UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
Sustainable Consumption and Production along Global Value Chains:Trends and Focus Areas
Michael KuhndtHead, CSCP
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
SCP on the international agenda
Supporting the Switch to SCP
SCP in global value chains
SCP on the international agenda
3Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles World Summit on Sustainable Development identifies changing C&P patterns as overarching theme (chapter 3)
2002UN Guidelines for Consumer Protection extended by Chapter G: Promotion of Sustainable Consumption
1999
SCP on the international agendaInternational attention to Sustainable Consumption & Production
Human Development Report: Consumption for Human Development, problem analysis
1998Roundtable on SC in Oslo involving businesses, NGOs and governments
1994Agenda 21: Develop a better understanding of the role of consumption and how to bring about more sustainable consumption patterns
1992
4Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Marrakech Process
10-year framework of programmes in support of regional and national initiatives to accelerate the shift towards sustainable consumption and production
SCP on the international agendaThe four elements of the Marrakech Process
Organizing regional
consultationsin all regions to identify needs
and priorities for sustainable
consumption and production
Building regional
strategies and
implementation mechanisms with regional and national ownership;
Implementing concrete
programmes and projects
on the regional, national and local levels;
Monitoring and evaluating progress
and exchanging information and experience at
the international level.
5Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
MarrakechMeeting
2003
Costa RicaMeeting
2005
International
Regional
National
Latin America
Buenos Aires (2003)Managua (2003)Managua (2005)
Asia-Pacific
Yogyakarta (2003)Seoul (2003)
Europe
Lithuania (2004)Belgium (2004)Berlin (2005)
2003 2005
Africa
Casablanca (2004)Nairobi (2005)
Addis Ababa (2006)
National RoundtablesChina, India (2006)
South Africa, Brazil (2007)
SCP on the international agendaThe Marrakech Process at the international, regional and national level
20062004
StockholmMeeting
2007
2007
Marrakech Task Forces
Cooperation Dialogue
6Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Preparation
Extension
Mainstreaming
Agenda Setting
60s 70s 80s 90s 00s
Europe Production
Consumption
SCP on the international agendaStrategies for SCP – Governments
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
SCP in global value chains Supporting the
SWITCH to SCP
SCP in global value chains
SCP on the international agenda
8Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Ecological footprint and human development
Source: adopted from WWF 2005
Hum
an Developm
ent Index
Ecological Footprint per person
Sustainable Development
High demand on biosphere per person
High demand on biosphere per person
Low human developmentWithin carrying
capacity
Low human development
Minimum acceptable level of Human Development
Wor
ld a
vera
ge b
ioca
paci
ty
avai
labl
e pe
r per
son
‚Developed Countries‘
‚Developing Countries‘
leap frogging
traditional
9Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Ecological footprint and HDI Baltic and Eastern European countries
Source: Global Footprint Network 2006
Hum
an Developm
ent Index
Ecological Footprint per person
‚Developed Countries‘
‚Developing Countries‘
Development of Baltic / Eastern European average
2003
1975
10Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Ecological footprint and HDI Baltic and Eastern European countries
Source: Global Footprint Network 2006
Hum
an Developm
ent Index
Ecological Footprint per person
Sustainable Development
High demand on biosphere per person
High demand on biosphere per person
Low human developmentWithin carrying
capacity
Low human development
Minimum acceptable level of Human Development
Wor
ld a
vera
ge b
ioca
paci
ty
avai
labl
e pe
r per
son
‚Developed Countries‘
‚Developing Countries‘
Czech Rep.Estonia
Hungary
Latvia
Lithuania
Bulgaria
Rep. Moldova
Romania
Russian Fed.
Ukraine
Poland
Belarus
11Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Resource Consumption in different Countries
12Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Increasing evidence for burden shifting – an European Perspective
European consumption – global burden
Source: Wuppertal Institute
Global systems of production and
consumption lead to rising resource
extraction in developing countries....
13Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Industrialised countries~ 20% of ecological backpack~ 80% of value added
Developing countries~ 80% of ecological backpack~ 20% of value added
End-of-life Managers ConsumersRetailersProducersResource
Extraction
SCP in global value chains Burden shifting: Inequalities along global value chains
14Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Sustainability impact along value chains
SCP in global value chains Opportunities in value chains
high
low
Pote
ntia
l con
tribu
tion
to
sust
aina
bilit
y
Value Chain
UsageDistributionIn-house production
Supplierproduction
Raw materialextraction
15Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Management focus in value chains
Man
agem
ent R
espo
nse Focus of current
management effort
only ad hoc and sporadic management
high
low
Value Chain
Current management efforts
End-of-lifeUsageDistributionIn-house
productionSupplier
productionRaw material
extraction
16Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Classic mismatch between opportunities and efforts
Opp
ortu
nity
for r
esou
rce
effic
ienc
y
Policy, performance and reputation opportunities
80% of overall efforts focus on 20% of the total risk
high
low
Value Chain
Natural Resources Transportation Manufacturing
sitesProduct
distribution ConsumersConsumption DistributionManufacturingTransportationNatural Resources
Sustainability in the supply chain?
