There has been a longstanding urban legend about Wall Street being a good ole boys’ club, sexist and exclusive with a cornucopia of decadent rewards for those on the inside, rewards that a recent blockbuster film has done much to sensationalize. But we’ll get to that in a minute. A Bloomberg article last week revealed that much of this is indeed, factual, and is directly linked to college fraternity culture.
Based on some three dozen interviews, the article describes “a network whose Wall Street alumni guide resumes to the tops of stacks, reveal interview questions with recommended answers, offer applicants secret mottoes and support chapters facing crackdowns.”
According to authors Max Abelson and Zeke Faux, the line begins forming in college fraternities, which is where the young men are first exposed to the advantages of operating outside the realm of government regulation. Students vying for internships, in an industry where 22 year-olds can make $100,000 a year or more, find that their fraternity affiliations can, in many cases, hard-wire them into open jobs. Given how extremely competitive these internships can be, (about 2 percent of applicants are accepted at Goldman Sachs), this is a significant advantage.
Fraternity candidates at Dartmouth’s Alpha Delta received emails from Wells Fargo assuring them that their resumes would be placed at the top of the pile.
Once recruited, the story says, the new hires are sent back to campus to recruit more from the same fraternity. One recruiter from Barclays, made a comment at a recruiting reception at the University of Pennsylvania, that “we’re trying to create Sigma Chi on Wall Street, a little fraternity on Wall Street,” which more or less summarizes the attitude.
There may be nothing illegal about this, but that is not the same thing as there being nothing wrong with it. Not only is it patently unfair, but think about what kind of culture us being perpetuated, when candidates are being selected to help manage the world economy based on their demonstrated ability to be the best drinking buddies. We’ve already seen the damage that the party atmosphere on Wall Street can do, if anyone can still remember 2008. Certainly no one on Wall Street is thinking about that now, not as we draw the curtain on the best stock market year since 1997. However, I am sure that many of the 1.3 million Americans who just get kicked off unemployment are still thinking about it.
“How can cities contribute to the advancement of sustainable development and address issues including water, energy and waste?”
Not only is there much that cities can do to advance sustainable development, it is critical that they begin doing so. With 50 percent of humanity already living in cities and emitting 80 percent of all greenhouse gases, with far more arriving in coming years, as Schneider Electric‘s Mike Calise said, “the battle for our future is going to be won or lost in the cities.”
The good news is that cities are in a good position to win that battle. The concentrated population provides tremendous leverage. Retrofitting skyscrapers, for example, with systems to improve energy or water efficiency, can have the same impact as taking individual measures across entire neighborhoods or even small towns.
Look at New York City, where 82 percent of residents travel to work by public transport. That’s one reason why the Big Apple’s per capita energy consumption is lower than any of the 50 states.
The Smart Cities movement, spearheaded by companies like IBM, Cisco and Schneider Electric has injected advanced technology into the mix. Opportunities are plentiful in buildings, where, according to the IEA, 80 percent of the potential for energy savings remains untapped. Advanced building management systems integrate HVAC, lighting, security management and fire protection equipment, utilizing sensors to direct resources to where they are needed. All of this is enhanced by analytics that predict occupancy and weather conditions, taking proactive measures to prepare the building. Cisco now has the capability to discover, measure, and manage all devices connected to the internet, providing dramatic savings by turning off idle equipment. Smart meters help residents understand their energy usage details, allowing them to save energy and money.
Transportation options range from hybrid-electric buses, to car-sharing services, to smartphone apps that encourage people to walk, bike or use public transit. Schneider has smart charging systems for electric vehicles. Energy storage systems, either solar integrated, or vehicle-to-grid (V2G) will facilitate utilization of renewable resources. Smart parking systems can help drivers find parking spots quickly, reducing fuel consumption and time spent searching.
This sustainability business can get really complicated sometimes. Although we always like to press for more than “less bad,” in the solutions being offered, with the understanding that less bad won’t be good enough in the long run unless it’s truly sustainable, there are times when we do have to choose between the lesser of two evils.
A good example of this is the recent practice of constructing houses in Kenya out of polystyrene, otherwise known as Styrofoam, blocks. Proponents of this practice claim that this use of this material reduces the impact on local forests that would otherwise be stripped of wood to feed the building boom that has occurred there since independence. The boom has led to the disappearance of tree cover along with the appearance of numerous quarries. The impact on the ecosystem has been significant.
