation. For those interested, the Book Cradle to Cradle: Remaking the way we make things by Michael Braungart and William McDonough covers this in greater detail.

Now, let’s explore our current circularity challenges and their potential solutions.

What happens today is downcycling mostly and sometimes recycling. Let’s try to understand this through a few examples.

· When was saying we are going “plastic-free”, what are putting in as a replacement? And how environmentally friendly is that? It talks about how when the car industry was regulated not to use the harmful asbestos, they replaced it with the much-more harmful antimony sulfide. Or how when lead or cadmium is prevented from being used, manufacturers shift to using tin, copper, nickel, copper or bismuth – all of which is more rare and more harmful! Essentially, replacement ends up being a distraction, not a solution, and introduces new problems by itself; if not thought through in a systems-approach.

· When companies say “this product can be recycled” and not “this is how much of the product we recycle or re-use”, it is as good as saying “this Amazonian Forest is your biggest carbon sink, and can give you endless supply of oxygen”. While what we need to say is “This Amazon Forest can be your biggest carbon sink, if we prevent grazing by X%, deliberate land-grab by Y% and sell off to industrial lobbies by Z%”. Hence, claiming “recyclability” is not enough, show how you recycle and re-use materials – companies like Body Shop and Patagonia have been leading in changing the narrative around such superficial sustainability actions and disclosures.

· When we are obsessed with the easier-wins; like doing away with plastic straws or cleaning beaches for eternity. I have been at the forefront at similar campaigns on both these fronts, and as well meaning as they are, they still do not solve the core of the problem. Plastic straws being replaced by paper straws, only moves the problem from plastic to trees. Just like cleaning the beaches, only moves the focus away from solving waste generated at sources, into well-meaning citizen campaigns on our beaches. Both these transitions are necessary conditions, certainly not sufficient ones.

There is a lot which needs to change, to bring about this transformation. None of it requires rocket-science worthy research, but, just requires us to pause and reflect on the inherent circularity that already exists around us. Here is a suggested strategic framework to make this happen.

1) Products that are designed to be re-used or up-cycled. Such as enabling “asset recovery” in electronics (Phones, TVs, Washing Machines), and doing away with oft-embedded volume-achieving concepts like “planned obsolescence”.

2) Upcycling, wherever possible, has to be the number 1 priority. It is like what the brewing industry is now doing by not just converting its Spent Grain into cattle fodder, but, also look at how it could make premium energy bars and healthy drinks out of the same.

3) The book Biomimicry by Janine M. Benyus talks about the concept of an “industrial ecology”, where we close the loop of material usage across businesses. You see your industrial parks and SEZ’s? Well, waste for one is often input material for another. It is not in thin air, that Energy has such massive shifts towards husk and briquettes to help create a self-fulfilling eco-system of energy use items.

4) Industrial ecology also need not be limited to just “industries”. After all, paddy straw which is being burnt unabated in Punjab and North India and causing lung-choking pollution, has eventually been converted into furniture by an Ikea.

5) Bio-mimicry at the core of product (i.e., innovation inspired by the circular nature of our surroundings). For this, minerals usage in a close loop is extremely critical. Like when you mine Bauxite to make Aluminum cans (the GHG emission of that extraction is extremely high), but, being able to use more than 95% of this extracted aluminum in a circuitous loop is extremely critical.

6) As William McDonough and Michael Braungart (yes, the same brilliant authors of Cradle to Cradle) talk about in their book Upcycle, we have stop thinking of “sewage” and start thinking from the perspective of “nutrient management” – then every man’s waste can very conveniently become other man / animal / organizations’ input! Singapore had taken the lead in converting sewage water into drinking water, and Delhi too has followed its lead. The fact that this is not a common occurrence in every possible city, is a huge miss on the part of our urban planning.

7) Incentivizing sustainability is not enough. Environment costs of resource extractive products have to be internalized by companies, if they do not wish regulators to keep fining them millions and billions of dollars. This idea of the “Tragedy of the commons” can no longer be an academic excuse for corporates.

And to communicate to any lay-man, if you need a Five-Pointer Toolkit, here is how it would look like -

1) Incentivize more upcycling, which values up the product or waste beyond the obvious linear re-cycling approach

2) When recycling, close out the loop, which doesn’t lead to the eventual passage into a land-fill or incineration.

3) Re-usability that is encouraged across the life cycle of a product

4) Move away from neutrality claims, to circularity claims. Plastic neutrality, like carbon neutrality, has seen it become a claim of the yesteryears, and thankfully so.

5) Making re-usability fun, and not a kill-joy of convenience

You can be a consumer, a policy-maker or a corporate manufacturer product. Your golden rule of thumb has to be that waste in itself is not a problem. If your waste can find its eventual destination to be recycled in a healthy manner or re-used in another industry or up-cycled for value-added products, that will be much better than having a small quantity of waste which is eventually incinerated or thrown into a land-fill.

