Global Compact International Yearbook 2016

we support
Global Compact
International Yearbook
2016

This publication is kindly supported by:
Acciona
Adecco
Arab African International Bank
Armacell
Audi
Banca Popolare di Sondrio
BASF
Bayer
Bosch
Commerzbank
Consolidated Contractors Company
Deutsche Telekom
EDF Group
Green Delta Insurance
HOCHTIEF
Manila Doctors Hospital
mcs
Merck
MTU Aero Engines
Nestlé
Philip Morris International
PostNL
ROMRADIATOARE
Sakhalin Energy
SkyPower
Vaisala
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The Global Compact International Yearbook is a product of macondo publishing GmbH in support of the UN Global Compact, the Sustainable
Development Goals, and the advancement of corporate sustainability globally. Use of company names and examples does not constitute endorsement
by the UN Global Compact. While the yearbook is developed in cooperation with the Global Compact Office, sponsorship by companies does
not constitute a contribution to the Foundation for the Global Compact. Financial contributions are not collected on behalf of the Global Compact
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we support
H.e. Ban Ki-moon, UN Secretary-General
“
Last year’s adoption of the 2030 Sustainable
Development Agenda, together with the historic
Paris Climate Agreement on climate change, sent a
powerful message far and wide: we cannot continue
on our current course.
We need new ways of living that will end the suffering,
discrimination and lack of opportunity that define the
lives of billions of people around the world, and that
drive instability and conflict.
The solutions must involve everyone, from world leaders
and chief executives, to educators and philanthropists.
We must work together – across sectors and industries –
in broader and deeper partnerships.
Two steps are essential.
First, we need to mobilize the global business community
as never before. I have seen first-hand the power of the
UN Global Compact’s Ten Principles on human rights,
labour, environment and anti-corruption. They are helping
thousands of companies contribute to sustainability.
Second, innovation will be crucial. I urge you to take
advantage of the new markets and solutions that are
emerging; to set corporate goals inspired by the SDGs;
”
and to let sustainability drive innovation
and investment.
Global Compact International Yearbook 2016 3

Note
3 H.E. Ban Ki-moon,
United Nations
Secretary-General
6 Sustainable
Innovation
8 Disruption
9 How to Be an Intrapreneur
Perry Yeatman
10 Corporate Social Innovation
is the New Corporate Social
Responsibility
Elizabeth Boggs Davidsen
12 Too Big to Fail? Disruptive
Innovation
Dr. Elmer Lenzen
15 Capitalism Is Chaos
16 Sustainability-Oriented
Innovation: A Bridge to
Breakthroughs
Prof. Jason Jay, Sergio Gonzalez,
and Marine Gerard
22 Does Firm Innovation
Affect CSR? What the
Academics Say
24 DECArBoNiZATioN
25 Growth: A Hard Habit to Break
Prof. Dr. Felix Ekardt
28 The De-Carb Diet
Dr. Elmer Lenzen
32 TALENTs
33 Is the Meaning of Work about
to Change?
Rick Goings
36 How Does Industry 4.0 Affect
Growth and Employment?
Prof. Dr. Harald Hagemann
32 FUTUrE MArKETs
39 How to Bust the Biggest Myths
about the Circular Economy
Liz Goodwin
42 Sharing Has Been Hijacked
Lily Cole and Adam Werbach
44 Start-Ups: About Do-Gooders,
Money-Burners, and
Social Entrepreneurs
46 Changemaker
48 The Peaceful Punk:
Angelina Jolie
52 The Problem Solver:
Alejandro Aravena
54 Doing More with Less:
Navi Radjou
56 The Savior of Sundance:
Robert Redford
60 Real-life Eco-warrior:
Sigourney Weaver
64 The Drowning Child Dilemma:
Peter Singer
66 The Water Advocate:
Mina Guli
72 The Taste Tester:
Kevin McCloud
140 Cities of the Future
6
Sustainable Innovation
4
Global Compact International Yearbook 2016

GooD praCtICe
SUSTAINABLE
DEVELOPMENT
G O A L S
46
Changemaker
72
74
76
78
82
84
86
88
90
94
96
adecco
Banca popolare di Sondrio
Bosch
Deutsche post DHl Group
Deutsche telekom
Green Delta Insurance
Manila Doctors Hospital
Merck
philip Morris International
Sakhalin energy
Sanofi
140
Cities of the Future
102
104
106
108
110
112
114
116
118
120
122
126
128
130
132
134
136
138
acciona
arab african International Bank
armacell
audi
BaSF
Bayer
Commerzbank
Consolidated Contractors Company
eDF Group
HoCHtIeF
MaN
mcs
MtU aero engines
Nestlé
postNl
roMraDIatoare
Skypower
vaisala
Global Compact International Yearbook 2016 5

6
Global Compact International Yearbook 2016

Sustainable
innoVAtion
the idea of sustainability is based on the certitude that we have
planetary boundaries. the WWF vividly illustrates this with “earth
overshoot Day.” It describes the day of the year on which human
demands on natural resources exceed the capacity of the earth
to reproduce these resources. presently, earth overshoot Day is
at the beginning of august. From then onward, we are looting our
resources.
What does this mean for corporate sustainability? Business must
fit into planetary boundaries. this probably will not work with
traditional business models. that is why we need new, fresh ideas.
We need change, even when it happens in a rough, disruptive way.
and the earlier the better. When you talk about the Sustainable
Development Goals, you have to talk about sustainable innovation.
the SDGs are the agenda, innovation is the pathway.
Global Compact International Yearbook 2016 7

Disruption
“
Action without vision
is only passing time,
vision without action
is merely day dreaming,
but vision with action
”
can change the world.
Nelson Mandela, political leader (1918 – 2013)
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Global Compact International Yearbook 2016

innoVAtion
how to Be An
Intrapreneur
By Perry Yeatman
every great innovation begins with an idea.
every great achievement requires a champion.
Scientists. explorers. adventurers.
entrepreneurs.
For centuries, intrepid individuals have been tackling
problems and seizing opportunities others either could
not or would not. By doing so they have changed the way
we live and work, time and again. Consider all of the change
that maverick individuals have largely brought about in the
past 15 years alone: mapping the human genome, the rise of
human-machine learning, the commonplace harnessing of
big data across all sectors, the creation of the smart phone,
the rise of social media, the internet of things, and apps that
let us do virtually everything from the palm of our hands
– from banking to shopping to learning. These developments
have transformed our world, and largely for the better.
New ways to tackle society’s challenges
But it has not been enough. We are still facing serious issues
related to our increasingly resource-constrained planet and
the inability of many of the world’s governments to meet
the basic needs of their citizens: nutritious food, safe shelter,
quality education, affordable healthcare, and more. So we
need more innovative thinking. And we need it at scale. And
we need it fast. Enter the era of corporate social innovation,
where companies seek to build their businesses while tackling
important societal problems at the same time. To learn more
about this growing trend and how to make it happen within
your company, check out the new report recently released by
the World Economic Forum.
As the report outlines, we largely know what needs to be done,
and more leading companies are stepping up to the plate. The
remaining question is who within these companies will lead
the charge? Who will become these much needed “corporate
entrepreneurs”? Who will pioneer this new breed of professional,
most often referred to as an “intrapreneur”?
What is an intrapreneur?
Think of them as old-fashioned “change agents,” but change
agents with a specific focus: to make or save the company’s
money while tackling a pressing societal issue.
Who can become a successful intrapreneur? Well, that is the
good news: They can come from practically anywhere in the
organization: marketing, supply chain, operations, finance,
and more. And they do not have to be at the very top (C-suite)
to be effective. In my experience, some of the most effective
intrapreneurs come from upper / middle management.
As for the personality traits of these internal champions, they
are much the same as for a successful entrepreneur: curious,
insightful, doggedly determined, strategically agile, etc. But
Global Compact International Yearbook 2016 9

there is one critical difference: Whereas a successful entrepreneur
can be bombastic, unrelenting, and uncompromising,
an intrapreneur needs to be viewed as a team player
– someone not out for themselves but out for the company.
Why? Because any big new idea hatched within a major
corporation will ultimately require new resources and the
cooperation of literally hundreds of people, most of whom
will not report directly to the intrapreneur – not at first
anyway. So, to be successful, an intrapreneur needs to be a
keen observer of human nature and organizational dynamics
as well as a master in the art of persuasion. But with these
skills, intrapreneurs can be real game-changers, so perhaps
it is not surprising that they are also being increasingly
sought after by the world’s leading companies.
This trend could not come at a better time because not
only does the world need novel approaches and solutions
to pressing social issues, but companies themselves need to
figure out how to keep their talent engaged and motivated.
Today, in countries such as the United States, millennials
are the largest segment of the workforce and – according
to a recent Deloitte survey – fewer and fewer are loyal to
their current employers.
CSI is the new CSR
A new trend in international development
has paired some unlikely business partners:
Development finance institutions and impact
investors are working with large multinational
corporations to fund projects that advance both
development and business agendas.
By Elizabeth Boggs Davidsen
In fact, this study finds that nearly 50 percent of those
surveyed would, given the chance, leave their current employer
within the next two years. This remarkable lack of
allegiance represents a serious challenge to all businesses.
However, it is not too late for employers to turn this around.
The Deloitte survey also found that creating opportunities
for millennials to pursue purpose and profit simultaneously
within their existing organizations is one of the best ways
to bridge this loyalty gap.
So despite the fact that companies are facing significant
headwinds, there may be an elegant solution: Companies
need stable, prosperous environments in which to operate
and grow their businesses; growth requires attracting and
retaining the best talent – including millennial talent.
Pursuing corporate social innovation opportunities and
turning to corporate intrapreneurs to lead these efforts
could help to both build the business and fill the talent
pipeline. Could there be a more win / win / win solution?
Perry Yeatman is a Principal & CMO at Mission Measurement,
author of the award-winning book Get Ahead by Going
Abroad and CEO of Perry Yeatman Global Partners.
This article was originally published by the World Economic
Forum’s Agenda.
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Global Compact International Yearbook 2016

innoVAtion
T
his “corporate social innovation”
is the latest advance along the
continuum of corporate social
responsibility, which began in the 1990s,
when many companies began embracing
worthy community causes in areas
where they operated. Programs focused
mainly on the company’s reputation
and license to operate, with little direct
connection to their bottom lines. For
example, Microsoft initiated an annual
Employee Giving Campaign, in which
employees attend fundraising events for
nonprofit organizations.
Good corporate citizenship
This evolution continued in the 2000s,
when companies began integrating good
corporate citizenship into their business
models, often through partnerships with
development finance institutions. For
instance, when the International Youth
Foundation and the Multilateral Investment
Fund (MIF) of the Inter-American
Development Bank Group launched the
New Employment Opportunities Program
(NEO) for youth in 2012, five large
companies pledged resources and joined
the alliance: Arcos Dorados, Caterpillar,
CEMEX, Microsoft, and Walmart. NEO
offers job training and placement services
to improve the employability of
poor youth, and thereby the quality of
the workforce throughout Latin America
and the Caribbean. The member companies
– some of the largest employers in
the region – are contributing money
and helping to shape the training curriculum
and other employment services.
The partnership is paying off; NEO is on
track to reach 1 million youth through
effective job-training programs by 2020.
Shared value
In 2011, professors from Harvard Business
School published an article on
“Creating Shared Value,” and since then,
there has been a growing global movement
to make societal impacts integral
to a company’s strategy. SABMiller, the
world’s second-largest brewer, was an
early adopter. SABMiller and the MIF’s
4e Camino al Progreso Program targets
more than 380,000 small retailers in SAB-
Miller’s biggest Latin American markets:
Colombia, Peru, Ecuador, Panama, Honduras,
and El Salvador. The 4e program,
which began in 2013, aims to improve
small retailers’ business performance
– and therefore quality of life and leadership
abilities – through a combination
of classroom training and in-store
mentoring on business, life skills, and
leadership, and by strengthening the
broader “business ecosystems” in which
the retailers operate, with a special focus
on improving their access to financing
and technology. The hope is that this
effort will strengthen SABMiller’s retail
network and sales.
Corporate social innovation
The latest evolution on this continuum
has been the advent of corporate social
innovation (CSI). The World Economic Forum
launched the Global Agenda Council
on Social Innovation in 2014 – bringing
together an unlikely cross-section
of corporate leaders, impact investors,
and development executives – and offered
a definition for CSI that builds on
shared-value concepts: when companies
proactively design and implement business
models that increase incomes and
better the quality of life of underserved
or vulnerable communities at the bottom
of the market’s pyramid. The mutual
attraction for the unlikely bedfellows is
that CSI initiatives are often fueled by
corporate venture capital – the investment
of cash reserves from a company
to fund new endeavors.
A new alignment is emerging among
corporate venture capitalists and impact
investors. The corporate venture capitalist
is seeking returns for the company and
new capabilities or access to markets that
are aligned with its long-term business
strategy. The impact investor is interested
in placing capital into companies
and generating measurable social and
environmental impacts, together with a
financial return. The impact investor also
wants to expand effective development
solutions and – together with development
finance institutions – is beginning
to understand that working with
large companies may be the best route.
Companies that set up corporate venture
funds also have in-house expertise and
distribution channels that allow them
to scale-up successful projects.
In its study, Investing in Breakthrough:
Corporate Venture Capital, the think tank
and advisory firm Volans identifies six
sectors in which corporate venturing
is active, because these sectors directly
affect businesses, individuals, and the environment:
cleantech, education, health,
urban infrastructure and transportation,
financial inclusion, and agriculture and
food. Not surprisingly, these are also
areas where impact investors place most
of their investments.
Some intriguing CSI examples are emerging.
To name one: Shell Foundation, the
philanthropic arm of the oil giant, formed
a strategic partnership with Husk Power
Systems, a biomass electricity generator.
In five years, Husk has installed 84
minipower plants, providing electricity
to more than 200,000 people in 300
rural villages in India. By electrifying
villages, Husk is promoting economic
development, as businesses are able to
stay open after dark and children can
study at night. Impact investors Acumen
and Oasis Fund have contributed funding
to the venture. Business leaders are at
the forefront of transforming societies’
ability to confront important challenges.
Development finance institutions and
impact investors are along for the ride,
and it is guaranteed to be exciting.
Elizabeth Boggs Davidsen is a principal
specialist at the Multilateral Investment
Fund (MIF) and responsible for its
regional economic development and
value-chains portfolios. She also advises
on new partnership opportunities for the
MIF’s grant and investment activities.
Global Compact International Yearbook 2016 11

Big
Too Big to Fail ?
Disruptive Innovation
Every CEO generation has its own management buzz words. In the 1990s “re-engineering”
was in fashion, then came “offshoring”, and today it is probably “disruptive innovation.”
The concept was coined by Clayton M. Christensen, a Harvard Business School professor who
introduced the wording in his 1995 article “Disruptive Technologies: Catching the Wave.”
Two years later in his book The Innovator’s Dilemma, Christensen replaced the term disruptive
technology with disruptive innovation. That was groundbreaking because he recognized that
few technologies are intrinsically disruptive; rather, it is the business model behind it that
disrupts and reinvents markets.
By Dr. Elmer Lenzen
But what is disruptive innovation?
A disruptive innovation is one that creates a new market and/
or consumer behavior. Often, this includes disrupting existing
markets and displacing established market participants.
This stands in contrast with sustaining innovation and the
well-known continuous improvement model, which has a
focus on the improvement of existing products. That is an
interesting point because it means that even a company with
a well-managed improvement and customer service ethos can
be severely hurt by disruptive innovation. This happens when
the companies stay “close to the customer” or “listen to the
customer,” which is good, but at the same time they overhear
the silent and marginal voices of future customers.
But not all innovations are disruptive, even if they are revolutionary.
The automobile, for example, was not a disruptive
innovation for quite a while because early automobiles
were expensive luxury products that did not challenge the
transportation market of horse-drawn carriages. It was Henry
Ford’s Model T in 1908 that made automobility a disruptive
innovation because Ford’s vision completely changed our
mobility behavior.
How low-end disruption occurs
Christensen distinguishes between “low-end disruption,”
which targets customers with low budgets, and “new-market
disruption,” which targets new customer requests. Low-end
disruption occurs when the performance of a product exceeds
the needs of a certain customer segment. Then innovations
enter the market with lower performance levels but also with
lower prices, and this combination is fine for a certain clientele.
That is how new market players gain a foothold in the market.
It becomes disruptive when the new player changes the whole
market in the aftermath. But again, the starting point of low-
12
Global Compact International Yearbook 2016

innoVAtion
IT sector as a place of permanent
disruption
Very practical examples of both low-end
as well as new-market disruptions can be
seen in the IT sector. At the beginning, IT
incumbents completely misinterpreted
the market. “There is no reason anyone
would want a computer in their home,”
said Ken Olsen, founder of Digital Equipment
Corporation, in 1977. Digital Equipment
in those days was a major force in
the computer world – four years later,
the first IBM PC proved Olsen wrong.
Microsoft and Dell computers are two
disruptive innovators that changed the
markets with their low-end innovations.
Later, it was Microsoft that missed the innovation
of the internet browser and the
need for internet guidance, giving space
to new players such as Yahoo and, most of
all, Google. New market disruption also
came with the rise of social media sites
Facebook and Twitter. The “internet of
things” surely will be the next step, a combination
of low-end as well as new-market
disruptions. Google promises to reinvent
cars as autonomous vehicles (new market);
Amazon promises to reinvent shopping
(again) using drones (low-market); 3-D
printing could disrupt manufacturing
(sometimes low, sometimes new market).
But the most surprising and promising
of the disruptive innovations will come
from the bottom of the market pyramid
with new ways of delivering food security,
education, and healthcare, etc., for millions
of consumers in emerging markets.
end disruption is a customer who is not
willing to pay for premium products but
is happy with a good enough product.
For many companies, such clients are
not very attractive because they are the
least profitable customers.
But once the disruptors have entered
this market, they seek to improve profit
margins by offering additional value
in small doses, so customers might be
willing to pay a little more for better
quality. The incumbent operators, on
the other hand, do not spend too much
time or thought on the least profitable
customers and instead concentrate on
the most profitable ones. Over time, the
incumbents are squeezed into smaller
markets. By the end, it is the disruptive
innovator that serves the largest market
segment and earns the greatest revenue,
whereas the former market leaders have
a niche existence or are driven out of the
market. “New market disruption,” on
the other hand, occurs when a product
serves a new or emerging consumer desire
that is not being served by existing
market players.
Disruptive innovations tend to be
produced by outsiders
So why is it so hard for disruptive innovators
to make their way? And why
are they so often outsiders with no – or
only loose – ties to incumbents in the
markets? There are at least three reasons
why: 1) Innovations are not profitable
enough at the beginning; 2) these processes
can take longer to develop and
results may be so new that they cannot
be compared to other products; 3) it cannot
be evaluated and does not fit into
conventional risk schemes.
Global Compact International Yearbook 2016 13

Renevue and time
Professor Joseph Bower came to the point when writing a
Harvard Business Review article in 2002: “When the technology
that has the potential for revolutionizing an industry emerges,
established companies typically see it as unattractive: it’s not
something their mainstream customers want, and its projected
profit margins aren’t sufficient to cover big-company cost
structure. As a result, the new technology tends to get ignored
in favor of what’s currently popular with the best customers.
But then another company steps in to bring the innovation
to a new market. Once the disruptive technology becomes
established there, smaller-scale innovation rapidly raise the
technology’s performance on attributes that mainstream
customers’ value.”
Comparing apples and oranges
Comparing unknown new markets with known traditional
markets is a bit like comparing apples and oranges, as Milan
Zeleny knows. In an article for the International Journal of
Management and Decision Making, he wrote: “The effects of high
technology always breaks the direct comparability by changing
the system itself, therefore requiring new measures and new
assessments of its productivity. High technology cannot be
compared and evaluated with the existing technology purely
on the basis of cost, net present value or return on investment.
Only within an unchanging and relatively stable TSN [technology
support net] would such direct financial comparability be
meaningful. For example, you can directly compare a manual
typewriter with an electric typewriter, but not a typewriter
with a word processor. Therein lies the management challenge
of high technology.”
Dr. Elmer Lenzen is founder and CEO of macondo
publishing GmbH, publisher of the Global Compact
International Yearbook and the CSR Academy. He has
a PhD in journalism and studied at the universities
of Münster and Bochum (both in Germany) and
the UCR in San José (Costa Rica). In 1998 Lenzen
founded macondo, with its major business focus being
publications and corporate communication. CSR plays
a prominent role, and macondo today is one of the
leading publishing houses.
Fallen Brands
There can be different reasons for the
decline of a brand. It may be that the
product is no longer trendy, or that it
is regarded as being old-fashioned. It is
fatal when a company stops developing
the brand, making it harder to catch up
with competitors. “Successful products
decline when companies continue to
produce beyond the trends of the time,”
says Wolfgang Zankl from the European
Brand Institute, which ranks the most
valuable brands in Europe annually.
In no industry sector are the pressures
of innovation and market changes more
pronounced than in the IT sector, as these
three following examples show.
The Commodore 64. Due to its shape,
its fans affectionately called it the “bread
box.” The Commodore 64 dominated the
home computer market in the 1980s:
More than 30 million copies were sold
worldwide. But when the PC began
to take hold in the market, the era of
Commodore ended. In 1994, the manufacturer
went out of business.
AOL. Do you remember the CDs in
your mailbox or the ones glued into
magazines? They came either from
CompuServe or AOL and offered dial-up
internet service. At the beginning of the
millennium, AOL had almost 30 million
customers and was the largest internet
provider worldwide. Money was abundant,
so they took over the prestigious
media group Time Warner. Then came
the market bubble and the advent of
internet flatrates. Today, AOL belongs
to Verizon and is looking for new business
models.
BlackBerry. With the invention of the
first smartphone, BlackBerry wrote
history. Its founder, Mike Lazaridis, did
so many things right. If you wanted
to be someone 10 years ago, you had
to have a BlackBerry in your pocket.
BlackBerry was THE status symbol and
the favorite gadget of managers and
starlets. But then came Apple, which
brought us the endless world of apps.
Bye-bye BlackBerry.
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Global Compact International Yearbook 2016

innoVAtion
Capitalism
is
CHAOS
The future belongs to those companies that continuously
challenge and reinvent themselves. Does this sound to you
like it came from a recent executive seminar? It is certainly
possible that it could have. But did you know that this idea
was formulated more than a hundred years ago by a 28-yearold
economics wunderkind, who was without a doubt one of
the most important economists of the 20th century? Did you
know that many of his ideas are perhaps even more pertinent
today than they were in his own time? The Austrian economist
Joseph Schumpeter (1883-1950) brought us concepts such
as “innovation,” “venture capital,” and “corporate strategy.”
Decades before innovation became a buzzword for managers,
Schumpeter expanded the field of modern economics with
these concepts – at a time when people were still talking
about national economics. His concept of “creative destruction”
enriched the three classic factors of production – land,
labor, and capital – with an essential fourth dimension:
entrepreneurship.
Schumpeter’s core idea is that markets tend not toward
order but disorder, which then invariably generates new,
innovative entrepreneurs. Disorder is therefore productive
rather than threatening: Progress and growth emerge from
“creative destruction.” This view put Schumpeter far ahead
of his time: Today, by contrast, creative destruction and innovation
are more relevant than ever. In an era when the
framework conditions are in constant flux, the strength of a
company is no longer determined by its size, but by its speed
and adaptability.
His logic of “creative destruction” is radical, its consequences
brutal: In Schumpeter’s view, all rules, systems, processes,
products, and services will eventually have served their
purpose and require renewal – or will not have served their
purpose and therefore need replacing all the more. Schumpeter
was the first to interpret the modern economic order
scientifically, as an evolutionary development without end,
a constant flow that evinces progress through revolutionary
inventions and fitful bursts of innovation.
At the same time, his economic theory brings a touch of
individual psychology to the economic debate by amending
the doctrine that the main driver in commerce is homo
oeconomicus – the rational actor. Instead, it is the mavericks
and inventors who bring about disorder and change, those
actors who go beyond the conventional path. Schumpeter
rejects the conventional, liberal equilibrium thinking about
supply and demand. The problem in practice is that innovation
is never accepted wholeheartedly; creative destroyers
are usually not welcome in companies, even if the corporate
mission statement promises otherwise. Companies are geared
more toward recognizing risks and then bringing them under
control. But activists of innovation will not stand for avoiding
risk through risk management.
This makes Schumpeter the first important economist to
think consistently in processes, forgoing models. But this
economics wunderkind made enemies, too: Schumpeter
was intentionally provocative. He considered science an
ongoing attempt to “produce, improve, and pull down analytical
structures in an unending sequence.” This is how he
takes swipes at the giants of economics, reproaching Adam
Smith for describing a largely pre-capitalist world that is no
longer applicable today, Karl Marx for having understood
the dynamics of capitalism but nothing of the psychology of
prosperity, and Schumpeter’s own contemporary John Maynard
Keynes for concerning himself with only shortsighted
prescriptions, in the form of political instruction manuals.
But Schumpeter is not immune to criticism either: He believed
– perhaps overly naively – in the social permeability
of the capitalist system. Thus, he considered success and
wealth to be ephemeral values specific to the individual:
“The upper strata of society are like hotels which are indeed
always full of people, but people who are forever changing.”
But the practice is different in the present day, when
we are instead experiencing the emergence of a heritable,
moneyed aristocracy around the world, the feudalization
of the political class and the financial markets, and the reproletarianization
of the workforce.
Global Compact International Yearbook 2016 15

A Bridge to
Sustainability-Oriented Innovation:
Breakthroughs
“Innovate or die” has become almost a mantra for companies in this era of rapid technological change and
globalization. When we consider such conditions as extreme air pollution in Beijing, factory collapses in
Bangladesh, drought in California, and deadly heat waves in India, the darker side of this foundational
belief stands out in high relief. Yet we continue to settle for and cling to consumption-based business models
that add to these global threats. Many large companies have survived and thrived for decades by selling
high-calorie, sugary drinks or distributing apparel made by people working in extreme poverty for unfair
wages in unsafe conditions.
By Prof. Jason Jay, Sergio Gonzalez, and Marine Gerard
Overcoming these challenges and enabling societies to
thrive on a planet with increasingly finite resources will
take significant innovation. We call this sustainabilityoriented
innovation (SOI).
SOI is about dispelling the notion of tradeoffs between what
seem to be competing goals — performance versus impact,
profit versus purpose, human wellbeing versus environmental
protection. Our research suggests that when we no longer see
these goals as competing, we create products, services, and
business models that are holistic rather than fragmented.
The potential for SOI exists within all firms. We just need to
understand the barriers to unleashing it. Our research suggests
that one critical barrier to achieving SOI is the “sustainability
tradeoff” view of the world, a mental model
that says having a positive social and
environmental impact must exist
as a tradeoff with more
traditional business drivers.
the late 1990s, it started to develop an organizational commitment
to environmentally responsible shoe design. One of its
early forays into this work was the “Trash Talk” shoe, a shoe
made from scraps of discarded material. The intended social
value was to find a productive use for
cutting-floor waste in the factories.
Less waste meant using less energy,
less water, and fewer
chemicals.
Let us look at Nike as an
example of a company that
discarded its tradeoff model. In
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innoVAtion
But the shoe was a commercial failure. Customers did not
find it aesthetically appealing, and Trash Talk did not have
all the performance characteristics that Nike athletes had
come to expect from their footwear. For Nike, succeeding
with SOI meant holding firm to its commitments to both
performance and impact. While Trash Talk had been a
“compromise,” moving along the tradeoff line, they needed
to push the envelope.
The impact / performance frontier
After an extensive search and invention process, Nike took a
very different approach from the one they had been using.
On the impact dimension, they sought to achieve zero waste
on the cutting room floor, a standard that far exceeded any
they had set in the past. On the performance dimension,
they sought to make shoes lighter and more breathable. By
committing to achieving both performance and impact, Nike
had let go of its either / or approach. The result was Flyknit, a
new technology that involved weaving the upper portion of
the shoe from a single thread. They had learned what artists
have long understood — that constraint generates innovation.
For Nike, holding impact and performance constraints
simultaneously led them to an entirely new way of producing
athletic footwear.
Nike Flyknit technology involves weaving the upper portion
of a shoe from a single thread. It reduces the shoe’s overall
environmental footprint and at the same time increases its
athletic performance with lighter weight and flexibility.
By creating a new way to manufacture its popular running
shoes, Flyknit produced what Nike CEO Mark Parker summed
up as an innovation with “the potential to change everything.”
Flyknit is a mainstream product, marketed as a high-performance
shoe. Its sales are projected to surpass $ 1 billion in
2016, which for a single shoe is an astounding accomplishment
given Nike has a footwear business worth $ 18.3 billion in total.
In our example, Flyknit hit the SOI sweet spot and tackled
all three constraints simultaneously by creating
customer value by increasing comfort and
running performance; creating
business value by cutting
production time and costs, and
addressing mainstream customer needs with significant
market potential; creating system-wide environmental
and social value by reducing landfill waste and reducing the
need for labor-intensive, low-wage work.
The customer-business-system constraints
We know that successful SOI does not occur in isolation
but through collaboration. Dutch start-up DyeCoo Textile
Systems B.V. completely revamped Nike’s textile dyeing by using
an entirely waterless process called ColorDry, which reduced
water demand by 100-150 liters of water (26-40 gallons), reduced
dyeing time by 40 percent and energy use by 60 percent,
and reduced the factory footprint needed for production by
25 percent. DyeCoo’s technology was a game-changer.
Although Nike Flyknit and DyeCoo ColorDry have both proven
to be powerful technological innovations, SOI is not limited
to cutting-edge technologies. It also has impact at the organizational,
institutional and social levels.
“
Innovation allows
companies to reap
the benefits of products
and services that
create social and
environmental good.
Types of sustainability-oriented innovation
”
Consider new intra-company “process” innovations such as
Buffer’s transparent salary bulletin and calculator, Tesla Motors’
“system infrastructure” changes such as its international
EV supercharging network, and Uber’s new “delivery and
business model” innovation for car-sharing taxi alternative.
These are all prime examples of the versatility of SOI across
the organizational, institutional, and societal levels of innovation.
They all work within different boundaries of change
— from individuals to the inside of firms, firms to the inside
of states, and states to the inside of society. In pursuing these
bigger, more systemic solutions, SOI embraces a wide swath of
commercial and civic stakeholders. Entrepreneurs, corporate
intrapreneurs, policymakers, NGOs, investors, academics, and
active citizens all play a role in SOI success.
Embracing such diversity dispels the notion of single-player
innovation and focuses instead on increasing opportunities
for growth and scale through a multistakeholder approach.
Global Compact International Yearbook 2016 17

Important
performance
focused
Sustainability-Oriented
innovation
Performance
“Compromise”
Impact
focused
Not Important
impact
Important
With this wider perspective and more diverse population of
stakeholders, it becomes possible to tackle the big challenges
more effectively and to be part of the solution that creates a positive
future for business and society at large. In our subsequent
blog posts, we explore the types of firms and strategies that can
mesh with SOI, and the process of multi-stakeholder innovation.
Why sustainability-oriented innovation is valuable in
every context
Sustainability, sometimes under the banner of corporate social
responsibility (CSR), used to be a specialty practice used by
only a few companies, like Nike and Coca-Cola, to manage
risks to their high-value brands.
But times have changed, and as we described in our first
post, Nike is now using sustainability to drive the top line by
enhancing product development and revenue growth with
technologies such as Flyknit. Start-ups such as Liquiglide and
its super-surfactant products, unicorns such as Uber and its ondemand
transportation service, and large systems integrators
such as Lockheed Martin with burgeoning renewable energy
and energy storage systems are combining sustainability with
revenue generation in various ways. Sustainability-oriented
innovation is the basic enabler of this trend.
Because SOI allows companies to push beyond their usual innovation
boundaries and their typical business protocols, it is
expanding the range of businesses that are practicing sustainability
and finding new fuel for their innovation processes.
It is also allowing them to reap the benefits of products and
services that create social and environmental good.
The context and intent around SOI influences its final shape
and form. Our research has identified three degrees of sustainability
orientation: sustainability-relevant, sustainabilityinformed,
and sustainability-driven.
The three degrees of SOI
The most common form of SOI in the mainstream corporate
world is sustainability-informed innovation (SII). The
aim of SII is to meet a well-defined customer need using a
design informed by sustainability considerations. Nike and
its Flyknit technology discussed in our first post offer a good
example of SII.
Many “green” brands and internal labels, such as Clorox
Greenworks and Johnson & Johnson’s Earthward program, also
fit this category. Some companies, such as Patagonia, build
their whole R&D portfolio around SII. Since its founding in
the 1970s, Patagonia’s mission statement has evolved from
“build the best product” to “use our business to inspire and
implement solutions to the environmental crisis.”
With this mission statement in mind, sustainability has become
integral to Patagonia’s innovation process, which has resulted
in products such as “synchilla” fleece made from recycled
plastic bottles and the recent Yulex wetsuit — the first biomaterial-derived
wetsuit in the surfing industry.
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Sanergy builds healthy, prosperous
communities by making hygienic
sanitation affordable and accessible
throughout africa‘s informal settlements.
So far 732 Fresh life toilets are installed
in informal settlements.
Global Compact International Yearbook 2016 19

Sustainability:
A positive side effect.
Sustainability:
One of the inputs.
Sustainability:
The core purpose.
Sustainability-
Relevant
Innovation
(SRI)
E.g. Zipcar
Sustainability-
Informed
Innovation
(SII)
E.g. Patagonia
Sustainability-
Driven
Innovation
(SDI)
E.g. Sanergy
The partnership between Patagonia and Yulex paired each
firm’s core competencies in materials technology to enable
the creation of the world’s first sustainable wetsuit. Their SOI
was then shared with the rest of the surf industry, and now
the same environmental technology can be found in almost
all brands’ premium wetsuits.
Nike Flyknit and Patagonia Yulex illustrate two benefits that
companies reap through SII. The first is that sustainability
constraints help drive a wider search for new materials, new
processes, and new designs that can yield higher-performance
products. The second is that SII creates possibilities for differentiation
among sustainability-minded customers. In this way,
it manages risks and opportunities as customer preferences
and regulations change.
Sustainability-driven innovation (SDI) is another kind of SOI that
innovates with the specific goal of solving a public problem. An
example of technology-based innovation would be renewable
energy companies such as SunPower, which are developing
high-efficiency solar photovoltaic panels to mitigate the air
and climate pollution associated with fossil fuels.
Other enterprises, such as Sanergy, achieve SDI through businessmodel
innovation. Sanergy is an MIT spinoff established to
solve sanitation problems in the developing world. Knowing
that nearly 8 million people in Kenyan slums lacked access to
a proper sanitation, the Sanergy team used $ 25,000 from the
MIT Public Service Center to test their solution. They installed
two toilet stations and franchised them out to local entrepreneurs,
who maintained them and charged for use. Sanergy
safely collected the waste and converted it into fertilizer that
could be sold to farmers. The pilot was so successful that in
2011 the team formed a for-profit and non-profit business to
continue its work. The for-profit arm developed and sold the
toilet stations and waste fertilizer. The non-profit arm supported
the franchisees and infrastructure with training and services.
Sanergy’s results are impressive and include:
• installation of 734 toilets
• 33,000 daily uses
• removal and treatment of 6,028 metric tons of waste
• creation of 763 jobs
In addition, local entrepreneurs, 35-40 percent of whom are
women, are making a profit of at least $ 1,000 per year; organic
fertilizer made from the waste sells for 30 percent less than
inorganic alternatives; and local school attendance increased
20 percent after schools purchased toilets, which gave parents
more confidence to send their children to class.
The third form of SOI, sustainability-relevant innovation (SRI),
is the most broadly applicable but the least discussed. SRI is
about discovering and leveraging hidden sustainability benefits
after innovation. Zipcar and the car-sharing revolution are
prime examples. The practice dates back to the late 1980s in
Europe with the rise of programs such as Mobility Switzerland
and StattAuto Berlin. Convenience and cost-savings were the
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innoVAtion
“
We know that
successful SOI doesn’t
occur in isolation
but through
collaboration.
”
original value drivers of the innovation. The success of these
programs in providing superior benefits over owning a car
led to wide adoption in the United States and Europe. In addition,
membership exploded once internet technology made
it possible to streamline business operations.
Zipcar rode this wave after debuting in Boston in June 2000,
and its leadership quickly realized that this new business
model had tangible sustainability benefits as well. Entering
into public-private partnerships with cities such as Baltimore
made Zipcar aware that their business was encouraging people
to sell their cars, avoid buying new ones, take fewer trips, drive
fewer miles per trip, walk and bike more, and take public
transit more often.
SRI can also grease the wheels for SII and SDI projects. Consider
GE’s “Ecomagination” strategy. When it began, GE focused
on identifying the environmental benefits of their existing
products, such as more energy efficient appliances and engines.
By marketing these benefits to customers, employees,
investors, and other stakeholders, GE established broader
legitimacy of an SOI approach. From that foundation, GE
was able to undertake SII and SDI projects. EcoSwitch — a
tea kettle, slow cooker, hot plate, and blender combined into
one energy-efficient package — is an SII product, and Open
Innovation was an SDI project that called for innovators to
solve water scarcity and energy challenges in international
communities struggling with those issues.
Although one form of SOI may have significantly greater scale
or impact than another, all three are beneficial. The sum reduction
in GHG emissions from car-sharing (SRI, Zipcar) and the
GHG emission reductions achieved by replacing petroleumbased
neoprene with e-fiber in wetsuits (SII, Patagonia) are
both beneficial, even though the former clearly will have a
larger-scale impact than the latter.
Each of these three SOI variations will have its own area of
impact. SIIs will tend to include mainstream consumption
channels and foster shifts in industry impact. SDIs will tend
to push the envelope and be very specific in focus. And the
impact of SRI will be in discovering and leveraging hidden
sustainability benefits after innovation.
Whether technological, organizational, institutional, or social
innovation, SOI practitioners will benefit by recognizing the
need for an ecosystem of SOI that will accommodate the entire
spectrum of impact.
Another positive by-product of SRI for Zipcar was the unanticipated
recruitment of allies for its business. Cities and
universities came to see it as an eco-friendly alternative to car
ownership, with the added benefit of fewer regulatory barriers
and lower parking prices.
How sustainability factors into SOI
These behavioral changes all entailed real social and environmental
benefits. Although more research is needed around their
quantification, better air quality, less traffic congestion, and
more physical activity are highly likely. Zipcar stumbled upon
these sustainability benefits as a free and positive side effect of
its business-model innovation and made it possible for people
to drive within a new sustainability-oriented context. The result
of Zipcar’s SRI activities was nothing short of industry-shaking.
Prof. Jason Jay is a Senior Lecturer and Director of the
Sustainability Initiative at MIT Sloan. Sergio Gonzalez
is a graduate student in the MIT Technology and Policy
Program. Marine Gerard is a 2014 graduate of the MIT
Sloan School of Management currently working as an
associate at the Boston Consulting Group. The article was
originally published in the Sloan Management Review.
Global Compact International Yearbook 2016 21

Does firM innoVAtion
AffeCt ?
CSR
WHat tHe aCaDeMICS SaY
Is a sustainable company more innovative or, vice versa, is an innovative company more
in favor of sustainability? and is there any link between innovation and CSr? two notable
academic studies help us to answer these questions. the first one is from rui Shen, Yi tang,
and Ying Zhang and was published as a Harvard Business School Working paper in 2016
using a sampling of 3,315 publicly listed US firms from 2001 through 2011. the second study
was conducted by xinghua Gao and Yonghong Jia, both from Governors State University,
Illinois, and published in September 2015. to better understand how different aspects of
CSr influence corporate innovation outcomes, the authors examined five social dimensions:
community, diversity, employee relations, the environment, and products.
What do the studies tell us?
The most important finding is that, yes, there is a positive link
between CSR and innovation. Shen, Tang, and Zhang write:
“We find that more innovative firms also engage more in CSR
activities. This effect is stronger for firms of higher risk and/
or operating in a less munificent environment. Additionally,
firms with higher innovation reap greater financial benefits
from their CSR activities.”
Innovation is risky
Innovation is considered by most experts as being a key factor
in determining a company’s ability to maintain advantages
against its competitors. The more a company is willing to,
and capable of, inventing and reinventing itself, the better
it can respond to fast – and often abrupt – market changes.
This is a well-known fact. But few efforts have been made “to
examine whether or not innovation may influence a firm’s
other strategic choice,” write Shen, Tang, and Zhang. This
is all the more extraordinary because innovation activities
are highly complex and have uncertain outcomes – traits
that normally produce sleepless nights at the C-level and
among investors. Innovation means limited control of the
process and always implies risk. That is why companies with
less-open cultures or control-obsessed management are less
innovative by nature.
How does CSR come into the game?
CSR helps to reduce the level of uncertainty and the information
asymmetry between the company and its main
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innoVAtion
stakeholders by serving as a credible signal. It is a fact that
companies with a good CSR reputation maintain a good
social image in the eyes of the public – they accumulate
moral capital, in a manner of speaking. This moral compass
can help to “identify emerging problems, prevent fraud,
preserve corporate reputation, and minimize any penalty
when transgression occurs,” say Shen, Tang, and Zhang. That
creates a reaction: To meet potential concerns, an innovative
company must be motivated to engage more in CSR. Gao and
Jia write: “CSR enhances innovation because CSR initiatives
help foster a culture for employees to be creative, enhance
firms’ access to external financing, and form an enthusiastic
and effective workforce.”
Key findings
1. Companies featuring greater innovation record higher
levels of CSR.
2. This correlation becomes stronger when the company’s risk
level is higher or when it is operating in a less munificent
market.
3. The positive effects of innovation on CSR are stronger for
companies with greater financial leverage.
4. CSR brings more financial benefits to companies well known
for their innovation performance.
5. Companies scoring high on CSR performance obtain better
price terms from capital suppliers.
6. These positive financial effects are weaker when market
munificence is higher.
Intel and the first DraM
Sustainable stakeholder management is nowadays an essential
element of modern corporate management. a practical
example as to why stakeholder inclusion is so crucial
goes back to the early 1970s. In 1970, Intel planned to
invest in the mass production of the first semiconductor capacitor,
the 1 kilobit “1103” DraM (dynamic random access
memory). this type of memory storage was the cornerstone
of the digital age, revolutionizing our daily lives, our work
environments, and our leisure time. DraM was a “disruptive
innovation,” to use the words of Clayton Christensen.
However, in 1970, Intel’s engineers were concerned about
the potential negative consequences of the new DraM
technology. Harvard Business School authors quote some
colleagues: “there was a lot of resistance to semiconductor
technology on the part of the core memory engineers. the
engineers didn’t embrace the 1103 until they realized that it
wouldn’t make their skills irrelevant.” additional resistance
came from suppliers and distributors because they had to
invest in specialized equipment and new facilities that would
be of no use for other forms of production. they had no
idea about whether semiconductor innovation would make
its way onto the markets. Intel agreed to hold discussions.
though initial production in 1970 was below standard, five
modifications of the production line were necessary before
the product could finally take its victory lap in late 1971.
Global Compact International Yearbook 2016 23

