Four years ago, I stood in the centralized data command center of an American oil and gas company, watching a former colleague remotely adjust infrastructure at wellsites thousands of miles away because an algorithm detected a potential failure. This was the first time I personally witnessed the power of the “digital oilfield.”
Essentially, the “digital oilfield” refers to a transformative effort to bring solutions such as automation, predictive maintenance, and IoT technologies to the world’s oil and gas industry. Oilfield digitization has started to change the way decisions are made, operations are conducted, and facilities are managed across the entire oil and gas value chain. While early adopters are already employing automated and connected innovations to gain a competitive advantage, only a few are applying digitization technologies to address one of the industry’s biggest challenges: methane.
At Environmental Defense Fund, we believe that environmental progress and economic growth can and must go hand in hand. EDF+Business works with leading companies and investors to raise the bar for corporate sustainability leadership by setting ambitious, science-based goals; collaborating for scale across industries and global supply chains; publicly supporting smart environmental safeguards; and, accelerating environmental innovation.
This is the 10th in a series of interviews exploring trends in sustainability leadership as part of our effort to pave the way to a thriving economy and a healthy environment.
Let’s turn back the clock to 1990. It was a milestone year for McDonald’s, as the company opened its first restaurants in Moscow, mainland China and Chile. It was also when the largest restaurant company in the world joined forces with Environmental Defense Fund to launch a groundbreaking partnership that would find ways to reduce McDonald’s solid waste. The results? $6 million in savings, more than 300 million pounds of packaging eliminated, and 1 million tons of corrugated boxes recycled.
2018 is shaping up to be a big year for McDonald’s too, with a packaging waste goal set in January and an announcement to reduce emissions across its supply chain in March. Led by Executive Vice President and Chief Supply Chain and Sustainability Officer Francesca DeBiase, McDonald’s has raised the corporate leadership bar with these ambitious sustainability targets. But now, the difficult and complex work of meeting these goals begins.
I caught up with Francesca ahead of the Global Climate Action Summit this week to ask her about what the roadmap to meeting these goals looks like, and how they’ll collaborate with their suppliers and the industry to prioritize action on the areas where McDonald’s has the biggest opportunity to reduce greenhouse gas emissions, including responsible beef production
Here’s an edited transcript of our conversation.
In this three-part blog series “Making Vanilla Green or Making Green Vanilla,” EDF+Business Sustainable Finance Manager Jake Hiller, and Clean Energy and Sustainable Finance Intern Gabriel Malek unpack how an environmental advocacy group like EDF could best use its resources and expertise to drive impact in the fixed income market. This research is informed by interviews conducted with Eric Glass, Senior Portfolio Manager at AllianceBernstein and founding member of the Municipal Impact Investment Policy Group; Rob Fernandez, Director of ESG Research at Breckinridge Capital; and Navjeet Bal, General Counsel of Social Finance Inc. and former Commissioner of Revenue of the Commonwealth of Massachusetts.
Over the past few years, experts in socially responsible investing have become increasingly intrigued by green bonds, financial vehicles designed to kickstart environmental projects. In 2016, both EDF and the Stanford Social Innovation Review examined the strengths and challenges of the growing green bond market and outlined how this novel financial tool could help channel capital to sustainable development initiatives. Since the publication of these articles, the green bond market has expanded dramatically. In the US alone, the value of green bonds between 2016 and 2017 doubled to $48 billion. What began in 2008 with an experimental, World Bank-issued “green” labelled bond has since developed into a $155 billion market that is projected to expand this year.
Walmart and Unilever made big news at this week’s Global Climate Action Summit. With forest loss still on the rise (the highest levels of tropical tree cover loss occurred in the last two years), these two consumer-product giants just committed to taking big, concrete steps toward addressing the complex reality of global deforestation.
At the center of their commitments are critical actions in support of jurisdictional approaches, which encourage companies that source deforestation-related agricultural commodities to collaborate with local governments, communities, and producers in their sourcing region. Through these collaborations, jurisdictional approaches ensure that local laws, regional efforts, and corporate policies work in concert to reduce deforestation across entire landscapes.
Companies with forest goals coming due – and there are hundreds of them – should take note, for three big reasons:
How top energy companies engage in the U.S. methane policy debate in the coming weeks may tell us a lot about the future of natural gas.