We must not forget what Ernst F Schumacher said in his seminal book Small is Beautiful : Economics as if People Mattered, “Nothing makes economic sense unless its continuance for a long time can be projected without running into absurdities.” A linear economy is a time-tested absurdity. A circular economy can be the only way to run our economies henceforth. And this is not just a “sustainability” agenda, but, quite clearly a “quality of life” and “running a business” agenda!

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Originally posted on 6th November, 2023

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How to identify a "green-washed" sustainability claim?

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Here's a handy cheat sheet to help you identify greenwashed claims. By being more aware, you can move beyond just being passive consumers or creators of brands and companies. This ready-reckoner can help you become even more of an aware and credible sustainability and branding professional, who are now transforming the operations & communications of the sustainable companies of our future!

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Let’s jump into this one. We all know of green-washing and how a much of a pain it is to navigate through the same for consumers, investors and marketing & sustainability professionals alike.

Quite simply, here are the top 10 rules of thumb, to identify greenwashing claims –>

1)    Are the claims about absolute reduction or claims which happen through "off-sets" primarily? Be more skeptical of “off-sets” – Big brands like Coca-Cola bore the brunt of it recently, and then also received a lot of flak for sponsoring the COP27 summit! Carbon neutral, net zero, relative emission reduction and absolute emission reduction – these are four different metrics, in increasing order of their credibility.

2)    In terms of recycling, are the claims incomplete? Are claims only for certain low-hanging input materials, while not talking about the tricky GHG and extraction-heavy materials? And are recycling claims about what is potentially “recyclable” or what is actually “recycled”? Here is an insightful GreenBiz article, for reference.

3)    Are claims being made about recurring usage reductions, while not talking about the construction/creation level emission in the value-chain? The EV industry, and how it only talks about comparative emission reduction vis-à-vis internal combustion engines, and not the extraction cost and emissions of minerals and rare earth metals is a case in point. Here is a podcast, which deep dives into the EV sector.

4)    Are certain elements of a product becoming more externally sustainable, without changing the inherent way of working of an organisation? In the fashion/clothing industry, except for a Patagonia, we have rarely seen any brand having embedded sustainability into its operations. Others do interesting “sustainable launches” here and there, and carry out post-production CSR reports without addressing the core issues of concern. The myth of sustainable fashion is covered effectively in this write-up by HBR.

5)    Are all claims made over the same time frame? Or do some numbers look bloated because of different time frames used for different claims? Apple’s recent sustainability video, had a classic case of this for their water-saving claims - check point 5 of this write-up for Apple's video, for more details on the same.

6)    Is the company passing of cost-saving initiatives as sustainability initiatives? When your hotel chain exhorts you to look at how you handle your linen and towels to “save water”, are they really asking you to “save water” or “save their operating cost”. Ask the hospitality chains to spend more time in disclosing how they are generating and storing for their power needs? With vast roof and open spaces, this is the perfect industry to drive the renewable energy transition instead.

7)    Are company’s loosely using words & terminologies like “natural”, “real”, “raw” and even “organic” without providing certifications and other evidence to back their claims? Organic claims in particular, in India, needs a complete overhaul on the institutional approach. Remember; you can call it “all-natural” and still have naturally occurring elements like lead, arsenic and mercury inside the product!

8)    Watch out for apparently oxymoronic campaign or advertising claims. The energy and oil industry aren’t far behind. When “clean coal” became a point of debate in the 2008 US Presidential election (which Barack Obama had to later course-correct himself), or even when oil companies pass off a more efficient fuel as “green fuel” with visible green colour branding elements, our green-washing radar should go on alert-mode.

9) What is also a recent practice, is when companies use primarily risk-evaluation and mitigation based ESG / Sustainability rating and portray them as a proof of their “achievements” and “progress” in the intent of embedding sustainability. It can as well be step 1 of the journey, but it must be called out with a clear caveat that just because one’s reporting is top-notch, does not mean one has also cleaned up its eco-system of all emission-linked and resource-crunch issues.

10) Are company’s passing off legal requirements as their sustainability achievements. Is a product highlighting CFC-Free on its packaging as a point of differentiation, despite it being a legal mandate? Did the company really start off its sustainability reporting for its suppliers, or did a global mandate to which it is a prior signatory compel it to do so? Although these are not so high in the level of being “dis-honest” with claims, but, can be avoided by the company simply being honest with its disclosures in not just the fine-line of its annual reports, but also its publicly prominent advertising claims.

Be honest. Be aware. Be sustainable.