Decarbonization
“
The Paris Agreement is a victory
for people, for the common good, and
for multilateralism. It is a health
insurance policy for the planet.
It is the most significant action in
years to uphold our Charter mandate
to ‘save succeeding generations.’
”
Ban Ki-moon, UN Secretary-General (2007 – 2016)
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Growth
a HarD HaBIt to BreaK
If we are to take the Paris Agreement on climate change seriously,
growth-driven society is on the way out. But greed is part of the human
condition, and no one knows what life without growth would be like.
By Prof. Dr. Felix Ekardt
In December 2015, countries around the world agreed to a
new global climate treaty. The legal details are vague, but
the overarching objective is clear and binding. The Paris
Agreement stipulates that global warming be limited to well
below 2 degrees Celsius. For an industrialized country such
as Germany, which has high per capita emissions, the IPCC
estimates that this would mean 95 percent fewer greenhouse
gas emissions by 2040.
The Paris Agreement targets a further limit of 1.5 degrees
Celsius. The changes required to achieve this would have to
happen even faster; developing countries would have to press
ahead with these in the near term as well. The Paris targets
are absolutely welcome, considering that the consequences
of climate change threaten all of humanity. But what no one
admits is that their implementation will likely lead to a world
without growth.
Protecting the climate and perpetuating growth can go hand
in hand if we replace the fossil fuels we use for electricity,
heating, fuel, and fertilizer by relying solely on technical options
such as renewable energies and energy efficiency. New
technology can be sold and growth achieved in this way. But
technology alone will hardly get us to the aforementioned
targets – even though, of course, no one can predict this
today with any certainty. The challenge is simply too great.
Tidy emissions projections
Moreover, as our technology improves, our level of wealth
rises, creating more emissions to deal with. We also lack
effective technological solutions for some of the sources of
emissions, such as agriculture. In addition, previous statistics
and forecasts are based on tidily estimated projections. Industrialized
countries such as Germany are supposedly reducing
emissions, but in reality, the emissions from our way of life
are increasing. We are simply shifting them onto developing
countries, since this is increasingly where our consumer goods
are coming from.
Furthermore, all of this talk about climate is one-sided: Other
environmental problems such as the degradation of soil and
ecosystems pose just as much of a long-term, existential risk
to humanity and need to be addressed at the same time. The
solution is obvious: Give more space to nature. Technology
alone is not enough for these problems, even less so than it
is for the climate. Consequently, under the Paris Agreement,
part of protecting the environment is about leading a more
frugal lifestyle, in addition to using green technology. It is
not enough just to drive more-efficient cars – we have to
walk places more often, or go by bike, bus, or train. Cosmetic
fixes such as massive reforestation to bind greenhouse gases
will do almost nothing to remedy this inconvenient truth;
Global Compact International Yearbook 2016 25

their scale would have to be enormous
if we are to substantially reduce emissions
that way.
Emissions-free nuclear energy is no solution
either. The risk of such facilities
being attacked by terrorists is uncontrollable,
at the very least, and their costs
are exorbitant. The German debate over
nuclear waste demonstrates precisely
this fact. And if, rather than embracing
undesirable frugality, experts suggest
removing greenhouse gases from the
atmosphere through methods such as
seeding the oceans or carbon capture
and carbon storage, we face the threat
of equally incalculable risks and exorbitant
costs.
More frugality
The shift to a more sustainable society,
therefore, will not work unless we also
shift our way of life. We need to consume
less. But then less will be sold:
significantly fewer leisure flights, and
fewer cars. This implies that the end
of the growth-driven society is upon us,
first and foremost in those industrialized
countries that are called upon to make
progress on climate change under the
Paris Agreement. Neither will we get away
with visions of a purely service-oriented
world without any environmental footprint:
Services such as flights and IT technologies
also use a good deal of resources.
If we limited environmental protection
purely to what was technically feasible,
on the other hand, we would have to accept
considerable environmental damage.
This would mean tackling climate change
only partially and would be tantamount
to ignoring problems such as degraded
ecosystems. In the long term, we would
be destroying the physical foundations
of our existence, and in the worst case
this would happen through increased
international and civil wars over dwindling
food and water resources.
But here is the big problem: Until now,
central social institutions such as the
labor market, the pension system, the
banks, and the system of national debt
have depended on growth. So far, alternative
concepts to liberate them from the
growth compulsion have hardly gone
beyond individual ideas such as a reduction
in the number of hours worked.
Furthermore, we lack conceptions of
how to make the difficult transition
into the post-growth era without massive
upheaval and social unrest – as we
witnessed in the euro crisis countries,
where growth turned into contraction
in the briefest of times.
Many adherents of post-growth evidently
do not see this as a problem. Ultimately,
they say, the contraction will gradually
bring about an economy oriented toward
solidarity and the common good,
including the appropriate political majorities.
They argue that people would
be happier without capitalism because
the competitive society would then become
passé – that people are, in fact,
primarily cooperative or even altruistic
in nature, and only capitalism deforms
them to be selfish. A world without
growth, then, appears as the actualization
of true human nature. But this
misses the point.
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Not everyone dreams of a happy life
in the country
As the research shows, happiness is
relative. So it is less the Malaysia trip
in itself that generates happiness than
the ability to keep up with the Joneses.
A more frugal life can therefore make
a person happy if that person still feels
acknowledged. But happiness levels
also often increase when people have
more than those around them, and not
everyone dreams of growing their own
food in agricultural cooperatives instead
of going to the capitalist supermarket.
The increase in mental health disorders
in a globalized capitalism environment is
not in itself proof that capitalism causes
unhappiness. It used to be that someone
who was sad would simply go see friends;
nowadays, we diagnose depression and
prescribe pills, which not least benefits
the pharmaceutical industry and its
continually new products.
Capitalism is an important cultural
influence. Nevertheless, sociobiology
has demonstrated that human beings
have a certain propensity for selfishness.
Outside of the kind of directly
life-threatening conditions as occurred
in the Stone Age, our propensity for cooperation
is often limited. Cooperation
is particularly difficult when it has to
take place internationally, as with the
climate, rather than in relatively manageable
small groups, as in the distant past.
Therefore, we must count on clear and
very short-sighted calculations of selfinterest,
and among more groups than
just managers and politicians.
We are part of the growth world
We are all interlinked in the growth
world: through our jobs and our consumer
desires, or our pension funds
that own companies through their stock
portfolios. And none of us – politicians
included – always acts rationally. The
all too human biases toward comfort,
habit, repression, prestige, and the usual
concepts of normality complicate any
fundamental change. When I sit down
on the emissions-heavy plane to Tenerife
in February drizzle, I have absolutely
no inkling of the climate disaster and
limits to growth.
Concepts for the post-growth world
should not bank on a new kind of human
being, lest they remain ineffective
utopias. But change is possible. Calculations
of self-interest, concepts of normality,
and even values can evolve further as
different actors interact. They will even
have to – environmentally speaking –
if we are to survive.
Prof. Dr. Felix Ekardt is Director of the
Research Unit Sustainability and Climate
Policy in Leipzig, which he founded in
2009. Since 2009, he has also been a professor
for public law and legal philosophy
at Rostock University (Faculty of Law).
His scientific focus lies in issues around
human science sustainability studies.
Global Compact International Yearbook 2016 27

The
De-
Carb
Diet
To comply with global climate targets, we have to reduce our carbon footprint – no ifs, ands, or buts.
Nevertheless, there are a lot of challenges we need to face first.
By Dr. Elmer Lenzen
Last year’s UN Climate Conference in Paris was truly a
historic moment for mankind and its sustainable development:
The key result of the COP 21 was an agreement
to set a goal to limit global warming to less than 2 degrees
Celsius compared to pre-industrial levels. In addition, the
conference also identified the enemy we have to fight: carbon
dioxide (CO 2
) and all the other greenhouse gases that are –
as a matter of routine – converted into CO 2
equivalents. To
comply with the 2-degree goal, we have to reduce carbon
emissions to almost zero by the middle of the 21st century. So
the magic buzzwords in blogs, speeches, and the rumor mills
are “decarbonization” and the “low-carbon” – or even better,
“zero-carbon” – economy. But to be honest, carbon is not a
problem per se. It is the foundation of life on this planet. The
aggregate state of carbon is the problem: When it takes the
form of a fossil in the ground, it is completely unproblematic.
As a greenhouse gas in the air, it causes global warming. This
is where all carbon strategies come in.
Fossil fuel divestment. The Guardian offers a great explanation
of this concept by writing: “The global movement for fossil
fuel divestment is asking institutions to move their money out
of oil, coal, and gas companies for both moral and financial
reasons.” The concept arrived in mainstream thinking when
the Rockefeller family said in March that they wanted to divest
from fossil fuels as quickly as possible, including its holdings
on ExxonMobil – the company that brought the Rockefellers
their fabulous wealth.
Carbon taxation. An oversized carbon footprint is not just
a problem of the explorative and energy industry. It can be
found in all sectors of the economy. This is why experts say
that we have to put a price on carbon. Lise Kingo, Director
of the UN Global Compact, is one of them: “We believe that
setting a $100 internal price on carbon is one of the most
effective ways to drive climate deep into corporate strategy
and investment. While leading companies have taken steps
to price carbon, we need to see an ascent in ambition and
price across the board.”
Public regulation. It is obvious that self-regulation of the markets
does not work in driving decarbonization into the right
direction, at the right pace. This is why an increasing number
of public authorities are imposing regulations: California, for
example, has very strict legislation, as Volkswagen is learning
the hard way. The European Union and China follow next. Other
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innoVAtion
industrial sectors and more countries
will be regulated to comply with the
Paris Agreement. No one should hold
any illusions.
So we are putting the world economy
on a de-carb diet. Is everything going to
be fine? The goal may be clear, but the
road is rocky and there are many challenges
ahead.
1. Challenge: Politics, or the temptation
of the low-hanging fruit
The critical issue, in short, is not 2030 or
2050, but what happens afterward. Jeffrey
Sachs, Guido Schmidt-Traum, and Jim
Williams point out in a brilliant analysis
that good intentions alone will not bring
about true decarbonization. They argue:
“There are reasons to worry. There are two
paths to 2030. We might call the first path
‘deep decarbonization,’ meaning steps
to 2030 that prepare the way for much
deeper steps after that. The second path
could be called the way of ‘low-hanging
fruit’ – easy ways to reduce emissions
modestly, quickly, and at relatively low
cost. The first path might offer little lowhanging
fruit; indeed, the low-hanging
fruit can become a distraction or worse.”
What have we observed? Politicians
around the world are fostering moreefficient
power plants or mobility concepts
and, true, they can improve their
carbon footprints significantly. But these
technologies might never be able to be
geared toward a zero-carbon solution.
But this is the long-term idea. Jeffrey
Sachs reminds us that the easiest way
is not the best. It is up to the politicians
to explain this to their voters.
2. Challenge: Capital markets, or
how to incentivize mature markets
The Climate Roadmap 2050 says that we
have to reduce our carbon emissions by
80 to 95 percent. You cannot do this with
the present stock of industry. You have
to invest in new plants and industrial
processes. In practice, this means the
industry must be “zero-emissions ready”
by 2040 to guarantee an efficient and
economically predictable infrastructure
by 2050. These deadlines are only one
– maximum two – major investment
opportunities away. But in many sectors,
we do not see investment being made. It
is not because interest rates are high –
on the contrary: They are almost at zero.
It is because the expectations for profits
are low. The case of Japan offers insight:
Aging societies are consuming less and
they are prone to deflation, zero GDP
growth, and decades of stagnation. China
and Europe might join the Japanese
track. So how can we offer incentives to
invest in sustainable solutions in such
mature markets?
3. Challenge: Entrepreneurship, or
how to deal with immutable sectors
Max Åhman and colleagues from Lund
University point to the fact that the
prospects for decarbonization are still
relatively unexplored in many industrial
sectors. The reason is that industries are
still sheltered by their governments to
protect jobs in spite of lost competitiveness.
And when we talk about decarbonization
or about imposing carbon taxes
and regulations, we have to be honest
and say that there will be losers. Refineries,
for example, will have less importance
– or even none at all. The chemical
sector, relying on refinery byproducts,
must also change fundamentally toward
bio-based chemicals to find its place in
the post-carbon economy. Look at the
steel industry: There is no steel without
coking, and there is no coking without
carbon emissions. Abstaining from steel
is not an option. In fact, a decarbonizing
economy will have a growing demand
for steel for new, sustainable industrial
sites. This is a true challenge for zerocarbon
entrepreneurs.
4. Challenge: Growth of population,
or the dilemma with the backlog
demand
There are many smart studies on the market
calculating the effect of this or that
measure. I am confident that they are correct.
The challenge is not only to manage
the already existing market but also to
meet new demands in a sustainable way.
Europe, for example, is enthusiastically
developing a renewable-energy sector. So
are we finally reducing our dependency
on fossil energies? No, we are not. The
US Energy Information Administration’s
recently released International Energy
Outlook 2016 projects that world energy
consumption will grow by 48 percent
between 2012 and 2040. Most of this
growth will come from countries that
are not in the Organisation for Economic
Co-operation and Development (OECD),
including countries where demand is
driven by strong economic growth, particularly
in Asia. Non-OECD Asian countries,
including China and India, account
for more than half of the world’s total
increase in energy consumption over
the projection period. Concerns about
the energy security issues generated by
renewables support the expanding use
of fossil energy sources and nuclear
power. There is nothing new about the
dilemma with the backlog demand. We
are still waiting for someone to offer a
smart answer.
5. Challenge: Shortages drive prices
The biggest challenge lies in the mechanisms
of the markets themselves. When
a resource becomes scarce, this does not
mean that producers look for alternatives.
On the contrary. Scarcity means, first of
all, a significantly higher demand than
supply. This generates higher prices and
profits. Market actors therefore will do
everything possible to take advantage
of this shortage. Even if their actions
aggravate the situation, for example by
overusing resources, they will not stop
because the profits will continue to rise.
This greed will not stop until all resources
are consumed. Let us take a look at oil
production: The high price of more than
$100 per barrel in recent years did not
lead to a turning away from oil production.
On the contrary: Oil drilling was
extended to remote areas, to oil sands,
and especially toward fracking technologies.
The often discussed “Peak Oil”
Global Compact International Yearbook 2016 29

is not an argument in favor of decarbonization, it is rather
a signal that the real big business with the black gold is just
at the beginning.
Measures to take
• Honestly, a lot of expectations depend on disruptive innovations
in the future. New players, new products, and new
ideas will stir up the markets.
• We have to use limited resources more intelligently: The
circular and shared economies have shown us new business
models that address this aspect.
• Efficiency is not only a topic for engineers and graduates in
business administration. It is foremost a topic for product
designers and product developers. We have to form a new
aesthetic that shows how cool it is to buy without packaging,
to shop without plastic bags, and to live without disposables.
• We will need a holistic calculation of costs. It is too simple
to calculate a price without taking into account the up- and
downstream supply chains. Sport shoe manufacturer Puma
is a good example for showing us the way companies can
do it. I do not know if this holistic calculation of costs must
have an effect on the price itself, but it will have an effect
on transparency and awareness-building. Such a holistic
concept of costs, by the way, corresponds with the holistic
concept of capital that the International Integrated Reporting
Council is discussing.
• Politicians will have to write the regulations. Global solutions
are desirable but not obligatory. It is erroneous to believe
that there is no alternative to globalization. National, or
even regional regulations show us that there is always an
alternative and competition is the way to improve systems.
See how California emissions legislation is breathing fire
into the belly of the EU administration.
None of these descriptions offers a concrete, one-step solution
for practitioners. This is up to you. You have to realize that
corporate sustainability is a compass, not a map.
Dr. Elmer Lenzen is founder and CEO of macondo
publishing GmbH, publisher of the Global Compact
International Yearbook and the CSR Academy. He has
a PhD in Journalism and studied at the universities of
Münster and Bochum (both Germany) and the UCR in
San José (Costa Rica).
Jim Yong Kim
World Bank Group President:
“There is a growing sense of inevitability
about putting a price on carbon
pollution. In order to deliver on the
promises of the historic Paris climate
agreement, a price on carbon pollution
will be essential to help cut
emissions and drive investments into
innovation and cleaner technologies.
Prices for producing renewable
energy are falling fast, and putting
a price on carbon has the potential to
make them even cheaper than fuels
that pollute our planet.”
Prime Minister
Hailemariam
Dessalegn
Ethiopia:
“We should now follow up the Paris
Agreement with adequate actions,
national policies, investment schemes
and regional and international
initiatives and partnerships. I iterate
Ethiopia’s commitment to the global
efforts to overcome dangerous climate
change and ensure sustainable development.
We will use every policy
instrument, including carbon pricing,
which is found to be effective,
efficient and fair.”
30
Global Compact International Yearbook 2016

innoVAtion
polItICal leaDerS Call For
faster Action
oN CarBoN prICING
Chancellor
Angela Merkel
Germany:
Mayor
Eduardo Paes
Rio de Janeiro:
“Cities have a major role to play in climate
change and actions made by mayors
could save 45 Gt CO 2
by 2030 – equivalent
to eight times the current emissions
of the United States. More than half of
the people in the world lives in cities.
Cities are responsible for over 70 percent
of energy-related carbon emissions.
In Rio we will decrease gases emissions by
20 percent by 2020, and achieve carbon
neutrality by 2065. Mayors are closer to
the people, they can take actions faster.
Carbon pricing will help us to implement
the commitments we took in the Paris
Agreement and foster the transition to
a low carbon economy.”
“With a price for carbon and a global carbon
market, we can achieve our common
goal – staying well below the 2 degree
ceiling – in such a way that is technology
neutral, promoting innovation, market
based and thus cost efficient.”
President
François Hollande
France:
“The first chapter of the post-carbon era
is being written under the French COP
Presidency. As a frontrunner, the Panel
has the mission to go further in this
direction. We now need to make carbon
pricing levels consistent with the Paris
Agreement objective, to broaden the scope
of covered emissions, and to initiate the
convergence of carbon pricing schemes.”
Global Compact International Yearbook 2016 31

Talents
“
When everyone is competing
for the same kind of talent, you need
a much clearer way of explaining
how you will attract those people to
your organization.
”
Jeff Joerres, CEO ManpowerGroup
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innoVAtion
IS tHe
Meaning
of Work
aBoUt to CHaNGe?
By Rick Goings
Our world is facing a crisis cubed: Jobs are disappearing
faster than they are being created; companies
are struggling to attract people with the right skills;
and people rightly worry how new technology will threaten
their livelihoods. These global challenges affect developing
countries as much as highly industrialized economies. I have
heard plenty of suggestions from all corners that this crisis
can be solved by “creating more jobs.”
It is increasingly clear to me that creating more jobs is not
enough, nor is it the real solution. This solution is based on
a big misunderstanding. To tackle this crisis cubed, we need
to focus on not just jobs but on people earning incomes. This
requires us to develop a new model of work.
What is clear is that the transformations that are now taking
place worldwide, resulting in the loss of jobs, are caused by
forces we cannot alter. The disruption of our world of work is
the result of a tectonic shift just as dramatic as industrialization
and urbanization – and it is occurring along three fault lines:
1. Technology: The speed and breadth of today’s innovation
affect every single job and skillset. Automation, artificial
intelligence, big data analytics, the internet of things, and
mobile technologies are leveling the playing field – not only
geographically but also across the spectrum of businesses,
from large to small. Not all of this disruption is positive.
New technologies could result in a net loss of more than
5 million jobs by 2020, warns a recent World Economic
Forum report.
2. Talent: We are facing a massive skills gap. Today’s education
systems simply cannot keep up with the rapid pace
of change. Too many of today’s graduates are merely not
business-ready for the jobs that now exist. For the rest who
may not have the academic credentials and special skills,
they face barriers as well, as the non-cognitive skills they
might possess are often discounted.
3. Millennials: In 10 years, the millennial generation will make
up 75 percent of the global workforce. They are different,
very different. Not only are they digital natives, they also
have a different set of values; they want purpose in their
lives, flexibility with their time, and a healthy work–life
balance. More than half do not even want a job but want
instead to do something on their own.
This tectonic shift is tearing down many familiar features of
the economic landscape to which we have become accustomed.
Take corporations: Yes, they have been around for two centuries,
and during their time were the primary creator of “jobs.”
Yet, corporations as we have known them may soon have had
their day. They will run out of skilled workers and will also
fail to produce enough jobs to provide to those who want to
Global Compact International Yearbook 2016 33

The whole world can’t be Bill Gates
Rolling out the alternative to a job with the government or with
a corporation requires focusing on start-ups, self-employment,
self-made work, entrepreneurship. Yet, for most people, many
of these notions conjure up images of larger-than-life figures,
of a Bill Gates or Mark Zuckerberg or, perhaps, some teenagers
who – fueled by takeaway pizza – burn the midnight oil
coding new apps. When we hear terms like these, we think
of a path that is risky, requiring top-level education, out-sized
intelligence, and ambition to succeed.
I will not offer a ready-made solution that will make our current
crisis cubed simply go away. But I will offer that – in
my 30 years of living and working in the Americas, Europe,
and Asia – I have seen how income can be created by many
outside the formal structures of government and corporations,
and how people who have taken this route can thrive and
shape their own futures.
Company minus hierarchy equals collaboration
work within the traditional definition of jobs. Additionally,
millennials, who are fast becoming the core of the global
workforce, have little appetite for jobs and careers, since they
offer too much structure and too little personal fulfillment.
What did people do before there were jobs?
Neither governments nor companies can become sustainable
engines of job creation. But then this crisis is not actually about
“jobs.” In the early 19th century, what did people do before
there were jobs? Well, certainly they worked – usually for
themselves – in agriculture, as craftspeople, as tradespeople,
or as part of their local economy in other ways.
This “cottage industry” work lacked scale; it was local by necessity.
When corporations came along in the 19th century,
they simply took these workers, organized them, and – with
the aid of steam-powered factories and early industrializing
technology – created focus, efficiency, and scale. They brought
us the big corporations we now have today, and that model
worked for a long time. Yet, it is fast becoming obsolete.
Today’s most valuable companies, such as Apple, employ a
proportionally small number of people. At the same time, the
job market is shrinking almost everywhere because of the
forces mentioned above. We simply must change our model of
work and look beyond traditional jobs, beyond governments,
beyond corporations. We must develop concepts that provide
the flexibility and resilience needed for people to thrive amidst
this massive disruption.
Take away the hierarchies of today’s corporations and what
are we left with? At their core, companies are a collection of
people engaged in collaborative efforts. It is this collaboration
that is at the heart of our new model of work.
Let us look at it from the perspective of individuals. What they
need for success are business templates that leverage their skills,
match their interests, and – most importantly – nurture
the right mindset that will allow them to be collaborators in
this emerging new economy. They should not just be trained
with cognitive skills or STEM smarts but also non-cognitive
skills such as creativity, self-discipline, resourcefulness, and
endurance – none of which are measured by tests, and few
of which are taught in school.
People with those non-cognitive skills may not feel comfortable
calling themselves entrepreneurs … but from a mindset perspective
they are! And with the right tested templates, models,
and tools, they will be able to generate an income that allows
them to be independent and stand on their own two feet.
Just last week I used my Uber app and was picked up by an
older middle-aged woman who told me she previously had
been cleaning houses a few days a week. Now, she proudly
reported, she was making much more money and with the
flexibility the work offered, was able to drop off and pick up her
granddaughter from school each day. I asked what new skills
she had to learn. “None,” she said. She already knew how to
drive, she knew the area, and always loved meeting new people.
WeWork, another disruptive business model, is a chain of
shared office spaces that rents workspaces on a pay-as-you-
34
Global Compact International Yearbook 2016

innoVAtion
Top 10 Skills
in 2020
1. Complex problem Solving
2. Critical thinking
3. Creativity
4. people Management
5. Coordinating with others
6. emotional Intellegence
7. Judgment and Decision Making
8. Service orientation
9. Negotiation
10. Cognitive Flexibility
in 2015
1. vomplex problem Solving
2. Coordinating with others
3. people Management
4. Critical thinking
5. Negotiation
6. Quality Control
7. Service orientation
8. Judgment and Decision Making
9. active listening
10. Creativity
go basis for budding entrepreneurs. The spaces are actually
working social incubators where, for example, a computer
whiz meets up with a graphic designer. … Think Steve Jobs
and Steve Wozniak.
First, though, we need to flip any mismatched expectations;
we have to help people realize that striking out on your own
is not a necessity but an opportunity, and that the risk can
be managed. Individuals should feel confident operating at
whichever scale they feel comfortable – small and local, or
dynamic, scalable, and global; fully independent or collaborating
with a larger corporation.
Lessons from the world’s most valuable companies
Corporations, meanwhile, will have to abandon their traditional
hierarchies and structures. Take the world’s two most
valuable companies, Apple and Google: Their strength does
not come from making things but from the collaboration
within the huge ecosystems they have created. Think Nike, too.
They are designers and marketers supported by collaborative
companies and individuals.
So to survive, corporations have to reinvent themselves as
conveners of collaborators. That is their new template. They
have to morph into collaborative ecosystems – with their
own rules and community ethos – in which individuals can
plug in their skills. The collaboration economy can be our
new model of work. This may require companies to change
their business models; or it could be as simple as introducing
dynamic and flexible procurement systems.
I will make no bones about it: The transition to this collaboration
economy will not be easy. It cannot be. The three fault lines
– technology, talent, and demographics – have ruptured, and
the disruption brought on by this tectonic shift is simply too big.
But I am an optimist at heart, not least because, during my
entire career, I have met so many people who were able to
turn their lives around simply because they were given the
right template and mentoring.
It is now our job to spot the opportunities in the disruption
and equip people not just to cope but to thrive beyond jobs
and beyond corporations.
Rick Goings is Chairman and Chief Executive Officer of Tupperware
Brands Corporation. He served as a petty officer in the US Navy
during the Vietnam Era. Following this, he founded the fire detector
distributor Dynamics, Inc. After his sale of the company, he worked
in various positions with Avon, including President of Avon USA.
In 1992 he joined Tupperware Worldwide as the CEO. This article
was originally published by the World Economic Forum’s Agenda.
Global Compact International Yearbook 2016 35

By Prof. Dr. Harald Hagemann
Industry 4.0
How does
Affect Growth
and Employment?
With the digitilization and global linking of production
– the “fourth Industrial Revolution” – the
specter of unemployment in the technology sector
has entered central stage again. In its special report on June 25,
2016, on Artificial Intelligence, The Economist proclaimed “The
return of the machinery question,” which first had been posed
in serious economic literature by David Ricardo in 1821. Since
then, a controversy between labor-displacement pessimism
and compensation optimism has run through the economic
literature as well as public policy debates.
Although this controversy gained steam every time greater technological
dynamism led to higher unemployment, Schumpeter
pronounced this controversy “dead and buried.” However, the
current debate, which led authors such as Brynjolfsson and
McAfee to proclaim the “second machine age,” contradicts the
author who stated that “creative destruction” is the essential
fact of capitalism.
Schumpeter’s term of creative destruction indicates well the
double-sided nature of technological change, which, on the
one hand, destroys old jobs and firms and leads to an erosion
of old qualifications and shrinking sectors, but, on the other
hand, stimulates the creation of new jobs, firms, and the rise
of new sectors. This raises three important questions for the
economy as a whole:
1. Do the compensation effects balance, or even dominate,
the displacement effects?
2. Do the new technologies require higher or lower skill levels
than the old ones?
3. How do the new technologies influence the distribution of
income? In particular, do new labor-saving technologies
contribute to higher levels of inequality regarding income
and wealth distribution?
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Global Compact International Yearbook 2016

innoVAtion
Since the future is uncertain and there are many other
economic, political, and social factors beyond new technologies
that will influence the development of employment,
skills, and distribution, reliable empirical predictions are
almost impossible to make. However, it is relatively easier
to make predictions about the future prospects of existing
jobs that are at risk than about new jobs being generated
due to the diffusion of the new technologies. Thus, in the
widely cited study The Future of Employment. How Susceptible
Are Jobs to Computerization? by Frey and Osborne from Oxford
University, the authors came to the result that 47 percent
of existing jobs in the United States are in danger of being
replaced by computer capital soon. A similar study for Germany
found that 59 percent of the jobs are at risk due to
the digital revolution.
Deeper analysis reveals that the probability of being replaced
by computer capital varies widely between different groups
of employees. Whereas academics in scientific and creative
professions, such as doctors, chemists, and physicists, are
hardly affected, office jobs and auxiliary workers in transport
and logistics are extremely vulnerable to automation.
Most studies found that the decisive issue is whether the job
concerned pursues a routine activity, and not whether it is a
blue-collar or white-collar job. Brynjolfsson and McAfee have
pointed out that the second machine age is characterized by
a bifurcation – or job polarization – between two groups
of employees: unskilled, low-paid workers whose work is
dictated by computers, and highly paid, skilled ones who are
managing Industry 4.0.
Is this time different? Partly yes. Whereas past technological
revolutions frequently created disadvantages for low-skilled
workers whose jobs could be easily eliminated due to the
diffusion process of new, more productive technologies, the
digital revolution also affects medium-qualification levels. In
their book The New Division of Labor. How Computers Are Creating
the Next Job Market, Levy and Murnane have already predicted
this lower demand for middle skills. This is because progress
in the new information and communication technologies
enables the automation of more complex tasks that are
based on certain rules and routines, such as the handling
of tax declarations.
In a study from January 2016 for the World Economic Forum
in Davos entitled The Future of Jobs. Employment, Skills and Workforce
Strategy for the Fourth Industrial Revolution, which was based
on a poll survey of the leading managers of the 350 largest
companies, a net loss of 5.1 million jobs is predicted for the
leading economies in the period 2015–2020. This would be the
result of a reduction of 7.1 million routine jobs, which would
be countered by the creation of only 2.1 million jobs, mainly
in the IT technology sector. As a consequence, an increase
in human capital in fields such as mathematics, computer
1st
Mechanization,
water power,
steam power
2nd
Mass production,
assembly line,
electricity
3rd
Computer and
automation
4th
Cyber physical
Systems
and natural sciences, and engineering is being demanded,
including a higher share of women in these areas to avoid
a structurally higher unemployment rate for women in the
future. A study of the labor market research institute IAB in
Nuremberg from August 2015 is much less pessimistic in its
prediction of a net loss of 60,000 jobs by 2025 due to Industry
4.0 in Germany. An important point is the emphasis that not
only academics but also higher-skilled workers will be among
the winners of the digital revolution, if they acquire the additional
skills necessary for the future linking of industrial
production with computer technologies. This indicates the
importance of research and education as a prohibitive labor
market policy to avoid higher unemployment in the technology
sector in the future.
One need not deplore every job loss due to technological change.
A good example is the use of industrial robots to replace workers
who once were employed lacquering cars and who suffered
high rates of cancer due to breathing in poisonous steams. New
technologies imply risks and chances. The restructuring of
economies – from an older industrial economy to a modern
one – strengthens the options for “green growth” strategies. The
digital revolution not only makes greater material productivity
possible or creates efficiency in the use of natural resources,
but it also generates a general reduction in the absolute use
of non-renewable resources. This may help in contributing
toward the requirements of sustainable development – in
the economic as well as the ecological and social dimensions.
This also makes the greater synthesis of two hitherto widely
independent developments necessary: the digital revolution
and strategies for coordinated sustainable development policies,
which first became an issue at the United Nations Conference
on Environment and Development in Rio de Janeiro in 1992,
and were further specified in the worldwide agenda of the
Millennium Development Goals in 2000.
Dr. Harald Hagemann is professor of macro-economics
and economic theory at the Universität Hohenheim.
Global Compact International Yearbook 2016 37

future Markets
“
In this ever-changing society,
the most powerful and enduring
brands are built from the heart.
They are real and sustainable. Their
foundations are stronger because
they are built with the strength of the
human spirit, not an ad campaign.
The companies that are lasting are
those that are authentic.
”
Howard Schultz, CEO Starbucks
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Global Compact International Yearbook 2016

innoVAtion
HoW to BUSt tHe
Biggest Myths
aBoUt tHe CIrCUlar
eCoNoMY
Tired of being told the circular economy is just a fancy term for recycling that will cause profits to slump?
Here’s how to fight back.
By Liz Goodwin
When China began to emerge as one of the major
global economies, the dominance of English as
a global business language was challenged by
Mandarin. Would this lead to barriers? Apparently not. The
reality is, it does not matter what language you speak, as long
as it is the universal language of business.
Some say that the premise of the circular economy gets lost
in translation and is misunderstood. There is a perception
that it is an ongoing battle between environmentalists and
corporations – that one side wants to see the environment
preserved and protected, and that the other prioritizes profits.
But the circular economy connects both, in fact, delivering
economic as well as environmental gains.
Despite the growing case for the circular economy, barriers still
exist. As former CEO of Kingfisher, Sir Ian Cheshire, recently
wrote, there are “examples of deliberate blocking of progressive
business policies by dinosaur corporates that claim they
cannot adapt to the new economy.” So, if you are confronted
with this attitude, here is a basic translation reference for the
circular economy – a handy rebuttal guide.
Perception: The circular economy is just another way to
describe recycling
Reality: The circular economy is much more than recycling.
A linear economy makes, uses, and disposes of materials. The
circular economy looks at all the options across the chain
to use as few resources as possible in the first place, keep
resources in circulation for as long as possible, extract the
maximum value from them while in use, then recover and
regenerate products at the end of service life. This means
designing products for longevity with reparability in mind
so that materials can be easily dismantled and recycled, not
to mention the alternative business models that encompass
trade-ins, sharing models, and service packages.
Perception: Encouraging people to reuse or keep
products for longer does not encourage sales, so profits
would slump
Reality: In the United Kingdom, there is a saying: “The customer
is always right.” In France, they say: “Le client n’a jamais tort,”
meaning the customer is never wrong. In Germany the saying
is: “Der Kunde ist König,” the customer is king. There is a clear
status quo to prioritize customer satisfaction. Currently, we are
being shortsighted and building products without longevity
in mind, which costs UK businesses some £ 400 million a year
in product returns. A circular economy encourages people to
keep products in circulation for longer, which creates business
opportunities for service packages that include repairs and
maintenance services and drives customer loyalty.
A colleague recently returned from South Korea, where he
was exploring LG Electronic’s approach. Like a doctor’s surgery
practice for electronics, customers can take their broken
products to LG’s service-repair center, where they are issued
with a ticket and seen by a technician, who fixes it on the spot.
Perception: The circular economy might be an
opportunity for some, but it will have a negative impact
on manufacturers
Reality: Natural resource and materials prices are rising, and
they are also volatile. Refurbishment and remanufacturing
Global Compact International Yearbook 2016 39

Perception: The top priority is the economy and jobs,
especially in times of austerity
Reality: The president of the European Commission, Jean-Claude
Juncker, has said he wants to focus on jobs and growth, and
rightly so. There are a number of routes to get to a destination,
but the end result will be the same. Jobs and economic
growth are no exception, and one possible route to achieve
this ambition is growth of the circular economy.
Life Cycle
Thinking
Globally, Innovate UK claims resource-efficiency measures
could add $ 2.9 trillion to the economy by 2030, with returns
on investment of more than 10 percent. There are also major
job opportunities. WRAP and Green Alliance recently identified
that more than 200,000 jobs could be created in the United
Kingdom if circular economy activities continued to grow.
In a recent report, the World Economic Forum and the Ellen
MacArthur Foundation also identified that a shift in reusing,
remanufacturing, and recycling products could lead to more
than half a million jobs being created in the recycling industry
across Europe.
Perception: If the environment is on the agenda,
shouldn’t the top priority be climate change?
offers are sheltered from these fluctuations. Walter Stahel,
originator of the circular economy concept, recently said that
if a businessman suggests opening a manufacturing plant to
make money, you should counter that they can make five
times as much from opening a remanufacturing plant.
Greater circularity can also benefit existing manufacturers.
Rolls-Royce, for example, is known for the “power by the hour”
service model, and Caterpillar is known for its remanufacturing
arm, Cat Reman. More recently, Jaguar Land Rover embedded
circularity into its design and assembly process and is using
50 percent recycled aluminum in some of its latest car models.
Considering that cars are so reliant on aluminum, a high-value
material, it makes economic sense to use recycled content.
Perception: The circular economy may be the latest
buzzword, but my business has been steady for years,
why change now?
Reality: It was only 10 years ago that we would happily rent a
video and turn pages of a newspaper. Now online streaming
and internet news prevail. Many businesses that were once
leaders have disappeared as new trends have emerged, such as
internet shopping and digital technologies. Business as usual
is not always the safest path. The companies that prioritized
short-term profits rather than future-proofing themselves
ultimately paid the price. The sooner that businesses understand
ways in which to adapt to change, the less is the risk
of a hard blow.
Reality: The circular economy could go a long way toward
helping reduce carbon emissions. According to a recent report
by the Carbon Trust, Innovate UK’s Knowledge Transfer
Network, and Coventry University, remanufacturing typically
uses 85 percent less energy than manufacturing; on a global
scale, it has the potential to offset more than 800,000 tons of
CO 2
emissions per annum.
And remanufacturing is just one component of the circular
economy. In its first phase between 2005 and 2009, WRAP’s
Courtauld commitment – a voluntary agreement aimed at
improving resource efficiency within the UK grocery sector –
avoided 3.3 million tons of CO 2
-equivalent emissions, equal
to an airplane flying around the world half a million times.
Liz Goodwin became CEO at WRAP in 2007, having joined
in 2001 as the first Director of Materials Programme.
Under Liz’s leadership, WRAP has been at the forefront in
helping to create a more sustainable world, to the benefit
of the environment, economy, and society. One of WRAP’s
leading areas of work is preventing and tackling food waste.
Through ground-breaking voluntary agreements, such as the
Courtauld Commitment, and behavior change campaign,
Love Food Hate Waste, this work has helped reduce UK
household food waste by 21 percent. Originally published in
the Sustainable Business section of The Guardian.
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innoVAtion
Global Compact International Yearbook 2016 41

Sharing
Has Been Hijacked
The “sharing economy” is today’s buzzword for Silicon Valley’s most recent
batch of billion-dollar companies. So ring the headlines: $ 51 billion valuation
for Uber; Chinese ride-hailing business Didi Kuaidi raising $ 4.42 billion; Airbnb
valuation $ 10+ billion. In the last three years, the world has embraced this idea
of the sharing economy. Who would have thought that a 23-year-old part-time
student tooling around in her Prius would disrupt the transportation industry?
Or that renting out your spare bedroom with the Star Wars sheets could make
you part of the largest hotel network in the world?
By Lily Cole and Adam Werbach
Is it just us or is there something a bit awkward about
marrying “sharing” with “billion dollars”? Unless you are
sharing a billion dollars, which would be rather cool. In
reality, it is millions of people “sharing” to produce a handful
of billionaires. Riddled with contradiction, it brings to mind a
pseudo-communist dictatorship with a well-groomed leader.
The word “share” comes from the Old English word scearu,
related to sceran (“to cut”) and is recorded in the late 16th
century as having meant “to divide one’s own and give part
to others.” Note the word “give” in there. The Latin origin for
“give” is muni and is found in words such as communication
and community: We share our words; we share in communities.
Sharing has been an important part of humanity’s mutual
ability to distribute resources and sustain relationships since
the time of fire and caves. We share with our families, we share
with our friends, and in some places we still share with our
neighbors. Sharing creates community, social cohesion, and
the identity of the group. Real sharing thus is in the realm of
giving and was never a transactional endeavor.
Therefore, sharing does not seem to be the most fitting description
for technical platforms that enable users to pay to
use one another’s underutilized resources, be it homes or
cars. “Rent” might be a better word. “Rent” in the mid-15th
century meant “to rent out property, grant possession and
enjoyment of in exchange for a consideration paid.” Although
modern rental platforms offer enormous value – enabling
trust between strangers and a partial deconstruction of hierarchical
economies on the peer-to-peer level (albeit with the
same macro-ownership structures) – they do not reflect the
sentiment of sharing that has defined communities as communities
for thousands of years.
Well, yes. We believe so. And not because we are not fans of
rental platforms – we are – but in the miasma of lumping
everything together as the “sharing economy,” there is the
threat of distorting and confusing both the meaning of sharing
and the very real and silent sharing economy that sits like a
backdrop to our reality.
So what is the real sharing economy? It includes libraries and
buses, roads and parks, power systems and water supplies,
courts and rummage sales, charity shops and bulletin boards,
community gardens and universities. This is not just about mobile
apps. We estimate the entire sharing economy represents
well over $ 15 trillion in assets. To put things in perspective,
the headline-grabbing, venture-backed “sharing economy” is
worth about $ 130 billion. That is less than 1 percent of the
broader sharing economy. To allow the “sharing economy” to
be understood as Uber and Airbnb would be to understand
the “music economy” to be Taylor Swift and Adele.
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innoVAtion
Perhaps the term “sharing economy” is self-consciously contradictory.
The definition of economy is “the state of a country or
region in terms of the production and consumption of goods
and services and the supply of money.” So we are explicitly
making sharing transactional, turning it into a market. Consider
then the even broader culture of sharing: thanksgiving lunches,
helping a friend move, Christmas gifts, giving a stranger directions.
The UK government reckons that the informal gift
economy is in fact larger than GDP.
Technology allows us to safely and efficiently share outside
our circle of trusted friends and family. There has been a
wellspring of apps and platforms to better enable sharing
between strangers. Both of us were attracted to the idea of
building start-ups that encouraged genuine sharing. Using
technology to enable better distribution of resources spoke
to our aspiration of addressing planetary challenges at scale
and speed. Reddit, CouchSurfing, Kiva, IndieGoGo, Etsy, Waze,
Mozilla, and Wikipedia all represent the type of scaled community
power that could be applied to the sharing of our time
and our things. Respectively, we built Impossible and Yerdle
to further these goals.
There is a lot at stake. By the end of the century, the Earth
will be home to 10 billion people. It cannot accommodate us
all if we all consume resources like the Americans and British
of today. We would need three planet Earths to support us.
We will jointly use what we have, or we will die fighting each
other for the last bits of water, atmosphere, phosphorous, and
arable land. Jointly using what we have – sharing – is one
of our best chances for survival.
There is a massive opportunity for people who wish to serve
the planet to take hold of new technological tools and outinvent
those who would consume our common assets. We
invite you to join us in rewiring the economy so that everyone
can benefit from the bounty of the Earth. We have trillions of
dollars of underutilized resources that need to be unlocked.
The challenge of our generation is to get more out of every
tomato, drill, mile of road, and hour of boredom. That is the
only way we will stretch our resources across 10 billion people.
And developing systems that foster cooperation and mutual
benefit is fundamental. The benefits belong to all of us.
Lily Cole is founder of the social giving network Impossible,
and Adam Werbach is founder of Yerdle, a people-powered
store in which all of the inventory comes from members.
The post was originally published on Medium.
Global Compact International Yearbook 2016 43

