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Climate Finance Hits Hurdle in Greening Meat and Dairy
By Ajit Niranjan
When private equity giant Blackstone invested in alternative milk maker Oatly this summer, furious customers pledged to boycott the dairy-free drink.
"Blackstone investments have been linked with deforestation activities in Brazil," wrote British local produce shop Buth Bharraigh in a tweet announcing they would stop selling Oatly products.
"I don't want my money going to the destruction of the planet ... just so that I can have a creamy coffee in the morning!" wrote sustainability influencer Laura Young in Instagram and Twitter posts that were shared thousands of times.
They criticized Oatly for enabling Blackstone — an investment firm managing $564 billion (€478 billion) in assets — to greenwash climate-damaging investments. "Learn how we're backing sustainable, plant-based alternatives to dairy with our investment in @oatly," Blackstone wrote on its Instagram page.
The social media spat between a corporate giant, a "woke" food brand and disenchanted customers is part of a wider debate about the role of capital in fighting climate change. It has grown more significant in the food sector as investors start to divest from the highly polluting meat and dairy industries, and consumers look for sustainable alternatives.
Divesting From Deforestation
Meat production is the biggest driver of tropical deforestation. Driven by demand for foods like burgers and milk, rainforests are burned to create land for cattle ranches, and to grow soy that is then mostly fed to livestock.
Blackstone, which has invested billions of dollars in the fossil fuel sector, partly owns Hidrovias do Brasil, a Brazilian logistics company that was linked to deforestation in the Amazon rainforest by U.S. news organization The Intercept last year. A spokesperson for Blackstone told DW the deforestation claims were "completely false and wholly fabricated."
Blackstone CEO Stephen Schwarzman is a major donor to U.S. President Donald Trump, a climate-science denier who has rolled back environmental regulations and brought the U.S. out of the 2015 Paris Agreement on climate change.
Pressured by customers, campaigners and policymakers, some food companies are starting to assess their own ecological footprints.
In 2018, McDonald's pledged to clean its supply chains and cut its emissions. In July, Brazilian food processing giant Marfrig said it would remove deforestation from its production chain by the end of the decade.
Then, in September, JBS, the world's biggest meat-processing company, said it would monitor its entire supply chain to cut out deforestation by 2025. Its announcement came two months after investor Nordea Asset Management said it would divest holdings of about €40 million in the company because of a lack of engagement on environmental issues.
Last year, after fires devastated the Amazon rainforest, a group of 251 investors called for a reduction in deforestation, identifying its environmental impacts as "systemic risks" to their portfolios.
Biodiversity and climate change matter to agricultural markets at risk of extreme weather and environmentally conscious consumers, said Matt McLuckie, research director at Planet Tracker, a UK-based nonprofit that aims to redirect capital toward sustainable development. "The trends are not looking positive for these agricultural producers, particularly in the beef sector."
Alternative Sources of Protein
The IPCC, the gold-standard on climate science, has said climate change could in part be slowed by switching to plant-based diets, particularly in richer countries. This is where oat milk comes in.
Oatly, the biggest player in the alternative milk industry, is valued at $2 billion, and is considering an initial public offering that could push that up to $5 billion, Bloomberg News reported in September. For a business whose core product is made by mixing two cheap and readily available ingredients — oats and water — the Swedish food company founded in the 1990s has seen incredible growth since entering the U.S. market four years ago.
While campaigners have spent years pressuring the financial world to take their money out of dirty investments like fossil fuel companies, little attention has been paid to finance in the agriculture sector, which is responsible for about a quarter of greenhouse gas emissions.
Shareholders are also typically the ones pressuring companies they own to improve their environmental record, and not the other way around.
The backlash against Oatly's partnership with Blackstone is fascinating because it's "looking through the other end of the telescope," said Daniel Firger, managing director at climate finance consultancy Great Circle Capital Advisors. "The target of so many people's anger here is Blackstone, a private equity group. And private equity, as compared to other parts of the financial markets, has not really had as much scrutiny."
Diverting Capital to Climate Change
By accepting a $200 million investment from a group led by Blackstone and including U.S. talk-show host Oprah Winfrey, musician Jay-Z and actor Natalie Portman, Oatly said it was diverting capital to sustainable causes. The returns Blackstone makes from the investment could inspire other private equity firms to green their portfolios, it said in a statement justifying its decision.
"We have to have a fundamental shift in basically everything we do: the way we eat, the way we move, the way we live," Ashley Allen, chief sustainability officer at Oatly, told DW. "The only way to do that, in my mind, is to incentivize finance toward those solutions and disincentivize finance toward high-carbon, high-risk, high-polluting entities."
Asked whether Oatly would set red lines on who could invest in it — for instance, fossil fuel companies — Allen said she wasn't sure. "I haven't been part of any discussions on that."
Oatly is not the first ethical food brand to anger customers by accepting money from an investor with a poor environmental record. U.S. ice cream producer Ben and Jerry's — which champions its commitment to social justice — was bought out in 2000 by Unilever, a global conglomerate that has come under fire from campaigners for deforestation and plastic pollution.