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Originally posted in January'2024

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Apple opened up gaps on Corporate Sustainability speak, and then fell straight into it

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This article critiques the recent Apple advertisement on its progress against its 2030 Sustainability commitments. It covers the nuances surrounding "carbon neutrality" claims vis-a-vis "net zero" ones, the challenges of transforming the landscape of material recycling, the need for reporting on "life-cycle" value of emissions that includes the gamut of indirect upstream to downstream emissions, reporting sustainability numbers with context and in relative sense rather than absolute numbers which might sound big in form but make much less sense in function. Well, it's all of that, and much more - Question. Explore. Derive.

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By now, most of us have seen the Apple advertisement, which is its visual status report of 2023 towards its 2030 Sustainability commitments (here is the video - https://www.youtube.com/watch?v=QNv9PRDIhes)

The creative nervousness of Apple employees is shown quite brilliantly in the visuals. It also has certain stand-out elements which must be appreciated (time stamp from the video in brackets) - such as its near-term commitments of removing all plastic from its packaging by the end of next year and not decades down the line (1:44), moving away from merely planting trees to forests in Paraguay and Brazil, restored mangroves in Columbia and grasslands in Kenya (3:23). The most important element to recognize is when the Apple CEO, Tim Cook, says towards the end, "but, there is still a lot more work to do" (4:10).

Much appreciated is how tongue-in-cheek it is about current achievements and commitments in the space when Mother Nature says "This is my 3rd corporate responsibility gig today, so who wants to disappoint me first?" (1:31). This rare humility in the space of climate action is what we need even more of - not just celebrations of minor milestones, but, systemic changes that are embraced from the product development and new initiative ideation stage.

Let us dive a bit more into this viral video. The achievements and commitments mentioned in it are commendable in their own siloes for sure, but need to be analyzed thread-bare. What follows below is not an exercise in "exposing lies" or "exposing green-washing claims", but, a critical exercise in highlighting the gaps that continue to exist in how we look at achievements in the space of sustainability and net zero corporate-speak. Sharing them with their original time-stamps from the video (mentioned in brackets).

1) Apple says that from 2020 to 2030, it has committed to cut its carbon footprint to zero (1:09) and that "100% suppliers have committed to using clean renewable electricity" (2:56)

• What they fail to mention here is their 2020 commitment talked about “Carbon neutrality”. But, the world has changed a lot in the past three years and now what is being demanded more by corporates is genuine harm reduction and achievement of Net Zero without just a focus on off-sets.
• Notice how in the video they talk about “renewable electricity” for the suppliers while it talked about “renewable energy” for itself. There is a difference there, as electricity is a much smaller sub-set of the “energy” conundrum.
• Most importantly, by when will this commitment be achieved by the suppliers? No disclosures yet on this. This is going to be a mammoth task. A quick look at two of its annual documents on “People and Environment in our Supply Chain Report” and “Conflict Mineral Disclosures” is enough to show that a lot more indeed has to be done. Kudos to the extremely insightful disclosures done in these reports, as its baseline transparency on the same.

2) The ad says that it is "using 100% recycled aluminum in the enclosures of all our MacBook, Apple TVs, Apple watch" (1:54)

• But, what about gold, tungsten, cobalt and other rare earth metals? It is now evident through the boom in the Electric Vehicle industry, and the challenges it is facing today in terms of the reducing “life-cycle carbon emissions” of inputs materials and human rights abuse for material extraction covers the like of metals like Cobalt, Nickle, Lithium, Manganese et al. Let’s start hearing more and more corporates, policy-makers and researchers talk about this harmful affect of the technological and renewable revolution we are going through right now i.e., the impact of material extraction as Step 1, from the most under-developed and mineral-rich regions of the world.
• Is there a larger cross-industry coalition on rare metals access that needs to be created at a trans-national level, to address such deeper issues?  It is here that I am reminded of the lines Siddharth Kara wrote in his book Cobalt Red (How the blood of Congo powers our lives, when he wrote “The biggest problems faced by Congo’s artisanal miners (of Cobalt, Copper & other minerals) is that the stakeholders up the chain refuse to accept accountability for them, even though they all profit from their work. Corporations should treat the miners as equal employees to the people who work at the corporate headquarters.”

3) It also talks about how "every apple office, store and data centre runs on clean electricity" (2:27)

• This is the “carbon-cost” of running these buildings. Not the cost of making these buildings and storage centers. What we miss, when we all often talk about sustainability is that there is no point in efficiently running a system that was designed to pollute at its inception. Let's start questioning this even more & more, as the cost of running an operation carbon-efficiently eventually is counter productive if the carbon-cost to make such operations was abysmally high. The more we demand disclosures on “life cycle emissions”, the more we will get access to transparent information across a company’s’ value-chain. My experiences in having understood the scope 1, 2 & 3 emissions made me realize the usually reported Scope 1 & 2 estimate to be roughly (only) 20% of the total supply-chain emissions of an organization - hence, the need to probe ourselves even more on the hard to measure and reduce upstream as well as downstream Scope 3 emissions.