Start-Ups
aBoUt Do-GooDerS,
MoNeY-BUrNerS, aND SoCIal eNtrepreNeUrS
United States
the world’s most valuable start-ups
The sharing economy is the buzzword for tech start-ups these
days. Whether talking about Uber or Airbnb, these young and
innovative companies are among the most valuable startups.
However, this period of soaring growth might come to
an end. Voices such as those of venture capitalist Bill Gurley
and Satya Nadella, CEO of Microsoft, advocate more caution
with investments in this area. Both say corrections are overdue
in the market. This could well lead to changes in the list
of billion-dollar start-ups. One more point to add: Corporate
responsibility is another element these top start-ups should
add to their business models.
Valuation of the 10 most valuable venture backed private companies
total equity funding
Uber $ 51.0 b $ 7.4 b
Xiaomi $ 46.0 b $ 1.4 b
Airbnb $ 25.5 b $ 2.3 b
Palantir $ 20.0 b $ 1.5 b
Snapchat $ 16.0 b $ 1.2 b
Didi Kuaidi $ 16.0 b $ 4.0 b
Flipkart $ 15.0 b $ 3.0 b
SpaceX $ 12.0 b $ 1.1 b
Pinterest $ 11.0 b $ 1.3 b
Dropbox $ 10.0 b $ 0.6 b
https://www.statista.com/chart/3904/worlds-most-valuable-startups/
As of october 2015
Source: statista / The Wall Street Journal
Brazil
Fresh ideas for banking
With the new competition “InovaBra,” Bradesco is helping to
foster start-ups and has promised to implement 10 ideas into
its own product and service portfolio. Young companies that
intend to participate can present their innovations in the following
areas: improvements in services, methods of payment,
digital channels, new security technologies, new solutions for
smart phones, and future banking. The invention has to be
developed enough so that it can be adopted in the coming
years within any area of the bank.
“We are already thinking about what to offer in the nextgeneration
bank,” says Maurice Gerais, Bradesco’s Executive
Vice-President. “This is a project where everyone wins: the
customer of Bradesco, who has access to innovative products
and services; the bank, which maintains its tradition
and pioneering role, creating a new channel to generate
innovation; and the start-ups, which have the opportunity
to leverage business in partnership with a major supporter,”
adds Gerais.
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innoVAtion
Start-ups are innovative motors for fresh ideas from outside.
That is why they are increasingly drawing the attention of large companies.
This trend can be observed globally. Here are some markers.
United Kingdom
For start-ups, it’s not easy being green
The world needs smart new players to meet global challenges
such as climate change. But when young entrepreneurs try to
promote their environmentally friendly business ideas, they get
a lot of pushback from investors as well as customers. This is
the result of a recent study from the Warwick Business School
(WBS). One of the reasons for the disillusion is that entrepreneurs
focus too much on their own values and beliefs instead
of listening to their stakeholders. Balancing “what matters to
me” with “what matters to them” is the principal challenge.
“Their ambitions to ‘break free’ and enact their hopes and
dreams to make a difference often need to be tempered by the
realities of attracting investors and other stakeholders whose
primary goal is making money and not environmental issues,”
says Deniz Ucbasaran, one of the study’s authors and a professor
at WBS who spoke to the Journal of Business Venturing. “This
led some entrepreneurs to question if it was all worth it, as
they had to compromise the scope of their ‘green’ ambitions.”
Tanzania
electricity for tanzania
Standardized containers equipped with a photovoltaic battery
hybrid system provide remote areas in Africa with clean energy
around the clock. In Tanzania, the pilot plans of Rafiki-Power
bring electricity to domestic and business customers. The
system can be used anywhere in the world independently.
Thus, the business model can be transferred to other African
or Asian countries. “We bring not only light in the sector but
also help the people to learn about television or the internet.
You can compare prices and offers, and their products are more
marketable,” says project manager Daniel Becker.
India
Few companies put CSr money into incubators
India became the first country in the world to force companies
by law to invest in sustainability programs. The official
Schedule VII list tells companies what they can do to comply
with CSR regulations. Of the 10 possibilities are “contributions
or funds provided to technology incubators located within
academic institutions which are approved by the Central Government.”
But only a few companies have put CSR money into
these incubators, reports the Hindustan Times. All over India,
there are more than 100 incubators associated with the legal
regulations, each of them coaching about a dozen start-ups.
But raising money for CSR business is hard. The main reason
seems to be that companies investing in CSR start-ups do not
get returns on their investments because the returns are given
to society. “CSR funding in incubators is an interesting option
but may not be sustainable for building a start-up ecosystem
for the longer term. That is better done by capital that will
look for returns also, as that will ensure more competitive
start-ups take root,” says Alok Bardiya, Director of Corporate
Development at Cisco.
The project is part of the Corporate Accelerator program named
Agile, which E.ON launched in 2013. Agile helps innovators
to realize their business ideas in the field of flexible energy
solutions and to develop marketable business models.
Global Compact International Yearbook 2016 45

Changemaker
ˈtʃeındʒˌmeıkə
Be the change that you wish to see in the world,
Mahatma Ghandi said. In a time of profound
political, environmental, and social upheavals,
examples are more important than ever. In our
category “Changemaker,” we introduce women
and men who are making credible contributions to
sustainable development. Most of us desire change,
but there is only a small group of people who are
acting to make that change happen. That makes
them exceptional. And we are proud to introduce
them through interviews and individual profiles.
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Global Compact International Yearbook 2016

ChAngeMAker
Global Compact International Yearbook 2016 47

Angelina Jolie has transformed herself from troubled teen star
into the queen of hearts with her tireless humanitarian campaigning.
From the crisis in Cambodia to the current global refugee situation,
the 41-year-old star is always on the frontlines of change.
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Global Compact International Yearbook 2016

THE
PEACEFUL
PUNK
I
n modern society, fame and philanthropy appear to go
hand in hand – and upholding the appearance of “giving
something back” is a vital part of modern celebrity.
But for actress Angelina Jolie, her dedication and relentless
campaigning on behalf of others sometimes tip the scales in
the other direction: humanitarian first, Hollywood star second.
Once a troubled starlet, Jolie has seemingly dealt with her own
demons by focusing her energy on trying to limit the suffering
of others. Having grown up in Los Angeles, she struggled
with depression, drug abuse, and self-harming throughout her
youth. Her father, actor Jon Voight, left her mother, actress
Marcheline Bertrand, when Jolie was barely one. This experience
– coupled with the feeling that her own family was not
as wealthy as those of her peers at Beverly Hills High School –
left her feeling disenfranchised.
In spite of her early success as an actor, Jolie remained deeply
troubled, and she says her humanitarian work has helped
heal some of her deeper wounds. “It’s a big difference, but
all the pain I went through when I was younger was my way
of trying to get to where I am now,” she confesses. “I wasn’t
happy with how things were for me because I thought I wasn’t
accomplishing enough, and all the characters I played in my
films were leading much more interesting lives than I was.”
In 2001, while filming Lara Croft: Tomb Raider in Cambodia,
Jolie found herself moved by the plight of those living in the
war-torn country. On her return home, she contacted the
United Nations High Commissioner for Refugees (UNHCR)
and began her enduring relationship with the United Nations
Educational, Scientific and Cultural Organization (UNESCO),
becoming an official ambassador the same year.
“The basic thing was that I was searching for some greater
purpose and goal in life, and when I started working with
UNESCO and doing humanitarian work, I began feeling that
I could point to something concrete that I was doing to help
people who had very little hope,” Jolie explains.
Celebrity endorsement, or even taking on a role as an ambassador,
does not necessarily mean a star will “get their hands
Global Compact International Yearbook 2016 49

“
For over a decade
I have been visiting
refugee camps and
orphanages and other
places working with
the United Nations
and the UNHCR.
”
dirty” per se. But for Jolie, an important part of her work has
always been to get out into the world and see the heartache
and poverty for herself – to comfort the mother who lost a
child in conflict and hear firsthand the plight of a teenage
soldier forced into combat from a young age.
Since 2001 she has gone on more than 40 field missions in over
30 countries, from Pakistan to Sierra Leone. She has always
covered her own costs and stayed in the basic accommodations
provided for fellow aid workers – a far cry from the
glamorous world of Hollywood. This altruism shines a light
on those celebrities for whom column inches are everything.
“There are many times when there are no media present, and
many times in the past when I was working on the ground
there was no immediate attention,” Jolie says. “For over a
decade I have been visiting refugee camps and orphanages
and other places working with the United Nations and the
UNHCR. So I know what I’ve been able to contribute personally
and in terms of creating greater public awareness of the
issues at stake and the actual conditions of the people and
children in various regions.”
Naturally, the presence of such a high-profile personality can
cause a furor that negates the good work they are trying to
do. But the 41-year-old star is acutely aware of this dilemma.
“There is a fine line to walk, but I’m very conscious of that line.
Everywhere I go I try to balance the needs of field officers who
are doing the real work and also serving the general interest
of creating awareness, which can influence political decisions
and public support, which are vital,” Jolie says. “I believe that
after all this time, though, the public knows how serious and
committed I am to the work I’m doing in these regions.”
Though her mission has very much been global, Cambodia
in particular has maintained a strong place in Jolie’s heart.
In 2002, while married to actor Billy Bob Thornton, Jolie
adopted her first child, seven-month-old Maddox Chivan, from
an orphanage in Battambang, Cambodia. She later bought a
property in the province in an attempt to maintain her son’s
connection to his heritage. Unfortunately, the land was adjacent
to Samlout National Park in the Cardamom Mountains and
plagued by poachers who threatened the endangered species
there. Jolie’s response was to buy the entire park and turn
it into a wildlife reserve – named the Maddox Jolie Project.
Along with three biological children, Jolie adopted her daughter
Zahara from Ethiopia and son Pax Thien from Ho Chi Minh
City in Vietnam. The path was by no means an easy one,
though, as in each case, controversy surrounded the adoption
process. In the case of Maddox, it was purely bureaucratic
due to the United States temporarily banning adoptions from
Cambodia amidst child trafficking allegations, but the ”trend”
of celebrities adopting children from developing countries
often raises the debate on how ethical the process is, with
mothers coming forward afterwards – as was the case with
Zahara, saying it was not her decision to put the child up for
adoption in the first place.
Regardless, one look at Jolie and husband Brad Pitt with their
enormous and diverse brood proves it is possible to break down
the conventions of traditional family and raise children who
are happy, stable, and, above all, deeply loved.
“When it comes to my children, I can see how important it is to
be there for them and teach them things and to be with Brad and
create this sense of a family unit,” Jolie says. “It’s also fascinating
how the children react to Brad and I differently, and how
each of us has a different connection to each of our children.”
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Global Compact International Yearbook 2016

when I was about nine,” recalls Jolie, who lost her mother to
cancer. “She was very involved in Native American issues – she
was part Iroquois Indian and French Canadian. And in the end,
we started a foundation together for Native American people.
It was instilled in me from a very young age how important
it is to do nice things for other people. I saw how it made her
life very happy and fulfilled.”
She then adds, “The biggest lesson she taught me was that it’s
the little things that often count the most in life. This was
somebody who the world didn’t know about at all, but her
simple acts of kindness left a huge impression. I still get letters
from people who work in a dentist’s office, for example,
who will tell me something she did for their daughter – or
something she remembered that just stunned them, because
it was so out of the blue and thoughtful.”
Jolie and her husband have sought to instill in each of their
children a sense of worldliness and gratitude for their incredible
lives. The couple also try to involve their children in their
humanitarian work and foster an awareness and empathy for
the plight of others. Following Hurricane Katrina’s devastation
of New Orleans in 2005, Pitt has worked tirelessly to rebuild
homes and support families in the city’s Ninth Quarter, one
of the worst hit neighborhoods.
“We both feel inspired by the work we’re doing and particularly
a project like Brad’s Make It Right [house-building] project,”
Jolie says. “We lead very fulfilling lives. We both want the
same things. We want to be as happy and connected as we
possibly can be because the whole point of being a family is
to share your love and caring with your children. We want
our kids to always feel that we’re one big loving family taking
this big adventure together.”
In the same way Jolie strives to instill compassion in her own
children, it appears her selfless attitude was nurtured by her
mother, Marcheline. “From a very young age, I saw her doing
aid work. She took me to an Amnesty International dinner
Yet, astonishingly, there are still snipers taking shots at Jolie’s
altruism and achievements. Following the recent announcement
by the London School of Economics that Jolie is to be
a visiting professor in practice as part of the MSc it offers in
Women, Peacekeeping and Security, some have been quick
to criticize the appointment, saying she lacks the academic
credentials. That rather misses the point, and one can be sure
that Jolie has come a long way since her troubled childhood,
developing the thick skin she needs to deflect such detractors.
“I’m a much stronger and better woman today,” she nods. “I’ve
become a deeper and more understanding individual, and
working for the UN and other missions has been a source of
incredible satisfaction to me. It’s been so important to me to
try to contribute as much as I can to these causes.”
For an actress who is becoming more ubiquitous in the refugee
camps of Syria than the hills of Hollywood, it is obvious.
Written by Karen Anne Overton.
Global Compact International Yearbook 2016 51

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Global Compact International Yearbook 2016

the
proBLeM
soLVer
Alejandro Aravena
they call it the “Nobel prize for architecture” – the pritzker architecture prize – one of
the top awards given to architects. It is not only about craft but also mindset. this year, the
Sustainable Development Goals Fund and the pritzker architecture prize have explored
links between contemporary society and the role of architecture to improve livelihoods.
The winner of this year’s prize is 48-year-old Chilean
architect Alejandro Aravena, whose environmental
and social engagement distinguishes him from many
of his colleagues. His work “gives economic opportunity
to the less privileged, mitigates the effects of natural
disasters, reduces energy consumption, and provides
welcoming public space. Innovative and inspiring, he
shows how architecture at its best can improve people’s
lives,” says Tom Pritzker, Chairman and President of The
Hyatt Foundation.
Aravena is leading a new generation of architects who
have a holistic understanding of the built environment.
He has clearly demonstrated the ability to connect social
responsibility and economic demands with the design of
a human habitat and the city. He epitomizes the revival
of a more socially engaged architect, especially in his
long-term commitment to tackling the global housing
crisis and fighting for a better urban environment for all.
“It is increasingly evident that more stakeholders will be
required to meet the sustainability challenges of the future.
At the same time, it is inspiring to explore how new
sectors such as architecture can play a role by incorporating
key dimensions of sustainable development, such as
social justice and economic inclusion, in their plans,” says
Paloma Duran, Director of the Sustainable Development
Goals Fund. “For example, how we can ensure access for
all to support adequate, safe and affordable housing and
design spaces that enrich and promote social equality.”
Global Compact International Yearbook 2016 53

Necessity is the mother of invention.
For billions of people, this is a daily
truth. Business school graduates
reword it and say “doing more with
less” is a disruptive innovation strategy.
You have to take part in global needs as
well as C-suite speeches to harmonize
these two worlds. This is what
distinguishes Navi Radjou, a French
national born in India. A graduate
of École Centrale Paris and the Yale
School of Management, Radjou
is a highly respected advisor who
confesses that his creativity and ideas
are deeply rooted in the South.
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Global Compact International Yearbook 2016

Doing More
with Less
The idea of frugal innovation – or Jugaad innovation
(a Hindi word for mobilization) – is described in his
successful books. “Frugal innovation is a way that companies
can develop high-quality products and create more value
with limited resources,” explains his publishing house. The
Financial Times calls Radjou’s ideas “increasingly fashionable.”
This thinking is truly sustainable. Radjou says: “Companies
in the West spend billions of dollars to invent new products
and to differentiate their brands from the competition. They
charge customers more money for new features. The condition
of this model in the West is more for more, but this model is
running out of gas for three reasons. First, many customers
in the West can no longer afford these expensive products.
Second, we are running out of natural water and oil. And
third, the growing income disparity between the rich and the
lower classes disconnects existing products and services and
basic needs of the customers.”
Products for the so-called overlooked consumers have to be
calculated with “razor-thin profit margins,” says Carlos Ghosn,
CEO of Renault and Nissan. So what are examples of frugal
innovation? One is M-Pesa, a mobile banking solutions from
Safaricom in Africa. It offers even poor people the ability to
conduct basic banking services from their mobile phones.
Money transfers, deposits, and withdrawals are done through
mobiles without the need for a bank account.
Thanks to his captivating ways, Radjou seemingly connects
many current contemporary business concepts, such as sharing
and the circular economy, degrowth, and the maker movement,
in a simple fashion. His editorial house adds: “With
an estimated trillion-dollar global market for sustainable
products, and with potentially huge cost savings to be gained,
frugal innovation is revolutionizing business and reshaping
management thinking.”
Kevin Roberts, CEO at Saatchi & Saatchi, agrees. He offers
a review of Radjou’s work by saying: “Jugaad innovation
challenged the top-down Western approach to innovation
by offering an agile, bottom-up model. Frugal innovation
moves this forward, further and faster. The practical roadmap
and numerous cases in this book find the beat of the new
customer-led world order – where velocity, synergy, empathy,
and involvement are standard. The future will be about doing
more with less, and here we see how.”
Global Compact International Yearbook 2016 55

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Global Compact International Yearbook 2016

The SAVIOR
OF SUNDANCE
Robert Redford is one of Hollywood’s most celebrated actors and directors, but offscreen he
has been waging a lifelong campaign to preserve the Earth’s natural resources and keep some of
America’s most vulnerable places out of the hands of commercial developers and big business.
Robert Redford is still a golden boy of Hollywood, an
all-American star of the silver screen who, despite
nearing the age of 80, retains the handsome features of
his youth, and the passion and desire that have been central
to his pursuits outside of the realm of acting.
In 1978, Redford founded the Sundance Film Festival, which
still exists today as one of the major highlights of the cinematic
year. In 2001, he was rewarded for his efforts with an Academy
Honorary Award and hailed by the entire industry as an “inspiration
to independent and innovative filmmakers everywhere.”
Offscreen, however, Redford has turned his attention and
considerable gravitas to the pursuit of environmentalism. Not
only is the celebrated thespian a devoted trustee of the Natural
Resources Defense Council, but in 2012, he was also honored
by Pitzer College through the Robert Redford Conservancy for
Southern California Sustainability, which educates future generations
of Californians with the aim of tackling some of the
most complex and immediate threats to the world’s ecology.
“I’m an individualist and a loner by nature, and I won’t preach,”
explains the actor and director. “All I can do is help fight the
negativism and the malaise that has crept over us; we don’t
have to be sheep. I’ve tried to do my part to fight against a
mass consumption society that is killing our environment,
and I think that slowly some progress is being made. But in
order to save the lakes and trees, society as a whole needs to
believe that life is worth living and that the future is worth
protecting.”
Despite the fact that Redford can now look back on decades of
work at the forefront of environmentalism, it was not always
so. Nowadays, he is known for participating in a host of films
Global Compact International Yearbook 2016 57

that document ecological struggles across America, including
his appraisal of the dire situation regarding the Colorado River
in his 2008 documentary Grand Canyon Adventure: River at Risk.
But it was his time as a young man traveling in Europe that
opened Redford’s eyes to the problems that society faced.
“The time I spent in Paris was a decisive point in my life. It
transformed me,” he says. “I was part of an incredibly stimulating
crowd of artists and intellectuals who were all heavily
interested in politics, whereas I was ignorant in that respect.
They pushed me to think and develop my ideas, and that
process was a major step in my evolution.”
He continues by explaining, “I felt almost humiliated when I
was living among these very committed French students and
artists who would have these incredibly sophisticated debates
about broad political issues in Europe. Being in Europe gave
me a whole new perspective on life, and when I came back
to the United States, I felt I was ready to make my mark – I
wanted to learn more about the important issues in my country.”
It was in his home state of California where Redford began
to realize that things were not as sunny as they were made
out to be. By the time the “political and cultural ferment of
the 1960s came around,” Redford had decided to make social
statements, both onscreen and off.
“I was ready to think about the issues that were being raised,
and I wanted to understand as much as I could and in my own
way – with films like Downhill Racer and The Candidate – make
some sort of statement,” Redford says. He adds that, “As an
actor, you have to be careful – when I started getting involved
in environmental issues, long before they were popular, I was
getting attacked as some sort of tree-hugger.”
It was not just Redford who was being dismissed at that time
by the mainstream media – the power of big companies
made it almost impossible to speak out against the rampant
destruction of the environment.
“The powers that be had too much power at that time, so they
could drown you out,” he recalls. “Oil, gas, and coal companies
had all the power because they had all the money and all of
Congress behind them. You felt like you were just a voice in
the wilderness. I thought: If you have passion and just keep
at it, eventually things will start happening.”
Although Redford admits that environmental issues are becoming
more commonplace in discussions surrounding American
society, he also stresses that the same issues are not a recent
revelation.
“I remember hosting a climate conference in Denver in 1985,
where two scientists came and made presentations about global
warming,” he recalls, before exclaiming, “They were already
predicting that the icecaps were melting then!”
The consequences of such ignorance about the need to protect
nature – such as the decisions made during George W. Bush’s
presidential tenure that led to events such as the Appalachian
toxic coal slurry spill at the turn of the century – still have
far-reaching negative effect on the fight for environmental
protection today.
“It was frightening that the Bush administration tried to destroy
many of the government agencies that had been created to
protect the environment,” says Redford, referencing the gutting
of sections of the Clean Water and Clean Air acts, and the
crippling of the Superfund Program, which was an attempt to
clean up toxic waste in more than 48 states. “We still haven’t
recovered from the damage that was done to federal institutions
that were created to safeguard our water, air, and what
oil, gas, and mining companies are doing to our land.”
Redford’s own unique experiences of the damage caused by commercial
natural-resource mining have fueled his own personal
development of projects, such as the Grand Staircase-Escalante
National Monument in Utah – a 1.7-million-acre expanse of
land that Redford campaigned to keep out of the hands of
the mining companies, from 1975 right up until President
Clinton officially closed the area off to development in 1996.
“I first started to worry when I went to work at the oil refinery
where my father was working,” he explains. “I remember seeing
the oil seeping into the sand dunes and making a chemical
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“
The time I spent in Paris was a
decisive point in my life. It transformed
me. It pushed me to think and develop
my ideas, and that process was a major
step in my evolution.
”
mess of the land. It kind of horrified me that we could be so
dismissive of the damage we were doing to the soil and air.”
The chance for Redford to showcase the fruits of his environmental
labor came as the popularity of his independent film
festival began to rise. The event was moved from Salt Lake City
to the Sundance Resort, an area of land on the slopes of Mount
Timpanogos in western Utah that Redford acquired in 1968.
“I grew up in a grim urban setting, and being able to develop
land out there was a form of liberation to me,” he says. “Utah
was an ideal setting because it was very raw and beautiful – at
Sundance, I’ve taken this acreage, which is now almost 6,000
acres, so that only wildlife can exist inside.”
Not even Redford’s beloved Utah, however, is untouched by
commercial development.
“If you drive out of Sundance,” he says, “the moment you
leave the canyon, you see nothing but concrete, cement, and
bulldozers – that’s the attitude that surrounds us.”
The veteran thespian hopes that recent signs of positive change
in the general public and mainstream media’s attitude toward
environmentalism will only continue. One modern ally that
Redford did not have back when he began his fight to protect
America’s natural landscapes in the late 1960s was the internet,
which he says is allowing “more information to reach people
faster than ever before.”
This, he envisions, will bring about a change in politics. And
although he believes it has already begun to happen, he is as
determined as ever to challenge the same dominant voices
that threatened to drown him out decades ago.
“I think they are genuinely worried, but the ones that are most
threatened are going to raise their voices the loudest because
they see their time is running out,” he declares. “They don’t
want to go quietly into the night because of all that money that
has been made in their industries – and since money really
runs the show, I think they see a threat to their investments.”
Having fought tooth and nail against the powers that be for
decade after decade, Redford’s mission is just as important
now as it was in the 1960s. However, the true cost of such
development, he says, will not be known for many years to
come, when future generations will be tasked with the attempt
to rebuild the world, if they can.
“Our planet is shrinking, and I worry about what’s going to
be left if we don’t stop,” he sighs. “What we develop for our
survival, and also what we preserve for our survival – if we
don’t have equal preservation, there will be no planet left.
After all, why would anybody want to bring children into the
world if that’s the direction we are going in?”
Written by Jake Taylor.
Global Compact International Yearbook 2016 59

Real-life
Eco-warrior
She is known for playing passionate women who fight for their chosen cause, but in real
life, Hollywood actress Sigourney Weaver is equally relentless in her work as a zoologist
and conservationist. From saving the gorillas to protecting our oceans, the actress is
devoted to bringing about real change.
It is not unusual for actors to temporarily “become” the
person whom they are portraying, but when Hollywood
star Sigourney Weaver took on the role of murdered primatologist
Dian Fossey, it launched the actress on a lifelong
conservation mission that has continued long since the cameras
stopped rolling. Twenty-eight years later, her environmental
endeavors have gone beyond advocating for the protection
of the mountain gorillas, though she still serves as Honorary
Chairperson of the Diane Fossey Gorilla Fund International.
She is now also committed to raising awareness about the
threats faced by marine wildlife and empowering women in
extreme poverty through the nonprofit organization Trickle Up.
“After spending so much time with the mountain gorillas in
Rwanda and playing Dian, I felt that I had been given a gift.
It’s appropriate that I try to do whatever I can to help protect
them,” explains Weaver, describing how her environmental
crusade began. The 1988 drama tells the true story of Dian
Fossey, a naturalist who worked in Rwanda with mountain
gorillas. Prior to her work in the Virunga Mountains, Fossey
had spent time in the Congo studying the primates. Having
become frustrated at her inability to get close to them, she
eventually used her experience of working as an occupational
therapist with autistic children, discovering that when she
mimicked the primates and became submissive, they would
respond better to her. By the time she began her work in
Rwanda in 1967 and founded the Karisoke Research Centre,
Fossey was entirely devoted to protecting the animals and was
horrified by the practice of poaching in the area, despite it
being illegal. Over the next 18 years, Fossey would help arrest
several poachers, who went on to serve lengthy jail sentences.
She even founded her own poaching patrols, and in 1978
tried to prevent two infant gorillas, Coco and Pucker, from
being exported to a zoo in Cologne, Germany. Naturally, her
incredible efforts caused tension among the local gangs and
poachers, and in 1985 (aged 53) Fossey was found bludgeoned
to death in her cabin on the outskirts of the camp.
The story of Dian Fossey is so extraordinary that little embellishment
was required. Even her relationship with National
Geographic photographer Bob Campbell was based on fact.
Weaver was dedicated to bringing to life the tale of the woman
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who essentially saved these mountain gorillas from extinction
at the cost of her own life, even if, at times, the actress
admits she felt utterly out of her comfort zone. “The truth is,”
she explains, “I didn’t really know how I would react to the
gorillas. I had no experience with wild animals. But I knew
that in order to play the part [of Dian Fossey], which I wanted
very much to do, and in order to get Dian’s message out, there
was no time for me to worry about what was going to happen.
I remember I was pretty excited when we finally reached a
place with gorillas.”
The film seamlessly blended moments of actual gorillas in
their live habitats with scenes of humans in costume. Even
so, there were plenty of scenes where Weaver would interact
with actual gorillas. Not only did this add authenticity to the
film, it also helped Weaver understand Fossey’s own motives
and commitment to helping them.
“The first time you see the mountain gorillas, you feel so blessed;
you feel like you’re in Eden. One of them, a little female named
Josie, came right over and sat next to me. She kind of leaned
on me and looked up at me. I was just captivated. I never
looked back after that,” says Weaver wistfully. “I always felt
that if I followed Dian’s basic rules of being submissive and
quiet, not drawing attention to myself and being respectful,
nothing would ever happen to me.”
It is a bitter irony that the real Dian Fossey spent so much
among these wild – and presumed dangerous – creatures,
and yet met her death at the hands of humans. Weaver admits
that the time spent among the gorillas not only galvanized her
desire to protect them but also triggered her own maternal
instincts, saying: “Playing Dian, I would usually have several
little baby gorillas jumping up and down on me, pulling my
hair, urinating on me, grabbing my bag…. And I had so much
fun with them, and I loved them so much; I remember thinking,
‘I would really like to be a mother!’ I got hooked on being
a surrogate mother, roughing it in the hills of Rwanda, and I
had my daughter pretty soon after that.”
Over the past three decades, she has cemented her place among
Hollywood’s elite and has garnered a reputation for playing
Global Compact International Yearbook 2016 61

“
The planet Earth has its own
life force – the oceans. Our oceans
generate most of our oxygen, regulate
our climate, and provide most of our
population with sustenance.
strong and formidable females, especially in her most famous
role as Ellen Ripley in the Alien franchise. However, it would
be another film featuring extraterrestrials that would inspire
Weaver to once again speak out on conservational matters,
this time on behalf of our marine life. In CGI behemoth Avatar,
she plays Dr. Grace Augustine, a scientist who has dedicated
her life to analyzing the links between the alien Na’vi people
and the peculiar environment on Pandora. Similarly, Weaver
is determined to compel lawmakers to enact legislation to
save our oceans.
”
“The planet Earth has its own life force – the oceans. Our
oceans generate most of our oxygen, regulate our climate, and
provide most of our population with sustenance,” explains
Weaver, who narrated the 2010 documentary ACID TEST: The
Global Challenge of Ocean Acidification as part of her work on
behalf of the Natural Resources Defense Council.
“Marine ecosystems are essential to all life on earth,” Weaver
says. “Yet our oceans face a threat as dangerous as any Pandora
faced: ocean acidification.” The film explores the startling
phenomenon of the increasing acidity of our waters and the
subsequent threat to marine life. Like global warming, ocean
acidification stems from the increase of carbon dioxide levels
in the Earth’s atmosphere since the start of the Industrial
Revolution.
Leading scientific experts on the problem – many of whom
appear in the film – believe that it is possible to cut back
on global warming pollution, improve the overall health
and durability of our oceans, and prevent serious harm to
our world, but only if action is taken quickly and decisively.
Weaver insists that we simply cannot act fast enough. “One
of the reasons that science fiction movies are becoming more
and more popular is because we are actually in a world more
and more like the worlds in science fiction. Our glaciers are
melting and people are talking about colonizing Mars – so I
think that not only will it become a very popular and beloved
genre but also increasingly significant.”
The problem with ocean acidification is that while, individually,
we can all do our part to lower our own carbon footprints, for
the most part it is the lawmakers and politicians who need
to bring in legislation and devote money to monitoring and
researching a problem that could prove devastating, not just
for sea life but for our ecosystem in its entirety. By urging
politicians to support America’s transition to a clean-energy
economy, Weaver insists that America can increase its energy
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Global Compact International Yearbook 2016

efficiency and invest in renewable power while cutting carbon
pollution. By passing strong clean-energy and climate legislation,
Congress has the power to move society toward clean energy,
tackle climate change, and protect our seas from acidification.
“Small creatures in the ocean who are being affected by acidification
are like the canaries in the mine. They’re singing,
and we have to hear that and act,” insists the actor. “I, like a
lot of concerned citizens, feel a kind of urgency about these
climate questions. I don’t think I’ve ever felt more passionately
about anything than this because I feel we’re already
at a tipping point.”
and aims to honor American women whose work has greatly
advanced conservation, locally and globally. In Weaver’s acceptance
speech, she credited her experience working with
mountain gorillas in Rwanda for inspiring her environmental
and conservation work, emphasizing that it taught her the
importance of preserving animal habitats. She also credited
her role in Avatar as a botanist who champions the natural
world for intensifying her commitment toward protecting the
Earth. But surely it is us who should be thanking Weaver for
her admirable efforts in striving to protect something that is
arguably invaluable to each and every one of us.
In 2011 Weaver received the prestigious Rachel Carson Award
from the National Audubon Society. The award was established
in honor of Rachel Carson – a monumental figure in the 20th
century and founder of the modern environmental movement –
Plastic Ocean Waste
$13 billion in damage every year to industries such as
fishing, shipping, and tourism, UNEP reports. This is why
initiatives like “The Ocean CleanUp”, founded by Dutch
student Boyan Slat, or “Waste Free Oceans“ are developing
feasible methods to rid the oceans of plastic. The goal is to
extract, prevent, and intercept plastic pollution by initiating
the largest cleanup in history. Many companies have shown
an interest in using the harvested plastic. In an interview
with The Guardian, Slat says: “Tens of companies – large
corporations – have shown an interest in buying up the
plastic and that is our holy grail; funding the cleanup using
revenues created by the plastic we extract.”
At least 5.25 trillion pieces of plastic are currently in the
oceans, a third of which is concentrated in the infamous
Great Pacific Garbage Patch, a maritime area larger than
Texas. This plastic pollution inflicts grave environmental
damage, such as killing at least one million seabirds
each year. Additionally, plastic pollution creates at least
Revenue with plastic waste? Yes, the brand Interface for
example has the biggest and most diverse choice of carpet
tiles made with 100 percent recycled yarn. Their goal for
2020 is to only use recycled or bio-based materials, to cut
the dependence on virgin petro-chemical raw materials.
Its German competitor Desso now received a Cradle-to-
Cradle-Gold certificate for using 100 percent recycled yarn.
There are many other sectors who depend on plastic –
decarbonization strategies have to take this in consideration
and they have to bring more stakeholders on board. Hannah
Gould writes in The Guardian: “Consumer goods companies
keen to design for recycling don’t know which system to
design for because municipal recycling is so diverse, while
municipalities and waste companies are overwhelmed by a
growing and changing portfolio of plastics.”
Global Compact International Yearbook 2016 63

The
Drowning Child
Dilemma
“Imagine you come across a
small child who has fallen
into a pond and is in danger
of drowning. You know that
you can easily and safely
rescue him, but you are
wearing an expensive pair of
shoes that will be ruined if
you do. We all think it would
be seriously wrong to walk
on past the pond, leaving
the child to drown, because
you don’t want to have to
buy a new pair of shoes – in
fact, most people think that
would be monstrous. You
can’t compare a child’s life
with a pair of shoes!”*
Peter Singer
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So what will you do? Most of us do help in a concrete
situation. Would it make any difference if the child is
far away, in another country perhaps, but similarly in
danger of death? Saving this child would come at no great
cost and pose absolutely no danger to yourself. Most people
do not help. The United Nations Children’s Fund (UNICEF)
estimates that nearly six million children under the age of five
die each year from causes related to poverty. That is 16,000
a day. We human beings are emotionally and evolutionary
conditioned to help people in front of us, where we have faceto-face
communication. But we behave indifferent when the
problem is far away.
This world-famous thought experiment was invented by
Peter Singer. The Australian philosopher is one of the most
prominent representatives of the concept of utilitarianism.
Balancing interests and equality, Singer says, does not mean
equal treatment but equal consideration of interests. That is
an aspect worth thinking about when you plan stakeholder
dialogues.
The drowning child dilemma is very prominent in the present
discussion on migration and refugees: Do we help or do we
behave indifferent to prevent more refugees from coming?
In 1997 Singer wrote the following with an almost prophetic
vision: “Our capacity to affect what is happening, anywhere
in the world, is one way in which we are living in an era of
global responsibility. But there is also another way that offers
an even more dramatic contrast with the past. The atmosphere
and the oceans seemed, until recently, to be elements of nature
totally unaffected by the puny activities of human beings. Now
we know that our use of chlorofluorocarbons has damaged
the ozone shield; our emission of carbon dioxide is changing
the climate of the entire planet in unpredictable ways and
raising the level of the sea; and fishing fleets are scouring the
oceans, depleting fish populations that once seemed limitless
to a point from which they may never recover. In these
ways the actions of consumers in Los Angeles can cause skin
cancer among Australians, inundate the lands of peasants in
Bangladesh, and force Thai villagers who could once earn a
living by fishing to work in the factories of Bangkok. In these
circumstances the need for a global ethic is inescapable.” *
* Source: Peter Singer, “The Drowning Child and the Expanding Circle,”
New Internationalist (April 1997).
Are you an EA?
EA means effective altruist. When you talk to an EA, you
learn fast what distinguishes them from a classical altruist.
Both care about others, society, and mankind, but the
EA invests in a career to make a lot of money to finance
as many social projects as possible. The problem with
altruism, they say, is that people are not rational. They help
with their hearts, not their heads. A recent study investigated
how much money people would give to save birds.
The result: It does not matter if you save 200,000 birds or
20,000 birds because the amount of money stays the same.
For EAs, this kind of behavior is inefficient because it does
not have enough “impact” – a crucial buzzword for them.
That is why platforms such as GiveWell spend a lot of time
and statistics on cost-benefit calculations. EAs want to
have the maximum impact for each cent they spend. Where
the money comes from is less important. It is not surprising
that many EAs work in the financial sector, where they
make lots of money to spend altruistically. But is it ethically
correct to work for companies that are not sustainable?
EAs say yes, because it is better that an ethically conscious
person – an EA, for instance – does this kind of job than
someone who does not care about philanthropy. This has
no impact. From the CSR point of view, this argument is
critical. For example, Thomas Beschorner, a professor in
Switzerland, says that it does not matter how you spend
your money – it matters how you earn it.
Global Compact International Yearbook 2016 65

the
wAter ADVoCAte
Water is her absolute number one priority.
Mina guli, an australian businesswoman
and environmental activist, is committed
to the idea that water is the foundation of
our society and that, without water, we do
not have a future. She felt that she had to
do something big to capture the world’s
attention. So beginning in 2016, Guli tied
her shoes for the “7 Deserts run.” then she
started running: 40 mara-thons, 7 deserts,
7 continents – in just 7 weeks. It was an ultramarathon
that had never been done before.
all for one reason – water.
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Global Compact International Yearbook 2016

Your athletic career is meant to raise awareness about issues important
to you, right?
I want to demonstrate to the next generation the enormity
of the problem concerning the water supply. The problem
is that water is so far removed from our reality. We turn the
tap on, water comes out, and we don’t have any idea that
that’s actually not going to be permanent. Second, we don’t
understand how all these consumption patterns are linked
to the water crisis.
What you’re doing is grabbing people’s attention and inspiring them
to change?
That’s what I hope. I want people to ask, “Why is this woman
doing this really crazy thing? Oh she’s doing it for water. Well,
why water?” And then for people to ask, “Oh, did you know
that that cup of tea used more than 30 liters of water to make?”
“Did you know that those leather shoes took 16,000 liters of
water?” “Did you know that eating a hamburger is the same
as taking a shower for two hours?”
How do we begin to turn the water crisis around?
The World Economics Association has raised the water issue as
being the number one risk facing society – so large a risk that
by 2030 there will be a 40 percent difference in the demand
for water and the supply available. That’s why I’m running so
many marathons – to illustrate this point. If we can create a
consumer movement comprised of people who understand and
value water, and if we can create an incentive for companies
to change the way they utilize water in their supply chain, we
can avert the future that is currently set out for us.
which means that they can’t afford to pay the banks. People
need to leave their places of residence, the towns become
ghost towns, and the fabric of that society starts falling apart.
Can you talk about your work attempting to lower greenhouse emissions,
especially in China?
Before I got involved in the water issue, I spent about 15
years involved in climate change: first in Australia at the
Sydney Futures Exchange, where I developed some of the
first contracts to reduce greenhouse gas emissions; and then
at the World Bank in Washington, DC. I realized very quickly
that if we really wanted to make an impact on the planet, it
wasn’t going to be good enough to just switch one light off
in Australia. We had to change the way the lights were being
manufactured in places such as China. So we built Peony
Capital and invested in a bunch of projects across China that
reduced greenhouse gas emissions and attempted to change
China from being a high-carbon economy to a low-carbon
economy. It was through my work in climate change that I
became known as a leader in that field and was nominated
by the World Economic Forum to join their Young Global
Leaders community. It was through that community that
I became exposed to the water issue and realized that, although
climate change was an important issue, water was an urgent
issue that required attention now. I also realized that although
there were many people involved in climate change and in
solving that, the water movement needed more exposure. To
get it onto the front pages of the newspapers, we all need to
understand this concept of invisible water. We need to make
invisible water visible.
How will it affect our daily lives in the future?
Every single thing you see right now took water to make –
your house, walls, the lights, the computer you’re probably
using. All of those things took water. If you fast forward to
an environment in which we have very little water or where
water is too expensive to use, all those things will either not
be available or be available and much more expensive because
the input of water is much more expensive than it is now.
We’re so dependent on it that it could have profound effects on our
civilization.
Absolutely right. Water is the foundation of our entire economy
and our lives, and without water there’s a huge ripple effect.
Look at villages or towns in different parts of the world where
they’ve had such major water crises that they’ve been unable to
continue to survive on the crops that they traditionally planted
and harvested. Their income over a period of time dwindles so
much that they can no longer afford to repay their mortgages,
Global Compact International Yearbook 2016 67

