Zurich: A European Greencity

 

Presentation written by:

Antoine MICHALAK, antoine.michalakpol@gmail.com

Xingkai FANG, singafong@163.com

Presentation supervised by: Assoc. Prof. Dr. Elena M. BARBU, elena.barbu@univ-grenoble-alpes.fr

The presentation is divided into three parts: social responsibility in Zurich, SCR in Asea Brown Boveri (ABB) and CSR in University of Zurich.

 

Corporate Social Responsibility of Zurich

Introduction

The city of Zurich is located at Zurich Lake, the fourth largest lake in Switzerland. Zurich is the major international economic, financial, scientific and artistic center of the country. It is the city with the most banking and financial institutions in the country, and is one of the “world cities”. According to Globalization and World Cities Research Network (GaWC), Zürich is the sixth largest banking and financial center in the world, behind London and New York. The downside is that in 2012, Zurich ranks second, as the most expensive city in the world according to the British Newspaper. But Zurich has a lot of things to say about the quality of life and many very responsible projects.

Switzerland is a country concerning about its environment while Zürich is one of the cleanest cities in the world. The Limmat river was ranked as the cleanest urban river in Europe according to the US Department of Agriculture in 2015. The citizens may even swim in Limmat in summer.

In order to sustainably protect its healthy ecosystem, Zurich has organized an urban plan that integrates a multitude of urban projects under Corporate Social Responsibility philosophy.

A Well-organized Urban Plan

This began in 1980 with a transport policy adopted by all the different cantons constituting Zurich. This policy, which is still relevant today, aims to improve the mobility of citizens while slowing down the use of private vehicles but also to establish the image of the city and improve the quality of life in the city while reducing the pollution of the area and noise.

This is how the metro and Zurich’s extensive tram network appeared. The use of this mode of electric and clean displacement has significantly reduced the carbon footprint. As it was enlarged, buses almost disappeared from the city center.

So far, Zurich has always been able to maintain this advance of modernity in new technologies geared towards ecology and the protection of the environment. In 2016, in a study by Arcadis, Zurich is considered the most sustainable metropolitans in the world.

“2000 – Watt Society” – Greencity

Even today, the city is embarking on a very ambitious project, always with the aim of reducing energy consumption. The construction of the Eco-neighborhood named Greencity. Greencity is the first district of Zurich built in accordance with the objectives of “2000 Watts Society” by Swiss subsidiary Losinger Marazzi. This eco-neighborhood will logically deliver this year.

Figure 1.3: “2000 – Watt Society” – Greencity

2000 – Watt Society

Ten years ago, the vision of a “2000-Watt Society” was developed at the Swiss Federal Institute of Technology (ETH) in Zurich. It is a model for energy policy which demonstrates how it is possible to consume only as much energy as worldwide energy reserves permit and which is justifiable in terms of the impact on the environment. It is possible when every person in every society limits their energy consumption to a maximum of 2000 watts.

Furthermore, at least 75% of energy needs were met using renewable energy sources, meaning that on an annual basis only one ton of greenhouse gas is given off per person per year. The 2000-Watt Society is Zurich’s approach to tackling climate change and the future conflict of resources.

The vision of a 2000-Watt society makes it possible to strike a balance between industrialized and developing countries and for everyone to thus enjoy a good living standard.

2000 Watts for A Higher Life Quality

The quality of life in the 2000-Watt Society does not entail any restrictions. On the contrary, security, health, comfort and the development of the individual are all improved, with incomes increasing by around 60 percent over 50 years. On a global level, sustainability will be a necessary condition for peaceful social co-existence.

To achieve this goal by 2050, Zurich has made commitments in the following areas:

  • Energy efficienc and renewable energies

Comprehensive energy services are offered along with consulting for constructioncompanies to pass on the necessary expertise.

  • Sustainable buildings

Almost all new constructions such as housing estates, school buildings and retirement homes, correspond to the Minergie Standard (for low-energy housing).

If Zurich succeeds in winning this challenge, it will again be an international example for cities that also want to preserve natural resources.