Sustainability during consumption?
17Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Resource efficiency can strengthen local
enterprises
SCP in global value chains SME in developing countries
Expenditures including merchandise
4%
1%
26%
42%
10%
10%
7%
36%
PremisesMachinery maintenanceMaterialsMerchandise for saleSalaryWater, ElectricityOther
Cost structure of micro-enterprises :
Costs for material & energy 3.6 as high as salaries paid.
18Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Classic mismatch between opportunities and efforts
Opp
ortu
nity
for r
esou
rce
effic
ienc
y
Policy, performance and reputation opportunities
80% of overall efforts focus on 20% of the total risk
high
low
Value Chain
Natural Resources Transportation Manufacturing
sitesProduct
distribution ConsumersConsumption DistributionManufacturingTransportationNatural Resources
Sustainability during consumption?
19Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
BhutanGermany
SCP in global value chains Lifestyles in different countries
20Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Consumption Cluster
source: Wuppertal Institute
material intensityper capita per year
76 tonnes =
0 224 46 6810tonnesper capita
100 % mineral rawmaterials
fossilefuels
residence
food
clothing
health
education
leisure
community
others
6
11
13
5
9
6
20
29
biological rawmaterials
visible material loadhidden material “backpack”
unconvertedmaterials
earthdisplacement
erosion
21Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Housing: The right for more energy efficient housing
Source: Enerdata (2004) in EEA (2006)
• In countries of temperate and cold climates, typically 80-90% of total life cycle energy use in housing is consumed during the use phase of a building’s life.
• Potential energy efficiency lies in electric appliances and lighting.
Energy use in the use phase of housing is typically 80-90% !
Distribution of energy use in housing use phase in %
22Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Mobility: The right to have affordable low-carbon mobility
Source: WWF-UK Evidence Base 2006
Use phase is the most important lever for change in private road transport !
CO2 emissions over the life-cycle of a vehicle
23Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Global Consumer Class in Asia
The GCC – a new ‘lower middle-class’
Source: Territory size shows the proportion of all people living on PPP US$ 20-50 a day (US$ 7000-17.800 / year) worldwide, that live there.
24Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Fostering new markets
Base of the Pyramid
Poor / extreme poorBase of the Pyramid= 4 billion customers
Traditional business focus
Neglected markets
Middle class
High income
Go for inclusive consumption?
Anwara Begum, a Grameen 'telephone lady'
(Credit: Nurjahan Chaklader)
25Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Tapping the Fortune at the Base of the Pyramid
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
SCP in global value chains
Supporting the SWITCH to SCP
Supporting the SWITCH to SCP
SCP on the international agenda
27Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Combine macro- and micro elements!
Supporting the SWITCH to SCP
Support research and
concept development
Pilot project implementation and monitoring
Best practice assessment and
exchange
Implementation tools and
instruments
Dialogue platforms and
network building
Enabling framework and
policy implications
MACRO
MICRO
28Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Combine macro- and micro elements!
Supporting the SWITCH to SCP
Support research and
concept development
Pilot project implementation and monitoring
Best practice assessment and
exchange
Implementation tools and
instruments
Dialogue platforms and
network building
Enabling framework and
policy implications
MACRO
MICRO
29Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPBuilding a supportive knowledge framework
Life Cycle Assessment
Life Cycle Design
Supply Chain Management
Management System
Performance Evaluation
Sustainability Reporting
Internalfocus
Stakeholderfocus
Product chainfocus
Cl. Prod.Assessm.
Env. Cost.Account.
Mea-sure
Com-muni-cate
Source: CSCP/Wuppertal Institute
30Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Accounting for Consumption
Individual resource budgets for awareness
raising
Scenarios: Individual consumption decisions
Comparison … my parents, me, my kids ... me at different
lifetimes
Individual level What impacts does
my consumption
have?
How would this change
if...?
Supporting the SWITCH to SCPBuilding a supportive knowledge framework
31Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Combine macro- and micro elements!