“There are a lot of mudslides and landslides due to destruction of the catchment areas,” said Eustace Kathuni, an elder in the Upper Eastern Kenyan village of Kiereni. “We had very unique monkeys but not anymore because the migratory corridor was destroyed. There are no fish in the rivers while the African love bird has disappeared.”
The expanded polystyrene (EPS) panels are more affordable than other materials, and they can be purchased a few at a time, which makes it easy for someone like schoolteacher Alfred Kinyua to save up for a new house by accumulating the panels.
It looks like Elon Musk and his friends at Solar City are at it again. First, there was the Tesla electric car. Then came solar energy provider Solar City. Then came the financial innovation of bonds backed by solar power. Now they appear to be combining all of these, with Solar City offering commercial energy storage systems based on batteries produced by Tesla Motors.
The batteries, which are “about the size of a small refrigerator,” were originally developed to store solar energy during periods of cloud cover or darkness, which, of course, they certainly can do.
But the leaders at SolarCity saw another, perhaps larger opportunity—providing short term storage for buildings to reduce their peak power demands at the time of day when power is most expensive. People in the industry call this “load leveling,” and it not only benefits customers, but it benefits the utility and the environment as well by reducing the need for inefficient and dirty “peaker plants” that are often used to fill in supply gaps during the busiest times of the day.
I just returned from India last week. Between the unbreathable air in Delhi, due to the multiplicity of smokestacks and tailpipes belching black smoke, and the mountains of trash littering the roadsides, it’s clear that this is a country with a long road ahead of it, when it comes to finding a way to exist sustainably on this planet. Yes, there are some signs of progress, albeit small ones. Solar hot water systems are prevalent. Some towns have outlawed the use of plastic shopping bags. Woven cloth bags are available as an alternative.
A larger step was taken by the Indian government this year, in the form of the Companies Act, 2013. This legislation requires companies to take action, make investments, and report against a number of metrics related to Corporate Social Responsibility (CSR). Last week, PwC India released a Handbook on Corporate Social Responsibility in India, providing guidelines to help industry to comply with the regulation. The guide was developed for the Confederation of Indian Industry (CII). While CSR does not in itself address the environmental issues mentioned above, it does set the companies and the country on a path to eventually deal with them.
Clause 135 of the Companies Act, 2013, which was passed on 29 August 2013 is applicable to companies with an annual turnover of 1,000 crore INR ($161 million) and more, or a net worth of 500 crore INR ($80 million) and more, or a net profit as low as five crore INR ($800,000) and more. This will, in some cases extend to small and medium sized enterprises (SME).
This week, Cisco Systems released their 9th Annual Corporate Social Responsibility (CSR) Report. The comprehensive 160-page report is divided into five major sections: Governance and Ethics, Supply Chain, People, Society, and Environment. This is a broad sweep, and as CEO John Chambers says in his opening remarks, “Our focus on creating value for society, the environment and our business is reflected in the breadth of our commitments: from investing in our employees to improving labor standards in our supply chain, and from improving healthcare to reducing our environmental footprint. These are all multi-year efforts that require a long-term view to achieve positive outcomes.”
In the governance and ethics section, the company conducted five stakeholder sessions around the world to get feedback on environmental, social and supply chain issues. The company reported that they have met all of their objectives in this section including: employee certifications for code of business conduct, human rights training, and deepening engagement with socially responsible investors.
They also were recognized by the Carbon Disclosure Project, Dow Jones Sustainability Index, and the Global 100 for their CSR achievements.
We all know that Elon Musk is one of the world’s great innovators. The South African-born developer of PayPal, and current CEO of both Telsa Motors and Spacex may well be a legend in his own time. In 1992, he dropped out of a Ph.D program in Physics at Stanford to pursue entrepreneurial aspirations in the Internet, space exploration and renewable energy. To date, he has achieved major successes in two out of three.
And now, as the Chairman of SolarCity, he might have achieved a Triple Crown. The solar installation company has just become the first of its kind to offer bonds backed by rooftop solar panels.