The Taste
Tester
Kevin McCloud, MBE, is a
British designer and television
presenter best known for his
work on Grand Designs, which
is one of the longest-running
Channel 4 shows. McCloud
is actively campaigning to
promote One Planet Living, the
WWF’s sustainability initiative.
We talked with him about
sustainability in building and
furnishing houses. McCloud’s
message is clear: We have to
make sustainable products
irresistible.
Sustainable housing is a big focus at Grand Designs and you’re
a vocal advocate for sustainability. What impact do you think
design has on sustainability, and in what ways?
The relationship between making things and sustainability
is so essential. As a society, we’ve lost touch in the West with
the value of made things, with the value of raw materials, of
the energy required. I don’t just mean fossil fuel energy but
also the human energy that goes into making things. I’m very
struck by the fact that we’ve got people making lighting out
of bits of recycled industrial stuff, or that people are selling
furniture that they’ve handcrafted in small workshops all
over the country.
What goes in is normally a raw material, something dug out
of the ground, rough and unprocessed, and what comes out
is such beauty. A tree in one end, a table comes out the other;
a lump of unrefined iron goes in one end, and a beautifully
wrought table or door handle comes out the other end. That
is what sustainable design and construction is: the reconnection
of all of us to the value of things. I think we’ve lost that,
we’re not a making society anymore.
When we come to build houses, for example, it’s about getting
people to understand the value of the made object, the
value of the made building, to run it in such a way so that
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it’s efficient, minimizing energy loss. That to me is actually
what a lot of sustainability is about. People talk a lot about
carbon, they talk about energy consumption and sustainable
codes and building rigs, energy in use – all that stuff. It’s all
technical, but actually, if you want people to save energy, if
you want people to drive electric cars, to walk more, to cycle
more, to share more, to buy less and consume less rubbish,
to recycle more, then you’ve got to make them value what
we have. It’s that simple.
The UN has said that 7 out of 10 people will live in cities across the
globe in the future. Are concepts such as your HAB project in the UK
transferable to the wider world, to places with fewer amenities, fewer
facilities, less electric?
The HAB project is very contextual – it’s designed for the UK,
designed for where they are. I’m more interested, actually, in
learning about how other people live in other cultures with
much lower impact and bringing that here. I spent some time
in India, in very high-density places, and studied there how
people share resources and public spaces, even the notion of
personal space. How people get by with the minimum of stuff
is really, really humbling. Of course, they’re happy – that’s
the other thing. Those communities that we may think of as
being more primitive – slums – actually hold the key to a
lot of positives in terms of human interaction.
The younger generation is being told a lot more about being eco-friendly.
When younger couples are building houses, do you think they go for
more sustainable materials, or do you think they still gravitate toward
a more timeless, traditional style?
All of us are attracted by the bling. We love the idea of the new
and the fresh, the exciting and the sparkly. I know plenty of
18-year-old kids who just want to own a Porsche and live in
a glamorous flat on the Thames. We’re all vulnerable to the
same yearnings and deceptions, and the trick, of course, is to
make the sustainable desirable – actually more desirable. I
drive an electric car, and there are electric cars out there that
are more exciting, more beautiful, and more sustainable than
their petrol equivalents.
When we build our houses, what we want to do is provide more
light, higher ceilings, skylights, extra storage. We try and basically
produce better architecture that also happens to be sustainable.
The trick is to make it irresistible. That’s the way to do it, not
by saying, “Oh look, don’t buy Versace, buy this hair shirt, it’s
far more ecological.” No, the answer is to make the big surprise
that the product is really well-made, that it lasts, that we don’t
succumb to the changing whims of fashion but we go for style,
more timeless values, beauty. We need the bigger manufacturers,
be they carmakers or fashion houses. We need them to use
sustainable, organic materials, and use them ethically.
Global Compact International Yearbook 2016 69

GOOD PRACTICE SECTION 1: INEQUALITIES | EDUCATION | PARTNERSHIP
The size of the SDG icons reflects the quantity of appearance in this section.
HUMAN RIGHTS
LABOUR STANDARDS
ENVIRONMENT
ANTI-CORRUPTION
SUSTAINABLE
DEVELOPMENT
G O A L S
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Global Compact International Yearbook 2016

GOOD PRACTICE
IneqUAlITIeS | eDUCATIon | PARTneRSHIP
72
74
76
78
82
84
86
88
90
94
96
Adecco
Banca Popolare di Sondrio
Bosch
Deutsche Post DHl Group
Deutsche Telekom
Green Delta Insurance
Manila Doctors Hospital
Merck
Philip Morris International
Sakhalin energy
Sanofi
woRK | InnoVATIon | ClIMATe
102
104
106
108
110
112
114
116
118
120
122
126
128
130
132
134
136
138
Acciona
Arab African International Bank
Armacell
Audi
BASf
Bayer
Commerzbank
Consolidated Contractors Company
eDf Group
HoCHTIef
MAn
mcs
MTU Aero engines
nestlé
Postnl
RoMRADIAToARe
SkyPower
Vaisala
Global Compact International Yearbook 2016 71

Aspire to Be
‘CEO for One Month’
Accessing the world of work and finding a pathway to fulfill their personal potential is a major
challenge for anyone out of – and seeking – work. This is especially so for the 73 million youths
under the age of 25, fueling fears of a ‘jobless generation.’ Skills mismatch and a lack of experience,
even among the most highly educated, can almost be perceived as a discriminatory
barrier to employment, which is central to Global Compact Principle 6. It dashes dreams,
wastes human capital, and damages productivity. The Adecco Group – the world’s leading
provider of HR solutions – has not stood by idly.
By Lilian Furrer, Adecco Group
The 10 finalists of ‘CEO for One Month’
2015 from Europe, Asia, and Oceania,
who all showed exceptional flair for
business, creativity, and entrepreneurship.
‘CEO for One Month.’ From that group of
34 – equipped with their local experiences
as CEO – 10 were shortlisted to run
for Adecco Group’s Global CEO position.
Those 10 participated in a final selection
‘boot camp,’ with the successful candidate
working alongside the Adecco Group CEO,
Alain Dehaze, for one month.
In the last three years, more than 2.2
million people have accessed a range of
Adecco Way to Work initiatives. They are
designed to provide practical support and
work experience opportunities for young
people – of various ages and abilities –
to help them make breakthroughs and
fulfill their potential. These include “Street
Days,” in which Adecco employees offer
practical job hunting and career advice in
cities worldwide; internship opportunities;
an online career center; and an innovative
scheme called ‘CEO for One Month’ – an
initiative first launched by Adecco Norway
in 2011 and piloted by the Group in
2014. An astonishing 18,000 applied for
the ‘CEO for One Month’ opportunity in
2015, starting with an online application.
In 34 countries, candidates went through
thorough selection processes, with the
very best applicant in each country being
offered the chance to become an Adecco
‘CEO for One Month’ and Adecco Way
to Work are practical expressions of
Adecco’s corporate social responsibility,
over and above the company’s day-to-day
business of helping people find work and
companies access the talent they need.
Alain Dehaze, CEO of the Adecco Group,
states: “Our future depends on the skills,
confidence, and experience of today’s
young people. It’s a shared responsibility
to help them build their careers through
training, guidance, and opportunities.
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Global Compact International Yearbook 2016

she rose to in her month. “I was struck
by how even a global organization like
the Adecco Group is open to new ideas
from people outside the organization
with relatively little experience.”
‘CEO for One Month’ Ayumi Kunori
and Alain Dehaze on stage at the
VBO FORUM – Young Talent in Action
This is what ‘CEO for One Month’ is all
about. It raises aspirations and allows
youngsters to challenge themselves, gain
hands-on experience alongside Adecco
Group’s top management, and get a taste
of how to run a global company.”
Shadowing the top management provides
the young ‘CEOs’ with unique insight into
the real-life challenges and responsibilities
such a position brings. It is about
much more than learning about the nuts
and bolts of sales meetings and finance:
they deep-dive into HR and leadership
issues, as well as industry trends and CSR.
As part of Adecco Group’s overall efforts
to help people of all abilities and educational
backgrounds fulfill their potentials,
the ‘CEO for One Month’ initiative
focuses upon helping build responsible
and successful leaders for the future.
Transformational opportunities
It has been a unique experience for participants,
especially for the 2015 Global
‘CEO,’ Ayumi Kunori, an undergraduate
from Ritsumeikan University in Kyoto,
Japan: “Looking at the journey I made,
I think I came very far, learning many
new things. It was a turning point in my
life, helping me set my goals higher, to
become a CEO one day. I think a good
CEO needs to be passionate about work,
but you also have to be humble and recognize
the colleagues who support you.”
She traveled with Adecco Group’s global
CEO around Europe, Asia, and the United
States. Her toughest and yet most rewarding
challenge was addressing 1,000 young
people at a career conference in Belgium
about her experiences. Her message to
them and to all young aspiring people:
“If you dream big, you can do it.” While
completing her studies, Ayumi took up a
part-time position at Adecco Japan.
Ernesto Lamaina, Adecco Italy’s ‘CEO for
One Month’ and one of the boot camp
finalists, did not regret leaving an internship
in Slovakia to experience the ‘CEO’
role. “It’s been life-changing. It’s like an
MBA but in real life. One thing I learned
is that as a CEO, it’s important you listen
to everyone’s input, even if they are the
most junior member of a team.”
The Romanian ‘CEO for One Month,’
Alexandra Tirziu, studied languages, PR,
and HR. She found the ‘CEO’ experience
enriching, even attending the World Economic
Forum at Davos, where the Adecco
Group presented its Global Talent Competitiveness
Index to business leaders. At
that event, she was tasked with writing
an article for the Wall Street business daily
in Romania, one of the many challenges
The ‘CEO for One Month’ initiative has
proven to be an enabler for youngsters’
employability and job opportunities. Paola
Ospina from Colombia, Adecco Group
‘CEO for One Month’ 2014, progressed to a
career in marketing at Adecco headquarters
in the United States. Ayumi Kunori
works part-time for Adecco in Japan while
completing her studies, and Ernesto Lamaina
was hired at Adecco headquarters
in Switzerland. In 2016, the ‘CEO for One
Month’ initiative has sparked even more
interest: by April 15, more than 53,400
ambitious candidates from 50 countries
had applied to take on the challenge.
Work-based training:
A win-win situation for youngsters
and companies
The ‘CEO for One Month’ initiative is
now firmly embedded in the Adecco
Way to Work initiative. The company
is always looking for new and innovative
ways to help young people succeed in the
working world in ways that reflect their
needs and experiences. For example, in
June 2015, the Adecco Group joined the
European Alliance for Apprenticeships,
pledging to offer 5,000 apprenticeships
in Europe by the end of 2017. “Joining
the European Alliance for Apprenticeships
represents a further confirmation
of Adecco Group’s commitment to tackle
youth unemployment,” says Mark De
Smedt, former Chief HR Officer. “In 2015,
within the Adecco Way to Work programme,
Adecco has already placed over
3,000 youngsters in internships and
work-based training opportunities. With
this pledge, we go a step further and
commit on apprenticeships. We strongly
believe that concrete solutions to boost
economic development and employment
are only possible through public-private
partnerships and initiatives such as the
European Alliance for Apprenticeships.
Together we can make a difference.”
Global Compact International Yearbook 2016 73

Financial Education and
Beyond: Investing in the
New Generations
for a Better Future
The cultural development activities of Banca Popolare di Sondrio
have always focused on the needs of its home territory, where
the bank has its “head, heart, and roots.” The objective has been
to promote and highlight the many cultural and social aspects
of the area, as well as its natural beauty and the resources that
inspire human creativity.
By Mara Simonini, Banca Popolare di Sondrio
Among cultural activities proposed by
the bank, special and ongoing attention
is dedicated to young people who – with
their minds on the future and their enthusiastic
projects – will be tomorrow’s
workers and consumers and will have a
considerable influence on the economy
and society as a whole.
Many of the numerous initiatives organized
by the bank over the past year have
been dedicated to them, especially those
that emphasize the need for a sustainable
economy and the sensible use of money
and its careful management.
In the spring of 2015, Banca Popolare
di Sondrio worked together with other
partners to promote “EconomiaAscuola
– A lezione di cittadinanza economica”
(economic citizenship in the school),
an event organized by the Fondazione
per l’Educazione Finanziaria e il Risparmio
(Foundation for Financial Education and
Savings) that was dedicated to more than
400 students in the province of Sondrio
and their teachers. The day, divided between
information and fun, covered
many aspects:
• the sensible use of money (ordinary and
extraordinary expenses, the difference
between necessary and superfluous
spending, the importance of savings);
• how to become sustainable citizens
(adopting a responsible approach to
oneself, to others, and to the surrounding
environment);
• the value of money (work, income, and
human capital within the economic
cycle of a family);
• what lifestyle and consumption patterns
to adopt (the role of individual
and collective responsibility, legality in
the economy, what the newspapers say
versus what happens in everyday life).
This special day sought to make an indelible
impression on the young participants
and, hopefully, orient their future
attitudes and decisions.
“Invito a Palazzo” (Invitation to the Palace),
an event held under the patronage of the
Italian Banking Association, took place
in October 2015. This was an occasion
for Banca Popolare di Sondrio to open a
number of prestigious buildings to the
public, including the branch at Passo
Stelvio and the adjoining Carlo Donegani
Museum. The museum collection includes
various precious items, placed side by
side, that were left behind by the Italian
and Austrian soldiers who died in the
local mountains during World War II,
demonstrating the futility of war and representing
an invitation for peace and the
exchange of culture, ideas, and knowledge.
Moreover, in the Stelvio National Park,
at 2,600 meters, the bank organizes an
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Global Compact International Yearbook 2016

Each year, the bank marks “World Savings
Day” with initiatives for the general
public, but especially for young people
and students. Banca Popolare di Sondrio
considers it both useful and a necessary
duty to remind people about “saving”
and encourage them to think about
what it means. Last year, this day was
honored by the authoritative presence in
Sondrio of Professor Francesco Sabatini,
a high-profile personality, famed linguist,
philologist, lexicologist, and honorary
chairman of Accademia della Crusca.
annual Mass to celebrate “the Madonna
of the Snow, Queen of Peace, Custodian of
Creation,” during which the congregation
is invited to reflect in an intimate and
spiritual way – assisted by the stark beauty
of the alpine surroundings – about the
tragedy of the Great War and about peace
in a world still torn by strife.
Driven by its cooperative and socialcultural
spirit, Banca Popolare di Sondrio
opened the “Luigi Credaro” Library in
October 2007 in the presence of the Minister
of Education at the time, Giuseppe
Fioroni. This library is dedicated to an illustrious
local educationalist, parliamentarian,
and senator (1860–1939), who
also served as the Minister of Education.
The “Luigi Credaro” Library is justified
by the need and desire of the bank to
make its massive and precious collection
of documents and books more widely
available. This wealth partly derives
from a number of generous donations
made by customers and shareholders and,
more particularly, from major bequests
of funds, archives, and personal libraries
of important economists, sociologists,
and academics.
Given the unique nature of the assets held
and the items collected, this is a specialist
library of general social importance
whose duties include the conservation of
our heritage. More specifically, the library
makes vast knowledge available to users,
with most of the books being dedicated
to economic, financial, and legal matters,
while also offering a public reading
service, inter-library loans arranged
together with prestigious universities,
and a document delivery service.
The rooms housing the “Luigi Credaro”
Library also provide a cultural space
that integrates – rather than competes
– with other libraries in the city and the
province, seeking to broaden opportunities
and boundaries through the targeted
use of new IT and digital technologies:
numerous university and other students
visit the library every day for individual
or collective study purposes.
In some sense, savings and culture go
hand in hand. Summarizing with regard
to savings, they certainly involve sacrifice
but also generate benefits for the
individual saver and the community as a
whole. The same is true for culture, which
is acquired by study, commitment, and
hard work that involve costs and going
without: the benefits can be found, however,
in the future personal and working
life of the individual. Invited by Banca
Popolare di Sondrio, Professor Sabatini
first talked to students and teachers on
the subject of “Italian is the key to our
brain” and then held a conference entitled
“The Italian language is not a telephone
wire. The mother tongue and the others”,
which was well attended by the public.
The intensive cultural activities of Banca
Popolare di Sondrio also include two
special directions that have been followed
successfully over the years: the
preparation of cultural, historical, and
naturalistic publications that are gifted to
shareholders at the annual general meeting;
and the holding of public conferences
and conventions that have featured
more than 100 speakers over the past 40
years, including some of the most authoritative
exponents from the worlds of
politics, economics, culture, journalism,
sports, and the performing arts.
Banca Popolare di Sondrio likes to consider
itself a bank that plays an important
role as an intermediary, not so much
in favor of its own territory’s culture,
but more in terms of the circulation of
culture within the territory.
Global Compact International Yearbook 2016 75

Promoting integration
At Bosch, a sustainable approach to doing business is an established part of corporate strategy.
Since the company was founded, its activities have reflected the wishes of its founder, Robert
Bosch, who was committed to contributing to social well-being and strongly believed in the
principle of ethical business. That sense of social responsibility is still reflected in the actions of
Bosch associates today, for instance when it comes to the integration of refugees.
By Bernhard Schwager, Bosch
The number of refugees seeking safety
and a better future in Europe remains
high, and this poses a major challenge for
EU member states. Since 2015, Germany
has also faced a particular challenge:
Well over a million people have sought
asylum in the country since the start
of last year. This situation has been the
subject of heated debate and has brought
forth a number of questions. Nevertheless,
most politicians, business people,
and members of the general public agree
that all stakeholders must cooperate
with one another to keep the situation
under control. Here, the business world
can make an important contribution.
Especially when it comes to the integration
of refugees, companies can provide
support in a number of ways.
Donations for local aid organizations
Against this backdrop, in 2015 targeted
aid initiatives were organized in a number
of Bosch countries. For instance,
Primavera e.V., the nonprofit organization
operated by Bosch associates, made
a call for donations across Europe. With
the help of the Bosch board of management,
the group works council and the
group committee of executive representatives
asked all associates to support
the refugee cause. In the end, more
than € 400,000 was collected in several
Bosch countries. As it had previously announced,
Bosch then doubled the total
to € 820,000. The money went toward
a number of sustainable local projects
that aimed to help refugees. Moreover,
associates were invited to make suggestions
for projects that the funds could
support. The idea behind this was that
local people would have the best knowledge
about which social activities were
important in their locations. Eligible
projects included charitable initiatives
that had already received the support of
current or former Bosch associates. Ideally,
these initiatives would be situated
close to a Bosch location. A committee
that included members of Primavera,
the group works council, and Bosch
associates decided on how the money
would be distributed. Until now, Bosch
has provided targeted support to more
than 100 projects.
Associates as mentors
In addition to this, Bosch is committed
to helping refugees get off to a good
start in Germany. Prior to the call for
donations, the company had already
made € 500,000 available for integration-related
activities at its locations.
Moreover, the company has offered cities
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Global Compact International Yearbook 2016

and municipalities properties on which
emergency shelters can be built, as well
as vacant apartments.
“
The integration of refugees is an extremely
important social responsibility. For this reason,
we at Bosch also want to make an active
contribution to supporting integration.
We have a long tradition of combining
economic activity with social responsibility.
Together with our committed associates, we
want to help people gain a foothold in our
society and offer them a better future. ”
Dr. Volkmar Denner, Chairman of the Board of Management, Robert Bosch GmbH
Bosch also plans to create 400 additional
internship spots that will either prepare
refugees for an apprenticeship or for
entry into the German labor market. At
the same time, mentorships with Bosch
associates and language lessons aim to
help make interns capable of navigating
their new surroundings as quickly
as possible. The company is working
closely with public institutions to expand
existing qualification programs in
a way that makes sense. This is also the
aim of Bosch Jugendhilfe (Bosch Youth
Aid), which sees Bosch associates act as
mentors for refugee children with the
“KinderHelden” (Child Heros) initiative.
These mentors help children and youth
get off to a good start in school and are
available to support their mentees on
school-related issues.
A network of companies
Bosch is also a member of the nationwide
network of companies called “Wir
zusammen” (Together). This platform
pools the projects of more than 60 large
and mid-sized companies and inspires
others to get involved with refugees
as well. Just as it has done with many
initiatives at more than 20 locations in
Germany, Bosch is sponsoring a project
in Immenstadt. The initiative supports
24 unaccompanied minors. Among other
things, these young people complete a
six-week internship at Bosch in cooperation
with the local vocational school. The
first round of internships has already
been successfully completed, in no small
part thanks to the participants’ high levels
of motivation. This project reflects the
importance of local activities, as it shows
what can be achieved when apprentices,
site management, and many other associates
cooperate with one another.
Cultural exchange
Ultimately, refugee aid initiatives in
Europe depend on the commitments of
thousands of volunteers. At Bosch, too,
many associates are helping promote the
success of integration. For instance, an
initiative of apprentices in Germany aims
to encourage intercultural exchanges
between people of different nationalities.
To this end, the participants meet
with refugees on a regular basis, for
instance to cook together or go to local
events. At other Bosch locations, associates
regularly call for donations to
provide newly arrived refugees with
the things they need for everyday life.
Other initiatives make language and
math lessons possible.
Conclusion
Although none of these activities offer
a complete solution for the successful
integration of refugees in Europe, the
commitments of companies such as
Bosch and their associates illustrate
possible approaches to tackling this
historic challenge. The aim is to come
up with individual solutions, discover
what we have in common with people
from other cultures, and find out
about differences that can be assets to
our society. And everyone can make a
contribution. Every bit of help counts,
no matter how small.
The Bosch Group
The Bosch Group is a leading global supplier of technology and services. It
employs roughly 375,000 associates worldwide (as of December 31, 2015). Its
operations are divided into four business sectors: Mobility Solutions, Industrial
Technology, Consumer Goods, and Energy and Building Technology. The Bosch
Group comprises Robert Bosch GmbH and its roughly 440 subsidiaries and
regional companies in some 60 countries.
Global Compact International Yearbook 2016 77

Compassionate Action:
Deutsche Post DHL Group
Refugee Aid Project
As a company conducting business throughout Germany and around the world, we take our
responsibility to society and our communities seriously at Deutsche Post DHL Group, including
through our adherence to the Global Compact Principles. This is why, in the midst of the recent
refugee crisis confronting Europe and Germany, we took the initiative to work together with
established partner organizations to help facilitate the integration of refugees in Germany.
By Deutsche Post DHL Group
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Global Compact International Yearbook 2016

Our refugee aid initiative is consistent
with both our corporate and CR strategies
and is a logical extension of our ongoing
engagement in the area of corporate citizenship.
By seeking to make a positive
contribution to society, this also serves to
strengthen our employees’ sense of mission
and engagement, as we encourage
and motivate them to support refugees
in their areas. And, since we employ
people in Germany from some 150 different
countries, providing refugee aid
is a natural reflex.
Our aim is to provide steady and lasting
support in the process of refugee
integration. This requires careful coordination
with partner and other relief
organizations and public authorities.
As this project gains momentum, we
will further intensify this collaboration.
Three pillars
Our refugee aid initiative rests on three
key pillars: strengthening social engagement
among our employees; providing
vocational orientation for refugees; and
supporting federal, state, and local authorities.
TIME TO ACT – DEUTSCHE POST DHL GROUP
REFUGEE AID
1 “Time to act” – Deutsche Post DHL Group refugee aid
TIME TO ACT – DEUTSCHE POST DHL GROUP
REFUGEE AID
We
want
to …
… strengthen social
engagement among
our employees
… provide vocational
orientation for
refugees
by We … want … motivating … strengthen employees social … offering … provide them vocational
to…
engagement among orientation for
in our branch our employees offices internships refugees with
to support refugees the prospect
in their areas.
of training and
We cooperate with employment.
by… experienced … motivating partners employees
in our branch internships with the
… offering them
and provide financial
offices to support
prospect of training
resources refugees and in their
and employment.
coordinators. areas. We cooperate
with experienced
partners and provide
financial resources
and coordinators.
PLANNED RELIEF EFFORTS IN FIGURES:
PLANNED RELIEF EFFORTS IN FIGURES:
up to 1,000,000,
… support federal,
state, and local
authorities
… … making support properties
federal, state
and local authorities
available for
refugee housing
and providing staff
for administrative
tasks. … making properties
available for
refugee housing and
providing staff for
administrative tasks.
… euros in financial support for local
refugee aid efforts
With the first pillar, we seek to stimulate
employee engagement by motivating employees
in our branch offices to support
refugees in their areas. As we ramped
up internal communication efforts to
inform employees throughout Germany
about the initiative, we received a strong
response to the call to get involved. There
are now some 13,000 Deutsche Post DHL
Group employees volunteering in 650
projects, along with 100 volunteer coordinators
providing a communications
interface between employees and aid
organizations. We are also providing
€ 1 million in funding for local projects
in which our employees are involved.
up to 100.000 ,
up to 10.000 ,
up to 1.000 ,
up to 100
… m² of Deutsche Post properties for
refugee housing
… employees in Deutsche Post branch
offices as volunteers
… internships for young adults throughout
Germany
… coordinators to act as contacts for employees
and aid organizations
The second pillar of our refugee aid initiative
is to provide vocational orientation,
including by offering 1,000 internships
for young adults throughout Germany.
The internship program has been set
up at all Deutsche Post mail and parcel
Deutsche Post DHL Group has won the
German CSR Award in the special category
"successful refugee support measures.
Global Compact International Yearbook 2016 79

Partners in action
Our employees volunteer with the
following partner organizations:
• Stiftung Lesen, reading aloud to
facilitate language acquisition
• SOS Kinderdorf, caring for
refugees who are unaccompanied
minors and families with children
• Teach First Deutschland, schooling
in “welcome” classes
• Aktion Deutschland Hilft, aid
projects for refugees in Germany
and operation of refugee
accommodations
centers. These are low-threshold positions
as sorters and loaders, for example, allowing
the deployment of interns with
limited language skills. The idea is to
give refugees an insight into the working
world in Germany. Employees at the various
branches take charge of the interns,
both during the internships and beyond,
such as by helping them learn German,
providing car pooling, and so on. This
standardized process was agreed centrally
with the Federal Employment Agency
and has been implemented country-wide.
With regard to the third pillar of support
for federal, state, and local authorities, we
are making available 100,000 sq meters
of properties to shelter refugees.
Industry initiatives
In addition to the above, Deutsche Post
DHL Group also takes part in various
industry-led refugee aid initiatives
within Germany, including Wir Zusammen
and InCharge. Wir Zusammen is a
platform that consolidates industry-led
integration initiatives within Germany.
It is meant to encourage companies to
invest in long-term integration initiatives,
with more than 50 companies
taking part.
InCharge helps refugees of all ages find
their footing in the labor market. It
matches refugees with mentors based
on the individual’s vocational or professional
qualifications – an engineer
with an engineer or a courier with a
courier, for example. So far, more than
30 companies are taking part in the
initiative.
Positive response
As the Deutsche Post DHL Group employees
in Germany come from so many different
countries around the world, many
of them are familiar with the home regions
and cultures of the refugees, which
makes it easier for us to provide effective,
targeted support. These employees are
working with our partner organizations,
“
We consider this to be a
model initiative that will
have a long-term return on
investment, and this action
will have strong resonance
within further initiatives. ”
Dr. Wilfried Vyslozil, Executive Chairman
SOS-Children's Villages Worldwide
“
After initial assistance for refugees, their integration
is both an obligation and an opportunity for our society,
and one of the most important tasks for aid organizations.
The initiative makes an extremely important contribution.
We’re very thankful that we can take part in this initiative
and we’re very pleased that Deutsche Post DHL Group
is taking responsibility. ”
Bernd Pastors, Chairman of Aktion Deutschland Hilft
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Global Compact International Yearbook 2016

acting as reading buddies and integration
guides for refugees, for example.
To help them prepare for their volunteer
role, we organize information events for
Deutsche Post DHL Group employees
to provide tips on effective interaction
and brief them on the substance of the
teaching materials. For example, in our
partnership with Stiftung Lesen, we provide
guidance along with a specially
designed start-up box of books to prepare
employees in their role as volunteer reading
buddies. In addition, all volunteers
receive polo shirts for enhanced visibility,
which are also a token of our appreciation
for their efforts. The response from
employees has been very positive, with
thousands signing up to take part in
hundreds of different activities in the
first weeks.
The strong support received from our top
management and employees internally
– as well as from our partners, local
authorities, and communities externally,
not to mention the refugees themselves
– attests to the power of this compassionate
action. The Deutsche Post DHL
Group Refugee Aid Project brings together
our company, our employees, and
our communities in a collaborative effort
that is consistent with our commitment
to the Global Compact Principles.
“
As a company with a strong presence both in Germany
and throughout the world, we want to contribute to
the integration of refugees jointly with our partners.
In doing this, we also continue to support a
long-established tradition of volunteering among our
employees in cooperation with non-profit organizations. ”
Frank Appel, CEO Deutsche Post DHL
Left: Employees with migration backgrounds
get involved as translators / interpreters,
integration guides and “bridge builders.”
Center: Various activities, incl. with FC
Deutsche Post: e.g. organization of a summer
festival, collection of sporting goods, and
charity tournaments.
Right: Several branch offices initiated
collection programs for toys, clothing, and
other everyday articles for local refugee
housing.
“
In the end, it will be our
schools that provide the
litmus test for how well
Germany rises to meet the
challenge of integrating
refugees and providing them
with prospects for the
future. It’s a challenge faced
by our society as a whole,
a challenge to be shouldered
by many. ”
Ulf Matysiak, Managing Director of
Teach First Deutschland
Global Compact International Yearbook 2016 81

Deutsche Telekom Helps
Refugees All over Europe
By Gabriele Kotulla, Deutsche Telekom
No issue has preoccupied the entirety of Europe in the last year
more than the vast numbers of people seeking refuge. In 2015,
more than a million asylum seekers came to Germany alone.
The numbers across Europe are many times higher. In view of
the huge volume of refugees, Deutsche Telekom AG has specifically
stepped up its commitment to the refugee aid efforts. And
many various national companies are also making significant
contributions. The range of support being offered varies among
German companies as well as among the different European
national companies according to the national situation.
(Figures as of May 2016)
Deutsche Telekom
In August 2015 Deutsche Telekom created
a taskforce to coordinate different aid
activities in Germany, for example, the
supply of free WiFi to some 70 refugee
reception centers. We set up a portal,
“refugees.telekom.de,” which provides
refugees with information on the asylum
process and on living and working in Germany.
The information portal has now
been visited more than a million times.
In addition, we offer refugees internships
and scholarships at the company’s
own University of Applied Sciences in
Leipzig (HfTL).
Together with our partners Jobware and
Jobstairs, Deutsche Telekom has developed
the “careers4refugees.de” portal.
Companies can post their job vacancies
free of charge on the site, which is geared
specifically to refugees. To date, some 70
introductory and youth internships as
well as 10 university scholarships have
been provided via the job portal. Eight
of the scholarship holders have already
begun their studies. But it is not just
the numbers that talk for themselves.
The careers4refugees.de portal won two
awards after just a few weeks: firstly, the
special award “Employer Branding Innovation”
from the Trendence Institute;
secondly, the Special Award from Queb.
The Quality Employer Branding Network
praised the platform for providing
refugees with “fast and unbureaucratic
assistance” in seeking employment in
today’s labor market.
Also, more than 550 Deutsche Telekom
civil servants have switched to the German
Federal Office for Migration and
Refugees (BAMF), where they help process
applications for asylum. Deutsche
Telekom employees have organized more
than 100 social days and aid projects via
the “engagement@telekom” platform.
T-Mobile Austria
T-Mobile Austria donated around € 60,000
in 2015 to support the refugee aid efforts
of Caritas and provides desperately
needed accommodation. The company
also facilitated hundreds of WiFi spots at
Caritas housing and provided thousands
of SIM data cards with data volumes for
smartphones. T-Mobile now sets aside
10 percent of its training positions in
Vienna annually for young, unaccompanied
refugees, a project which began
in 2010 and on which the company is
collaborating closely with the private
“lobby.16” initiative. T-Mobile Austria
also supports the “hallo” app, which
helps refugee children learn German.
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T-Mobile Netherlands
T-Mobile Netherlands decided to initiate a partnership with
VluchtelingenWerk Nederland and donated technology and
prepaid SIM cards to the first 10,000 refugees. These SIM cardholders
are also being invited to job application workshops
and soft-skill training courses, as well as being provided with
apps to help them to find their way around the Netherlands.
Slovak Telekom
Slovak Telekom set up lines for donating money via text messages.
A total of € 2,000 was donated to two domestic NGOs.
Furthermore, Slovak Telekom donated € 2,000 to the #DomovNa-
Mame project, which offers canvas baby carriers to refugees.
Magyar Telekom
Magyar Telekom is helping with its own resources. Free WiFi
services have been built in two refugee camps, and power
strips have been provided for the sake of helping refugees to
connect and get information.
T-HT Hrvatski Telekom
Hrvatski Telekom donated money to the Red Cross and has
given employees who volunteer a day off. In addition, HT
provided the refugee camp with 10 USB sticks for free LTE
internet access and around 360 SIM cards, with free GB storage
and call time included.
Crnogorski Telekom
In September 2015 Crnogorski Telekom joined in an action
initiated by the Red Cross and collected aid for migrants in
southeast Europe through a humanitarian hotline. By sending
a text message, their customers were able to donate one euro.
Makedonski Telekom
On the occasion of the Guiding Principles Day on September 24,
Makedonski Telekom called for humanitarian action among
its employees. A donation of 20 boxes with canned food and
bottled water were given to the Red Cross.
OTE & Cosmote
One of the initiatives supported by the OTE Group was the
work and mission of the Hellenic Coastguard. By covering the
cost of repairing and maintaining more than 50 vessels, the
OTE Group contributed to the Hellenic Coastguard’s successful
response of saving more than 74,000 refugee lives within
just five months in 2015. The support also includes the free
provision of telecommunication products to facilities, the support
of NGOs, and the realization of volunteering projects.
Global Compact International Yearbook 2016 83

A Pioneer for Women's
Economic Security
By Syed Najmus Saquib and Tanvir Hussain, Green Delta Insurance
Bangladesh is a developing country in which women comprise
more than 52 percent of the total population as well as the
fastest-growing segment of the workforce. There exists a nexus
between gender equality and economic growth. An example is
Nibedita, which is the first comprehensive insurance scheme
for women in South Asia.
Director and CEO of GDIC. She holds
the unique distinction of being the first
female CEO in the Bangladesh insurance
industry. It is through her visionary and
dynamic leadership that Nibedita came
into being.
The nurturing and support of its visionary
employees, such as Chowdhury, and
the implementation of innovative projects
and products have led to an improvement
of the conditions of women
employees within the company. It has
also made GDIC a pioneer in empowering
women in the insurance sector of
Bangladesh.
Current statistics on women in
Bangladesh
Nibedita was launched by Green Delta
Insurance Company Ltd. (GDIC), the first
leading insurance company in Bangladesh
to receive an AAA rating. Through
its efforts, the company has not only
attended to improving conditions for
its own women employees but also provided
resources for all working women
of Bangladesh.
Setting the tone at the top
Nibedita was initiated in 2013. It was the
brainchild of Farzana Chowdhury, ACII
(UK) and Chartered Insurer, Managing
• Comprise more than 52 percent of the
population
• 10.62 million working in job sector
• Constitute 80 percent of RMG workers
• 7.8 million young working women
• Women unemployment rate reduced
to 5.8 percent
• Around 10 percent of total entrepreneurs
are women
• 200,000 women working abroad
Role of women in Bangladesh rising
Women are now playing more significant
roles in the domestic, social, and business
spheres of Bangladesh.
Women’s empowerment is the prerequisite
for the socioeconomic development
of a country. As a developing country
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Global Compact International Yearbook 2016

with a steadily growing economy, Bangladesh
has seen a sharp rise in the number
of women becoming more involved in
economic activities, both at the micro
and macro levels. As a result, issues
such as gender equality and women’s
empowerment, among others, are widely
discussed. This eventually led to the
concept of Nibedita, which caters to the
needs of women and helps them become
more self-dependent.
What makes Nibedita unique
This is the first scheme of its kind in the
region to center on women. Besides the
traditional accidental coverage areas,
Nibedita also covers a few extended areas,
for example trauma allowance in cases
of rape, road bullying, robberies, and
acid attacks. The extended coverage also
includes loss or damage to household
goods / personal effects due to fire / lightening,
riots, storms, typhoons, floods,
cyclones, and earthquake. It does not,
however, cover preexisting disabilities,
nor death, injury, or disablement arising
from actions while intoxicated or under
the influence of drugs and so on.
Nibedita provides a maximum coverage
of BDT 10,00,000 (10 lac) with the
minimum net premium of BDT 580 per
person (including VAT) per lac.
GDIC has deployed a special sales force
mostly consisting of women who go
from door to door to generate awareness
regarding Nibedita, as many are still
unaware of the significance of having
an insurance policy. Besides, when promoting
it among women, Green Delta
gives the utmost importance to creating
awareness among men so that they
become equally interested in availing
themselves of policies for the women
in their families.
Global recognition
Recently, Chowdhury was recognized
as one of the ten Local SDG Pioneers
by H.E. Ban Ki-moon at the UN Global
Compact Leaders Summit 2016 in the
UN Headquarters, New York. She has
been hailed as a pioneer for women’s
economic security and for her leadership
in guiding her teammates through the
Nibedita scheme in increasing women’s
freedom and playing a pivotal role in
achieving SDG 5 for Gender Equality
and Women’s Empowerment.
Chowdhury elaborates on Nibedita, saying:
“Green Delta Insurance Company
Ltd. has created a platform for growth,
corporate governance, youth leadership,
and especially women empowerment.
More than 52 percent of our population
is female today, and when it comes to human
rights, women are always the ones
that get neglected and their rights are
frequently violated. Nibedita has been
launched while keeping the healthcare,
safety, and social needs of the females
of our nation in mind. We are going
beyond insurance.”
Lives inspired
Since 2013, around 5,000 women have
availed themselves of the Nibedita
scheme to safeguard their futures. The
policyholders range from university students
and housewives to entrepreneurs,
corporate leaders, athletes, and artists.
A good number of policyholders have
already benefited from this scheme.
Going beyond insurance – the way
forward
Nibedita has reached beyond the world
of insurance. Nibedita has created a
Nibedita has created a One Stop Service
Solution Platform for Women Healthcare,
Safety, and Social Needs to support
the women who are in actual need of it,
in any form. A digital platform is being
created for the Nibedita women, which
will give them access to a better lifestyle,
healthcare, and most importantly, safety.
Nibedita is working to bring together
women from all walks of life so they
can be of help to each other by sharing
experiences and best practices.
Nibedita is working as the voice of the
voiceless. It can inspire oppressed women
and act as their partner in need. This
product aims at bringing a positive
and visible change to society. With the
Nibedita policy, women will find strength
in their time of peril. Thus, Nibedita
is playing a vital role in shaping the
mindsets of the women of Bangladesh
to become self-dependent.
Global Compact International Yearbook 2016 85

Being one with the global
community
By Corporate Social Responsibility Office, Manila Doctors Hospital
2015 proved to be a pivotal year as the global community welcomed the 17 Sustainable Development
Goals (SDGs) and participated vigorously during the COP21 in Paris. So many opportunities
are now being presented to the business sector to prove that it can be a force for good. As a responsible
corporate citizen, the Manila Doctors Hospital (MDH) readily took action in identifying
where it can best contribute toward the achievement of the Sustainable Development Goals in the
Philippines. By choosing to focus on three SDGs, the Corporate Social Responsibility office (CSR) of
MDH will allow it to maximize its resources and make a long-term commitment with its partners.
SDG 3: Ensure healthy lives and
promote well-being for all at all ages
Although MDH is a privately owned,
tertiary hospital, it has for years created
a mechanism that makes it possible
for social service patients to access the
rights-based delivery of world-class medical
care through its various CSR health
programs. One principle that rules our
service provision for the economically
disadvantaged patients is inclusivity. To
achieve inclusivity, MDH fully embraced
the concept of universal health care. An
MDH CSR strategy was to take the necessary
steps in harmonizing resources from
partners: Philippine Health Insurance
Corporation (PhilHealth) (national health
insurance program); Metrobank Foundation,
Inc. (majority owner of Manila Doctors
Hospital); and the Philippine Charity
Office (PCSO) (principal government
agency that raises and provides funds
for health programs and medical assistance).
By doing so, we are able to focus
on providing not just quality healthcare
but protection against the financial risk
of high out-of-pocket health spending.
Another MDH CSR strategy is the community-based
issuance of the MDH blue
card to economically disadvantaged patients
and dependents who qualify. The
MDH blue card allows patients who need
medical consultation to access service
for only one hundred pesos (PHP 100),
which is equivalent to two US dollars.
Blue-card holders are also entitled to
access 143 laboratory procedures at a
50 - 70 percent discounted rate. Should
they need confinement, the MDH CSR Office
under its in-patient program extends
partial subsidies from funds provided to
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Global Compact International Yearbook 2016