In recent years Unilever has begun to engage more with critics on environmental issues, threatening to sell off brands that do not contribute positively to society. But is still a major contributor to plastic pollution, for instance, responsible for more than 70,000 tons of plastic pollution a year, according to a report published in March by NGO Tearfund.
While it's important for activists to draw attention to inconsistencies in investments, said Firger, the scale of the climate emergency means hundreds more companies like Oatly need to grow as fast as they possibly can. "I'm not one for purity tests. I feel like we don't have time to waste."
Reposted with permission from DW.
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By Dolf Gielen and Morgan Bazilian
John Kerry helped bring the world into the Paris climate agreement and expanded America's reputation as a climate leader. That reputation is now in tatters, and President-elect Joe Biden is asking Kerry to rebuild it again – this time as U.S. climate envoy.
Energy Is at the Center of the Climate Challenge<p>The <a href="https://science2017.globalchange.gov/chapter/1/" target="_blank">effects of climate change</a> are already evident across the globe, from <a href="https://theconversation.com/100-degrees-in-siberia-5-ways-the-extreme-arctic-heat-wave-follows-a-disturbing-pattern-141442" target="_blank">extreme heat waves</a> to <a href="https://science2017.globalchange.gov/chapter/12/" target="_blank">sea level rise</a>. But while the challenge is daunting, there is hope. Solar and wind power have become the <a href="https://www.irena.org/publications/2020/Jun/Renewable-Power-Costs-in-2019" target="_blank">cheapest forms of power generation globally</a>, and technology progress and innovation continue apace to support a transition to clean energy.</p><p>In the U.S. under a Biden administration, long-term national climate legislation will depend on who controls the Senate, and that won't be clear until after two run-off elections in Georgia in January.</p><p>But there is no shortage of <a href="https://www.bloomberg.com/features/2020-biden-climate-change-advice/" target="_blank">ideas for ways Biden</a> could still take action even if his proposals are blocked in Congress. For example, he could use executive orders and direct government agencies to tighten regulations on greenhouse gas emissions; increase research and development in clean energy technologies; and empower states to exceed national standards, <a href="https://www.reuters.com/article/us-autos-emissions-california/defying-trump-california-locks-in-vehicle-emission-deals-with-major-automakers-idUSKCN25D2CH" target="_blank" rel="noopener noreferrer">as California did in the past with auto emission standards</a>. A focus on a just and equitable transition for communities and people affected by the decline of fossil fuels will also be key to creating a sustainable transition.</p><p>The U.S. position as the world's largest oil and gas producer and consumer creates political challenges for any administration. U.S. forays into European energy security are often treated with suspicion. Recently, France blocked <a href="https://www.wsj.com/articles/frances-engie-backs-out-of-u-s-lng-deal-11604435609" target="_blank">a multi-billion dollar contract</a> to buy U.S. liquefied natural gas because of concerns about limited emissions regulations in Texas.</p><p>Strengthening cooperation and partnerships with like-minded countries will be critical to bring about a transition to cleaner energy as well as sustainability in agriculture, forestry, water and other sectors of the global economy.</p>
Creating a Global Sustainable Transition<p>How the world recovers from COVID-19's economic damage could help drive a lasting shift in the global energy mix.</p><p>Nearly one-third of Europe's US$2 trillion economic relief package <a href="https://www.bloomberg.com/news/articles/2020-07-21/eu-approves-biggest-green-stimulus-in-history-with-572-billion-plan" target="_blank" rel="noopener noreferrer">involves investments that are also good for the climate</a>. The European Union is also strengthening its 2030 climate targets, though each country's energy and climate plans will be critical for successfully implementing them. The <a href="https://joebiden.com/clean-energy/" target="_blank" rel="noopener noreferrer">Biden plan</a> – including a $2 trillion commitment to developing sustainable energy and infrastructure – is aligned with a global energy transition, but its implementation is also uncertain.</p><p>Once Biden takes office, Kerry will be joining ongoing <a href="https://www.un.org/en/conferences/energy2021/about#:%7E:text=The%20overarching%20goal%20of%20the,2030%20Agenda%20for%20Sustainable%20Development.&text=Accelerate%20delivery%20of%20United%20Nations,related%20issues%20at%20all%20levels." target="_blank" rel="noopener noreferrer">high-level discussions on the energy transition</a> at the U.N. General Assembly and other gatherings of international leaders. With the U.S. no longer obstructing work on climate issues, the G-7 and G-20 have more potential for progress on energy and climate.</p><p>Lots of technical details still need to be worked out, including international trade frameworks and standards that can help countries lower greenhouse gas emissions enough to keep global warming in check. <a href="https://www.carbonpricingleadership.org/what" target="_blank" rel="noopener noreferrer">Carbon pricing</a> and <a href="https://www.csis.org/analysis/how-can-europe-get-carbon-border-adjustment-right" target="_blank" rel="noopener noreferrer">carbon border adjustment taxes</a>, which create incentive for companies to reduce emissions, may be part of it. A consistent and comprehensive set of national energy transition plans will also be needed.</p><p>The global shift to <a href="https://www.irena.org/publications/2019/Jan/A-New-World-The-Geopolitics-of-the-Energy-Transformation" target="_blank">clean energy will also have geopolitical implications for countries and regions</a>, and this will have a profound impact on wider international relations. Kerry, with his experience as secretary of state in the Obama administration, and Biden's plan to make the climate envoy position part of the National Security Council, may help mend these relations. In doing so, the U.S. may again join the wider community of countries willing to lead.</p>
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By Maria Caffrey
As we approach the holidays I, like most people, have been reflecting on everything 2020 has given us (or taken away) while starting to look ahead to 2021.