4) "Shipping more products by sea rather than air, which reduces transportation emission by 95%" (3:03)

• On face value, this is a sensible move. But, is this another case of a commercially sensible decision, which is passed off as environmentally-friendly one for the carbon-cutting benefits that it also brings along with it? The questions to ask yourself in these cases to get to the primary reasons for such decisions is the fallowing (i) Is higher sea shipping an outcome of manufacturing being limited to certain low-wage-cost locations of the world? Is the deeper solution then in near-shoring? (ii) How much is the cost benefit/loss of such decisions? Is sea shipping in the routes Apple products ships is product, just inherently much more cheaper than air freight? Knowing this in tandem with carbon-cost savings, gives us the entire picture.

5) "We have reduced our water usage by 63 billion gallons" (3:51)

• This is a classic number-hyperbole which hides the real facts. Ask yourself a few questions whenever you hear such achievements being thrown at you (i) How much was the water usage before (in its baseline year) (ii) How much is the % reduction till date (iii) How does this compare to its peers in the industry (iv) How does this industry compare to other manufacturing sectors in terms of water usage, in general (v) How much will this go down to, by 2030 (or the next milestone year) (vi) Are these incremental / operational efficiency improvements, or are there transformative technologies which have helped the company transform the input-material usage landscape.
• Beyond the general aspects of interpreting water saving numbers of a manufacturing entity, I was also curious to explore a bit more about what really was the calculation behind the “63 billion gallons of savings”. I dropped into their 2022 Annual ESG report and asked a few exploratory questions. (i) Is this savings in just in its own facilities, as its Annual ESG report talks about using only 1.4 billion gallons of water in its own facilities. Hence, is this creative usage of water reduced numbers across its supply-chain? (ii) But, then, its own 2022 Annual ESG report (page 19) also talks about how its Clean Water Program with its suppliers has saved 50 billion gallons of water, since 2013! So, did it just casually pass off a 10 year achievement number as a given in time reduction of water usage?
• Only when you have a fair assessment on the above six questions, would you really be able to contextualize “63 billion gallons” as being high, low or absolutely abysmal as an “achievement”. Hence, the best decision the content creators could have taken in this case, is to NOT have highlighted this stand-alone factoid in a video, but, rather disclosed it separately in their annual report or a media brief directed to corporate water stakeholders in specific.

6) They talk about doing "a mix of clean energy and eliminating GHG emissions" (2:40) and then go on to announce their very first carbon neutral product, the watch (4:28)

• When you double-click, you will realize that the fine-print says that only certain watches will be carbon neutral- based on a select combination of cases and bands.
• Carbon neutrality as a concept can be achieved by off-setting, and not only by reducing Green House Gas emissions (in its 2020 announcement, Apple had a 75:25 plan anyway – with 25% being through off-sets).
• Remember, that only earlier this week, EU has announced banning sweeping claims on "Carbon neutrality" by 2026, unless such claims are backed up by accurate and non-greenwashed evidence, which display performance in inherent environmental excellence.

7) Towards the end it says that by 2030, all of apple's devices will have a net zero climate impact (4:40)

• The elephant in the room that Apple does not address is how much of this would happen by embedding harm reduction to the environment and society, inherently into the creation of a new product or sustenance of an older one. Is it even a win on net zero, if planned early "product retirement" is in-built into own business plans?
• Hence, how does Apple plan to address the reality (not accusations anymore) of "planned obsolescence" which is the biggest problem in its supply-chain. Why not let the consumers decide when to get rid of and how much of their product to repair? The Japanese have a concept of "Kintsugi", which is the art of repairing broken pottery by mending the areas breakage with lacquer mixed with powdered gold, silver or platinum. Would be great to hear from an Apple on when we will start celebrating breakage of its phones as a part of its history to renovate, rather than something to disguise to build up for their next product launch.

I can imagine how the original brief for this advertisement would have been very aspirational and authentic, but, the outcome is a muddle of mostly typically safe corporate-sustainability speak. Hence what happens is that Apple eventually falls into the corporate sustainability-speak gap, that it had itself opened up as a gap at the starting of the video.

Now that Apple has taken the brave tongue-in-cheek approach through its video of taking head-on the conservative commitments and achievement gaps in general in the corporate sustainability space; it has put itself out there – to be appreciated and criticized. The ideal thing for Apple to do next would be to address the above genuine systemic gaps that prevent a larger sustainability transformation in its industry - and talk about how it plans to play an industry-leading role in the same - just like it has played a leadership role in creativity, innovation and consumer-centricity for at least four decades now.

The consumers are listening. The sustainability enthusiasts are listening.

And yes, so is Mother Nature.

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Originally posted on September 27, 2023

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