This financial innovation will allow solar companies to move away from becoming manufacturers and distributors of solar equipment, into energy companies, selling solar power as a service to their customers. The move is reminiscent of the move Xerox Corporation made back in the 60s, when they moved from selling copiers to selling copies by the click through leasing arrangements. The move proved to be critical to the company’s long-standing success.
I was disappointed to see the AP story last week, by Dina Capiello and Matt Apuzzo, an incomplete and shallow analysis, purporting to be an exposé of the current biofuel industry.
Characterizing the ethanol industry as “an ecological disaster,” is a distortion of the facts. Much of what they have described: the topsoil erosion and agri-chemical runoff, applies equally to all of modern agricultural methods and should be understood in that context. Yes, of course, modern agriculture does have many problems that need to be addressed. And the current corn ethanol mandate does extend that.
Who wouldn’t rather see National Parks, forests or prairies than cornfields? But given the nation’s enormous appetite for, and absolute dependence on, energy, that’s not a fair comparison. The more appropriate comparison should be between cornfields and coal mines, or cornfields and oil fields, or fracking wells, or tar sands oil brought down through enormous pipelines or perhaps even, cornfields and battlefields.
For them to weigh in with this story at a moment when the future of this vital attempt by our nation, lagging as we are in our efforts to reduce our carbon footprint, to move decisively in the direction of a cleaner energy policy, is simply irresponsible.
Last year, Microsoft committed to become carbon neutral. The mechanism for achieving this is an internal carbon fee charged to each business group and department for the amount of carbon emissions associated with their operations. These fees are treated as real money so that the cost of doing business effectively gets higher, particularly for those divisions with high energy consumption. The result has been slowly working its way through the system and impacting decisions.
The beauty of an approach like this is that managers who may care about climate change, may not even believe it is a problem, are now making plans to ensure their carbon footprints are minimized.
One very concrete result of this experiment is the announcement this week that Microsoft has signed a twenty year purchase power agreement from a wind farm that is to be newly constructed in Jack County, Texas, some 70 miles northwest of Fort Worth.
The timing is significant. Just a few days after the one-year anniversary of Hurricane Sandy, President Obama issued an Executive Order designed to encourage Americans to incorporate climate change awareness into their activities and plans.
In that order, he writes, unambiguously, “The impacts of climate change — including an increase in prolonged periods of excessively high temperatures, more heavy downpours, an increase in wildfires, more severe droughts, permafrost thawing, ocean acidification, and sea-level rise — are already affecting communities, natural resources, ecosystems, economies, and public health across the nation.”
In response, he calls on local governments, businesses, and individuals to, “improve climate preparedness and resilience; help safeguard our economy, infrastructure, environment, and natural resources; and provide for the continuity of executive department and agency operations, services, and programs.”
The Executive Order lays out the following actions:
- Several government agencies including, Defense, NOAA, and EPA, are to forge a plan to protect resources and watersheds
- All agencies are to make an inventory of climate change risk and actions they recommend to address them
- Resources such as open data frameworks to enhance cooperation between local governments, NGOs and the private sector will be established
As the battle over genetically modified foods continues to rage across the planet, significant victories are being scored on both sides. The victories on the pro-GMO side usually come about as announcements made by officials after a series of meetings of men in suits, talking quietly, behind closed doors, even, perhaps, making undisclosed promises or threats. The victories on the anti-GMO side are more likely to come after noisy rallies of people who are not so well-dressed. In both cases, however, there is someone in a position of authority listening.
The latest round was heard by Judge Jaime Eduardo Verdugo of the Twelfth Federal District Court for Civil Matters of Mexico City. He obviously was not persuaded by the men in the suits. Verdugo ruled that GM corn posed ”the risk of imminent harm to the environment.” He ordered the Mexico’s Secretary of Agriculture and Secretaría de Medio Ambiente y Recursos Naturales, (environmental protection agency), to “suspend all activities involving the planting of transgenic corn in the country and end the granting of permission for experimental and pilot commercial plantings” immediately.
Just about everything in our world is changing: the climate, the way we live, the way we make a living. Most of those changes are due to the advent of technology and the economy that propagates that technology around the world. At the heart of all of it, is money, the economic blood that flows through the system, collecting, storing and distributing value between people and enterprises, across distance and time.