As these companies have themselves recognized, the role of natural gas in a world that can—and must—decarbonize depends on minimizing harmful emissions of methane from across oil and gas production and the natural gas value chain. But a recent comprehensive study involving dozens of leading academics and companies around the country found that U.S. methane emissions from industry are 60 percent higher than prior estimates—enough to double the climate impact of natural gas.
Recent research on corporate sustainability indicates that companies still have a long journey ahead in order to meet their sustainability goals. Only four percent of companies recently surveyed by Bain & Company feel that they’ve succeeded in achieving their sustainability goals, while 47% feel that they’ve failed altogether.
Theresa Eberhardt, Project Coordinator, Supply Chain
These numbers might seem discouraging to some, but not to me. I’ve been in the sustainability space for over five years, working primarily in supply chains, and over this time, I’ve learned that the first step to success is acknowledging where you’re starting from. I’m also encouraged by EDF+Business, which has been helping companies meet their supply chain goals for over 25 years. These numbers show me that more and more companies are doing the hard work of evaluating and reporting on their own operations and supply chains. If you’re a sustainability officer at a large multinational corporation, we know that this can be a daunting task. However, you should relish the fact that you have the opportunity to make meaningful change on a huge scale. It just takes some focus, and the right business strategy.
As a working mother, I often have to multi-task. Recently, as I watched my toddler push his food around his plate, I caught up on last week’s news that Fortune had released its annual “Change the World” list of top companies using the profit motive to help the planet and tackle social problems.
About 10 percent of this list consists of corporate leaders who are thinking critically about the challenge to feed our world in a sustainable way without destroying our planet, including companies like Kroger (#6), Walmart (#16), Tyson Foods (#44), McDonald’s (#50) and PepsiCo (#57). These companies know that a thriving community requires a fed community.
While I’m thankful to Fortune for sharing best practices from these incredible, game-changing companies, I’m also painfully aware that the corporate sector at large has a lot more work to do: a recent survey by Bain & Company found that only four percent of companies feel that they’ve succeeded in achieving their sustainability goals, while 47 percent feel that they’ve failed altogether.
Speaking as both a mother and a sustainable supply chain specialist, that’s simply not good enough. We are already facing the massive challenge of producing even more food with fewer inputs. We are already facing increasingly variable weather. And in just a few decades, our planet will be home to 2 billion more people to feed.
What’s my point? Next year, food and agriculture companies, I want to see more of you on Fortune’s list. So to help you on this quest, I’m officially issuing you a two-part challenge:
This blog was co-authored with Mary Barber, Director of Strategic Alignment and Performance and State Implementation at Environmental Defense Fund
On May 23, New Jerseyans scored a major economic and environmental victory when Governor Phil Murphy signed a groundbreaking law that will soon make the Garden State an even greener one. The Board of Public Utilities (BPU) has initiated a proceeding that will establish a community solar pilot program within one year of the bill’s signing. Low-income and multifamily households will be able to earn credits on their electric bills for purchasing power from a shared solar array. In just ten years, half the state’s power will come from emissions-free renewable resources, and New Jersey will boast the highest amounts of energy storage and offshore wind in the United States. New Jerseyans can expect clean air, electric bill savings, and the creation of many local and lucrative job openings.
We recently heard from Mars, Incorporated’s chief procurement and sustainability officer, Barry Parkin, about the company’s plan to tackle its ambitious climate goals in an EDF+Business “Business of Sustainability” podcast. Their Sustainable in a Generation plan details Mars’ commitment to procure 100 percent renewable energy. Mars is plowing full speed ahead toward these goals and recently, Mars Australia signed 20-year power purchase agreements (PPA) to generate the equivalent of 100 percent of Mars’ electricity from renewable energy by 2020.
Graziella Siciliano, Senior Manager of Carbon and Energy at EDF
As a manager of EDF+Business’ carbon and energy supply chain initiatives, I wanted to learn more about Mars’ approach to meeting its renewable energy goals. What I like about Mars is that they are always willing to share their tips and best practices so that other companies can learn how to start mitigating their impact on the environment. So, I sat down with Mars’ renewable energy manager, Winston Chen – who has been with the company for 15 years – to learn more about their renewable energy strategy and what other companies can learn from being innovative when looking for ways to decarbonize the energy they need to make their products.
Over the last 15 years, an impressive number of companies have set ambitious forest targets in their supply chains. As of September 2017, more than 470 companies in the food and agriculture sector have pledged to eliminate deforestation from their supply chains. The Consumer Goods Forum – a group of 400 global companies with over $3.1 trillion in assets – for example, pledged to achieve zero net deforestation by 2020.