MDH CSR by the Metrobank Foundation.
The rest of the medical bills are covered
by PhilHealth, PCSO, and contributions
from the patient. The generated earnings
from the CSR Health Programs are used
to sustain the operations of the MDH
CSR Clinic, where seven of the MDH
medical departments provide medical
consultations from Monday to Saturday
for social service patients.
In 2015 alone, 17,501 blue-card holders
benefited from the services of the
following medical departments: Family
and Community Medicine, Pediatrics,
Otorhinolaryngology, Internal Medicine,
Obstetrics and Gynecology, Ophthalmology,
and General Surgery. There
were 4,684 who made use of the various
laboratory procedures at a discounted
rate, whereas 1,071 needed confinement
and benefited from the support of our
partners in covering the healthcare costs.
SDG 5: Achieve gender equality and
empower all women and girls
2015 saw the launch of Men Caring
for Women (MCW), spearheaded by
the male officers of the Manila Doctors
Hospital and led by the Hospital
Director himself. MCW is an advocacy
and resource-generation campaign in
support of the fight against cervical
cancer, violence against women and
children (VAWC), and human trafficking.
The proceeds from the first fundraising
activity enabled MDH CSR and its
partners to support the initial series of
capacity-building trainings of volunteer
lawyers, court social workers, and
frontliners. Experts volunteered their
time to train the participants on how
to prosecute child abuse cases, new
developments on children’s laws (both
local and international), prosecuting
child online sexual exploitation, and
the importance of forensic pathology
in criminal prosecution of VAWC cases.
Consistent with the MCW campaign, a
number of steps were also undertaken to
ensure that gender equality is observed
internally, starting with the comprehensive
orientation / seminar on anti-sexual
harassment in the workplace for officers.
The zero-tolerance policy inside the
hospital strongly reiterates that officers
are expected not only to behave properly
toward subordinates but also protect
them from those who might attempt
to subject them to abusive behavior or
unfair treatment. The open-door policy
of management is just but one of the
accessible tools for reporting a possible
case. This is just one part of a series of
capacity-building steps that will also
cover the MDH non-supervisory staff.
Both MDH CSR and the MDH Human
Resource Division, with support from
the Senior Management Team, recognizes
that all genders have the right to
a safe and supportive workplace in order
to pursue professional development,
which in turn can benefit the business
as a whole.
SDG 13: Take urgent action to
combat climate change and its
impacts
Green Rebellion (Generating Resources &
Engagement for Environment and Nature)
started as a small CSR program that sought
to preserve and revitalize the last forest
park in the City of Manila – the historical
Arroceros Forest Park – and at the same
time create clean and green spaces in the
hospital’s adopted community and school.
Now other corporations have joined the
safest “Rebellion” by adopting their chosen
zone inside the forest park as part of their
own “Green CSR.” Adopting a zone entails
not just financial resources but volunteer
hours and creativity. In the MDH-adopted
public school (Rafael Palma Elementary
School, Manila), vertical urban gardens are
being developed to help create a healthier
environment for learning. In the adopted
community (Barangay 662), recyclable
materials are being utilized in producing
products for the mainstream market. This
not only helps the recycling program of
the community but is also proving to be a
source of income for community members.
Forging ahead
The recognition from the Asian Hospital
Management Awards in 2015 for our CSR
programs serves as a reminder to remain
steadfast in heightening the consciousness
and participation of the public in
targeted health and environment issues
in the global community.
Global Compact International Yearbook 2016 87

Fighting schistosomiasis
in a strong alliance
Nearly 260 million people suffer from the worm disease schistosomiasis – children in Africa in
particular are affected. Merck, a leading science and technology company, has been cooperating
with the World Health Organization (WHO) in the fight against neglected tropical diseases for
years. Now, with the establishment of the Global Schistosomiasis Alliance (GSA), Merck has expanded
this partnership. By bundling the expertise of its members, the GSA aims to effectively
fight and eliminate schistosomiasis worldwide.
By Johannes Waltz, Merck
According to the WHO, around 70 percent
of those affected by schistosomiasis
live in 10 countries in sub-Saharan Africa.
Schistosomiasis is caused by parasites
that lurk in stagnant or slowly flowing
fresh water. It is a vicious circle. The
female’s eggs infest inner organs such
as the colon, spleen, or liver, where the
larvae develop into worms – the eggs
of which are then excreted via the urine
or feces of those infected. Freshwater
snails then act as a host in which the
eggs develop into larvae, which in turn
penetrate the human body.
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Global Compact International Yearbook 2016

Children at particular risk
Schistosomiasis is a typical poverty-related
disease: In the affected countries, the
population often has no access to clean
water or sanitary installations and uses
the polluted water, for example, to bathe,
swim, wash clothes, or fish. Children of
school age are at particular risk, since
they often play in stagnant water. The
consequences of this insidious disease
are severe, with acute symptoms ranging
from skin rashes to life-threatening
fevers. The long-term consequences include
chronic inflammation of various
organs, which can also lead to death. Up
to 200,000 of those affected die each year
from the effects of the disease. Among
children, the symptoms that result are
particularly serious: Schistosomiasis
stunts growth, causes learning disabilities,
and leads to anemia.
The Praziquantel Donation Program
With the launch of its Praziquantel
Donation Program in 2007, Merck made
a commitment to help the WHO combat
schistosomiasis in Africa. The active ingredient
praziquantel was co-developed
by Merck in the 1970s and has proven
to be the most effective therapy to date,
as it can be used to treat all forms of
schistosomiasis. Merck’s efforts are in
line with the WHO roadmap to overcome
neglected tropical diseases, the United
Nations’ Sustainable Development Goals,
and the London Declaration. Merck is
fighting schistosomiasis as part of its corporate
responsibility, within the health
sphere of activity.
In 2015, Merck donated more than 100
million praziquantel tablets to the WHO.
To date, Merck has supplied a total of
around 340 million tablets, which has
enabled the treatment of more than
74 million patients, primarily children.
“We want to give children a new future,”
says Stefan Oschmann, Chairman of
the Executive Board and CEO of Merck.
“The establishment of this alliance underscores
our commitment to fighting
schistosomiasis and means all relevant
partners are on the same page. The only
way to overcome the challenges on the
road to eliminating this disease is by
working together.”
As of 2016, Merck will donate up to 250
million tablets per year to the WHO –
until schistosomiasis has been eliminated
in Africa. However, providing the praziquantel
tablets is only one part of the
solution. In combating schistosomiasis,
Merck is following an integrated, comprehensive
approach: In parallel to the
donation program, Merck is working on
optimizing the tablets and on developing
a pediatric formulation of praziquantel
for preschool-age children, for whom
the drug is not yet suitable. In addition,
Merck is supporting a WHO awareness
program to educate children in African
schools. Using comic-style booklets designed
for children, the youngsters are
taught about the causes of schistosomiasis
and how to prevent the disease.
Alliance against schistosomiasis
As a founding member of the Global
Schistosomiasis Alliance, Merck is aiming
to promote greater coordination and
efficiency in the fight against schistosomiasis.
The long-term goal is to eliminate
the disease worldwide, thus contributing
toward ending poverty in the affected
countries and creating new economic
perspectives. At the end of 2014, stakeholders
from government, the private
sector, and civil society came together to
establish the GSA. The founding members
include Merck, World Vision, the
United States Agency for International
Development, and the Bill and Melinda
Gates Foundation. Their aim is to work
together to achieve greater impact on
the ground.
On the one hand, the GSA assumes a
mediator role in coordinating existing
efforts to combat schistosomiasis. On
the other hand, however, it also acts as
an initiator of innovative projects that
focus on eliminating the disease. To date,
three working groups have been formed
to carry out the GSA’s work. The first
working group manages, monitors, and
documents the distribution of praziquantel
tablets. The second working group
is concerned with raising awareness of
schistosomiasis with the aim of mobilizing
additional funds and resources
to combat the disease. The third group
is dedicated to research and development.
In their activities, all the working
groups pursue the ultimate goal of the
GSA: the elimination of schistosomiasis
worldwide.
Global Compact International Yearbook 2016 89

A Far-reaching Approach
to Raising Labor Practices
in Agriculture
By Miguel Coleta, Philip Morris International
When Human Rights Watch unveiled their research in 2009 on
child labor and other labor issues related to tobacco-growing
in Kazakhstan, it prompted Philip Morris International (PMI)
to rethink the way it was addressing these issues. Although
the company already had efforts in place, clearly they were
insufficient to gain visibility into these issues and address
child labor. This prompted PMI to seek the advice of Verité
(a leading NGO in supply chain responsibility) and to adopt a
new approach aimed at systematically addressing child labor,
resulting in the launch of PMI’s global Agricultural Labor
Practices (ALP) program in 2011.
Today, more than ever, companies are
expected to have strong policies and due
diligence processes in place to respect
labor and human rights in their supply
chains. Consequently, many companies
have had to reevaluate their approaches
to address these concerns.
When PMI introduced its global ALP
program in 2011 to progressively eliminate
child labor and other labor abuses on
all farms in its supply chain, PMI knew
that to be successful, it would have to go
beyond certifying farmers’ compliance
with standards: Better visibility into the
issues and an understanding of the root
causes of child labor – together with the
combined efforts of government, civil
society, and other industries – would
all be necessary to tackle this complex
problem. Although more work is clearly
needed, this approach – now in its fifth
year of implementation – is delivering
tangible results.
Global reach, one-on-one support
With a farm base of approximately
450,000 farmers worldwide – the vast
majority of whom are smallholders
growing tobacco on two hectares or
less – child labor is one of the salient
labor and human rights risks in PMI’s
global tobacco-growing supply chain
spanning nearly 30 countries. Although
the problem is not new or specific to
tobacco-growing in agriculture, this must
not be an excuse for inaction.
PMI’s ALP Code defines the labor practices,
principles, and a set of measurable
standards that embody the company’s
strong commitment to progressively
eliminate child labor and other labor
abuses, and to achieve safe and fair
working conditions on all farms in PMI’s
tobacco-growing supply chain. Suppliers
and farmers are expected to apply and
meet these standards in the framework
of PMI’s commitment to promote good
agricultural practices.
To facilitate this, PMI’s approach includes
establishing direct contracts between
smallholder farmers either with PMI’s
suppliers or with PMI, cutting out layers
of middle-men and often volatile pricing
at auction. Farmers receive agronomy
support to improve the quality and
yield of their crops, training on how to
care for the environment, and help to
achieve safe and fair labor practices on
their farms. Having a secure buyer for
the crop provides farmers with greater
economic stability, while giving PMI
better visibility into farm conditions
and stronger leverage to address labor
issues in its supply chain.
Dedicated field staff bring ALP to life
A team of 3,500 field staff known as ‘Field
Technicians’ (FTs) provide farmers with
technical assistance regularly throughout
the growing season. These “boots on the
ground” live in tobacco communities and
couple agronomy expertise with farmer
training and support on how to meet
the ALP Code Standards. These men and
women develop trusted relationships
with farmers, discussing concerns and
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Global Compact International Yearbook 2016

providing training and operational
support on continuous improvement
practices on the farm: from technical
know-how, certified tobacco and food
seeds, to health and safety equipment
and training, among other issues.
FTs conduct in-depth, internal monitoring
on a farm-by-farm basis, supporting
farmers to meet the ALP Code Standards.
At the beginning of the crop season, FTs
gather detailed information (in the form
of a ‘Farm Profile’) about each farm –
the profile is then used to identify risk
and define areas for improvement. Each
farmer receives several visits throughout
the season aimed at systematically
identifying and addressing labor issues.
As part of this process, FTs are firm and
ALP progress to date
“[Philip Morris International’s] Third ALP Progress Report presents a candid
account of our progress, challenges, and achievements in improving labor
conditions on over 450,000 farms worldwide during 2014 and 2015. While a
lot remains to be done, it is encouraging to see tangible progress, including
significant reductions in child labor in several countries due to the hard work
of more than 3,500 trained Field Technicians and strong partnerships with
over 30 not-for-profit organizations.
We hope that by sharing our learnings, our approach serves as an example of
a transformative, holistic system to address complex social and labor issues,
not only in tobacco but in agriculture more widely.”
André Calantzopoulos, Chief Executive Officer, Philip Morris International
Global Compact International Yearbook 2016 91

A Perfect Example
of “Beyond
Certification”
When the ALP program started in
2011, PMI partnered with Verité to
develop a curriculum for ALP
auditors and train field staff from
Control Union Certifications who
were engaged as third-party
assessors for the program. Since
then, it has been a continuous
learning process as project staff
openly discuss the challenges they
face in different countries. Johan
Maris of Control Union Certifications
shares his experience:
“PMI’s approach to improving labor
conditions in their tobacco-growing
supply chain is a perfect example
of “beyond certification.” In contrast
to many programs, PMI’s focus isn't
simply about the overall outcome,
but much more about having a good
understanding of local circumstances
on the ground.
CU country assessments are
published on www.pmi.com and
give PMI and stakeholders a good
basis for prioritizing the future use
of resources to improve farmer
and worker living and working
conditions. Each report is based on
CU visits to a meaningful sample of
farms, which give a better insight
into conditions on the ground.
Based on the reality that farmers
grow corn, soya beans, and
vegetables alongside their tobacco,
the United Nations Global Compact
can play a key role in bringing
initiatives such as ALP together
so that we learn from each other
and speed up the scaling-up of
sustainable agriculture.”
Johan Maris, Managing Director of Control
Union Certifications
clear about PMI’s expectations while
seeking to build trust with farmers,
discussing how they can adopt sensible
approaches to overcome problems and
problematic practices.
External monitoring is a critical component
of the program and consists of countryspecific
third-party assessments by Control
Union Certifications (CU), which evaluate
ALP implementation. These assessments
include action plans produced by PMI’s
affiliates or its suppliers, committing to
change conditions on farms in light of
the findings and prioritizing areas for
improvement. FTs are fundamental in
ensuring that these plans become a reality.
Transparency of reporting:
A “must-have”
PMI is committed to transparency of
reporting on progress. Together with
ALP country assessments from CU
highlighting ongoing challenges on
farms (assessments to date are publicly
available on www.pmi.com), PMI
publishes regular progress reports on
global implementation of the program
(see: www.pmi.com/ALPprogress).
Tailored community support to
address root causes
Collective efforts of business, government,
and civil society are needed to address
child labor. Under the ALP program, PMI
fosters strong alliances with stakeholders
to guide the implementation of tailored
community initiatives aimed at addressing
the root causes of child labor and fostering
behavioral change in tobacco-growing
areas. This includes reaching out to
civil society organizations, governments,
farmers, and worker representatives in
each country to gain valuable input on
the approach.
Examples of community initiatives
In the Philippines, Pakistan, and Indonesia,
PMI’s local affiliates developed a twopronged
program to reduce the risk of
children being involved in hazardous
farm work. The local ALP Country Teams
equip farmers with a labor-saving device
called ‘clip sticks,’ which allow for a more
efficient preparation of tobacco leaves for
curing, simultaneously reducing the risk
of children being involved in the process.
In parallel, a summer school program for
farmers’ children, run by local NGOs, takes
place during the harvest season.
To assess the efficacy of this program,
PMI’s local affiliates implemented a
detailed protocol of increased random,
unannounced visits during the peak
harvesting season with groups of farmers
who 1) received only clip sticks; 2) whose
children were involved in the summer
school program; 3) were participating in
both initiatives; and lastly, 4) a control
group not involved in the program.
Although further validation is needed, the
assessments in 2015 suggest promising
results showing that summer schools are
not enough and agronomy / operational
support is insufficient in isolation. A
twin-track approach is needed to avoid
unintended consequences or displacing
root causes of child labor on farms. The
assessment will be repeated in the next
crop seasons in these countries and
trialed in Thailand.
Meanwhile, in Latin America, PMI’s affiliate
in Colombia – Coltabaco – is committed
to improving access to, and the quality of,
rural education in tobacco-growing areas.
Over the last eight years, Coltabaco has
supported the “Dividendo por Colombia
Foundation,” which works in partnership
with the Ministries of Education and
Municipality Administrations to oversee
the “Sembrando Futuro” (Sewing future)
projects – namely, ‘new school’ and ‘early
years’ for children aged from 6 months
to 5 years of age, and 6 years to 12 years of
age respectively. The effort has benefited
more than 7,000 children to date, resulting
in the application of a tailored curriculum
for children in disadvantaged rural
communities in multi-grade schools, the
recruitment of 230 additional teachers,
and the building of 180 schools in Bolivar,
Sucre and Santander.
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External feedback
A leading industry example
PMI’s approach to addressing child labor
has come a long way since Human Rights
Watch reported on tobacco-growing in
Kazakhstan in 2009. The US Department
of Labor has since removed Kazakhstan
tobacco from the list of goods produced
from child labor, following a review
and acknowledgement of PMI’s efforts
to eliminate it in the country. Human
Rights Watch has since acknowledged
PMI’s policy efforts and transparency,
both in the United States and in their
latest report on Indonesia: “Transparency
is a key element of effective and credible
human rights due diligence. Philip
Morris International appears to have
taken the greatest number of steps to
be transparent about its human rights
policies and monitoring procedures,
including by publishing on its website
its own progress reports as well as several
detailed reports by third party monitors.”
Looking ahead
PMI has established a long-term strategic partnership with Verité, a leading NGO
in supply chain responsibility, to support the ALP program globally. In the first
phase of the program, Verité helped PMI develop the ALP Code, roll it out among
PMI affiliate and supplier staff in tobacco-growing regions, and provide training on
labor issues to worldwide agronomy and ALP staff. Verité is also working with PMI
to establish partnerships with local NGOs and other stakeholders to address the
root causes of underlying labor problems and establish grievance reporting and
remedy mechanisms. Now that the ALP program has largely moved beyond the
initial setup phase in most markets, Verité continues to support PMI with ongoing
capacity-building, technical assistance on issues such as monitoring and impact
evaluation, and strategic advice about the ALP program.
“Verité continues to experience PMI as a partner that is open to external input,
responsive to stakeholder suggestions, valuing of others’ expertise, strategic
in its thinking, committed in its resourcing, and reflective on the need to adapt.
The company’s approach to the serious problems in its tobacco production over
the past five years puts it at the leadership level among multinationals.” [...]
“PMI continues to achieve a commendable level of disclosure. During this period
[2014–2015], the company published on its website third-party assessment
reports on ALP implementation in Brazil, Mexico, Italy, the Philippines, and the
United States with additional reports from audits conducted during 2014–2015
forthcoming. This monitoring is done against 32 measurable Standards on over
450,000 farms in approximately 30 countries – a massive undertaking that
bolsters the credibility and validity of PMI’s problem-solving interventions.”
Verité’s Chief Executive Officer, Dan Viederman, commenting in PMI’s Third ALP Progress Report
PMI is strongly committed to improving
living and working conditions and
addressing child labor and other labor
abuses in its tobacco-growing supply chain.
Alongside the many process challenges
of making sure risks are identified on
farms and effective steps are taken
to address them, these are difficult,
emotional, and culturally-sensitive issues
to resolve. PMI will continue to build on
the strong foundations of ALP program
implementation, ranging from improved
data collection and support to farmers
in meeting the ALP Code, to ongoing
farm-by-farm monitoring, and support
to help farmers continuously improve
and address problematic practices.
External assessments remain essential
in understanding the impact of activities
and to identify areas for improvement.
Close cooperation with government, civil
society, and other industry partners to
develop lasting solutions to these issues is
also a fundamental part of PMI’s approach,
together with openly sharing the learnings
of the program through transparent public
reporting on progress.
Global Compact International Yearbook 2016 93

SAKHAlIn: PRoMoTInG
lAnGUAGe RIGHTS on
InDIGenoUS ISlAnD
Sakhalin energy Investment Company ltd., an operator of the Sakhalin-2 oil and gas project,
performs its activities on the island of Sakhalin, home to the nivkhi, Uilta (orok), evenki, and nanai
indigenous peoples. Some of the project’s assets are located near the areas of the traditional
residence and economic activities of the indigenous peoples. naturally, the company pays special
attention to effective engagement with indigenous Sakhaliners. Since 2006 a special program
– the Sakhalin Indigenous Minorities Development Plan (SIMDP) – has been implemented through
a partnership between the Sakhalin government and the Regional Council of Authorized Representatives
of Sakhalin Indigenous Peoples.
By Natalia Gonchar, Sakhalin Energy
In addition to the SIMDP, Sakhalin Energy
focuses on the preservation and
promotion of the cultural and linguistic
heritage of Sakhalin’s indigenous minorities.
This was one of the key priorities
identified by Sakhalin’s indigenous peoples
during open public consultations
held during the development of the
SIMDP. A significant number of indigenous
Sakhaliners defined languagerelated
projects as being critically important.
In addition, from the experts’ point
of view, the death of a language may
result in the loss of the native speakers’
ethnic identity. As all of the languages
of Sakhalin’s indigenous peoples are
seriously endangered, Sakhalin Energy
is making efforts to preserve them and,
consequently, the indigenous cultures.
It needs to be mentioned that, for many
years, the natural assimilation of indigenous
languages took place in Russia,
due to a host of factors. Being the majority
language, Russian serves both as a
unifying factor and as an intermediary
when studying foreign languages and
global culture.
Certainly the government implements
programs for the support and development
of native languages. It is not
preferable for business to overlap with
state-run projects. However, business can
also contribute and provide funding in
the areas that for whatever reason cannot
be financed by the government. In order
to effectively preserve languages and
culture, multi-partner efforts are vital.
Sakhalin Energy projects generally comply
with the provisions of the UNESCO
Convention for the Safeguarding of the Intangible
Cultural Heritage, which covers:
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Global Compact International Yearbook 2016

• oral traditions and expressions, including
language as a vehicle of the
intangible cultural heritage;
• performing arts;
• social practices, rituals, and festive
events;
• knowledge and practices concerning
nature and the universe;
• traditional craftsmanship.
The company’s language-support projects
first of all include the publication
of books, textbooks, and dictionaries in
indigenous languages. An example of
this is the series of publications in the
Uilta language. Until this century, the
Uilta language was a completely oral
language. With 295 Uilta people and
just several native speakers remaining,
it seemed that the Uilta language did not
have a chance and that the unique heritage
of these people will be irretrievably
lost. But the Uilta elder people, scientists,
linguists, and the company combined
their knowledge and resources and after
several years published The Orok-Russian /
Russian-Orok Dictionary, The Uilta ABC, and
The Uilta Language as Historic-Ethnographic
Source Dictionary. This is not an absolute
recovery, but it offers hope.
Sakhalin Energy provides funding for the
publication of folklore literature, such
as an unprecedented publication of The
Epic Book of Sakhalin Nivkhi, prepared by
a world-famous Nivkh writer, Vladimir
Sangi. The Epic Book is published in Nivkh
and Russian and is ranked among the
famous books The Kalevala and The Song
of Hiawatha.
In order to ensure the development of a
social-cultural environment for language
preservation, it is important to have
mass media in indigenous languages.
Sakhalin Energy provided support for
the newspaper The Nivkh Dif, which is
published in Nivkh and Russian.
There were several events supported by
the company that played a significant
role in the promotion of Sakhalin’s indigenous
languages. The key one was
the “First International Symposium in
the Languages of the Indigenous Peoples
of the Russian Far East,” which was arranged
in the town of Yuzhno-Sakhalinsk,
Sakhalin Oblast, Russia. Next was the
“International Workshop Preservation
and Promotion of Cultural and Linguistic
Heritage of Sakhalin Nivkhi,” which
was held in the UNESCO Headquarters
in Paris.
When speaking about the preservation
of languages, it is equally important to
mention their development as any living
language, in comparison with the dead
ones, is a flexible mechanism and changes
influenced by society. The special project
targeted at the preservation and development
of Sakhalin’s indigenous languages
was implemented jointly by Sakhalin
Energy and the Office of the UN High
Commissioner for Human Rights in Russia.
The project includes the translation of the
Universal Declaration of Human Rights
and the UN Declaration on the Rights of
Indigenous Peoples into the languages
of Sakhalin’s indigenous peoples. Each
declaration was published in a separate
booklet and in a joint brochure, including
as well brief information about the
peoples and a CD with recordings of the
texts read aloud by native speakers. According
to linguists’ expertise, such an
initiative gives a fresh impetus to language
development, as political vocabulary can
be new to indigenous languages and neologisms
are created. As Vladimir Sangi,
who translated both declarations into the
Nivkh language, says: “I needed to invent
the word ‘freedom’ in the Nivkh. Because
we never needed one before. The Nivkhi
had never known what ‘unfreedom’ was,
so ‘freedom’ was our natural state that did
not require a special name for it.”
Projects such as the translation of UN
declarations into indigenous languages
also increase the social prestige of the
minority languages. Another relevant
initiative was recently implemented when
the painstaking efforts of elderly people,
linguists, and the company’s employees resulted
in the illustrated corporate calendar
showing traditional culture and economic
activities of Sakhalin’s indigenous peoples,
with months’ names in their languages
and explanations provided in Russian. It
should be noted that months’ names in
languages of the indigenous peoples are
semantically related to peoples’ traditional
cultures or the natural and climate characteristics
of the territories. Along with
the Russian national holidays, the dates
important for indigenous peoples were
also highlighted: August 9 as the International
Day of the World’s Indigenous
Peoples, February 21 as International
Mother Language Day, March 30 - 31 as the
date for the establishment of the Russian
Association of Indigenous Peoples of the
North, Siberia, and Far East, etc. What is
important to mention is that this calendar
was extremely popular among both indigenous
and non-indigenous stakeholders
and won first prize in the All-Russian
Contest of Corporate Calendars 2016.
The work on language preservation is
continuing. It cannot stop until all the
languages are no longer endangered
– unfortunately, this is a hope for the
remote future.
Global Compact International Yearbook 2016 95

Playing Our Part in
Addressing the Impact of
Climate Change on Health
By Gregory Lamory, Sanofi
The year 2015 marked a turning point in the fight against climate change. The signing of the
Paris Agreement during COP 21 in December marked an important step in the move toward
limiting an increase in global temperatures. This agreement is not just a climate agreement;
it is also a major health agreement. Indeed, as the World Health Organization (WHO) points out:
“Between 2030 and 2050, climate change is expected to cause approximately 250,000 additional
deaths per year, from malnutrition, malaria, and diarrhea to heat stress.”
In its report published in June 2015, the
Lancet Commission on health and climate
change warned about the threat that climate
change represents for health: “The
effects of climate change are being felt
today, and future projections represent an
unacceptably high and potentially catastrophic
risk to human health. The implications
of climate change for a global
population of 9 billion people threatens
to undermine the last half century of
gains in development and global health.”
production in certain areas, the health
effects of a changing climate are likely
to be overwhelmingly negative. Climate
change is expected to lead to increases in
ill health in many regions, and especially
in low-income countries. Direct effects
include temperature-related illnesses and
death during extreme weather events.
Sanofi Pasteur, Neuville-sur-Saône site
Indirect impacts include the influence
of climate on microbial populations, the
distribution of vector-borne diseases, host
resistance to infectious agents, food and
water shortages, food-borne diseases, and
the consequences on non-communicable
diseases such as cardiovascular and respiratory
diseases.
There is therefore a need for the international
health community – public and
private – to get mobilized to address this
health challenge – and Sanofi is ready
to play its part.
Climate change directly and indirectly
affects social and environmental determinants
of health, such as clean air, safe
drinking water, nutrition, etc. Although
global warming may bring some localized
benefits, such as fewer winter deaths in
temperate climates and increases in food
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Global Compact International Yearbook 2016

Areas with weak health infrastructure
– mostly in developing countries – will
be the least able to cope with the negative
health effects of a fossil fuel-based
energy system or the indirect effects of
climate change on their communities
without assistance in preparing for, and
responding to, the impacts of climate
change.
In this context, in addition to the mitigation
efforts already being carried out by
Sanofi and its commitment to reducing
greenhouse gas emissions, Sanofi brings
its value by raising awareness about
the consequences of climate change on
health and by providing health solutions
for climate-sensitive diseases.
Raising awareness about the
impacts of climate change on health
Sanofi began addressing the climate
change and health nexus a few years
back. We set up an internal working
group whose mission was to define the
role that we should play on this issue
– as a global health leader, Sanofi has
a responsibility to address the threats
posed by climate change. We developed
a dedicated advisory board with external
experts from the climate and health
fields. This enabled us to better understand
the stakes related to the impacts
of climate change on health and identify
areas in which we would have the greatest
added value.
Our Chief Executive Officer, Olivier
Brandicourt, embodies our commitment
to tackle the impacts of climate change
on health. In June 2015, he was one of
the few CEOs from the pharmaceutical
sector who signed a statement to
support the publication of the Lancet
Commission’s report on climate change
and health. On November 27, 2015, on
the eve of COP 21, Mr. Brandicourt published
an op-ed in the French newspaper
Le Monde. This op-ed called for integrating
health into the official negotiations
of COP 21. It was translated into several
languages and published in major newspapers
in Brazil, Germany, India, Spain,
and the United States.
This strong commitment also materialized
through our involvement in COP 21.
We were the only pharmaceutical company
to be an official partner of COP 21.
We also organized a series of events in
December in Paris to raise awareness
about the impacts of climate change
on health, including a roundtable with
representatives from international organizations
(WHO, UN Foundation) and
a public conference with non-profit
Global Compact International Yearbook 2016 97

organizations (Drugs for Neglected Diseases
initiative – DNDi), and climate and
health experts.
Offering health solutions for
climate-sensitive diseases
Over the years, we have developed expertise
in many disease areas most likely
to be affected by climate change. We
work to provide solutions to prevent
and respond to the direct and indirect
impacts of climate change on health. This
includes the development of medicines
and vaccines to address the health risks
of diseases such as dengue and malaria.
Beyond the treatment or cure, Sanofi
takes action in the field alongside its
partners, working with local stakeholders
to help individuals protect themselves
against these diseases, including by increasing
awareness.
Launching a new vaccine to combat
dengue
Dengue is a viral disease transmitted to
humans by mosquitoes, mainly in the
intertropical zone (Southeast Asia, Indian
Ocean, South Pacific, Latin America,
West Indies). WHO estimates 50 million
cases annually, including 500,000 cases
of dengue hemorrhagic fever, which is
fatal in 20 percent of cases. There are 2.5
billion people who live in at-risk areas.
Climate change may extend the transmission
season and alter the geographical
distribution of dengue, particularly due
to weather variations (increased temperatures
or tropical rains). This could lead to:
• increased number of mosquitoes as environmental
conditions become more
favorable; for example, it was recently
demonstrated that high temperatures
during El Niño periods were associated
with dengue epidemics in Asia;
• the expansion of the vectors and virus
to previously unaffected areas (e.g.,
in temperate regions such as North
America and Europe);
• shorter incubation of the virus in the
vector, leading to more explosive outbreaks;
• changes in vector biology and biting
habits, facilitating increased transmission;
and
• changes in human behavior, in response
to climate change, that place
them at elevated risk of dengue.
After 20 years of research and development,
Sanofi Pasteur launched the first
dengue vaccine. On December 9, 2015,
Mexico was the first country to grant
marketing authorization to Dengvaxia®,
our tetravalent vaccine for the prevention
of diseases caused by all four dengue
virus serotypes in preadolescents,
adolescents, and adults (aged 9 to 45)
living in endemic areas. The marketing
authorization of Dengvaxia® in Mexico
was followed by approvals in the Philippines
and Brazil in 2015 and El Salvador
in 2016.
We are introducing Dengvaxia® first in
these countries where the vaccine has
the greatest potential to reduce dengue
burden globally and help achieve the
WHO’s goal of reducing dengue mortality
by 50 percent and morbidity by
25 percent by 2020 in endemic countries.
Regulatory review processes for
Dengvaxia® continue in other endemic
countries, and Sanofi Pasteur remains
committed to introducing the vaccine
first in countries where the disease is a
major public health priority.
Our integrated approach to fight
malaria
Malaria is one of the most deadly infectious
diseases in the world. According to
WHO estimates, there were 214 million
cases and 438,000 deaths from malaria
in 2015, mostly among African children.
In Africa, a child dies of malaria almost
every minute.
Heavy rains and high humidity are
identified as important factors for the
reproduction and survival of infected
mosquitoes responsible for transmitting
the disease. Climate strongly influences
the conditions for transmission of the
disease. In warmer weather, mosquitoes
carrying the parasites responsible for
the disease multiply and quickly develop
their infectious capacity. Africa
and South America are especially at risk.
Sanofi promotes access to treatment at affordable
prices in the areas most affected
by malaria. In 2007, Sanofi developed
Artesunate Amodiaquine Winthrop
(ASAQ Winthrop®), one of the leading
malarial drugs, under a public-private
partnership with DNDi. Distributed at
tiered prices in 34 countries, particularly
in Africa, more than 400 million doses
have been produced since 2007. Sanofi did
not seek patent protection for that drug.
We have also partnered with Medicines
for Malaria Venture to develop new therapies
to prevent the risk of resistance to
existing treatment in Southeast Asia and
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Global Compact International Yearbook 2016

the risk of expansion in Africa. Beyond
medicines, Sanofi is strongly committed
to awareness, education, and prevention
programs with local communities. The
“Schoolchildren against Malaria” program
provides educational tools to help teachers
educate children in Africa. Nearly
8 million children in 15 African countries
have been sensitized to the fight against
malaria. We collaborate with National
Malaria Control Programs and local NGOs
in a program to train educators, mainly
about how to manage malaria. Finally,
Sanofi is part of a collective process to
develop knowledge about malaria and its
treatment. We share data from clinical
studies conducted with the Liverpool
School of Tropical Medicine, and we
develop means of surveillance in the
countries most affected by the disease,
in partnership with National Malaria
Control Programs and DNDi.
Tackling climate-sensitive neglected
tropical diseases
As pointed out by WHO, the risk factors
around leishmaniasis include poverty,
malnutrition, and population mobility
but also climate change, as changes in
rainfall, temperature, and humidity are
factors that may impact the epidemiology
of the disease. Sanofi provides glucantime,
a treatment on the WHO List
of Essential medicines, at a preferential
price. In October 2015, Sanofi and the
Institut Pasteur de Tunis signed a partnership
agreement to launch a program
aimed at combating cutaneous leishmaniasis
in the school environment. This
awareness-raising program is centered
on the distribution of 70,000 comics
(available in both French and Arabic)
to schoolchildren in seven governorates
where leishmaniasis is endemic. The
program was launched in March 2016.
Asthma and allergies
Allergies are common and some are climate-sensitive.
Warmer conditions generally
favor the production and release
of airborne allergies and, consequently,
there may be an effect on asthma and
other respiratory diseases. In May 2015,
Sanofi and Regeneron announced positive
pivotal phase 2b dupilumab data in
adult patients with moderate-to-severe
asthma who are uncontrolled despite
treatment with inhaled corticosteroids
and long-acting beta agonists. The companies
also announced the initiation of
a phase III clinical trial of dupilumab in
patients with uncontrolled persistent
asthma.
Continuing our efforts in mitigating
climate change
We also fully recognize our responsibility
to mitigate climate change and are
actively seeking to develop innovative
solutions to mitigate our impact on
the environment. By taking concrete
and scalable actions to mitigate climate
change, we are contributing to immediate
public health and economic cobenefits
for the communities where we
operate while reducing our impact on
the climate. Through partnerships with
energy providers, infrastructure developers,
and research bodies, we aim to
develop groundbreaking solutions that
will have positive impacts on the health
of the planet and people. For instance, we
have installed a natural gas connection
at our Swiftwater site in Pennsylvania.
The project consisted of piping natural
gas to the site and converting existing
boilers to burn natural gas. The expected
impact of using natural gas instead of
light fuel oil represents an annual decrease
in CO 2
emissions amounting to
10,000 tons / year at this site alone. Moreover,
we decreased our CO 2
emissions by
24 percent between 2010 and 2015
by using maritime transport. Today,
86 percent of our international shipments
are sent by sea. In 2015, we reduced
our CO 2
emissions by 15.8 percent
compared to 2010 (scopes 1 and 2).
The future
Sanofi will continue to commit to tackling
climate-sensitive diseases, for which
we have a strong expertise. We will endeavor
to offer adapted solutions for
these diseases that may be impacted by
climate change.
According to WHO, climate change may
have had a role in the spread of the Zika
virus. In February 2016, we announced
that – building on our successful history
in developing vaccines against similar viruses,
including dengue – we are launching
a vaccine research and development
project targeting the prevention of infections
and diseases related to the Zika virus.
We will also assess any opportunities to
work with partners to promote awareness
about the impacts of climate change
on health, as collaborative efforts are
needed to tackle what The Lancet calls
“the biggest global health threat of the
21st century.”
Global Compact International Yearbook 2016 99

GOOD PRACTICE SECTION 2: WORK | INNOVATION | CLIMATE
The size of the SDG icons reflects the quantity of appearance in this section.
HUMAN RIGHTS
LABOUR STANDARDS
ENVIRONMENT
ANTI-CORRUPTION
SUSTAINABLE
DEVELOPMENT
G O A L S
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Global Compact International Yearbook 2016

GOOD PRACTICE
IneqUAlITIeS | eDUCATIon | PARTneRSHIP
72
74
76
78
82
84
86
88
90
94
96
Adecco
Banca Popolare di Sondrio
Bosch
Deutsche Post DHl Group
Deutsche Telekom
Green Delta Insurance
Manila Doctors Hospital
Merck
Philip Morris International
Sakhalin energy
Sanofi
woRK | InnoVATIon | ClIMATe
102
104
106
108
110
112
114
116
118
120
122
126
128
130
132
134
136
138
Acciona
Arab African International Bank
Armacell
Audi
BASf
Bayer
Commerzbank
Consolidated Contractors Company
eDf Group
HoCHTIef
MAn
mcs
MTU Aero engines
nestlé
Postnl
RoMRADIAToARe
SkyPower
Vaisala
Global Compact International Yearbook 2016 101

2010 – 2015
ACCIONA’S ACHIEVEMENTS
ON ITS FIRST SUSTAINABILITY
MASTER PLAN
Six years ago, with a view to the medium and long term, ACCIONA planned and structured the
initiatives related to sustainability in the form of a roadmap that has helped us stand out, become
more competitive, contribute to sustainable development, and consolidate our position as
leaders in sustainable practices. That was ACCIONA’s first Sustainability Master Plan 2010 – 2015.
By Juan Ramón Silva Ferrada, ACCIONA
Since then, the company’s sustainability
actions have been led and supervised
by the Board of Directors through its
Sustainability Committee. As a result,
the company’s sustainability initiatives
and objectives are discussed at its highest
level of governance.
Sustainability was integrated into the
business areas through the creation, in
2012, of Sustainability Committees in
the divisions; working in cooperation
with the Sustainability Department, they
promote and monitor the divisions’ specific
sustainability initiatives. There are
committees in the Energy, Construction,
Water, Service, and Industrial divisions,
and meetings are held periodically to
address sustainability with Real Estate
and Bestinver.
Additionally, matters regarding sustainability
have been brought to the attention
of the shareholders’ meeting. Since 2012,
ACCIONA has presented its Sustainability
Report for review and approval by the
shareholders’ meeting, and it was one
of the first companies to do so (the 2015
Sustainability Report was approved with
a favorable vote of 99.99 percent of those
in attendance at the 2016 shareholders’
meeting).
We maintain our commitment to workplace
health and safety, as reflected in
the zero fatal accidents among company
employees between 2012 and 2015, combined
with a notable improvement in
the workplace accident frequency index
of 31.57 percent, as compared to 2011.
A percentage of variable remuneration is
linked to achievement of sustainability
objectives for 97 percent of executives,
90 percent of structural managers, and
some of the technical and support staff.
Contributions to the development of the
communities where ACCIONA operates
were enhanced by implementing a methodology
for assessing and managing the
social impact of our projects: In 2015, it
was applied in 47 projects in 18 countries.
In the last three years, more than 2,400
corporate volunteers have contributed
more than 23,000 hours of work to the
community. Also, through the ACCIONA
Microenergy Foundation, ACCIONA
continues to provide basic electricity
supply to isolated rural communities in
developing countries: more than 30,000
beneficiaries in Peru and Mexico.
ACCIONA’s long-term values – focused
particularly on our bonds with people
and society – have been reinforced by the
steady implementation of improvements
in corporate governance, including:
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Sustainability Master Plan 2010 – 2015
Corporate Governance
our commitment to good governance,
ethics, integrity, and transparency
seeks to be a benchmark of integral
and responsible conduct
STAKEHOLDERS
establish a commitment
to continuous engagement
with stakeholders
Innovation
Technological, operational, and
design innovation of projects
constitute the underpinnings of
competitiveness
Value Circle
Sustainability as a
fundamental factor of
our suppliers, contractors,
and partners
DISSEMINATION AND
LEADERSHIP
Publish and disseminate
a business model based on
sustainable development
opportunities
ACCOUNTABILITY
Transparency
includes accountability
of each of our actions
Environment
Integration of the enviromental variable
in decision-making and in business
operations in order to reduce our
environmental footprint
People
Commitment to employees in a healthy and
discrimination-free environment in order to attract
and retain talent with a long-term vision
Society
Commitment to social
progress of communities in
which we operate
a new program to prevent crime and
corruption, an exhaustive analysis of our
risks in the area of human rights, and the
creation of a Compliance Department.
Those practices are also reflected in our
Policies Book, approved by the Board’s
Sustainability Committee, which reflects
the financial, social, and environmental
commitments and principles of action
that apply to the company’s businesses.
The company sought to improve supply
chain performance in terms of sustainability
through the approval in 2011
of the Ethical Principles for Suppliers,
Subcontractors, and Collaborators; the
inclusion, since then, of ethics clauses
in tenders, orders, and contracts; the
creation of a supply chain risk map each
year since 2012; an Audit Program for
these activities; and training of more
than 2,500 suppliers in sustainability
issues through six training courses.
ACCIONA avoided the emission of 85.7
million tons of CO 2
between 2010 and
2015. Since 2010, we have reduced our
direct and indirect CO 2
emissions (Scopes
1 & 2) by 43.1 percent.
ACCIONA has measured the greenhouse
gas emissions associated with the activity
of its 28,000 suppliers and begun to work
with them to implement joint measures
to reduce their environmental footprints.
Additionally, the water consumption associated
with the activities of the 28,000
suppliers in 75 countries was measured,
and the 500 suppliers – accounting for
70 percent of the supply chain’s total
consumption – were identified.
Our firm commitment to innovation is
evidenced in the € 876 million spent in
2010–2015, that is, far more than the
€ 500 million earmarked in the 2015
Sustainability Master Plan.
Since 2012, we have saved € 86.8 million
through improvements to innovation
processes.
ACCIONA has expanded its active presence
in international organizations such
as the Steering Committees of the United
Nations Global Compact LEAD and Caring
for Climate initiatives; the World
Business Council for Sustainable Development;
and the Corporate Leaders
Group on Climate Change. We are cochairs
of the Renewable Energy Committee
of the Advisory Board for the
Sustainable Energy for All initiative
organized by the UN and the World Bank.
We are present in the leading sustainability
indices, such as the Dow Jones
Sustainability World Index (for the 9th
consecutive year in 2015); FTSE4Good;
the CDP Global Climate Change Report
2015 and CDP Climate Change Report
2015 Iberia Edition; and the Carbon
Disclosure Leadership Index.
To conclude, the Sustainability Master
Plan 2015 and the forthcoming Sustainability
Master through 2020 evidence
our commitment to sustainability and
responsible stewardship and enhance
our position as leaders in sustainable
practices.
Global Compact International Yearbook 2016 103