Supporting the SWITCH to SCP
Support research and
concept development
Pilot project implementation and monitoring
Best practice assessment and
exchange
Implementation tools and
instruments
Dialogue platforms and
network building
Enabling framework and
policy implications
MACRO
MICRO
32Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPThe role of financial support models
Financial support matters...• Lack of funding / credit restrictions as a barrier to realising
SCP• Overcome short-term perspective of SMEs• Technology transfer depends on funding availability
Directly
Indirectly
• Financial institutions role in setting the framework for SME operations
• Financial institutions’ assessment of business success (e.g. considering environmental responsibility considered as better risk management)
• Diffusion of SCP concepts through credit officers, investment guidelines, technical specifications, ...
• Self-interest to support financially viable environmental or social entrepreneurs
33Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPThe role of new financial models
SCP-funds for SMEs?Example: TMB Bank
Advice on investment planning to projects on• energy conservation, • environmental management, • innovative projects, • business for social concern, etc.
Financing in following programmes:
Loan for investment in factory waste treatment and use of cleaner production technology
Loan for biogas technology in industries such as tapioca, palm and huge pig farms
Grant to SMEs for new non- CFC equipment & working capital loan for using new technology
Credit for Waste Treatment
Credit for Investment in Biogas System
Ozone Project Trust Fund
34Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPThe role of Marketing
Advancing Sustainable Lifestyles through Marketing and Communications
UNEP on Sustainable MarketingManual talkthewalk.net
Online database of ads for sustainable products
• How can marketing foster sustainable consumption?
• How companies do it: Case studies
• How can I do it? Tips, tools and resources
35Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Nutrition
fields of demand
Housing
Clothing
Tourism
Mobility
Communication
...
Mining
Manufacturing
Logistics
Business services
Consumer services
Retail
...
sectorsMultiple
relationships
No clear matching of sectors and
fields of demands
Promote sector co-operation in
fields of demand?
Current focus of policy makers and businesses
Behaviour change on consumer level needed!
Agriculture
SCP in sectors and companies Matching sectors and field of demands
36Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Combine macro- and micro elements!
Supporting the SWITCH to SCP
Support research and
concept development
Pilot project implementation and monitoring
Best practice assessment and
exchange
Implementation tools and
instruments
Dialogue platforms and
network building
Enabling framework and
policy implications
MACRO
MICRO
37Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPBuilding a supportive policy framework
Soft
Har
d Finance mechanisms
Fees and User Charges
Voluntary agreements
SCP Taxes
Norms and Standards
SCP Liability
Certificate Trading Technology Transfer
Research andDevelopment
Subsidies
Education and Training for SCP
Eco-Labelling
Sustainability Reporting
Consumer Advisory Services
Information Centres
SupportReward / Penalise Motivate
Det
erm
inin
g fa
ctor
s
Government strategy
Green Public Procurement
SCP Monitoring
38Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Resource efficiency innovation for enhancing competitiveness
Environmental reform of fiscal systems, covering all instruments
Integrate public policy and business strategies Dialogue between businesses and policy makers
Example: Resource efficiency1. Phase: Preparation 2. Phase: Extension 3. Phase: Mainstreaming
Singular economic instruments to promote resource efficiency
Finance
Consumer responsibility for reaching resource efficiency
Consumer ProtectionResource efficiency as a driver
for structural innovation
Resource efficiency as cost issue for enterprises
Economy
Resource efficiency key to wide range of environmental issues
Early environmental concerns about resource consumption
Environment
Technical solutions and potential for resource efficiency
Research
39Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPOpportunities and challenges
Challenges
Develop financial models for SCP
Strengthen national policy
instruments
Towards SCP
Enable Sustainable
Consumption
Tangible and visible project
results
Include SCP in policy making
Include SCP in business &
investments
Next steps
Up scaling ofproject results
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
Thank you for your attention !!!Michael Kuhndt
CSCP
[email protected] + 49 - 202 . 45 95 8 - 20Fax + 49 - 202 . 45 95 8 - 30
www.scp-centre.org
41Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP on the international agendaSCP in the EU
EU SCP Action Plan (of the DG Environment and the DG Enterprise)
Towards a Green Paper • Background Document released• Consultation process ongoing
Communication• In 2008• Based on consultation
TimelineLeveraging Innovation
“...Build on, bring together, and improve coherence of existing policies...”