Money, too, appears to be changing, impacted by the same electronic digital technology that is changing everything else. But will this new digital money simply be more convenient, or will it actually change the nature of our economy?
One big area where we see this happening is in developing countries where mobile money provides financial services in the form of secure digital transactions, ushering in a new era of a cashless economy. They allow rural farmers and vendors to easily process payments, even in outlying areas, allowing them to participate directly in the world economy. This is a big deal says Kosta Peric of the Gates Foundation, who is featured in the film, especially when you consider that some 2 billion people do not have access to any kind of modern financial system. You can’t build a business without one. “You need loans, you need a safe way to pay for things, you need a way to track your wealth. If you don’t have all of that, how can you grow? There is no way. But in developing countries, even people who don’t have a bank account, have a mobile phone.”
Yes, we have lots of natural gas right now. Yes, the prices are low. Yes, natural gas is cleaner than just about any other fossil fuel. That’s all good news.
Sadly, much of that natural gas is obtained by fracking, a drilling method that has many environmental agencies concerned. And fracking wells do not last long. That means that many more wells will be needed and the prices will invariably go up because of the costs of drilling ever deeper. This stuff does not come gushing out of the ground by itself the way those first Pennsylvania oil wells once did. And the low gas prices are dampening investment in renewables, which is, of course, exactly what the fossil fuel companies want.
Today’s natural gas story turns out to be a good one, for the most part. Here comes another player in from left field. As you may know, methane gas is being captured from many landfills around the country and burned to produce electricity. This is actually a good thing, because, according to EPA, methane is 21 times more potent that CO2 as a greenhouse gas. But when you burn the methane, it is converted to CO2 and water.
Now a company in California, called Clean Energy Fuels is taking landfill methane, and making it available for natural gas powered vehicles through a network of 35 filling stations across California.
Mike Ward, President of IKEA USA gave the keynote address at the 6th Annual Retail Industry Leaders Association (RILA) Conference in Orlando last week where he unveiled IKEA’s sustainability strategy.
I caught up with Ward a couple of days later to discuss the new strategy in greater detail.
TriplePundit: What are the main elements of IKEA’s new sustainability strategy?
Mike Ward: The new strategy really outlines for us how we want to transform the business in the next few years, using sustainability as a key platform of the business plan. People and Planet Positive is a way to explain to ourselves and to everyone what we’re going to be focusing on.
3p: So what’s different now?
MW: We’re looking at three change drivers. The first is a more sustainable life at home. We’ve always been fascinated with the way people live, and have focused our innovation on improving life, always at a low price. Sustainability adds another dimension to that challenge. Next we discussed energy independence and independence in the way that we source materials. That shows up in our commitment to renewable energy and the work we’ve done in our supply chain, particularly with respect to wood and cotton. The third aspect is a better life for the people and communities where we do business.
We’ve written quite a bit about e-waste here over the years. It is a growing problem that is oddly emblematic of our cyber-frenetic lives. Gadgets come and go with dizzying speed, the fruits of innovation that have ushered in our hyper-connected, information-rich lifestyle, have also grown into mountains of modern jetsam. At last count, there is somewhere between twenty and fifty million tons of the stuff being discarded each year. And like a lot of today’s trash, it is sometimes hard-pressed to find a final resting place, sometimes ending up in places like Africa or China where, desperate to extract bits of value, indigent people do themselves unintentional harm by exposing themselves to lead and other hazardous materials.
The electronics industry is worried about this, too. Legislation like the Responsible Electronics Recycling Act, which was introduced last year, but failed to pass, would have made it illegal to ship e-waste overseas and with takeback rules also in the offing, could well have caused some manufacturers to drown in their own, well, for lack of a better word…excrement. The bill is expected to be recycled next year.
But what about reducing the amount of e-waste to begin with?
A huge portion of this waste mountain consists of cell phones. Back when I was growing up, phones were quite a bit larger than they are now, but people rarely threw them out and hardly ever replaced them. They were extremely reliable and they did the one thing that they were supposed to do, make phone calls, very well and didn’t change much over the years. So it was not unusual for people to hang onto the same phone for twenty years or more. Not a lot of e-waste there.
So the idea behind Phonebloks, a phone that is made up of detachable blocks, each of which contains an upgradeable functional module, is that people would once again hang onto their phones, at least the main parts, for a long time.