AAIB – Maximizing Value
Beyond Disclosure
By P. Abdelghaly, M. Hasebou, and D. El Demerdash, AAIB
Having reached a decade plus in sustainability and business innovation, the Arab African
International Bank (AAIB) has served as a leader in Egypt and the MENA region and a trendsetter
in the financial sector regarding banking and finance sustainability.
AAIB’s journey toward sustainability
dates back to 2003, when the bank became
the first financial institution in
Egypt to join the UN Global Compact,
launched the AAIB undergraduate competition
for banking and finance, and
introduced social and environmental risk
to its credit policy. In addition to publishing
its report on the G4 Sustainability
Guidelines of the Global Reporting Initiative
(GRI), AAIB goes beyond disclosure
requirements to reveal the long process
of learning from experiences, exploring
gap analyses, and serving as a role
model for sustainable finance. The G4
report is more a journey of discovery that
helps organizations focus their sights on
setting goals, measuring sustainability
performance, and managing change
in order to implement better practices.
Although sustainability reporting is not
yet obligatory in Egypt, AAIB has been
taking proactive steps toward disclosing
its sustainability practices since 2005.
The reporting journey then evolved to
include various reporting initiatives
based on other international frameworks,
guidelines, and standards, such as the
United Nations Global Compact; the
Equator Principles, which are customized
for financial services; and the London
Benchmarking Group for impact assessment.
These elements help tackle AAIB’s
environmental and social risk-assessment
on project lending, as well as measure
the business and social impacts of our
annual community investments.
In 2010, AAIB took its first step toward
publishing its first sustainability report,
which engaged all the bank’s lines of
business and key functions. Followed by
the Carbon Footprint Report in 2014, AAIB
decided it was time for a more advanced
reporting level that is more holistically
inclusive of all the bank’s sustainability
reports and based on the most holistic
approach to reporting, namely the GRI.
This decade-long experience in reporting
has led to the bank’s adoption of its own
reporting framework, which went beyond
data collection and information disclosure
to include materiality assessment of the
most pressing subjects for our stakeholders,
as well as a holistic stakeholder engagement
– both internally as well as
externally – to decide on these issues.
Internal stakeholders’ engagement:
Sustainability reporting workshops
Educating our staff and creating awareness
is a major goal in establishing a
strong foundation for embracing sustainability
in banking operations as well as
developing sustainability into a collective
effort.
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Global Compact International Yearbook 2016

For measuring the key performance
indicators in the GRI report, the bank
conducted a series of sessions and workshops
for the employees to create awareness
on different levels among juniors
and liaison officers, first-line managers,
senior managers, and top management.
Although the most common approach in
endorsing the culture of sustainability
in the organization is the top-down approach,
AAIB introduced sustainability
awareness horizontally and vertically to
achieve the highest impact and transmit
the sustainability gene from one generation
to the next.
The internal awareness process took
place for five consecutive days for 97
employees in order to educate different
lines of business across all managerial
levels about sustainability and reporting.
External stakeholders engagement:
The Partners Club
Sustainability awareness extends beyond
the internal culture of AAIB and
reaches the bank’s external stakeholders,
such as clients, subsidiaries, government,
brokers, fund managers, as well as insurance
and financial advisors. The external
stakeholders were selected based on their
high influence on AAIB, as well as the
reliance of AAIB on these stakeholders
in day-to-day operations and long-term
business relations. The Partners Club
saw the attendance of 97 influential
stakeholders in AAIB that represented
the bank’s corporate clients, subsidiaries,
advertising agencies and suppliers, printing
houses, business partners, investors,
and consultants.
AAIB’s Partners Club is aimed at:
• external stakeholder engagement
• establishing stakeholder relations and
networking
• creating awareness on sustainability
matters and issues
Building a sustainability strategy is a
way to develop a more structured and
coherent sustainability approach that
demonstrates commitment – not only
to AAIB’s shareholders, but also to the
community and the environment. As CSR
and sustainability are about value creation,
AAIB has developed a framework
and approach that follows the bank’s
spheres of influence, including core business
operations, voluntary contributions,
and policy advocacy.
Moving forward, the GRI assessment
and organization’s screening directed
the top management toward establishing
strong levels of support from top
leadership to promote the concept of sustainable
finance over the coming years.
Accordingly, 2016 witnessed the launch
of the second phase of the MOSTADAM
platform for promoting sustainable finance
in Egypt and the MENA region.
MOSTADAM collaborated strategically
with the Frankfurt School of Finance
and Management in Germany to certify
experts in small and medium enterprises
as well as climate and renewable energy.
The platform registered candidates from
Egypt, Somaliland, and the Netherlands.
AAIB aims at creating an industry movement
in Egypt and the MENA region by
introducing new sustainable products
and services, preparing expertise, and
supporting a sustainable business model.
Post-assessment goals and objectives:
• lead and create a forum for sustainable
finance globally
• embrace sustainability in core banking
operations and branding
• educate financial institutions in Egypt
about sustainable finance
• develop comprehensive models for
sustainable finance
• exchange best practices and successful
role models globally
AAIB has established a solid foundation
with regard to sustainability. The
bank is still on its way to reaching an
“advanced” level of sustainability behavior.
AAIB has had success in engaging
the work environment and generating
strong commitments about responsible
business operations. The overall
performance reflects AAIB’s vision for
sustainability.
AAIB’s sustainability
decade and milestones
AAIB was the first bank in Egypt’s
financial sector to accomplish the
following:
2003 – 2010: Launches AAIB Award
– annual banking competition for
university undergraduates
2005: Joins the UN Global Compact
2007: Joins the LBG to measure
community investments
2007: Establishes the first independent
foundation for social development
in health and education:
We Owe It to Egypt foundation
2009: Joins the Equator Principles
for environmental and social
risk-assessment in project lending
2010: First to release a sustainability
report within the banking sector in
Egypt
2013: Launches the First Platform
for Promoting Sustainable Finance in
Egypt and MENA region within the
banking sector
2014: Launches the first certified
module on sustainable finance to
12 banks in Egypt; certified by EBI
2016: Launches the first certified
training modules for banking
executives on renewable energy
and climate change finance, and
SME finance
2016: AAIB publishes its second
sustainability report based on GRI G4
Regional and international
recognition:
2010: CSR Arabia Network Regional
Awards, Dubai
2011 – 2015: Good Practice in
UNGC Yearbook
2015: CSR Golden Shield, Dubai
2015: Best Green Bank Award by CFI
2016: AAIB awarded by Euromoney as
"Best CSR in the Middle East," Dubai
Global Compact International Yearbook 2016 105

Armacell sets new
standards for the
insulation industry
Armacell is setting new standards for the FEF technical insulation industry and defining the role
of Environmental Product Declarations for the insulation market and for safe and energy-efficient
green buildings.
By Diana Negrea, Armacell
Armacell is the first manufacturer of
elastomeric insulation materials (flexible
elastomeric foam, FEF) to present
Environmental Product Declarations
(EPDs) based on an independent lifecycle
assessment (LCA). EPDs are internationally
accepted ISO Type-III ecolabels that
disclose the environmental performance
of products based on the LCA method.
Unlike other environmental labels that
signify “green” performance, an EPD
discloses the full story of a product’s
direct environmental impact.
Armacell has yet again raised the standards
of the FEF technical insulation
industry while sending a clear message
to the market:
» With the Environmental Product Declarations, we create a unique
degree of transparency for our Armaflex® products. We provide architects,
specifiers, and those inviting tenders with reliable information
for designing sustainable building projects. At the same time, we commit
ourselves to continuing to improve the environmental friendliness
of our products, thus sharpening our competitive edge. «
Patrick Mathieu, President and CEO of Armacell
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Global Compact International Yearbook 2016

Environmental Product
Declarations are based on
independent lifecycle assessments
EPDs rely on LCAs, which provide systematic
and standardized data for an
ecological assessment of a building in
the “modular construction system.” In
an LCA, the entire life of the building,
the building phase with possible conversions,
as well as demolition and disposal
are taken into consideration.
Armacell received support in the analysis
of several thousand datasets from PE International
(now thinkstep), which is the
market leader in strategic eco-consulting,
software solutions, and comprehensive
services in the field of sustainability.
Comparing the primary energy input
identified in Armacell’s product LCAs
with the energy savings achieved, it
shows that using Armaflex insulation
materials saves about 140 times more
energy than is needed for their manufacture,
transport, and disposal. The
energy input needed to manufacture
Armaflex pays off in just 50 days.
As an LCA can only provide very specific
information about an individual manufacturer’s
products, the results cannot
simply be transferred to the products of
other FEF manufacturers. Deviations in
the raw materials used or the production
process, as well as the very different
manufacturing footprints of the providers,
have a significant impact on the data.
Environmental Product Declarations
serve as a “sustainability passport”
for insulation materials
The construction industry has huge potential
for improving energy efficiency
and reducing greenhouse gas impacts
through innovative products and solutions.
One of the most significant opportunities
in this area is in high-tech
insulation products. Optimal technical
insulation is the simplest, fastest, and
most cost-effective measure for improving
energy efficiency in industrial, commercial,
and residential infrastructures.
Armacell’s EPDs, certified by the Institute
for Construction and Environment
(IBU) in Europe and the Underwriters
Laboratories in Asia, not only make
statements about the primary energy
requirements but also contain information
about the extent to which the
products contribute to the greenhouse
effect, acidification, over-fertilization,
depletion of the ozone layer, and smog.
With this unprecedented transparency
for the FEF technical insulation market,
the EPDs serve as a “sustainability
passport” for insulation materials and
ensure that green buildings are designed
in accordance with the following certification
schemes: Leadership in Energy
and Environmental Design (LEED®);
the Building Research Establishment
Environmental Assessment Methodology
(BREEAM); the French
certification HQE, which is
awarded to building construction
and management; and the
German Sustainable Building
Council (DGNB). With this initiative,
Armacell is supporting
the development of green
city-building and encouraging
responsible construction in the
21st century.
The role of Environmental Product
Declarations for the insulation
market
Demand for EPDs is growing in response to
changes in green building guidelines and
design practices. The US Green Building
Council’s LEED® green building program
is now placing emphasis on lifecycle-based
environmental reporting and transparency,
rewarding points for use of products
with EPDs and LCAs as part of the Material
and Resources Credits. The top 10
countries outside of the United States for
LEED-certified green buildings that made
the list for 2015 are geographically and
culturally diverse, representing seven of
the world’s twenty largest economies by
gross domestic product: China, Germany,
Brazil, India, Canada, South Korea, and
Turkey. Although Canada tops the list,
Brazil and the Republic of Korea have
moved up in the rankings, and Turkey and
Sweden are new to the top 10 this year.
EPDs are suitable as proof of environmental
claims in the public procurement
arena and offer the relevant data
on environmental properties of a product
for sales and marketing purposes.
They include statements on the use of
energy and resources and the extent
to which a product contributes to the
greenhouse effect, acidification, eutrophication,
destruction of the ozone
layer, and smog formation. In addition,
End of life
Use
Transport
Raw
materials
Manufacturing
details are given about the technical
properties, which are required for assessing
the performance of the building
products in the building, such as
durability, heat and sound insulation,
or the influence on the quality of the
indoor air.
The ISO Type-III EFDs for insulation
products are directed at many target
groups with regard to these qualitative
statements about the environmental
performance of building products: planners,
architects, building companies,
real estate companies, facility managers,
and, of course, the companies that are
involved in manufacturing and serving
the supply chain – from raw materials
to the building itself.
Global Compact International Yearbook 2016 107

Faster, More Efficient,
More Sustainable –
The Production Plant of
the Future
By Prof. Dr.-Ing. Peter F. Tropschuh and Jasmin Lotze, Audi AG
Digital integration will play a central role in the modern production plant over the next few years:
The “factory of the future” – also known as Industry 4.0 or the Smart Factory – not only increases
the ability of machines to control processes faster and more efficiently; it also results in greater
integration of machinery and humans.
Following on from mechanization, electrification,
and automation, the Smart
Factory denotes what now represents
the fourth industrial revolution that
industry will be facing over the coming
years. The goal of the Smart Factory is
to increase productivity and flexibility
while at the same time realizing ecological
benefits by reducing the level of
resources consumed.
The driving force behind this development
is the steady inroads made by
worldwide integration. Today’s internet
continues to evolve into an “internet of
things,” over which not only people, but
also machinery (= things) can exchange
information. The real and virtual worlds
are thus increasingly converging. The
Smart Factory symbolizes this process.
Because all workers, machinery, and resources
are interconnected non-centrally
there, they are able to communicate
with each other in real time. That is how
the factory is able to assist the workers.
Various elements and technologies of
the Smart Factory are already in use at
Audi. The much-lauded revolution is
therefore more a case of an evolution
for Audi production.
Future scenario: Islands of expertise
instead of assembly line
Intelligent systems, innovative technologies,
efficient structures: time to rethink
the topic from the ground up. Small
groups of forward thinkers in Ingolstadt
gather ideas for the Smart Factory beyond
2030. The creative teams work on solutions,
free from the current processes in
production. Instead of today’s practice
of high-volume production at a small
number of plants, in the future production
facilities could be built wherever
the demand is high – in other words,
close to the customer. Every production
unit would therefore need to be able to
build every model according to the same
principles and using the same flexible
tools – a complete rethink of the working
approach in automotive manufacturing.
Here, too, the future is connected,
integrated, and communicative.
The role of the workers
For all the focus on the technology, people
will not disappear from the production
plant of the future. Quite the opposite:
The large number of production
variants, the high degree of customization,
and the high-quality standards
can only be realized with suitably wellqualified
workers. But wherever possible,
they are supported by assisting robots.
Ergonomics and reduced workloads are
the overriding priorities; the workers
will increasingly take on planning and
controlling roles, because in 2035 skilled
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Global Compact International Yearbook 2016

workers will be in demand and coveted.
Identifying problems and indicating
them to the workers – the rectification
process, for example – will also proceed
much faster thanks to integrated diagnostics
systems.
Clearly, however, the standards involved
in working in the production plant of the
future will rise. The workers are therefore
supported by elaborate information
systems because the extreme variations
in products has resulted in a very large
scope of tasks. At the interfaces between
electronic and mechanical systems, for
example, software experts ensure that
sensors are set and functioning optimally.
Network architects ensure that machines
and workers can communicate. So the
high levels of technology and integration
already require one thing above all: the
adequate qualification and advancement
of the workers.
New robots facilitate work
In the production plant of the future,
robots can support the workers in many
different ways. For example, machines
can supply them with important information
as needed, or step in to perform
non-value-adding activities. The division
of labor runs along the same principles
as in the operating room: prepare – pass
on – operate.
the workers of the need to do physically
strenuous tasks. Audi’s goal is to make
every workstation as ergonomic as possible.
Assembly Technology Development,
for example, is working on increasingly
transferring burdensome tasks from
workers to robots. This aspect is especially
relevant in production, because
that is where most physical effort is
required, and demographic change is
forcing through fresh solutions.
Beyond the confines of the plant –
globally integrated
Digitalization is making inroads not just
within a production location, but across
the entire global production chain. The
Audi Group currently builds vehicles at
17 locations in 13 countries. The new
plant in Mexico was added in 2016. More
than 85,000 employees throughout the
Group work simultaneously on creating
high-quality products all over the world.
To do this, a huge amount of data needs
to be shared between the plants because
they are all interconnected non-centrally.
Networking this working data intelligently
and processing it in real time
are therefore major priorities. The key
thing is to send and evaluate enormous
data flows quickly and at high speed.
Data security is obviously hugely important
for this “big data”: As early as
the research phase, the company uses
recognized and tested embedded security
mechanisms and standards. To enable
smooth communication, international
standards must also be clarified.
Ideas from our own ranks
Preparing the way to the Smart Factory
of the future is not merely the task of
designated experts in creative teams. Ever
since 1969, each individual employee
at Audi has had the opportunity to put
forward their own ideas; in 1994 this
suggestions scheme gave birth to the
Audi Ideas Program. The large number
of innovative suggestions has resulted
in both minor and far-reaching process
improvements, all of which save
costs. Since the program was introduced,
AUDI AG has realized savings in the order
of € 780 million. Audi examines the
benefits and feasibility of every idea submitted
with a view to raising efficiency
or improving the working environment.
It is quite common for them even to
result in successful patents, such as the
helical-thread mold.
For the past two years, smaller robots
operating according to this principle
have been in action on the Audi assembly
line without any safety fence. The
work that these new “colleagues” do is
often relatively simple, but they relieve
Left: Efficient and kind on the back:
The robot offers the container at the very
moment the worker needs it.
Right: A highly efficient factory:
The Audi A3 body shop with innovative
technologies and cutting-edge equipment.
Efficiency and sustainability were the priorities
when planning the production hall.
Global Compact International Yearbook 2016 109

Stakeholder Relations –
Invest in Them Before You
Need to Rely on Them
By Nadine-Lan Hönighaus and
Thorsten Pinkepank, BASF SE
Why engage your stakeholders?
As the world’s leading chemical company,
BASF has products in all kinds of
industries. It employs approximately
112,000 people globally, services numerous
suppliers and customers, and has
relationships with shareholders and a
large number of societal stakeholders.
Having a clear picture of a company’s
relevant stakeholders in business, government,
and civil society is essential
for effective stakeholder engagement.
However, a company’s set of relevant
stakeholders will change with time. In
order to ensure an ongoing stakeholder
engagement, it is appropriate to have
skilled people and organizational structures
in place.
BASF has always interacted with its stakeholders,
but in addition to rather “classical”
forms of stakeholder interaction,
which are still essential, new approaches
have been developed. Engagement with
stakeholders can improve a company’s
decision-making and performance, since
it helps in acquiring a broader view of
the market than what economic figures
alone can provide. Stakeholders can offer
a company insight into their perspectives
on current and emerging issues, into how
they perceive the company, and what
they consider to be the company’s impact.
This does not mean delegating decisionmaking
to external people; it is still a
company’s management that decides
on its business strategy. However, this
strategy has a higher likelihood of meeting
the market’s needs if it is based on a
participatory approach that also includes
stakeholders’ views.
BASF has given a clear answer as to the
“why”: We have identified “responsible
relations” as being one of the material
aspects of our organization.
Different forms of stakeholder
engagement at BASF
BASF has various forms of stakeholder
engagement in place. Our stakeholder
engagement comprises of onsite and local
community-related forums, such as
our community advisory panels at sites
worldwide. On the business side, BASF is
A fixed component of our sustainability
management is the continuous exchange
with our stakeholders.
a founding member of Together for Sustainability,
an initiative in which leading
chemical companies have joined forces
to support sustainability in the supply
chain and standardize supplier assessment
methods. On an international level,
BASF takes an active part in the United
Nations Global Compact: BASF’s Chairman
of the Board of Executive Directors
is a member of the UN Global Compact
Board, and BASF is an active member in
many local networks. Different formats
of stakeholder engagement serve different
purposes: With local initiatives, you are
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Global Compact International Yearbook 2016

close to the communities adjacent to your
sites; international initiatives such as the
UN Global Compact can give you a broader
view on the world’s material topics and
the company’s possible impact on them.
In 2013, in order to involve our stakeholders
more intensively, BASF established
the independent Stakeholder Advisory
Council (SAC). The SAC consists of various
renowned thinkers and leaders whose
knowledge on material sustainability
topics bring an important external perspective
to the table in discussions with
BASF’s Board of Executive Directors. The
SAC meets annually with BASF’s Board
of Executive Directors to offer critical
evaluations and refine the sustainability
management of BASF on the basis
of a shared dialogue. The meetings are
chaired by BASF’s Chairman of the Board.
Based on recommendations of the SAC,
we continuously review and update our
sustainability approach and positioning.
BASF has been cooperating with the European
Water Partnership (EWP) since 2008,
an independent organization founded
through the initiative of the European
Commission in 2006. Working as partners,
water experts from BASF as well as
other representatives from industry, governments,
and NGOs developed the European
Water Stewardship (EWS) standard.
It enables companies from various sectors
as well as agricultural operations
to examine how sustainably they use
water resources. The partnership with
EWP highlights that a multistakeholder
group can really achieve results beyond
what is possible for a single institution.
The EWS standard fulfills high-quality
expectations, is widely accepted, and
is thus a real tool for improving water
management within the industry. BASF
has set itself the goal of introducing
sustainable water management at its
production sites in water stress areas by
2020 on the basis of the EWS standard.
Success factors for effective and
stakeholder engagement
In our experience, several factors contribute
to successful stakeholder engagement.
• The issue taken up with stakeholders
should be relevant and pressing, and it
should be addressed at the right time.
• Furthermore, getting the right stakeholders
to the table and identifying
them is not an easy task.
• Depending on the subject and stakeholders,
the right form of engagement
should be chosen.
• Enough time and resources should be
put into thorough preparation of any
kind of activity.
Internal preparation also needs to address
the mindset of participating management.
Interacting with some of the stakeholders
will possibly require managers to step out
of their comfort zones and collaborate
with individuals and types of organizations
they might not be familiar with. In
terms of time and research efforts, the
resources needed are often underestimated,
but investments must be made.
Two thoughts on the evolution of
stakeholder engagement
Everyone agrees that solid stakeholder
relations help a company to ensure its
license to operate: They help to mitigate
risks and retain and win customers and
employees, including supporting solid
public relations. This is a major motivation
for stakeholder relations.
Openness and a constant exchange with
colleagues, customers, suppliers, shareholders,
as well as experts from science,
economy, politics, and the media are
particularly important for us.
Considering the growing complexity of
the world we operate in – the “communication
revolution” illustrated with key
words such as social media and big data –
and with regard to a growing societal
skepticism toward new technologies, we
will talk about the license to innovate.
This is especially crucial, as innovations
are key to providing solutions for the
various challenges to ensure (more) sustainable
development.
A second factor we see concerning the
evolution of stakeholder engagement
is the trend of operationalizing and
measuring by metrics. We elaborated
on a number of success factors, and
you need to be prepared for general
discussions on the quantification of the
benefits of stakeholder engagement. But
how do you measure success or impact
on value? More precisely: How do you
measure how hard a crisis – maybe
reputation-wise – has affected you if
you have not communicated with your
stakeholders for years?
There are some approaches for assessing
the value of stakeholder relations, but
still there is no simple “metric answer”
in sight – and a simple answer might
not even be helpful. Not everything that
counts can be counted.
More information is available at www.basf.com/
en/company/sustainability/environment/water/
water-stewardship.html and www.ewp.eu
Global Compact International Yearbook 2016 111

Smartening Up Tomorrow’s
Agriculture
Food security ranks among the pressing challenges of a steadily increasing global population.
Yet, there is not enough land left on Earth for further agricultural development. Creating an
environment that promotes sustainable agriculture is critical to Bayer in providing enough food
for ourselves and also our livestock well into the future. Bayer is contributing to counter these
challenges, among other things, with the innovative approach of Digital Farming. This business
model is part of Bayer’s contribution to support UN Sustainable Development Goal 2: “End
hunger, achieve food security and improved nutrition, and promote sustainable agriculture”
and emphasizes our commitment to the UN Global Compact.
By Tobias Menne, Bayer
The situation is alarming: UN studies
predict that the world’s population will
grow to more than nine billion by 2050.
One consequence is that the demand
on global food systems will intensify.
Although the world’s population is growing
constantly, the available farmland
cannot be continually expanded to accommodate
it. Therefore, each farmer
will have to produce more on the same
amount of land. In order to accomplish
this, the use of agricultural inputs such
as seeds, fertilizers, and crop protection
products must be chosen as precisely
as possible to ensure sustainable food
production into the future. For Bayer,
digital innovation is one key to further
increase production through efficiency
while using the planet’s resources in an
ever more efficient and sustainable way.
This will help to enable increased yields
while considering the environmental
footprint of agriculture at the same time.
Rather than add to the complexity, it
will make the world of farming a more
predictable place, empowering farmers
to do what they do best – now and in
the future.
Harvesting the benefits of Digital Farming
Sources: IBM Research, CEMA, FAO
“We need new ideas and have to better
cultivate the existing land to produce
significantly more food on a limited
agricultural area – in a sustainable
and environmentally friendly manner.
Because our planet is at its ecological
limits,” says Liam Condon, Member of
the Board of Management of Bayer AG
and Head of the Crop Science Division.
Digitalization of agriculture
Arable land can vary considerably, even
within one and the same parcel of land,
depending on the topography, type of soil,
and the soil-related supply of water and
nutrients to the plants – all of which
have repercussions for their biomass.
Digital Farming – the next evolution of
the digitalization of agriculture – will in
the future be able to deliver hyper-local
and field-specific information in order
to spark quick and intelligent action on
the field. Bayer currently offers large and
small-scale farmers throughout the world
a variety of digital decision support-tools,
such as: the so-called Expert tool, which
provides farmers with analysis of the
infection process of fungal diseases, the
development and migration of pests, and
storage-risk based on weather information;
weed recognition applications to
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identify weeds and provide farmers a
treatment recommendation; as well as
developing digital farm management
applications for smallholders. In the not
too distant future, real-time analysis will
help farmers identify pests, diseases, and
weeds that threaten the farmer’s crops
and yield, down to the square meter. Sensors
and imaging techniques will zero-in
on a problem and allow the farmer to
treat it at the source. Field-specific modeling
and integration of public and proprietary
data will garner superior recommendations
that a farmer can rely on.
Plenty of data is already available. The
latest satellite technology can deliver
detailed maps, weather information, or
even measure the biomass of a field to
determine yield potential or possible weed
problems. On a farm itself, a trail of data
is created every season when the grower
monitors the farm. The variety of seeds
used, the GPS and product data from the
machinery, water use and yield – most of
this information is collected and stored to
make it comparable over various seasons.
The question is: How can this enormous
amount of data be prepared in a way that
it is of use? “What it comes down to is
the correct interpretation of big data:
Advancements in technology allow for
software to sift through the myriad of
data points, to analyze and combine them,
and to set them all into proportion to
retrieve a final and personalized recommendation,”
says Thomas Schilling, Head
of IT, Digital Farming at Bayer.
How can all the data be made usable?
Digital Farming will in the future deliver local
and field-specific information.
Bayer translates this basic data into
practice-relevant and usable decisionmaking
tools, which farmers can employ
for soil and water management and to
more precisely predict the impact of their
actions – such as choice of seed variety,
application rate of crop protection products,
and harvest timing – making the
risk management of the farm a much
easier task, along with the chance to
improve profitability in a sustainable
way. The individualized recommendations
can be transmitted directly to the
farmer’s agricultural machinery. As such,
geoinformation systems play an important
role in sustainable agriculture. Bayer
plans to offer its customers further digital
services in the future in order to drive
forward the digitalization of farming
and sustainable agriculture.
“We want to help farmers to implement
their agronomic decisions with unprecedented
accuracy, efficiency, and ease.
By identifying the perfect timing and
quantity of each product application
for each field, we are ‘personalizing’
our products for every individual. This
support can one day be possible, down
to the last square meter of every field.
With these tailored treatments – never
too much, nor too little – the farmer will
in the future be able to take utmost care
of the land, making each application in
a more sustainable manner,” emphasizes
Mathias Kremer, Head of Crop Strategies
& Portfolio Management at Bayer’s Crop
Science Division.
Global Compact International Yearbook 2016 113

Sustainable Trade and
the Role of the Banking
Industry
Trade can support sustainable development in the global
economy. Ruediger Senft, Head of Corporate Responsibility
at Commerzbank, argues that banks can therefore be a
major part of the movement toward a sustainable future.
– supporting environmental protection,
respecting human rights, ensuring fair
labor conditions, and tackling corruption
– thus upholding the core principles
of the UN Global Compact. But
for sustainable trade to truly take hold,
increased levels of collaboration between
the financial, political, regulatory, and
consumer sectors will also be vital.
The drivers of sustainable trade
The global economy is being presented
with important challenges regarding
growth, such as the demand for increasingly
scarce resources, which put the
future of trade at risk.
By Ruediger Senft, Commerzbank
Sustainable trade is key to global development.
Not only does it spur economic
growth, it raises living standards, helps
to fight poverty, and safeguards the environment.
As the vital facilitators of
global commerce, financial institutions
are best placed to identify the dynamics
of sustainable trade and help pave
the way toward sustainable economic
development for the future.
Key to this is the banks’ ability to mitigate
environmental, social, and governance
(ESG) risks for trading companies
Of course, this means that banks such
as Commerzbank, whose business is financing
world commerce, are heavily
invested in sustainable trade as a longterm
solution. By conserving resources
across supply chains, offering fair prices
to workers, and protecting the environment,
sustainable trade provides a longterm
way of maintaining stable economic
development worldwide. To explore sustainable
trade in depth and identify its
key dynamics, Commerzbank published
an extensive report in March 2015 titled
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Insights: Five Drivers of Sustainable Trade. The
report found that sustainable trade relies
on enacting progressive governmental
regulation, building informed demand
among consumers, ensuring sustainability
in commercial supply chains, applying
ethical standards and labels, and taking
innovative approaches to finance. Such
a variety of drivers stem from the fact
that corporate responsibility has now
become a very broad concept. Whereas
originally it referred only to environmental
concerns, it now encompasses
all ethical and social concerns.
Banks have a crucial role to play
Given their central role in facilitating
global trade flows, banks are particularly
well placed to meet corporate demands
for sustainability. Indeed, because they
possess the organizational infrastructure
to mitigate risks, they can ensure that
global trade complies with ESG good
practice.
For example, as part of its commitment
to sustainability, Commerzbank checks
every single potential transaction it receives
against its ESG guidelines. The
bank’s ESG Risk Management department
uses a qualitative approach to environmental,
social, and ethical risks, and
to this end cooperates closely with other
relevant units at Commerzbank. Transactions,
loans, and business relationships
in which aspects of sustainability play a
material role are extensively researched,
analyzed, and subject to wide-ranging
evaluation. In some cases, this may lead
to the rejection of a transaction or the
termination of a business relationship.
On average, the department checks more
than 5,000 transactions a year.
The Roundtable on Sustainable Palm
Oil (RSPO) is a case in point about the
progress being made by banks, among
others, in driving sustainable trade. With
global demand for the vital resource
increasing constantly, rainforests in Indonesia,
Malaysia, Africa, and Central
America are subject to destruction, with
negative impacts both on the indigenous
peoples who call the areas home and on
the planet’s ability to absorb dangerous
carbon emissions. Yet, the RSPO demands
that all signatories meet stringent sustainability
criteria. As a member of the
RSPO, Commerzbank will not finance
the trade of palm oil if suppliers fail to
meet such criteria.
Making the business case for
sustainability
In addition to ensuring that trade is
sustainable, banks can also lead the
way in making the “business case” for
sustainability in the corporate world,
reconciling a company’s motivation for
profit with the need to respect the environment,
society, and good governance.
For example, no company will want to
see its public image tarnished by links to
poor working conditions in a developing
country. But banks can mitigate against
this type of risk by demanding respect for
human rights, fair labor conditions, and
anti-corruption measures across supply
chains – hence avoiding considerable
negative repercussions on a company’s
global reputation.
Indeed, with their knowledge of local
trading environments, banks can ensure
that companies deal with reliable partners
abroad who offer good standards in
corporate governance, thus safeguarding
local workforces and the sustainable
development of communities.
How does the future look for
sustainable trade?
Making the business case for environmental,
social, and ethical best practice
in future world trade also depends on
raising awareness about sustainability.
In this respect, the financial sector must
take a lead when it comes to promoting
it among key stakeholders. This is
why Commerzbank followed up with
the release of a second report, Insights:
Scenarios for the Future of Sustainable Trade,
in October 2015, releasing it to other
banks at the Swift International Banking
Operations Seminar, the premier
banking conference of the year.
The latest report projects Commerzbank’s
findings on sustainable trade
into the future. Assessing the global economic
outlook for the next 10–15 years,
it offers the “best-case” and “worst-case”
scenarios for sustainability in the global
economy – and gives recommendations
for a likely outcome.
Without doubt, the pressure for sustainable
trade will continue to grow in
future. For example, consumers around
the world are likely to become more
aware of the ethical and environmental
impacts of products and services. Thanks
to raised awareness of ESG risks, they
are likely to hold companies to stricter
sustainability standards.
Sustainability will also depend on all
key stakeholders collaborating effectively,
whether in the financial, political,
regulatory, or consumer sectors. Banks
form just one avenue toward realizing
the goals of the UN Global Compact. But
given their ability to finance sustainable
trade, mitigate key ESG risks, and communicate
their work to key audiences,
banks will be essential to driving sustainability
in the world economy.
Global Compact International Yearbook 2016 115

What Gets Measured
Can Be Controlled
and Managed
By Antoine Jurdak, Consolidated Contractors Company
Realizing the needs for sustainability efforts and plans to reduce CO 2
footprints are guiding the
construction industry toward new ways to optimize job execution, resulting in higher competitiveness.
Asset management and equipment used in the construction industry – along with
their associated running requirements, utilization, and health and fuel consumption – are major
governing factors in sustainability and greenhouse gas emissions.
CCC commitments are leading to the
development and implementation of progressive
technical skills, as projects are
being executed in a more environmentally
responsible manner. CCC embraces
this responsibility and has developed
many internal programs and processes
that go beyond what is described in this
article. Some of our achievements are
described below.
Centralization
Perhaps one of the biggest challenges for
CCC on “asset-intensive” projects is how
to effectively manage different types of
assets without creating a huge management
workload that erodes the bottom
line. So, maximizing the availability and
performance of assets is more critical to
success than ever before.
Decentralized operations contribute to
delays in collecting data and increase
errors. Automation and centralized databases
are essential for timely, big data
manipulation and applying analytics,
consequently enriching the management
by changing the paradigm from “react”
to “anticipate.”
Today, CCC fleet managers and maintenance
officers are making immediate
and strategic decisions thanks
to effective data analysis capabilities
and reporting and are able to get asset
management information into the
hands of maintenance technicians and
storeroom personnel rapidly. CCC has
advanced considerably in reinventing
the way we manage our fleet and in
providing leading solutions to converge
operational technologies and IT through
the deployment of our in-house, nearreal-time
control systems (CCC Cloud:
iFalcon) and IBM Asset Management
system (Maximo) to handle, manage,
and control timely maintenance, repairs,
job cards, spare-parts stocks, availability,
and fuel consumption during the full
lifecycle of each asset.
Equipment idling time
Excessive idling can be very expensive
and harmful in terms of emissions;
equipment running hours should be
associated with certain production,
otherwise fuel is burnt unnecessarily.
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This can be reduced by motivating the
operators to change their behavior to
avoid running the equipment unnecessarily
when not in use, except in very
few applications. In an idling state, an
engine may not generate enough heat
to achieve proper combustion, leading
to rapid oil contamination and engine
wear, hence excessive exhaust emissions.
The key component of any effort
to reduce idling time is proper planning
and performance measurement; that is
where CCC started adopting telematics.
Maintenance
When a machine starts its production
shift, it should work without interruption.
CCC’s goal is to have a minimum
number of on-shift failures.
Due to the present centralization of
information and controls, maintenance
programs are uncompromisingly thorough;
repairs and rebuilds are performed
to strict quality standards; and replacement
decisions are well-timed to ensure
that the fleet is as reliable as possible
and emissions do not exceed the manufacturer’s
norms.
Unplanned and excessive equipment
breakdowns are mostly the product of
a lack of preventive maintenance. Such
events directly alter the job execution
plan, which in many cases cannot be
revised, resulting in an increase in imposed
idling time.
Collateral costs, delays, and associated
increases in emissions are extremely
difficult to measure. They do not appear
in cost reports and are often the subject
of bitter debate. Regardless, there is no
doubt that they exist and that they have
a huge impact on costs, productivity, and
sustainability.
Fuel and CO 2
CCC recognizes that one of our major
environmental impacts is the air pollution
related to construction machinery,
transportation equipment, and vehicles.
The global growth in CCC’s business sectors
inevitably intensifies or reduces total
fuel consumption across our operations
– where the bottom line figures reach
hundreds of millions of liters – and
proportionally affects our CO 2
impact.
As such, the importance of the fuel
economy to the successful operation of
construction sites cannot be understated.
Fuel is one of the largest variable costs,
and while no operation can control the
cost and the supply quality of fuel, CCC
has been able to find at least some control
over the following:
• Adopting tight selection criteria during
equipment acquisitions, giving priority
to low HP ratings, low-emission options,
exhaust treatment options drag
improvement gadgets, efficient system
designs, smart engine shutdowns during
prolonged idling, and recyclable
units and components;
• Applying timely and proper preventive
maintenance;
• Disposing of old equipment and renewing
the fleet to improve on the average
fleet age and increase the population
of regulated engines;
• Monitoring tires for wear, pressure,
alignment, etc.;
• Buying, handling and using the right
fuel;
• Introducing advanced automation in the
fuel distribution process and control;
• Monitoring and control of individual
and cumulative idle time by using nearreal-time
data-capturing systems;
• Improving operator efficiency and job
knowledge and awareness through
regular training schemes.
Telematics
When used through CCC cloud data
(iFalcon) on idle time, telematics alone
can help managers save thousands of
dollars from fuel burnt during the life
of a machine, preserve vital warranty
hours, and determine best practices in
each application. iFalcon Telematics
can be used to capture, analyze, and
document a baseline for idling time,
utilization, maintenance requirements,
fuel consumption, load factors, and an
extensive list of other operational attributes
as well as look for ways to get
the right data, at the right time, to the
right people through intelligent KPI’s.
Challenges
• Building up and maintaining proper
awareness of sustainability and energy
conservation within the operating
teams while copping with their in- and
outflows;
• Guaranteeing a viable high “technical
condition” of every operating plant
to ensure good performance of equipment
on site without compromising the
timely project execution milestones;
• Imposing limitations on equipment owners
according to the global status of diesel
fuel sulfur levels. This is a direct restriction
on deployment of low-emission
engines in many countries of operation;
• Diversity and distribution dilemma and
the effect on availability, types, and
models of equipment, which renders
standardization impossible in many
cases;
• Management decentralization;
• Fleet mobilization and demobilization
considering limitations from local
regulations;
• Technical resources and skills availability;
• When / where / what to invest;
• Political instability in some countries;
• Environmental constraints and social
responsibility.
Global Compact International Yearbook 2016 117