Better Products
Leaner And Cleaner Production
Smarter Consumption
Global Markets
Dynamic Performance Requirements, Sustainability Labels, Eco-Design Instruments, Standardisation
Lead Market Initiative, Networking Of Innovation Stakeholders
Resource Efficiency Targets, Eco-Innovation and Environmental Technologies, Review of EMAS, SMEs
Retailer agreements, Market-Based Instruments, VAT rates, EU Eco-Label, Advertisement, Green Procurement,
“Exploiting first mover advantages and leveling the playing field worldwide for sustainable technologies and products”
42Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCPModes of engagement – online repositories for SME tools
Easy access to range of targeted and tested tools
Different level of complexity and resource requirements
Avoid ‘one-fits-all’, but consider different ‘customer-groups’ and project setups
Reference publications, newsletters, guidelines
Helpline / expert networksInformation clearinghouse
Databases (listing technologies, products and services, providing
institutions)On-site visit and audit
Consultancy services (feasibility studies, finance models, legal
advice)Seminars, trainings, workshops,
symposiumsTrade fairs and exhibitions
Demonstration projectsFact-finding tours
Local business networks
43Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Models for poverty-oriented SCPModels for addressing key challenges
Providing access to products and services
Developing innovative products and services
Knowledge and education
Infrastructure and good governance
food
construction
financeenergy
healthsanitation
footweartextile & apparel
Create local income
44Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Environment and developments in global value chains Asian countries
Source: Global Footprint Network 2006
Hum
an Developm
ent Index
Ecological Footprint per person
Sustainable Development
High demand on biosphere per person
Within carrying capacity
Low human development
Minimum acceptable level of Human Development
Wor
ld a
vera
ge b
ioca
paci
ty
avai
labl
e pe
r per
son
‚Developed Countries‘
‚Developing Countries‘
Bangladesh
Cambodia
China
India
LaosNepal
Myanmar
45Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Supporting the SWITCH to SCP... a common learning process
Mutual learning
Learning processes
EuropeanEnvironmental
awareness
Sustainability Management
Tools and instruments
AsianManagement
traditions
Local institutions, norms, values
‘Asian economic success story’
AsianTangible and visible
improvements
Local capacity development
Political framework conditions
EuropeanImport- and export
regulations
Demand for sustainable
products
Technological cooperation
Experience Framework
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
The SWITCH to SCP
Introducing the CSCPIntroducing the CSCP
Environment and global value chains
SCP on the international agenda
47Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Federal Ministry for the Environment, Nature
Conservation and Nuclear Safety
United Nations Environment Programme
for Climate, Environment and Energy
Introducing the CSCPOrganisational Setup
CSCP
A collaboration by
Supported given by
UNEP/Wuppertal Institute Collaborating Centre on
Sustainable Consumption and Production (CSCP)
Wuppertal Institute UNEP
North Rhine-Westfalian Ministry for Environment,
Agriculture and Consumer Protection
NRWFederal Ministry
for Economic Cooperation and
Development
German state
Business and Employment
Support Agency
Wuppertal
48Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Companies
Introducing the CSCPConsumption, production and policy choices
Consumers
Finance
Institutions
&
Govern-ments
&
Others
Companies
End-Of-life managers
Consumers
Retailers
Producers
Resource Extraction
Production choices
Supply
Consumption choices
Demand
Policy choices
Local and National Development
49Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Introducing the CSCP Thematic approach
50Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
Introducing the CSCP Strategic Priority Areas
Encouraging SMEs to engage in SCP activities
Guiding industry sectors on their role to achieve SCP
Exploring an effective, market based instrument mix for promoting SCP along global value chains
Awareness-raising and capacity-building for governments;
Collaborating with local sustainable development agencies;
Incorporating SCP into micro- and development finance.
Encouraging sustainable lifestyles;
Communicating SCP to consumers effectively;
Strengthening role of government in promoting lifestyles.
UNEP/Wuppertal Institute Collaborating Centre on Sustainable Consumption & Production
SCP on the international agenda
Supporting the Switch to SCP
SCP in global value chains
SCP on the international agenda
52Michael Kuhndt cscp | www.scp-centre.org SCP Conference, Vilnius, March 2008
Role of business for enabling sustainable lifestyles
SCP in global value chains Classic mismatch between opportunities and efforts
Opp
ortu
nity
for r
esou
rce
effic
ienc
y
Policy, performance and reputation opportunities
80% of overall efforts focus on 20% of the total risk
high
low
Value Chain
Natural Resources Transportation Manufacturing
sitesProduct
distribution ConsumersConsumption DistributionManufacturingTransportationNatural Resources
Sustainability in the supply chain?
Sustainability during consumption?