We Need More Than Listening<p>By now we have all become sadly accustomed to the current administration sidelining scientists, most prominently Dr. Anthony Fauci, because the facts they provide do not fit with the political rhetoric of the moment.</p><p>I have <a href="https://www.csldf.org/2019/08/22/csldf-helps-climate-scientist-maria-caffrey-fight-for-scientific-integrity/" target="_blank">my own history</a> of filing a scientific integrity complaint with the National Park Service (which falls under the Department of the Interior) after senior ranking employees attempted to censor one of my scientific reports. I know all too well the damage and pain that these actions cause, not just for the individual scientist, but also because these <a href="https://www.ucsusa.org/resources/attacks-on-science" target="_blank" rel="noopener noreferrer">attacks on science</a> over the last few years have undermined sound, evidence-based decision making.</p><p>President-elect Biden has repeatedly said that he will <a href="https://thehill.com/homenews/521638-trump-biden-will-listen-to-the-scientists-if-elected" target="_blank" rel="noopener noreferrer">listen to the scientists</a>. While this is certainly a welcome change, listening can only take us so far. This past week Lauren Kurtz from the <a href="https://www.csldf.org/" target="_blank" rel="noopener noreferrer">Climate Science Legal Defense Fund</a> and my colleague <a href="https://www.ucsusa.org/about/people/gretchen-goldman" target="_blank" rel="noopener noreferrer">Gretchen Goldman</a> published <a href="https://www.scientificamerican.com/article/ten-steps-that-can-restore-scientific-integrity-in-government/" target="_blank" rel="noopener noreferrer">an article</a> listing 10 actions the new administration should implement to show their commitment to strengthening government science:</p><ol><li>Clearly prohibit political interference and censorship.</li><li>Protect scientists' communication rights.</li><li>Acknowledge that attempts to violate scientific integrity, even if ultimately not fruitful, are still violations.</li><li>Protect federal scientists' right to provide information to Congress and other lawmakers.</li><li>Commit to incorporating the best science as part of agency decisions.</li><li>Elevate agency scientific integrity policies to have the full force of law.</li><li>Publicly release anonymized information about scientific integrity complaints and their resolutions at every agency.</li><li>Institute an intra-agency workforce, potentially under the White House <a href="https://www.ucsusa.org/sites/default/files/2020-09/strengthening-science-and-si-at-ostp.pdf" target="_blank" rel="noopener noreferrer">Office of Science and Technology Policy</a>, to coordinate scientific integrity efforts across agencies, foster discussion of policy improvements, and standardize criteria for policies across agencies.</li><li>Strengthen whistleblower protections.</li><li>Ensure that policies cover all actors who will be dealing with science.</li></ol>
Time for Action<p>I have spoken to many scientists, particularly federal scientists, who are eager to turn the page so they can hurry back to the work they had been doing before this administration, but I urge caution in assuming that things can be "normal" again.</p><p>Before Trump, I naively thought the scientific integrity policies established during the <a href="https://obamawhitehouse.archives.gov/blog/2016/12/19/scientific-integrity-policies-update" target="_blank">Obama administration</a> would be sufficient. I never imagined that any administration could so willfully ignore and attack expert advice and evidence that is intended to protect us and our public lands.</p><p>I have personally witnessed how hard our federal scientists work. They put in long hours with minimal pay (far less that what they could get if they worked in private industry) to pursue one simple goal: to make things better for the nation.</p><p>We need stronger scientific integrity policies to protect these people and their work. But more than that, we need stronger scientific integrity laws because they also benefit society.</p>
By Andrea Germanos
Environmental campaigners stressed the need for the incoming Biden White House to put in place permanent protections for Alaska's Bristol Bay after the Trump administration on Wednesday denied a permit for the proposed Pebble Mine that threatened "lasting harm to this phenomenally productive ecosystem" and death to the area's Indigenous culture.
<div id="da98c" class="rm-shortcode" data-rm-shortcode-id="478a197b7c59c92787c92bec92f1ac39"><blockquote class="twitter-tweet twitter-custom-tweet" data-twitter-tweet-id="1331662923710693376" data-partner="rebelmouse"><div style="margin:1em 0">Bristol Bay forever, Pebble mine never. #NoPebbleMine #SaveBristolBay https://t.co/CBQ9zuy8A5</div> — Save Bristol Bay (@Save Bristol Bay)<a href="https://twitter.com/SaveBristolBay/statuses/1331662923710693376">1606328156.0</a></blockquote></div>
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