Stakeholder Engagement:
A Key Strength for the
Success of Our Projects
By EDF Group
Consultation does not happen spontaneously. But without it, we believe that it would no longer
be possible to imagine the smallest project – even more so if it is an industrial project and a host
region needs to be found. Rather, what is needed is the willingness to create – through consensus
– the conditions under which a project can be sustainable, in accordance with a region’s own
development aims.
Against the backdrop of the energy transition,
EDF aims to become the champion of
low-carbon growth and the standard-setting
electricity company for performance
and responsibility. The main provisions
of Cap 2030 – EDF Group’s strategic
project – are to be closer to customers
and to double by 2030 its installed global
capacity in renewables: wind, solar, marine
energy, and hydropower. That adds
up to hundreds of projects that must be
put in place throughout the world. The
stakes are high to ensure their sustainability
and public acceptance.
We have heard the warning bells that
society is sending out in countries around
the planet: People expect more dialogue
and are increasingly vigilant when it
comes to projects that are likely to modify
the surrounding environment. For that
reason, we have decided to make consultation
our key strength for success and a
lever for our company’s transformation
and the way it goes about its business.
Building offshore wind power
with fishermen, environmental
organizations, and SMEs
In France, EDF Energies Nouvelles is
conducting several offshore wind farm
projects. One of these is an 80-turbine
farm in Brittany, off the coast of the fishing
town of Le Croisic and not far from
the shipbuilding town of Saint-Nazaire.
In the space of five years, apart from the
mandatory public inquiry procedures,
dialogue and consultation have enabled
many legitimate concerns of local people
to be assuaged. Fishermen participated
to study trips to the United Kingdom to
find out about existing offshore wind
farms and talk to their counterparts.
They then worked with engineers at
EDF Energies Nouvelles to establish a
location for the future wind farm that
would have the least impact on their
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activity. The Bretagne Vivante non-profit
organization was tasked with carrying
out a study on the impact of the wind
turbines on bird and bat populations in
order to gain a better understanding of
the behavior of maritime fauna, which
was little known up until then. The region’s
small companies had very limited
international experience, so to prepare
them for how to participate in technical
calls for tenders, training in English was
put in place via a non-profit that wished
to protect their interests. Welding skills –
which are very specific for offshore wind
turbines – were also improved. In the
end, all the environmental, fishing and
industrial stakeholders concerned are
now working alongside EDF Energies
Nouvelles in support of the project.
In 2016, the EDF Group has committed
to systematically organizing
a process of transparent and open
dialogue and consultation for every
new project around the world.
Forming partnerships to conduct
our business
Consultation and dialogue lead us to
change our practices. As we experiment
and see the resulting benefits, we build
new ways of conducting our business
through forming operational partnerships
that enable us to bring in project
stakeholders as early as possible. In the
French Pyrenees, for example, we reorganized
maintenance schedules for our
major hydro dams. The environmental
engineers of the national nature park
help us identify the breeding areas of the
bearded vulture, a protected bird of prey.
We modify the helicopter fly-over plans
that transport the people and materials
required so as not to disturb the mother
vultures. Any work that is too close to
young broods is postponed.
Another example concerns fighting fuel
poverty. In Toulouse, we bring together
neighborhood resident associations with
small businesses working in home renovation
and suppliers of light equipment
and tools. They form workshops that
enable vulnerable people to benefit from
advice, training, and tools so they can
renovate their own homes, especially to
improve energy efficiency.
Training project managers
Consultation requires a clear decisionmaking
process, procedural rules, and set
principles for all stakeholders involved.
In addition, the fears and worries that
can hamper trust have to be allayed. To
achieve all this, in 2012, EDF set up a
Group-wide training course and implemented
a methodology, called Durabilis,
for training project teams in how to identifity
local priorities and thereby carry out
the ground work for better stakeholder
inclusion in projects. The areas looked at
are local value creation, the consequences
of projects on the areas where they are
located, and environmental health issues.
Alongside the usual criteria of national
and local health regulations as well as
the governance of health issues at the
regional level, Durabilis backs up regional
assessment tools and encourages the
inclusion of several additional sets of
criteria (geographic, demographic, social,
and cultural). These criteria examine the
region’s environmental characteristics;
the state of existing pollution and health
risks; expected impacts due to climate
change, weather, lifestyles, and on quality
of life; people’s levels of education;
healthcare systems in the region; and
so on. In total, more than 60 questions
relating to environmental health were
fed into the regional assessment that the
project teams drew up.
“CONSULTATION
WITH REGIONAL
STAKEHOLDERS”
Specific Training for all
Project Managers
Manuel Lenas is the director of the One
River, One Territory Sud-Isère-Drôme
branch, which is part of a program to
support the economic development of
the valleys where EDF operates dams.
The aim is to maintain the vitality of
areas whose economies are largely
rural. Like a good number of project
managers, Lenas has taken an in-house
training course on conducting a consultation
process. He explains what is
needed to play his role more effectively.
“Reaching out to stakeholders is an integral
part of the work I do to manage
an economic development program.
Engaging in dialogue, keeping an open
mind, building a relationship – I used
to do all that empirically, based on my
own experience. The training course
taught me that it’s possible to be more
effective in relations with stakeholders,
and that a sound method helps
you adopt the right stance. You have
to shift from a relationship in which
you go with the flow of what’s being
said to something that is led, which
includes phases where you listen, you
ask questions, you add to the proposals,
and you consolidate. So there are
protocols to put in place in order to
be effective. It’s not just talking together
for talking’s sake: You’re there
to decide on a project together. Jointly
defining the program will give it every
chance of legitimacy for the long term.
To sum up, I would say that this course
has made me realize that there’s a
stance to be taken and a method to
be followed! That’s helped me more
easily and rapidly co-construct the
local development program with the
economic organizations present in
the areas our branch covers.”
Global Compact International Yearbook 2016 119

Above the Standard:
HOCHTIEF at the “Crossrail”
Project in London
In ever-expanding cities across the world, city planners are rethinking their transportation policies
and setting their sights on sustainable mobility. In spaces that had been allocated to cars, people
are now the focus. People and the environment benefit from expanding bicycle path networks,
car-sharing services, and better local public transport connections. A look at London shows where
we are heading – and that HOCHTIEF is a safe companion on this path. In the UK capital, the international
construction company is making a key contribution to a highly sustainable tunneling
project.
By Indra Folke, HOCHTIEF
“Crossrail” is a new 118-km rail line from
west to east offering access to Heathrow
Airport. It is currently one of the largest
transportation infrastructure projects in
Europe: More than 10,000 engineers and
builders have been feverishly working
to build 10 new stations and drill 42 km
of tunnels.
In a joint venture with J. Murphy & Sons,
HOCHTIEF has been a key partner in
one of the most demanding lots. In June
2015, the team completed – on time and
within budget – the construction of the
almost 3-km-long tunnel section C 310,
which leads from Plumstead, underneath
the Thames River, to North Woolwich.
With the construction of the two tubes
– each having an outside diameter of
more than 7 meters – the team provided
an impressive performance not only
with regard to engineering, but also in
economic, ecological, and social terms.
“Sustainable aspects are gaining in importance,
particularly for major infrastructure
projects, and are having an increasing
influence on the awarding and execution
of projects,” says Riku Tauriainen, who
led the Crossrail project on behalf of
HOCHTIEF. Especially in London with the
Crossrail project, the client demanded
very high standards. Because of their
many years of experience, the tunneling
experts were well prepared.
Energy demand on construction site
greatly reduced
Since the beginning of the C 310 project
in early 2011, the team had focused on
reducing emissions at each work site.
As an example, they saved 80 percent of
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Global Compact International Yearbook 2016

the energy demand for construction site
lighting. The site was equipped with LED
lights, which require considerably less
energy than conventional light sources.
In addition, materials and excavation
materials were recycled, transport durations
were significantly reduced, and
new technologies were used. By optimizing
construction workflows, employees
reused some 1,200 tons of material. The
performance regarding occupational
safety and health standards was also
optimized.
When installing the inner shell of the
tunnel, a difference of only 10 cm may
mean monetary savings of thousands.
HOCHTIEF adapted the width specified
by the client of the lining segments from
1.5 to 1.6 meters. This idea resulted in
an entire chain of positive effects. First,
the volume of segments that had to be
produced, transported, and used was
reduced by 7 percent, reducing CO 2
emissions
and costs accordingly. Underground,
where the two tunnel boring machines
“Sophia” and “Mary” worked around the
clock, the installation of a total of 3,405
concrete rings went considerably faster.
Due to the lower number of segments,
there are now fewer connection joints
between segments, and thus fewer possible
“weak points” in the tunnel. The
project team gained several working
days in this way.
Groundwater recycled and reused
In terms of conserving resources, employees
also had effective ideas. For
example, since groundwater had to be
removed from the excavation site, tunnel
experts collected the water and recycled
it. Combined with collected rainwater,
it was used in propulsion, in bentonite
recycling, and as a spray liquid as well
as for mortar preparation. Thus, the
team saved 2 million liters of drinking
water per week – 68 million liters during
the entire project: an amount that
would fill 27.2 Olympic swimming pools!
For this achievement, the joint venture
was awarded a prize in the category of
“Innovation and Environmental Performance”
by the client who had specifically
promoted and called for sustained acting
through internal competition.
The tunnel team used the opportunity
to ask for sustainable ideas internally as
well. The “Green Idea Tree” was consequently
created in order to continually
improve ecological efficiency. The best
proposals were awarded and implemented.
One of these ideas was to dry the lime
sludge taken from the Thames River
underground during the early phases
of the project. This procedure made it
possible to use the sludge again as environmentally
friendly material in other
projects. Other excavation materials were
used to replenish and to redevelop the
building site. A total of 3 million tons of
excavation materials from the Crossrail
project were shipped to Essex in order to
create a bird sanctuary in a river delta.
Transporting the materials by ship – a
total of 1,528 charges – was the best
low-emissions alternative and served
to avoid numerous truck trips through
downtown London, which already experiences
heavy traffic volumes. The habitat
will provide a safe home to tens of thousands
of domestic and migratory birds
and will have a pronounced balancing
effect on the wildlife.
Employees engage in social projects
Aside from environmental issues, the
team at lot C 310, led by project manager
Riku Tauriainen, also took into
account social aspects. In addition to
constant exchanges with local residents,
employees did volunteer work. They organized
transport services for seniors to
go shopping, repainted Salvation Army
accommodations, and collected debris by
hand in an adjacent public park. After
both tunnels became accessible, residents
were allowed to explore them in an open
house of sorts.
The installation of the tracks and the
building of stations began in 2015.
The first trains will travel through the
tunnel in 2018 and transport thousands
of people daily. With this project,
HOCHTIEF has made its contribution
to sustainability and has corroborated
its vision: “HOCHTIEF is building the
world of tomorrow.”
Global Compact International Yearbook 2016 121

Climate Protection
Through Innovation
The world is in a constant state of change. Effective climate protection requires both creativity
and expert knowledge. With the aim of cutting fossil fuel consumption, MAN is developing new
transportation and energy solutions that make our mobility even more efficient – and that take
account of the entire product lifecycle.
By Peter Attin, MAN
MAN’s Climate Strategy
Negotiated at the 2015 United Nations
Climate Change Conference, the Paris
Agreement represents a global consensus
on climate protection. Signatories have
agreed to conserve fossil fuels and radically
cut greenhouse gas emissions. To
achieve the targets, government, society,
and business will have to work together.
Industry must act as an innovator and
provide efficient technology that contributes
to a reduction in oil, gas, and
diesel consumption.
Because the transportation and logistics
sector is responsible for around onequarter
of global CO 2
emissions, it can
play a key role in slowing the pace of
climate change. As one of Europe’s leading
commercial vehicle and mechanical
engineering players, the MAN Group sees
energy efficiency as an essential element
of its products and production processes.
We place top priority on the development
and use of alternative drives and fuels.
In 2011, MAN launched its integrated
climate strategy, with five core initiatives
aimed at both its production sites
and its products.
1 25 percent reduction
in CO 2
emissions at
MAN sites by 2020
(baseline: 2008)
2 Consistently efficient
product portfolio
3 Customer involvement
and dialog
4 Potential for reducing
CO 2
emissions along the
product lifecycle
5 Climate strategy
management
We will reduce CO 2
emissions at MAN
sites by improving energy efficiency, using
renewable energy sources (solar, wind,
geothermal), generating energy using
combined heat and power (CHP) plants,
and through integrated energy-management
technology and organization.
We position ourselves in the commercial
vehicles and power-engineering sectors
with sustainable products and services.
We involve our customers and talk to
them about ways to reduce the global
carbon footprint. After all, many of our
customers have already set themselves
ambitious targets for cutting CO 2
emissions.
To identify potential for reductions, we
measure CO 2
emissions along the entire
product lifecycle.
We manage the implementation of our
Climate Strategy and have defined KPIs
that are regularly measured and published.
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Global Compact International Yearbook 2016

In South Africa, MAN’s first carbonneutral
plant cuts the Group’s carbon
footprint by 860 tons of CO 2
emissions
each year.
Innovation is the key
Innovation is the key to achieving
modern forms of mobility that are also
climate-friendly. MAN offers powerful
machines and engines that save fuel and
conserve resources, designed to reduce
the emissions generated by the transportation
sector. MAN takes a holistic view
of the lifecycle of its products, extending
from the production stage to the use
phase and continuing through to the
remanufacturing of used components.
Production powered by the sun
Integrated climate protection begins
in the production process. MAN has
set itself the target of reducing the CO 2
emissions of its plants 25 percent by 2020,
compared to a 2008 baseline. Having
cut emissions by 19.5 percent in 2015,
the Group is on track to meet this goal.
Through combined heat and power (CHP),
LED lighting, and renewables, MAN is
approaching the challenge from many
different angles, always with the aim of
reducing energy consumption and CO 2
emissions. Photovoltaic systems represent
one of the most effective ways to
conserve resources at our facilities.
Since the end of 2014, our production
site in Pinetown, South Africa, has been
generating more solar power than it
needs for its own operations, allowing it
to feed surplus electricity into the local
grid. A photovoltaic system on the roofs
of the production halls, which offer a surface
area of 6,300 m 2 , combined with 300
days of sunshine each year, make Pinetown
MAN’s first carbon-neutral plant.
And our production sites in Munich and
Plauen in Germany and Changzhou in
China also use photovoltaic systems to
generate green electricity.
Engines powered by natural gas
Some 90 percent of the greenhouse gas
emissions produced over the product
lifecycle are generated during the use
phase. For MAN, this makes it all the
Global Compact International Yearbook 2016 123

the transportation sector. MAN is leveraging
the digital revolution to make
efficient vehicles even more efficient
– cutting costs for its customers and
conserving resources. Truck connectivity
plays a key role in this process.
Fighting climate change on the high
seas with dual-fuel engines from
MAN, widely considered the most
environmentally compatible on the
market.
Today, MAN already offers integrated
services that cut fuel consumption, optimize
fleet-capacity utilization, and
reduce downtime for servicing and
maintenance. All this is made possible
by the MAN TeleMatics vehicle module,
which collects vehicle and driving data
and makes it available to the customer
in real time. Vehicle servicing can be
MAN offers a virtual distance-learning
program that can cut fuel consumption
by around 10 percent.
more important to develop alternative
drive systems for trucks and ships that
are reliable and low-emission. Gas-powered
engines play an important role here.
Running on natural gas, the MAN Lion’s
City GL CNG municipal bus almost
achieves CO 2
-neutral operation. If one
considers not only the purchase price but
also the operating and maintenance costs,
the bus also offers savings of around 15
percent – a good example of economy
and ecology in harmony.
Marine transportation is also made more
climate-friendly with MAN gas-powered
engines. And MAN unites energy efficiency
and flexibility in its dual-fuel
engines, which can run on both liquid
and gaseous fuels. When running on
natural gas, the engine’s CO 2
and nitrogen
oxide emissions are significantly
lower, while sulfur oxides, soot, and
particulate emissions are almost completely
eliminated. In addition to highly
efficient gas-powered engines, MAN offers
exhaust after-treatment systems
that can be retrofitted to older engines,
allowing them to meet current and future
emissions requirements.
Coaching in the digital revolution
Increasing costs and fierce competition
are among the many challenges facing
Potential for
reducing CO 2
emissions
in the
product lifecycle
To identify the potential for
reducing the CO₂ emissions in
the lifecycle of its products,
MAN calculates product carbon
footprints (PCF) for virtually
all product groups of the
MAN Truck & Bus subgroup and
for selected product groups of
MAN Diesel & Turbo.
The lifecycle stages are defined
in accordance with standard
automotive industry practice:
1. production
2. use phase
3. end of life (recycling and
waste processing)
Our calculation methodology
is based on the requirements of
the Greenhouse Gas Protocol.
The findings confirm that more
than 90 percent of our products’
greenhouse gas emissions are
generated during the use phase.
scheduled well in advance, optimizing
fleet-capacity planning. As a result, the
trucks operate more efficiently, saving
both time and fuel.
MAN also uses digitization to foster
more environmentally compatible styles
of driving. The driver still has a major
influence on fuel economy – even if
driver assistance systems already play
an important supporting role. With its
Connected CoDriver system, MAN offers
its customers a green driving coach as a
temporary virtual co-driver. MAN Tele-
Matics captures the driving data, which
allows the coach to analyze the vehicle,
the style of driving, and the route profile.
Based on this information, the coach can
use the hands-free system to speak to
the driver and provide advice on more
efficient driving. This can help even
experienced drivers achieve a further
reduction in fuel consumption.
Riding the slipstream
Thanks to digitization and connectivity,
trucks can safely follow one another,
nose-to-tail. Road trains made up of
multiple trucks, known as “platoons,”
help to save fuel. They could also boost
the safety and efficiency of transporting
goods by highway. To demonstrate the
potential of this concept, MAN took part
in the European Truck Platooning Chal-
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Global Compact International Yearbook 2016

“Platooning” lets trucks take advantage
of the slipstream of the vehicle in front,
boosting efficiency and saving fuel.
After sorting, the used parts are washed to
remove grime and oil. Only then it is possible
to see which parts can be remanufactured
as MAN Genuine Parts ecoline.
Awards 2015
International Bus Planner Sustainability Prize for the MAN Lion’s City GL CNG
municipal bus with natural gas drive
Green Ship Technology Award for fuel-saving and environmentally friendly
ship-propulsion solutions with the concept “Slow Steaming Optimization with
Derating and Propeller Upgrade”
European Transportation Prize for Sustainability for the MAN Genuine Parts
ecoline as well as the climate-efficient vehicle-leasing program by MAN and
EURO-Leasing
European Excellence Award for the MAN Corporate Responsibility Report
lenge – a test drive in which the trucks
are linked by digital data transmission.
Two or more trucks follow each other
at a close distance, allowing them to
take full advantage of the slipstream
of the vehicle in front. The driver of
the lead vehicle sets the pace and the
direction, with the following vehicles
in semi-automated driving mode. Driver
assistance systems such as adaptive cruise
control and autonomous emergency
braking systems ensure that one vehicle
can safely follow another with no risk
of a collision, despite the short following
distance.
These compact and energy-efficient formations
have a marked positive impact
on the flow of traffic, while diesel consumption
and CO 2
emissions are cut by
up to 10 percent. Platooning is a clear
example of the extent to which the transportation
sector will change, with fully
connected trucks making the roads safer
and the air cleaner.
Returned to the product lifecycle
The climate footprint of a vehicle depends
to a large extent on the length
of its service life. A long service life for
the individual technical components not
only makes economic sense, but also
leads to a reduction in CO 2
emissions and
resource consumption in the production
of new ones.
With our MAN Genuine Parts ecoline
initiative, we extend the service life of our
genuine parts – such as coolant pumps or
crankshafts – by returning used parts to
the use phase. A comprehensive remanufacturing
process in our plant in Nuremberg,
Germany, completely restores the
functionality of used original components.
The first step is a thorough cleaning. The
components are dismantled, cleaned in a
wash bay, sandblasted, recoated – and, in
some cases, rejected. The cleaning process
reveals which parts are still usable and
which are only good for recycling. The
next step is to remanufacture the functional
components and replace any worn
parts. Following remanufacturing, MAN
installs the components and tests their
functionality. The quality standards are
high, with MAN Genuine Parts ecoline
products covered by the same warranty
conditions as new parts – but at prices
up to 50 percent lower. Here, economy
and ecology go hand in hand.
Find out more:
www.cr-report2015.man
Global Compact International Yearbook 2016 125

Reducing Environmental
Impact via Digitization
mcs believes sustainable processes and production will soon be the industry standard, and we
strive to be one of the first movers. For us, sustainability is the only way forward. We are using
digitization to improve efficiency and save natural resources, while simultaneously increasing
transparency and cost-savings for our clients.
By Shay Clark, mcs
Begun in a small town in Germany in
1975, mcs (media contact service) has
grown from a family business to an international
promotional products agency.
The firm currently sources its products
from hundreds of suppliers globally. As
a leading partner of the International
Partnership for Premiums & Gifts (IP-
PAG AG) joint venture initiative, mcs
has access to 60 partner offices in more
than 43 countries.
away after a trade fair or when it becomes
outdated. According to a 2010
European Commission environmental
report, in Europe, materials with a commercial
value of around € 5.25 billion are
thrown away each year. Using natural
resources to needlessly produce items
that are never used makes no sense for
businesses or the planet. Luckily, mcs
realized that slow and limited access
to information is the root cause of this
destructive trend, so the firm is now
using intelligent planning and IT to
reduce unnecessary waste. mcs now
builds custom IT solutions via their
Ziggy platform, so clients can access
relevant information conveniently, 24
hours a day.
Sustainable supply chains save
money and decrease resource use
Businesses have traditionally ordered
marketing products from multiple suppliers,
but mcs offers all promotional
materials and print media to its clients
on one easy-to-use online platform. This
decreases the time needed for companies
to order and design various items from
multiple firms, while also eliminating excessive
production, shipping, packaging,
and storage that has been generated in
the past. The results are twofold: Clients
save money, whereas carbon emissions
and the use of natural resources decrease.
IT eliminates waste in the supply
chain
Many companies over-order promotional
materials, only to throw much of them
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When mcs recently began working with
a client in Switzerland, more than €2
million of unused products had to be
thrown away simply because they were
outdated. Sadly, this is not an isolated
case. Upon switching to mcs, another
new client was quickly informed that
25 percent of their stock was tied up
in outdated promotional materials sitting
in a warehouse. With the help of
mcs’ analytics, these and other clients
now only order popular, fast-moving
promotional products.
Ziggy means lower risk, decreased
costs, and less waste
At mcs the idea is not to produce more,
but to produce the right amount of the
right things at the right time. mcs offers an
expansive full-service solution surpassing
the conventional offerings of merchandisers
or printers that can be integrated into
any IT landscape. This user-friendly system
seamlessly blends with the client’s own
intranet to provide the client’s purchasing,
marketing, sales, and HR departments
with transparent planning, handling, and
control of all marketing media. Ziggy
further supports clients’ purchasing departments
by combining demands from
various branches located in multiple locations.
This streamlines branding, shortens
processing time, prevents overstocking,
and economizes on transport. The result
is an effective reduction of stock, along
with simultaneously improved availability
that creates less waste, saves time, and
frees up budgets.
Reporting analytics offer improved
transparency
mcs has found that the transparent reporting
and state-of-the-art analytics provided
by Ziggy reduce waste and uncover
potential savings time and time again.
This feature helps clients track their order
quantities, buying patterns, and rates of
product usage, which reduces waste by
helping clients to only order the amount
of product needed. Through reporting
and consulting, mcs alerts clients about
which products are performing poorly or
losing popularity to reduce ordering of
these “slow movers.” A positive waterfall
effect occurs: Fewer natural resources are
used, needless waste caused by accidental
excess ordering decreases, and fewer
emissions from shipping are incurred.
In this way, historic overproduction of
products is reduced.
Since beginning its partnership with mcs
in 2011, the promotional firm’s largest
account has not sent any merchandise
items to landfills. “We have made our
clients aware of the print items that have
not moved in a long time and have given
them the option to recycle these items.”
On-demand production
Capacities of Ziggy mean that more
merchandise and print products can
be created quickly on demand. Printing
companies near the end-user produce
materials within days, which eliminates
the need to print media in advance, only
to store it and ship it long distances. The
end result is that costs are drastically cut
and carbon emissions are immensely
reduced.
Corporate social responsibility
mcs has restructured its activities to
be more socially and environmentally
responsible, in line with the ISO 26000
standard. The firm is also part of the
Supplier Ethical Data Exchange (Sedex),
the international association for ethical
sourcing. In close collaboration with
IPPAG AG, mcs manages its suppliers
according to Social Accountability International
(SAI) Social Fingerprint, an
organization that promotes standards
for decent work conditions.
UN Global Compact Principles and
Sustainable Development Goals
(SDGs)
By creating and emphatically implementing
innovative IT solutions, mcs is both
supporting the UNGC Principles and furthering
the efforts of the SDGs. The firm
is directly adhering to UNGC Principles 7,
8, and 9, as well as SDGs 9.4 and 12.5–
7 by proactively assuming responsibility
to prevent environmental impacts. mcs
is doing this through the development
of environmentally friendly technologies
and by developing initiatives and
practices to advance and enhance its
socio-environmental responsibility, while
reducing spending, using resources responsibly,
and reducing waste and the
need for shipping.
The traditional idea is for companies to
compete for potential clients by providing
the best value for the cheapest price,
but the environmental costs are often
not considered. Simply put: Producing
promotional products creates waste. mcs
recognizes this as a problem and is taking
direct action to create financial and
environmental savings.
For further details about our efforts:
Global Compact International Yearbook 2016 127

MTU Aero Engines: Cleaner
and quieter engines
At MTU Aero Engines, assuming responsibility – for products and services, employees, customers,
partners, and not least for the environment – is a key priority. The biggest contribution of
Germany’s leading engine manufacturer toward the protection of the environment comes from the
eco-efficient products it makes using energy-efficient processes. “Product responsibility for us is
the motivation that drives all of our business efforts,” emphasizes MTU Chief Executive Officer
Reiner Winkler. “Eco-efficient and safe products are key to our long-term economic viability.”
possible by optimizations of this engine,
work on which is already underway. The
market was quickly convinced of the
benefits afforded by the GTF: Five aircraft
manufacturers around the world have
chosen this new propulsion system for
their aircraft, and about 60 airlines, too,
have selected the engine, the total order
book standing at almost 7,000 copies.
By Martina Vollmuth, MTU Aero Engines
The best case in point is the tremendously
successful geared turbofan (GTF) engine:
With this propulsion system, which
goes by the catchy name of PurePower®
PW1000G, Pratt & Whitney and MTU are
building the propulsion system of the
future. The new technology is a textbook
example of how to meet the challenge of
making engines even more fuel-efficient,
cleaner, and quieter: The GTF immediately
reduces fuel consumption and CO 2
emissions by 15 percent each and almost
cuts perceived noise levels in half. On
top of this, it is expected that even more
improvements can be achieved, bringing
down fuel burn and CO 2
emissions by
40 percent. These advances are made
What sets the new GTF propulsion system
apart is that it features a reduction gearbox
between the fan and low-pressure
turbine. The two are connected by a
shaft, and the turbine drives the fan.
The gearbox allows the fan with its large
diameter to rotate more slowly, and
the turbine to rotate much faster. This
lets the individual components achieve
their respective optimum speed, greatly
boosting the geared turbofan’s efficiency.
The result is a significant reduction in
fuel consumption, emissions of CO 2
, and
noise; moreover, the propulsion system is
much lighter, as it has fewer compressor
and turbine stages than today’s engines.
MTU contributes the high-speed, lowpressure
turbine – a key GTF component
– and, in collaboration with Pratt
& Whitney, is building an innovative
high-pressure compressor.
Today already, the GTF version to power
the Airbus A320neo is playing a special
role in the family of geared turbofans.
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The engine boasts two advanced technological
developments: In this program,
MTU is using a new additive production
process and a new material for the
first time. The high-speed, low-pressure
turbine for the PW1100G-JM is the first
production turbine ever to include an
attachment part made by the 3-D printing
method. New additive manufacturing
processes greatly benefit the environment,
since components can be produced
with only small amounts of material and
require few tools. From an economic
perspective, too, they score high, since
the technology opens the door to entirely
new, more complex designs; appreciably
cuts development, production, and lead
times; and brings down production costs
overall. MTU wants to take full advantage
of the benefits and is pressing on with
additive manufacturing in numerous
technology projects and programs, giving
its development top priority.
developing an enhanced TiAl alloy. The
aim is to make more turbine stages from
the new material. Again, the innovation
is good news for the environment – for
TiAl allows engines to be built that use
fewer resources, burn less fuel, and are
cleaner and quieter than today’s models.
“I’m sure that this material will help further
bring down the weight of engines
appreciably,” says MTU Chief Operating
Officer Dr. Rainer Martens.
Eco-efficiency is the driving force of
MTU’s production strategy. In its Clean
Air Engine (Claire) technology roadmap,
MTU has set out how it wants to go about
implementing this strategy. Here, the
engine experts combine the latest key
technologies into a commercial propulsion
system that, by the year 2050, will
burn 40 percent less fuel, will reduce
CO 2
emissions by the same amount, and
will cut noise levels by 65 percent. Plans
are to achieve the CO 2
and noise level
targets defined by the European aviation
industry and research community in
the Strategic Research and Innovation
Agenda in three stages.
The staged goals of Claire are 15 percent,
25 percent, and 40 percent less CO 2
. In
stage of Claire indicate that the GTF configuration
lends itself as a platform for
further development and improvement.
For example, it is quite conceivable that
the bypass ratio can be further increased
by the year 2030 – from 12:1 (geared
turbofan) to up to 20:1. Moreover, the
thermal efficiency of the core engine
can be enhanced by higher pressure
ratios and temperatures. The aim is to
increase the overall pressure ratio from
currently almost 50:1 to 70:1. In the third
and last stage of Claire, major changes
are envisaged that may well go beyond
today’s gas turbine technology. Jointly
with universities and other research establishments,
MTU is conducting studies
for this phase. Among the options under
review is the use of highly efficient heat
engines with extremely high pressures
based on recuperative technologies to
recover energy from the exhaust gas.
Other conceivable concepts are looking at
propeller noise shielding by the aircraft
or fans distributed around the fuselage.
One thing is for certain already: For MTU,
helping shape and push forward advances
in aviation is – and will remain
– a tradition to which the company is
firmly committed.
The second innovation incorporated in
the GTF for the A320neo is a new material
made by MTU: The rearmost rotor
stage of the high-speed, low-pressure
turbine is made up of tailor-made titanium
aluminide blades. TiAl is a new
intermetallic high-temperature material
for highly loaded engine components in
a class all by itself. It was developed by
MTU and partners within the record time
of a mere seven years. Its advantages: TiAl
turbine blades are only half the weight
of comparable nickel-alloy blades but
boast the same reliability and durability.
In this field, too, MTU is already working
to push research forward and is busy
the first stage, the geared turbofan engine
alone already provides a reduction
in fuel consumption – and hence CO 2
emissions – by up to 15 percent; noise
levels will almost be cut in half. Concept
studies conducted as part of the second
Left: Clearly cleaner and less noise: The
geared turbofan is the engine concept of the
future.
Above: Even better: MTU works on the improvement
of the geared turbofan mechanism,
permitting different materials for airfoils.
Global Compact International Yearbook 2016 129

Traceability in the
supply chain
By Andrea Biswas Tortajada, Nestlé
In the spirit of the Sustainable Development Goals, and invigorated by their worldwide importance,
we are determined to carry on with our work to realize a shared vision of a sustainable future. Our
ongoing commitment to support the world’s development ambitions is part of our responsibility as
a global company and a nutrition, health and wellness leader. We strive for people to live healthy
lives, in a healthy environment, and in healthy communities. Partnering is central to our business
model, and since 2011, we have been working with various civil organizations, international cooperation,
and the Turkish government to improve transparency and address complex social challenges
in the hazelnut supply chain in Turkey. Together, we are furthering our understanding of the
difficulties faced by rural communities and achieving significant progress.
Turkey is the world’s leading producer
of hazelnuts, with around 75 percent of
the total global production. Nestlé mainly
purchases hazelnuts as a raw material
from the eastern and western parts of the
Black Sea region of Turkey; of the 7,000
tons we sourced in 2015, more than 4,000
tons came from these areas. Even when
we do not source directly from the farms
but from a small number of suppliers,
who obtain the hazelnuts through a chain
of intermediaries, we believe that our
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Global Compact International Yearbook 2016

supply chains represent one of the biggest
opportunities at hand to contribute to
healthy lives, in a healthy environment,
and in healthy communities.
This is why, in 2011, Nestlé asked the Fair
Labor Organization (FLA) to assess labor
practices in our hazelnut supply chain
in Turkey. Since then, the FLA has been
conducting annual audits, after which it
supplier code awareness and training.
Encouraged by these results, we continue
to take firm steps to make continuous
progress in other areas that require
further work.
These activities are part of our effort
to ensure that our suppliers make continuous
improvements in meeting our
Nestlé Responsible Sourcing Guideline
strengthening internal monitoring and
remediation systems. The project, which
will be implemented in approximately
1,000 hazelnut gardens in Ordu, Sakarya,
and Sanliurfa, this atter region being
home to a large number of seasonal
migrant workers and labor contractors/
intermediaries. In coordination with
the Turkish government and the International
Labour Organization (ILO),
Nestlé, Olam, Balsu:
working together for sustainable supply chains
identifies a number of labor and human
rights issues, including the presence of
children on hazelnut farms; preferential
treatment of local workers over migrants;
health and safety risks related to the transportation
of workers; excessive working
hours; and inadequate compensation.
Each year, the FLA makes recommendations
to address any issues it has identified
during the hazelnut harvest. Nestlé
uses these recommendations to strengthen
its responsible sourcing roadmap and
action plans. FLA’s findings in its 2015
assessments were encouraging, as it identified
a series of important improvements,
notably the significant decrease in the
reporting of child labor, which suggests
that the prioritization of the issue and
joint remediation activities with other
companies have been effective. The association
has also acknowledged that
progress has been achieved in terms of
on Hazelnuts (RSG). Our RSG sets out
non-negotiable minimum requirements
on human rights and labor standards,
health and safety, sustainability, and
business integrity. Traceability is the
first step toward ensuring that suppliers
meet our RSG requirements. By the
end of 2015, 65 percent of our hazelnuts
sourced from Turkey were traced
back to the farm, and 20 percent of this
volume was responsibly sourced. In addition,
our two direct hazelnut suppliers,
Balsu and Olam-Progida, have held
training and awareness-raising sessions
on labor issues – including child labor –
with 2,349 processors, intermediaries,
growers, and workers.
In December 2015, Nestlé (along with
our direct suppliers) and the FLA were
awarded a $ 4.9 million grant from the
US Department of Labor to address child
labor in the hazelnut supply chain by
this initiative will especially focus on
preventing children from working in
hazelnut production.
Addressing challenges around labor
conditions is complex and requires the
collaboration of many stakeholders. We
believe that multistakeholder dialogue
and participating in industry efforts
can help raise standards, making efforts
more efficient and successful. We have
driven a public-private partnership with
the ILO and the Association of Chocolate,
Biscuits and Confectionery Industries of
Europe (CAOBISCO) trade association as
well as a working group with the Turkish
Ministry of Labor. These concerted
activities have focused on training workers
and raising awareness to improve
the working conditions for laborers, in
particular the conditions for the many
temporary migrant workers employed
during the harvest period.
Global Compact International Yearbook 2016 131

Solar Power to Help
Deliver on Sustainable
Growth
PostNL installs 20,000 solar panels to
significantly reduce carbon footprint.
By Nikaj van Hermon, PostNL
132
Global Compact International Yearbook 2016

As the leading mail and parcels deliverer
in the Benelux region, PostNL sits at the
forefront of the ongoing rapid growth
in e-commerce. To cope with the resulting
increase in the flow of parcels, in
recent years we have designed and built
a network of future-proof sorting and
delivery centers across the Netherlands
for our parcels operations. One of our
key objectives when developing these
centers was to ensure that they make a
structural contribution to our sustainability
objectives, thereby helping us to
improve the environmental efficiency of
our delivery networks and minimize our
impact on the environment. For example,
we have invested in state-of-the-art,
energy-efficient sorting machines, and
the depots have been constructed to make
optimum use of daylight, further cutting
energy requirements. In 2016 we took the
next step in developing our sustainability
goals and started installing approximately
20,000 solar panels on the centers’ roofs.
These panels will contribute up to 40
percent of the centers’ annual electricity
requirements, thereby significantly
reducing our carbon footprint.
Sustainability goals
Since 2011, our parcels segment has
designed and constructed sorting and
delivery centers that can more efficiently
process the rapid growth in parcels volume,
which has been driven by the rise
in e-commerce. These new centers have
achieved an A+ energy label based on
advanced building techniques, enabling
us to lower both our energy requirements
and decrease our carbon footprint.
This focus on developing energy-efficient
building solutions reflects both our stakeholders’
desire to develop sustainable solutions
across all business segments, and
our ongoing focus on our responsibility
to society and the contribution we make
to the community. We believe that one of
the ways to make a positive contribution
is to provide services and solutions that
are as sustainable as possible.
Introducing solar energy to our
sorting and delivery centers
One of the first innovations within our
new sorting and delivery centers was the
introduction of hi-tech sorting machines,
which use electromagnetic and induction
technologies to reduce friction during
operation. This has resulted in huge efficiency
benefits, with the machines using
75 percent less energy than those they
replaced, cutting our electricity needs,
carbon footprint, and costs. However,
our goal is to continually look for ways
to make our logistics operations more
environmentally friendly. As a result, in
2016 we began installing 20,000 solar
panels on the 19 new sorting and delivery
centers. Funded in part through a subsidy
from the Dutch government, which aims
at stimulating the sustainable production
of renewable energy, the solar panels
will produce 40 percent of the centers’
energy requirements. We will fully fit
12 centers with panels over the course
of 2016, with all 19 being completed in
2017. At PostNL, sustainable delivery
means maintaining the highest quality
standards while minimizing the impact
of our deliveries on the environment.
This means making our buildings greener
and introducing energy-efficient technologies,
whenever possible. We believe
that the introduction of solar technology
is another positive step toward realizing
our sustainability ambitions.
Global Compact International Yearbook 2016 133

Investments for
a Greener Future
With help from Norway Grants, ROMRADIATOARE has invested
in modern and innovative technologies for improved environmental
performance.
By Mihai Răducan, ROMRADIATOARE
The Green Industry Innovation Programme
Romania, which “aims to increase competitiveness
of green enterprises, including
greening of existing industries, green
innovation and green entrepreneurship”
(www.Norwaygrants-greeninnovation.
no), fit perfectly with our development
plans. With a € 550,000 grant, we began
the Green Business Development for Increased
Competitiveness project and invested
more than € 1.1 million in modern
machinery, equipment, and CAD-CAM
software. The aim of our project was to
improve the environmental performance
of our company, both in terms of “greening”
the production processes as well as
increasing the production capabilities and
capacity for greener products within the
overall production structure.
With 90 years of history, ROMRADIA-
TOARE is the oldest and most well-known
Romanian company producing radiators
and heat exchangers, and one of the oldest
in Europe. Although tradition is valuable
and attests to the notion that over
a long period of time we have been able
to continually add value for our customers,
it can also be a drawback, especially
with regard to the technology being used.
Old machinery and technologies for cutting,
forming, soldering, brazing, welding,
painting, and many other processes were
“traditional,” meaning we lagged behind
in productivity and efficiency as well as
environmental performance. Furthermore,
we assessed the health and safety aspects
for the people working in our factory
and wanted better conditions, even if
current ones were compliant with laws
and regulations.
Industrial production is a polluting activity
by its nature – old machinery and
old technology contribute to its environmental
impact – and ROMRADIATOARE
is part of this process. In 2014 we assessed
our equipment and production facilities
and concluded it was time for a change.
Even if our environmental impact was
well below the limits imposed by law, it
was not low enough for us.
The new CNC laser-cutting
machine acquired with the
support from Norway Grants
From our analysis, there were some key areas
that needed to be addressed. Firstly, we
needed to increase our energy efficiency,
to reduce natural gas consumption, and
to reduce harmful emissions to air and
wastewater. Secondly, our design and production
accuracy needed improvement in
order to reduce scrap levels due to quality
issues, reduce raw material technological
waste (copper, brass, aluminum, and
steel), and to increase production capacity
for greener heat exchangers. Thirdly, it
was the implementation of OHSAS 18001
– an international Occupational Health
and Safety Management System – that
would set the standard for our activity.
Each and every investment carried out as
part of our project tackled one or more
of these issues.
Energy consumption is one of our most
import focus areas, as excess energy con-
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Global Compact International Yearbook 2016

the degreasing part of the painting line
was fitted, meaning that, from now on,
mostly green energy is being used for
this process.
Through the Norway Grants and EEA Grants, Norway contributes toward reducing
social and economic disparities and strengthening bilateral relations with the beneficiary
countries in Europe. Norway cooperates closely with the EU through the
Agreement on the European Economic Area. For the period 2009 – 2014, Norway’s
contribution is € 1.7 billion. Grants are available for NGOs, research and academic
institutions, and the public and private sectors in the 12 newest EU member states
as well as Greece, Portugal, and Spain. There is broad cooperation with Norwegian
entities, and activities may be implemented until 2016. Key areas of support are
environmental protection and climate change, research and scholarships, civil
society, health and children, gender equality, justice, and cultural heritage.
Excess material consumption, due to
quality issues and technological waste,
has also been significantly reduced as a
result of investments in modern and efficient
tube-bending equipment, cutting
equipment (for metal sheet, bars, profiles,
aluminum fins for radiators), machining
equipment (lathe, mill), and CAM machining
software, press-brake-bending equipment,
and welding equipment.
sumption is bad for business (higher costs,
lower competitiveness on the market) and
bad for the environment (more pollution).
So, our first challenge was to reduce our
energy consumption. Our brand new CNC
laser cutting machine is amazing with
regard to power efficiency and nesting
capabilities. Our new industrial compressor
is 35 percent more efficient regarding
energy and oil consumption than the old
ones. By carefully assessing our needs and
purchasing only the latest equipment, in
2015 we managed to reduce our factory’s
energy consumption by 167 kWh per ton
of raw material processed, as compared
to 2014 numbers.
Harmful emissions are bad for the environment
and bad for the local community.
Our main focus was CO 2
emissions in the
air and PH levels and zinc emissions in
wastewater. To reduce our natural gas
consumption levels, we acquired a modern
electrical brass tube forming and soldering
machine. Due to the precise control
of the soldering bath, this new machine
also allowed for replacing the fluxing
substance with a less corrosive one, thus
eliminating zinc chloride from the process
and reducing the quantity of soldering
alloy by as much as 40 percent compared
to the previous technology. The former
hard brazing method was replaced by a
highly innovative OxyHydrogen brazing
technology, which eliminated acetylene
and CO 2
emissions from the pipe-brazing
process, all of this while achieving significant
increases in productivity, quality, and
efficiency. To better control the temperature
of the gas-fired aluminum CAB brazing
furnace, a telemetry tracking system
was installed. Improved control over the
temperature means increased efficiency,
lower CO 2
emissions, and better quality.
To further reduce gas consumption, a new
solar panel heating system for water in
Last, but for sure not least, is the implementation
of OHSAS 18001. Along with
other steps we took, this ensures that the
UN Global Compact’s Principles 1 and 2
are being followed. We are very proud
to report that documentation, training,
and implementation of the system have
been finalized and that we are OHSAS
18001:2007 certified, meaning that our
employees have a better work environment
and encounter fewer occupational
health and safety risks. Work conditions
have also improved considerably through
investments in welding and soldering
fumes exhaust systems and noise-reduction
systems for our punch presses.
Moreover, all the production equipment
purchased is CE compliant with regard
to operator health and safety.
By implementing innovative and ecofriendly
technologies in our production
processes and by increasing the quality
and share of greener products in our
portfolio, ROMRADIATOARE has improved
its environmental performance and has
become better aligned with the overall
expectations of all its stakeholders as well
as with the Global Compact’s Principles
7, 8, and 9.
www.romradiatoare.com
ROMRADIATOARE designs and manufactures heat exchangers and cooling /
heating systems for engines and other specialized applications, as well as a
broad range of metal fabrications and module assemblies.
This has just been a starting point for us.
We are committed to following the sustainable
and environmentally friendly business
model we have begun. By doing so,
we will better fulfill the expectations of all
our stakeholders. A greener future is not
only a desire for us, but an imperative.
Global Compact International Yearbook 2016 135

Overcoming Barriers to
Address Energy Poverty
By SkyPower
Today, approximately 1.2 billion people in the world lack access to electricity. A further 1 billion
people are connected to the grid but suffer from unreliable electricity levels. With a mission of
bringing power to the energy poor, SkyPower is focused on the development of utility-scale solar
photovoltaic (PV) energy projects to provide green, clean, and affordable electricity to developing
and emerging nations around the world.
SkyPower considers the greatest challenge
to the widespread proliferation of
solar energy to be the cost of capital in
non-OECD countries. For example, according
to a study by the Climate Policy
Initiative, high interest rates and relatively
short-term loans for large-scale renewable
energy projects in India add 24 - 32
percent to the cost of renewable energy
in that country, when compared to
similar projects developed in the United
States and Europe. The premiums in
other less industrialized countries are
even greater.
The reality is that the high cost of capital
in developing and emerging countries
means an individual living in a developing
nation is forced to pay substantially
more for electricity – when it eventually
arrives – than a person living in the
developed world.
Bringing power to the people
“Our efforts continue in emerging markets
by dedicating tremendous resources
to seek out lower cost of capital, allowing
us to focus on new power, not replacement
power. That is where we can make
the biggest impact,” asserts SkyPower
President and Chief Executive Officer,
Kerry Adler.
SkyPower is exploring ways with sovereigns,
financial institutions, investors,
and other stakeholders to utilize available
sources of low-cost capital, such
as green bonds, as well as to develop
innovative approaches to project financing
that significantly mitigate the risks
that are inherent in the development,
construction, and operation of clean
energy projects in the developing world.
Advancing 13 of the 17 Sustainable
Development Goals
In addition to propelling improvements
in the standards of living in developing
countries, solar energy is a key tool to addressing
climate change by providing an
alternative to a fossil energy future. Our
solar PV energy projects not only support
the reduction of carbon emissions,
but also reduce other environmental
impacts associated with the use of fossil
fuels. SkyPower’s unified global solar
energy development strategy directly
or indirectly contributes to 13 of the 17
United Nations Sustainable Development
Goals (SDGs), most notably SDG 7:
Ensuring access to affordable, reliable,
sustainable, and modern energy for all.
Giving back to communities
Our innovative and unique corporate
social responsibility (CSR) programs bring
meaningful social value and immediate
impact to the local communities where
we do business. SkyPower’s dedicated
CSR team works diligently to engage
local communities and develop sustainable
CSR programs that provide energy
access through solar light distribution,
education, skills training, and local economic
development – helping empower
the most vulnerable members of society.
Educating the next generation
At SkyPower, we believe in the importance
of education for poverty reduction
and spurring economic growth. We know
that access to affordable, clean power is
critical for empowering youth to develop
the skills they need to contribute to a
brighter future for their communities.
To this end, our renewable-energy schol-
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Global Compact International Yearbook 2016

arship programs advance research and
technical knowledge-development at
the university level, while our greenenergy
educational initiatives promote
environmental literacy in schools and
create awareness among students about
future careers in the solar industry.
An end to energy poverty in sight?
As a leader in international solar energy
development dedicated to advancing the
socioeconomic benefits of sustainable
energy for all, SkyPower is committed
to distributing solar-powered home kits,
desk lamps, and streetlights to communities
around the world with no access
to electricity. We invite and encourage
nongovernmental organizations and
other caring corporations to join us in
making a difference for families in these
energy-poor communities worldwide and
to help them break the cycle of poverty.
The international SkyPower team works
under the unified objective of producing
hundreds of millions of kilowatt hours of
clean electricity each year, giving people,
communities, and nations the power to
grow. It goes without saying that sustainable
development is at the very core of
our business. As dedicated proponents
of sustainability, the SkyPower team
and its international stakeholders work
every day to advance the development of
renewables on a global scale – generating
a brighter future for all.
UN Global Compact Recognizes Kerry Adler
As a Pioneer for Climate Action
At the UN Global Compact Leaders Summit
2016 in New York, Kerry Adler –
Founder, President, and Chief Executive
Officer of SkyPower – was announced as
one of ten 2016 Local SDG Pioneers. Adler
was recognized for his efforts, which align
with SDG 13 on Climate Action.
Today, SkyPower is a signatory of the UN
Global Compact, a champion of the Caring
for Climate initiative, a partner of the
Climate Bonds Initiative, and was an official
partner of COP 21. The SDGs are
core to business operations and part of
SkyPower’s corporate DNA.
Adler spearheads a business that succeeds
by working hand-in-hand with diverse
governments and communities to
meet their energy needs with clean, sustainable
solar solutions.
“Each of the 2016 Local SDG Pioneers
exemplifies how business can be a force
for good in addressing the challenges
we face as a global society,” says Lise
Kingo, UN Global Compact Executive
Director. “Mr. Adler is a passionate advocate
for climate change, particularly
clean energy. He is leading developments
toward a renewable power sector in
Canada and international markets for
sustainable energy solutions – making
him a Pioneer on climate action.”
The Pioneers are made up of entrepreneurs
who are championing sustainability
through their business models and
changemakers who are broadly mobilizing
the business community to take action
in support of the SDGs. A Pioneers Selection
Group, comprised of experts from
the UN, academia, civil society, and the
private sector, ranked the nominees based
on a set of criteria, resulting in the ten
2016 Local SDG Pioneers. In the years
to come, the Global Compact’s Pioneers
program will become a vital part of the
organization’s priority to make global
goals local business.
“I am honored to be part of the inaugural
class of Local SDG Pioneers and humbled
by the recognition from the UN Global
Compact,” says Mr. Adler. “Sustainable
Developments Goals are core to Sky-
Power’s global operations because I fundamentally
believe that businesses have
a duty to be responsible corporate citizens
and leave an inhabitable world for future
generations.”
Adler recently outlined a commitment to
donate 3.5 million solar-powered home
kits to families in Bangladesh and Kenya
who cannot afford access to clean energy.
Adler explains that by helping eliminate
energy poverty with accessible renewable
solutions, the market becomes primed
toward renewables as the first choice
when it comes to investment decisions
about energy use. With this in mind, Adler
is actively leading SkyPower to participate
in the climate bonds initiative in an effort
to access low-cost capital to bring energy
to the people who need it the most. Kerry
calls this initiative “Power to the People”
and believes it is the most critical initiative
for SkyPower’s continued success.
Global Compact International Yearbook 2016 137

Environmental Measurements
For Weather and
Climate Resilience
By Dr. Kevin Petty and Tomi Rintanen, Vaisala
In recent years, the need for improved weather and climate data and information has become
increasingly evident. As urbanization continues and society becomes increasingly reliant on
infrastructure and technology, humankind is more and more vulnerable to the effects of climate
change, extreme weather events, and other environmental hazards. The protection of life and
property is highly dependent on the availability of accurate, precise data and information. For
more than 80 years, Vaisala has addressed the need for quality environmental data and information
through numerous scientific and technological advancements, enabling individuals and
groups to better diagnose and mitigate the impacts of climate change and high-impact weather.
Analysis and forecasting are vital
elements
According to the World Meteorological
Organization, weather forecasting “is a
vital element” needed “in order to meet
the food, fodder, fiber, and renewable
agri-energy needs of rapidly growing
populations.” The World Bank estimates
that improved global weather forecasting
would result in increases in productivity
worth $ 30 billion per year, as well as
reduce asset losses by $ 2 billion per year.
The use of weather monitoring systems
and sophisticated storm preparations
days in advance enabled Vietnam to
minimize the impact of Typhoon Haiyan
in 2013, allowing it to avoid some
of the catastrophic damage that had
hit the Philippines. The steps taken by
Vietnam, which has been referred to
as a development success by the World
Bank, protected its citizens and their
economic livelihoods. The UN’s resident
coordinator for Vietnam, Pratibha Mehta,
said the nation’s preparedness “played a
key role in minimizing the impact and
number of lives lost.”
Improving weather analysis and forecasting
is extremely important in industrialized
countries as well. For example,
in a 2008 study, it was discovered that
having 12 hours warning of a flood in
the United States meant that, on average,
the amount of damage was reduced by
60 percent. When that warning time
was reduced to two hours, the damage
reduction fell to 20 percent.
Building capacity for weather
monitoring
Vaisala helps its customers to establish
weather observation networks and build
up capabilities that lead to an enhanced
capacity to assess, predict, and prepare for
extreme weather. In light of increasing
populations – particularly in urban regions
– and the growing dependency on
complex, integrated infrastructures such
as communication and transportation
networks, the need for timely, accurate
weather-related data and information is
essential in the effort to protect life and
property as well as ensure optimal operations
across a number of sectors. This is
particularly true for developing countries.
Vietnam has continued to evolve its
weather-based assets to further mitigate
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Global Compact International Yearbook 2016

the negative effects of extreme weather
events. It uses weather monitoring systems
and sophisticated storm preparations
to minimize the impact of severe
storms, which are common in the country.
Recently, Vaisala signed a contract with
the National Hydro-Meteorological Service
of Vietnam to deliver weather radar
and lightning detection networks, as well
as software to further improve weather
forecasting.
decisions throughout a renewable energy
project’s lifecycle.
provides environmental measurement
and monitoring capabilities that support
industrial applications and the life
sciences sector. Ultimately, Vaisala’s technology
and solutions help to safeguard
life and property, while enabling critical
decision-making that facilitates effective,
efficient operations.
Vaisala’s products are inherently nonintrusive,
require low energy input, need
little servicing, and can be maintained
remotely. The common denominator
is that by measuring the environment
accurately, the outcome is safer, more
efficient, reliable, and sustainable operations
in any application area.
Vaisala technologies and services help
to reduce potential impacts on the environment
and society. By delivering
sustainable technologies, Vaisala aims
to reduce its customers’ impacts on the
environment and improve the overall
efficiency of its customers’ operations.
The role of science and technology is
essential in developing and delivering
sustainable solutions.
Renewable energy sources and
climate change mitigation
As nations have pledged to reduce greenhouse
gas emissions in order for the climate
to stay under the limit of 2 degrees
Celsius, renewable energy is seen as one
of the key transformative technologies to
decarbonize the world economy. Making
the transition from a carbon-intensive,
ever-expanding civilization to a near
fossil-fuel-free existence will be one of
the greatest technological and economic
transformations in the history of the
world.
As renewable energy penetration grows,
the global energy system will increasingly
depend on the weather, not only
for electricity demand and stable operations,
but also for fuel. Vaisala works
with renewable energy customers to
help them make profitable, sustainable
Beginning with greenfield development,
Vaisala weather models and measurement
technologies provide the information
required to make sound investment decisions
and target the best project locations.
Its industry-leading energy-assessment
methodology reduces performance risk
with accurate estimates of future production,
ensuring that the best projects
receive financing on favorable terms.
Vaisala’s energy forecasting services provide
the accuracy necessary to integrate
renewables while reducing curtailment,
imbalance penalties, and the need for
backup power from fossil fuel sources.
Through optimizing the use of renewable
energy sources and by carefully assessing
the return on renewable energy
project investments, Vaisala helps energy
companies lessen risk and increase the
penetration of renewable energy in a
profitable, yet sustainable, way.
Sustainable technologies
Vaisala delivers weather and climatebased
products and solutions to meet a
wide range of needs in the meteorological,
transportation, and energy industries,
among others. In addition, Vaisala
Future positive
Vaisala has been improving environmental
measurements for weather-sensitive
industries as well as controlled environments
for 80 years. Throughout that time,
Vaisala has maintained its scientific and
technological curiosity, which has resulted
in novel solutions that help its customers
and communities around the world.
In 2015, Vaisala announced its target to
become a 100 percent renewable energy
powered company by 2020. This will
cut the company’s direct greenhouse
gas emissions by more than 90 percent.
As the global leader in environmental
observations, Vaisala is determined to
shape sustainable development across
the industries it serves, while still addressing
the core needs and requirements
of its customers. The first step
in this process is leading by example
and committing to its own responsible,
sustainable development.
Global Compact International Yearbook 2016 139

By 2050, seven out of ten people on earth will
live in cities. Urban living will be the norm, but
life for many of these roughly 6 billion people
will be everything else but normal. Water,
waste, and transportation problems; the lack
of housing, jobs, and security; and access to
education, participation, and information will be
just some of the challenges.
“vision 2050” of the World Business Council
for Sustainable Development describes the
city planning demand only for China, saying
that extra infrastructure for about 300 million
people is needed – 50 percent of which has
yet be built. But these challenges are also
opportunities: today we are at the brink of a
new urban era, says the Fraunhofer Society in
Germany: “to navigate the big challenges of the
next decades, city systems must be innovative,
flexible, livable, and sustainable.”
But future cities will not automatically be
romantic, smart, zero-emissions sites. It is
rather hard work to make cities places worth
living in. on the path, many questions have to
be answered: Where will our food come from?
How can we overcome gridlock? How can we
motivate locals for sustainable lifestyles?
Can we create sharing cities? What do green
buildings and green neighborhoods look like?
answers to these and other questions are given
in our section “City of the Future.”
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Cities of the future
CITIES OF
THE FUTURE
Global Compact International Yearbook 2016 141

URBAN BUILDING
More than a third of global energy consumption and
greenhouse gas emissions are caused by buildings.
Studies by the IpCC, UNep, and others show that the
building sector is undoubtedly responsible for a large
share of global warming. But both in the construction
and operation phases, there are a lot of opportunities for
sustainable actions. In fact, green building is one of the
main leverages to meet climate change challenges.
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Cities of the future
CopeNHaGeN:
GreeN BUIlDING “UN CItY”
In Svanemøllen beach in the northern district of Copenhagen,
there has been an impressive building landscape visible
for three years now: It is the “UN City,” officially opened
in 2013 while garnering international awards and praise.
the UN City building fosters Copenhagen’s goal to be Co 2
neutral by 2025.
Since the start of the UN City project in Copenhagen, it
has been clear that the new “blue” building had to also
be very green. to this end, it was decided to register the
project for certification under the leadership in energy
and environmental Design (leeD) Green Building ratings
system. participation in the leeD system ensured that
sustainability had been integrated into the project from
the beginning. UN Copenhagen staff have moved into a
building that is indeed very “green.”
portlaND:
JUSt, reSIlIeNt, aND
SUStaINaBle NeIGHBorHooDS
ecoDistricts is a portland-based community program that
specializes in helping governments and others to develop
sustainable cities. their philosophy is based on greening
districts and developing the whole city step by step. as the
company states: “Green districts are interesting because
they are small enough to innovate quickly, and big enough to
have a meaningful impact.” a practical example is the cooperation
with the US Green Building Council, well-known for
its successful leeD ratings system for individual buildings.
this concept has now advanced to “leeD for Neighborhood
Development” (leeD-ND), which is the first system of its
kind, integrating principles of smart growth, new urbanism,
and green building. the council reports that, so far, more
than 300 projects have earned the leeD-ND rating.
the UN City building offers a number of cutting-edge features.
For instance, the roof is covered with a reflective and
recyclable organic material that reflects sunlight, reducing
the building’s solar warming. Solar panels produce green
electricity so that the building will use no more than 50 kWh
per square meter per year. Water-saving is the other core
feature: UN City uses a smart rainwater collection system
that reduces water use by up to 60 percent.
Does it mean that the job is done, and that UN City will
be “green” forever? “Not really,” explains the Danish UN
entity. “Now that the UN has taken over the building, our
behavior as responsible users plays a major role: from
how agencies operate and maintain the systems, down to
individual actions.”
Global Compact International Yearbook 2016 143

URBAN CULTURE
FloreNCe: lIvING CItY CeNterS
Florence is the world-famous capital of tuscany boasting 74 museums
and where every brick contains a piece of history. as with many other
cities, the historical city center is losing its traditional workshops
to minimarkets and chain stores. In order to limit this, the Florence
municipality introduced a regulation stating that ground floor shops
previously used for arts and crafts purposes cannot be used for
other functions, such as services or selling groceries. to attract new
workshops, they have created the “technological District on Cultural
Heritage,” which is located in a former palazzo in the city center. It
fosters cultural heritage and restoration activities, including a high
school for restoration, which functions as an incubator for high-tech
enterprises working in the restoration industry.
aalBorG: SUStaINaBle CItY FeStIval
Many cities are in search of new ideas that are attractive to tourist
as well as their citizens. the aalborg example has proven successful
with its sustainability festival featuring public seminars, city tours,
promotion of sustainable mobility and climate-saving concepts, and
organic markets, among other things. event organizer anders Du Montthygesen
says: “the festival was intended to be about ‘awareness’
from two perspectives. there was, of course, the general awareness
of how to be more sustainable. this turned out to be very much driven
by the local community, with the city eventually adopting the role of
facilitator rather than educator.”
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Cities of the future
Global Compact International Yearbook 2016 145

URBAN DEVELOPMENT
NeW DelHI: HYperIoNS treeHoUSe
When talking about futuristic cities and
visionary architects, the Belgian vincent
Callebaut comes to mind. His concepts
are not only bold but, more important,
they are ecological and sustainably
inspiring. His new project is due to be
constructed by 2022 near New Delhi,
India’s smog-afflicted capital. Callebaut
writes the following about his new,
phenomenal project.
“the Hyperions project is made of six
garden towers, each 36-stories high
and comprised of housing and offices.
the towers are built with cross-laminated
timber (Clt) and are covered
with orchard gardens. all the wood
required to build the garden towers
comes from a Delhi forest, which is
also managed sustainably, and in which
we make sure to renew what we collect
with respect to the appropriate cutting
cycle and regenerating capacity. I like
to remind people that, with its 68 million
hectares of forest covering 23 percent
of its territory, India is one of the
ten most wooded countries on earth,
and the world’s second largest producer
of fruit and vegetables. trapped
as people are in the New Delhi smog,
it is a duty to preserve those carbonsequestrating
forests now more than
ever. Indeed, one cubic meter (ca. 35
cubic feet) of wood can stock up to
0.9 tons of Co 2
while a tree grows.
Wood, by definition a natural and renewal
material, allowed us to minimize
the ‘inherent energy’ of the materials
used to build the six garden towers.
Seeking a neutral environmental footprint,
we wanted to go even further,
by producing the ‘operational energy’
(for lighting, climate control, hot water,
etc.) on-site, while recycling our liquid
and solid organic waste into natural
resources, recycled and recyclable
in a closed loop, also on-site.
the fusion ‘forest + agriculture + urban
fabric’ is a humanistic alternative that
brings together the best of both the
city and the countryside. From agroforestry
to wood-based construction
to permaculture and aquaponics, the
Hyperions project is the symbol of a
short supply chain economy based
on harvesting local resources. this
virtuous circle generates links between
local producers and ‘prosumers.’
residents, organic farmers, garden
producers, agroecologists, loggers,
agronomists, architects, and designers
all participate in a sustainable production,
distribution, consumption, and
recycling process.”
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Cities of the future
tIaNJIN: GreeN CItY
tianjin eco-city is located within the tianjin Binhai New area,
about 45 km from the tianjin city center. tianjin eco-city has a
land area of 30 sq km and is planned for a population of 350,000.
UNep calls it a practical model for sustainable development.
the city project is a partnership between the governments of
China and Singapore with an investment of about $10 billion.
What makes tianjin an eco-city? all buildings will meet green
building standards and are barrier-free – an important feature
in an aging society such as China. one out of every five houses
will be subsidized by the government in order to generate a mix
of residents, creating a diverse and social atmosphere. Urban
mobility is also “green”: 90 percent is made for walking, cycling,
and taking public transport. to make sure that the eco-friendly
features really work, Ho tong Yen, Ceo of Sino-Singapore tianjin
eco-City Investment Co., is among the first to live in tianjin
eco-city. He tells the Danish architecture Center: “I think that in
time to come, this will be a model that many people will study;
some cities will replicate certain aspects of the concept we have
developed here. they may not replicate eco-city in its whole, but
I think as long as some ideas are replicated elsewhere, then I
think we would have made a very big contribution to sustainable
development.”
the city is intended to be completed by mid-2020. Until now it
has attracted just 20,000 residents. Nevertheless, Ho tong Yen
is satisfied: “last year in the eco-city, we sold more than 4,000
homes. that’s more than half the total number of homes sold
in Singapore last year; and we account for around 20 percent
of the whole tianjin Binhai New area market.” But all that glitters
is not gold: The Guardian notes that right now there are no
hospitals or shopping malls in tianjin eco-city. So there is still
a lot for Mr. Ho tong Yen and his team to do.
Global Compact International Yearbook 2016 147

URBAN ECONOMY
BrIStol: oUr CItY, oUr MoNeY
What makes a piece of paper money or a coin valuable? It is
the trust in the currency. But every currency represents not
only a monetary value but also a political and social system.
there are now alternative, not-for-profit currencies that emphasizes
economic, social, and environmental sustainability
within a certain region, mostly cities. the Bristol pound (£B)
is such an alternative currency and one of the world’s most
successful ones.
like regular British pounds, the local Bristol pound comes
in denominations of £B 1, £B 5, £B 10, and £B 20. the Bristol
pound is run as a not-for-profit partnership between the
Bristol pound Community Interest Company and Bristol Credit
Union (BCU). Since the BCU is a credit union with Financial
Conduct authority, there is no financial risk, as each Bristol
pound is backed pound for pound by sterling deposits, and
bank account holders receive the same protection as with
any other bank deposit accounts.
the Bristol pound is a complementary currency, designed to
work alongside sterling, not replace it. So why should people use
it? the activists have three good arguments: people foster local
business, they keep the money in the town, and every citizen
can be a member of the initiative. they control the money – it is
not the money that controls them.
Katie Finnegan-Clarke, Communications Manager at Bristol
pound, writes: “Next, from a social standpoint, a local currency
constructs a sense of community ownership. the Bristol
pound is a “community currency.” that is, it is not a currency
that bankers and financiers speculate on. It is a not-for-profit
venture used for the public interest. It also encourages people
to explore their own city. the technical Director of the Bristol
Campaign points out that having a local currency encourages
people to move toward smaller, more interesting businesses.
environmentally speaking, Bristol is the 2015 european Green
Capital City. Using the Bristol pound adds to that green image
by encouraging local spending and lessening the need to
bring in products and goods from elsewhere, thereby reducing
carbon emissions from the transportation of goods that
would otherwise have been imported. additionally, the Bristol
Campaign itself has links with local environmental organizations,
in particular those involved in climate change action.
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Cities of the future
SeoUl BeCoMeS a SHarING CItY
the “sharing economy” is a buzzword of our time. there is a lot
of sharing within a city, but can a city itself proactively foster
this trend, becoming a “sharing city”? as one of the biggest
mega-cities in the world, Seoul has started investing in the support,
encouragement, and development of enterprises focusing
on sharing services. City authorities additionally are reviewing
municipal regulations that inhibit or prevent citizens from sharing.
What is the motivation for a city such as Seoul? the big urban
challenges such as housing, transport, pollution, waste, and resource
efficiency can only be addressed by a cohesive community,
and that includes sharing. true, this is not new: Urban parks and
green areas have always been public and shared spaces. the same
with libraries and other communal facilities. What is changing is
that answers to public needs are increasingly given by private
providers: car-sharing for urban mobility, apartment sharing for
housing need of all age groups, local currencies, shared ownership
of various goods, etc. and new technologies such as 3-D
printing create even more opportunities for shared manufacturing.
the Seoul example shows what city administration can do, but
the sharing economy will not simply emerge by magic. “the
sharing economy cannot be imposed upon a city. participation
in developing, enacting, and owning the plan is as obvious as
it is critical. and cities themselves need significant autonomy
from national governments to develop this agenda,” explains
the Sustainable City Network.
Global Compact International Yearbook 2016 149

URBAN PARTICIPATION
Rio de Janeiro: Upgrading Shanty Towns
The Morar Carioca Program is the largest favela-upgrading program nationwide.
The aim is to “formalize” and re-urbanize all of Rio’s favelas by 2020. The Rio de
Janeiro City Hall explains the ambitious plan: “Besides urbanizing streets and
building leisure areas for residents, it performs drainage, water, and sewage
services. It also promotes improvements in the areas of education, health, and
other basic services, bringing citizenship and dignity to a significant portion of
the population that still lives under less favorable conditions.”
“Developed in the communities of Chapéu Mangueira and Babilônia,” the City Hall
statement continues, “in the South Zone of the city, the green version of Morar
Carioca was established in 2010 as a kind of laboratory in the two locations and,
today, is in an advanced stage of construction. Sustainability measures include
the use of alternative materials in the construction of apartments, featuring
recycled metal structures, rainwater reuse systems, treated sewage in toilets,
and individual water meters. All lighting in the community is being replaced by
LED lamps, in addition to the implementation of garbage collection and use of
solar energy.”
More: http://issoe.co/1HVMzZ0
150
1. Phase:
Existing homes
2. Phase:
Vertical interventions
Global Compact International Yearbook 2016

Cities of the future
SÃo paUlo: CIDaDeS SUSteNtaveIS
the Cidades Sustentaveis program is engaging political candidates in São paulo. ariel Kogan from the initiative
explains: “In Brazil, the urban population is 85 percent. and as the cities grow in size and population, the
difficulty in maintaining spatial, social, and environmental equilibrium also increases. Given the situation, three
organizations got together and created the Sustainable Cities program: the ethos Institute for Business and
Social responsibility, our São paulo Network, and the Brazilian Social Network for Fair and Sustainable Cities.
the Sustainable Cities program – Cidades Sustentaveis – aims to raise awareness, mobilize people, and
provide tools to develop Brazilian cities in an economically, socially, and environmentally sustainable manner.”
the program includes a campaign for political candidates to support sustainable city development. More than
650 candidates have signed, and more than 80 directories of political parties at the local, state, and federal
levels have also joined the program. So everything is fine? ariel Kogan adds: “the biggest challenge is to
make these commitments become public policy and not just voluntary actions. Having a more sustainable
city with less inequality, more transparency, a better quality of life, and a better environment is the right of
every Brazilian citizen.”
3. pHaSe:
MetropolItaN INFraStrUCtUre
Global Compact International Yearbook 2016 151

URBAN FARMING
We have to feed more than 7 billion people on this planet, the majority of them living in
cities with no natural areas of arable land. therefore, most of the industrially produced
food is trans-ported over large distances, with severe effects on the climate and environment.
So why not fostering the local production of food? one idea that may sound futuristic
is “urban farming.” Many projects prove that local production in cities has become a
trend with many different and creative facets.
DUBlIN: HeNS oN tHe FoUrtH Floor
the ground in their enclosure. Nothing unusual there, apart
from one thing. their hen house is on the roof of a four-story
building in Dublin city center.” this sounds mainly like fun,
but the farm seeks to provide more than just healthy food.
Douglas says: “It sets out to improve Dublin as a living
space and enhance the quality of life for a new generation
of ecologically literate, urban farmers.”
people call them local heroes, but andrew Douglas and
paddy o’Kearney are first and foremost passionate farmers.
and activists. that is why they started a unique project in
the heart of Dublin with the help of a number of volunteers.
From 2012 to 2014, they ran a rooftop farm at the Chocolate
Factory arts Building. the farm produced eggs, fish,
mushrooms growing from recycled coffee grounds, as well
as salads and herbs, among other things. also astonishing
was a collection of historic potato varieties, with some
dating back to 1768. a fascinated local journalist from The
Irish Times wrote: “the hens cluck contentedly and peck at
on a larger scale, projects such as that of Douglas and
o’Kearney can make a change. Some scientists wrote
in the Irish Economic and Social Review: “as a practice,
urban agriculture is beneficial in both post-industrial and
developing cities because it touches on the three pillars
of sustainability: economics, society, and the environment.
a garden or rooftop farm is a place where people come
together for mutual benefit, often enhancing the common
social and cultural identity for city residents.
larger urban farms also participate in community enrichment
through job training and other educational programs, many
of which benefit underserved populations. Finally, urban
agriculture can play an important role in the environmental
sustainability of a city. as a form of green infrastructure,
urban farms and community food gardens help reduce urban
heat island effects, mitigate urban stormwater impacts, and
lower the energy embodied in food transportation.”
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Global Compact International Yearbook 2016

Cities of the future
tHe toMatoFISH
the tomatofish lives at the leibniz-Institute of
Freshwater ecology and Inland Fisheries at the
Baltic Sea. It is a scientific method for producing
fish and tomatoes under one roof. tilapia
fish and tomatoes have similar environmental
needs for growth, for example a preference for
warmth. Because these two go so well together,
they named the project using the portmanteau
“tomatofish.” aquaponic solutions like these
are ideal for consumers concerned about the
environmental impact of food production.
the tomatofish model sets a new standard
in sustainable production because the plants
absorb the Co 2
exhaled by the fish and use it to
produce oxygen while they grow. the scientists
add: “When the system is powered by renewable
sources like wind, solar, or biomass, the entire
system runs with almost no emissions.” the possible
applications are immense: “Closed-loop
systems like tomatofish can be used in areas
that are too dry for conventional agriculture,
with the necessary heat provided by the local
climate. In the northern hemisphere, heat can be
in scarce supply, while water is often plentiful.”
Global Compact International Yearbook 2016 153

URBAN HEALTH
MexICo CItY: tHe lINK BetWeeN ClIMate CHaNGe aND HealtH
each week 1.4 million people move into cities. tackling
climate change and reducing cities’ greenhouse gas emissions
is not just important because of global warming but
also for the health and wellbeing of urban citizens around
the world. Green policies provide cleaner air, new jobs,
increased levels of city revenue, and many other benefits.
“Mexico City has seen first-hand how policies designed to
reduce greenhouse gas emissions can have far-reaching,
positive effects on the health and wellbeing of our citizens,”
says Mexico City Mayor Miguel Ángel Mancera.
Novo Nordisk and the C40 Cities Climate leadership Group
(C40) have announced a research-based partnership aimed
at establishing the idea that green policies in cities are
beneficial to both the environment and the health of the
citizens. at the heart of the partnership lies the pivotal role
of cities in the fight against climate change and poor health.
City lifestyles are contributing to the diabetes epidemic,
and two-thirds of the world’s 415 million people living with
the condition can be found in urban areas. Meanwhile, the
rapid rise of cities accounts for two-thirds of global energy
consumption and more than 70 percent of Co 2
emissions.
From bike-share schemes to adaptation efforts that lessen
the impact of floods and heatwaves, civic leaders are already
making decisions that will reduce emissions and deliver
additional benefits to their citizens. the research will help
city leaders to build a case for other specific climate actions
that will have the greatest impact on both emission
reductions and improved health and prosperity.
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Global Compact International Yearbook 2016

Cities of the future
tHe CoSt oF aIr pollUtIoN
Health impacts of road transport
3.5 MiLLiOn
people KIlleD a Year GloBallY BY oUtDoor aIr pollUtIoN
* tHat’S More DeatHS tHaN FroM DIrtY Water aND poor SaNItatIoN
50 % Of DeAThS
FroM oUtDoor aIr pollUtIoN IN oeCD CaUSeD BY roaD traNSport
* DIeSel veHICleS tHe BIGGeSt CUlprIt
US$ 1.6 TRiLLiOn
valUe oF preMatUre DeatH BY oUtDoor aIr pollUtIoN IN oeCD
= alMoSt tHe SIZe oF tHe CaNaDIaN eCoNoMY
www.oecd.org/env/cost-of-air-pollution.htm
Global Compact International Yearbook 2016 155

URBAN MOBILITY
BoGotÁ: tHe traNSMIleNIo UrBaN traNSportatIoN
Nobody thought it would be so extremely
successful: When the city of
Bogotá (Colombia) started planning
transMilenio, there was no public bus
transport system able to carry 20,000
passengers per hour. But that is what
was necessary to relieve the gridlock
on the streets of the Colombian capital.
City planners therefore had to invent a
real breakthrough in terms of capacity
and had to think completely outside
of the box.
they did, and today transMilenio is
regarded as a best practice worldwide
and a true blueprint for many megacities
with similar traffic challenges.
Future goals include replacing all of
the city’s diesel fleet with hybrid and
electric buses, electrifying the entire
taxi fleet, and adding a new metro line.
Fernando rojas, Deputy General Manager
of transMilenio, explains: “trans-
Milenio is successful not only as a
transport system but also as an image
of the city. today we have concluded
two phases that have 84 kilometers of
exclusive bus lanes. We have 104 bus
stations. the benefits are numerous.
First there are social benefits. the
average user now saves up to 40 minutes
a day. If we compare what used
to be the bus lines 10 years ago to
those today, the carbon emissions have
dropped 98 percent.”
“the growth of the transMilenio system
continues to be a step-by-step process,”
rojas says. “It will continue with the
addition of new bus fleets and with
the extension of new kilometers of
exclusive lanes. today we are organizing
transportation around the city
of Bogotá so that transMilenio can
be integrated in various ways. We will
be integrated through the payment
method. We are going to be integrated
through the infrastructure. and we will
also be integrated in terms of communication
with the users.”
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Global Compact International Yearbook 2016

Cities of the future
NaNJING: proMotING e-CarS
For years, the Chinese automobile market was selling more than
the US and Japanese markets together. recently, the trend has
cooled down, but in overcrowded and pollution-afflicted traffic
routes, smart and sustainable solutions are more necessary
than ever before. the central Chinese government therefore
launched a plan to have six cities – led by Nanjing – serve as an
urban agglomeration for a big pilot project promoting electric
cars, also known as New energy vehicles (Nevs).
the Nanjing municipal government set up the structure to define
detailed rules for subsidies and electricity prices for ev charging
and to promote the installation of charging facilities. as of now,
4,332 units of Nevs have been deployed in Nanjing, including
1,208 transit buses, 940 taxis, 1,311 inner-city commuting cars,
17 utility company cars, 647 private New energy cars, and 208
New energy special cars. there are 3 battery-swapping stations
and 14 battery-charging stations (equipped with 791 charging
facilities): among the latter, there are 150 charging facilities
in Shazhou, currently the largest charging station in the world.
the promotion of Nevs includes government-issued incentive
policies for New energy cars in terms of electricity price subsidies,
Nev purchase price subsidies, and charging station construction
incentive policies.
Reference: Nanjing was winner of the C40 Cities Awards 2015
in the category “Transportation”.
Global Compact International Yearbook 2016 157

URBAN SANITATION
NaIroBI: SaNItatIoN For GeNeratING INCoMe
Kibera is the name of one of the biggest slums in africa. about 1 million inhabitants
live in an area roughly two-thirds the size of Manhattan’s Central park. Sanitation
and waste facilities are rare. there is approximately one toilet for every 500
people. therefore, residents use plastic bags as their primary means of disposing
their excrement. Used bags are tossed along the roads or rivers, together with
other rubbish. the situation gets worse during rain season, when floods sweep
away and scatter the trash. But people in Kibera are providing an answer to this
challenge by creating local parks with sanitation and waste facilities. all compostable
materials are used to produce compost and later sold as fertilizer. the
revenue from the sales helps to fund the park and toilet maintenance.
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Global Compact International Yearbook 2016

Cities of the future
eVeRy 20 SeCOnDS
a CHIlD DIeS FroM tHe Water tHeY’re DrINKING
at aNY oNe tIMe
hALf The WORLDS
hOSPiTAL BeDS
are oCCUpIeD WItH patIeNtS SUFFerING FroM
WATeRBORne DiSeASeS
aN averaGe aFrICaN WoMaN WalKS
4 hOURS eACh DAy
to ColleCt DIrtY Water
3.575 MiLLiOn PeOPLe Die
eACh yeAR fROM WATeR ReLATeD DiSeASe
tHat’S eQUal to tHe CItY oF loS aNGeleS
Global Compact International Yearbook 2016 159

Publishing House:
macondo publishing GmbH
Publisher:
Dr. Elmer Lenzen
Photo Director:
Marion Lenzen
Art Director:
Magnus A. Sundermann
Text Editor:
Robert Furlong, Marion Lenzen
Translations:
Casey Butterfield
Note:
Secretary-General Ban Ki-moon remarks at
2016 UN Global Compact Leaders Summit:
Making Global Goals Local Business,
UN Headquarters, 22 June 2016
Authors of this edition (in alphabetical order):
P. Abdelghaly, Peter Attin, Andrea Biswas Tortajada, Elizabeth
Boggs Davidsen, Vincent Callebaut, Shay Clark, Lily Cole,
Miguel Coleta, D. El Demerdash, Prof. Dr. Felix Ekardt, Juan
Ramón Silva Ferrada, Indra Folke, Lilian Furrer, Marine Gerard,
Rick Goings, Natalia Gonchar, Sergio Gonzalez, Liz Goodwin,
Dr. Harald Hagemann, M. Hasebou, Nadine-Lan Hönighaus,
Tanvir Hussain, Jason Jay, Antoine Jurdak, Gabriele Kotulla,
Gregory Lamory, Dr. Elmer Lenzen, Jasmin Lotze, Tobias
Menne, Diana Negrea, Karen Anne Overton, Dr. Kevin Petty,
Thorsten Pinkepank, Mihai Răducan, Tomi Rintanen, Syed
Najmus Saquib, Bernhard Schwager, Ruediger Senft, Mara
Simonini, Jake Taylor, Prof. Dr.-Ing. Peter F. Tropschuh, Nikaj
van Hermon, Martina Vollmuth, Johannes Waltz, Adam
Werbach, Perry Yeatman
Solely responsible for the editorial contributions under the
heading “Good Practice” are the companies themselves.
Named articles do not reflect the opinions of the publisher.
Cover:
svetikd/iStockphoto.com
Photo Credits:
UN Photo/Eskinder Debebe (P. 3, 10 above), kantver/
Fotolia.com (P. 4, 9), Hkun Lat/AP/Press Association Images
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(P. 14), Nike (P. 16), Frederic Courbet/Sanergy (P. 19), baona/
iStockphoto.com (P. 22/23), 97/iStockphoto.com (P. 26 left,
27 right), hykoe/Fotolia.com (P. 26 right), Erwin Wodicka/
wodicka@aon.at/Fotolia.com (P. 28), Eugenio Marongiu/
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Cohen (P. 46 right, 69), Casey Curry/Invision/Press Association
Images (P. above left, 62), Derek Pashupa Goodwin (P. 47 above
right, 64), James Duncan Davidson/TED/flickr.com (P. 47 below
left, 54), Thirst For Water (P. 47 below center, 66, 67), Robert
Abaca USA/Press Association Images (P. 47 below right, 56),
Helga Esteb/Shutterstock (P. 58), UN Photo/Mark Garten
(P. 61), Adecco (P. 72/73), Banca Popolare di Sondrio (P. 74/75),
Bosch (P. 76/77), Deutsche Post DHL Group (P. 78, 80), Sonja
Beyland/Deutsche Post DHL Group (P. 81 right), Deutsche
Telekom (P. 82/83), Green Delta Insurance (P. 84), Zef Nikolla/
UN Global Compact (P. 85), Manila Doctors Hospital (P. 86/87),
Merck (P. 88/89), PMI (P. 91, 93), Irina Zavyalova/
www.zavyalova.me/Sakhalin Energy (P. 94), Sakhalin Energy
(P. 95), Sanofi (P. 96, 97, 98/99), AAIB (P. 104), Armacell
(P. 106/107), Audi (P. 108), Stefan Warter/Audi (P. 109), BASF
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Rennertz/Bayer (P. 113), Commerzbank (P. 114/115), CCC
(P. 116/117), EDF/Philippe Eranian (P. 118/119), HOCHTIEF/
Crossrail/ ajpmedia.com (P. 120/121), MAN (P. 123, 124, 125
right), Max Kratzer/MAN (P. 125 left), eyetronic/Fotolia.com
(P. 126/127), Andy Ridder/MTU (P. 128), MTU (P. 129 left),
Lucian Mitiu/ mitiuphoto.de/MTU (P. 129 right), Nestlé/Olam/
Blasu (P. 130/131), PostNL (P. 132/133), ROMRADIATOARE
(P. 134), 2016 Rob Tannenbaum Photography, inc./UN Global
Compact (P. 137), Vaisala (P. 138), Corbis/Vaisala (P. 139),
Adam Mørk/UN City Building (P. 142/143), Veronika Galkina/
Fotolia.com (P. 144/145), Patrick J. Hanrahan/Fotolia.com
(P. 148/149), Piotr Pawinski/Fotolia.com (P. 148 box), Morar
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160
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Global Compact International Yearbook 2016 161

The Ten Princiles of
The United Nations Global Compact
HUMAN RIGHTS
ENVIRONMENT
1.
Businesses should support
and respect the protection of
internationally proclaimed
human rights; and
2.
make sure that they
are not complicit in
human rights abuses.
7.
Businesses should support
a precautionary approach to
environmental challenges;
8.
undertake initiatives to
promote greater environmental
responsibility; and
9.
encourage the development and
diffusion of environmentally
friendly technologies.
Labour Standards
3.
Businesses should uphold the
freedom of association and the
effective recognition of the right
to collective bargaining;
4.
the elemination of all forms of
forced and compulsory labour;
5.
the effective abolition of
child labour; and
6.
the elemination of discrimination
in respect of employment and
occupation.
ANTI-CORRUPTION
10.
Businesses should work against
corruption in all it forms,
including extortion and bribery.
At the core of the Global Compact initiative are 10 principles
for human rights, labour standards, the environment and
eliminating corruption.
The Global Compact calls upon all companies to recognise
these principles and to take steps to put them into effect.
162
Global Compact International Yearbook 2016

GLOBAL COMPACT INTERNATIONAL YEARBOOK
EDITIONS 2009 – 2015
This publication is intended strictly for learning purposes. The inclusion of company names and / or
examples does not constitute an endorsement of the individual companies by the UN Global Compact.

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There is no ‘Plan B’
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work and galvanize
our action.
”
Ban Ki-moon, UN Secretary-General
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