In addition to engaging in the restriction of its energies, Zurich is committed to solidarity and sustainable causes around the protection of natural places.

Zurich Zoo’s Action

In fact, some of its municipal monuments invest in projects oriented towards the sustainable protection of natural areas in the world.

This is particularly the case for the Zurich Zoo, which is mainly financed by private donations and grants from the city of Zurich to discover and save endangered animals. It is also heavily invested near the Masoala National Park in Madagascar.

It is in the area of ​​Masoala in Madagascar that Zurich Zoo provides its largest commitment to the protection of nature. Since 1995, each year it accounts for at least 125,000 US dollars in operating costs and sustainable development fund of Masoala National Park.

A perishing struggle is also being waged by the Zurich Zoo against the traffic in rosewood which exploded in 2009. In collaboration with the ETH Zurich, a DNA test was developed to determine the origin of the wood and thus to distinguish legal trade traffic. Thanks to its help, the European and American companies were all punished for their illegal act.

Figure 1.4: Illegal traffic of rosewood

The Zurich Zoo is carbon-neutral and fully offsets its residual CO2 emissions with certificates from the Makira Nature Park. This park near Masoala National Park is REDD + certified. REDD means “Reducing Emissions from Deforestation and Degradation” and refers to projects that prevent deforestation and promote reforestation. The preservation of the Makira Natural Park will prevent the emission of 33 million tons of CO2 in the next 30 years. Half of the revenue generated by this project is used directly to support the local population.

Corporate Social Responsibility of Asea Brown Boveri (ABB)

Introduction of ABB

ABB (ASEA Brown Boveri) is a Swedish-Swiss multinational corporation headquartered in Zurich, Switzerland, operating mainly in robotics, power, heavy electrical equipments, and automation technology areas. It is ranked 286th in The World’s Most Admired companies in the Fortune 500 global list of 2016. ABB has been a global Fortune 500 company for 23 years.

ABB is one of the largest engineering companies as well as one of the largest conglomerates in the world. ABB has operations in around 100 countries, with approximately 132,000 employees in December 2016.

Sustainability Governance

ABB’s business strategy focuses on sustainability principles and considerations which guide them what they manufacture, how they operate the company and the way they behave towards their stakeholders. These considerations help them to capitalize on market opportunities and to reduce safety, security, social and environmental risks, for the benefit of our customers, employees and all other stakeholders.

ABB’s sustainability vision is that, by 2020 and beyond, they will be recognized as a leading contributor to a more sustainable world through their unique business offering and sustainable business practices.

All ABB facilities are encouraged to implement management systems for health and safety, environmental and quality issues, while manufacturing and service sites are required to implement such systems. Globally, ABB has achieved external certification for health and safety management systems at 408 of 583 reporting locations, covering 81 percent of employees, and for environmental management systems at 392 locations.

ABB is a founder member of the United Nations Global Compact (UNGC) and has been closely involved in its development. Close collaboration with the UNGC, the Global Business Initiative on Human Rights and other such organizations helps ABB’s understanding of human rights and benefits their day-to-day business. They have been working to implement the UN Guiding Principles on Business and Human Rights and use the recommendations to assess expectations of corporate behavior.

Energy Efficiency, Renewable Energy and Climate

Reduce climate impacts

ABB has set themselves the target to reduce the energy intensity of business by 20 percent by 2020 from a 2013 baseline. This includes both direct fuel consumption and the use of electricity and district heating for manufacturing processes and to operate buildings. ABB also aims to cut greenhouse gas (GHG) emissions by reducing direct fuel consumption, converting to lower carbon sources of energy and improved handling of sulfur hexafluoride gas (SF6).

To implement the object, all sites were required to establish an energy savings program and to undertake actions to reduce GHG emissions. By the end of 2016, country energy savings plans were in place for 40 countries, covering 99 percent of ABB energy use, and more than 280 energy savings projects were under way at ABB sites.

Figure 2.3.1: Reduction in ebergy consumption since 2013

These focused activities have brought results, with absolute reductions in both energy consumption and GHG emissions realized between 2013 and 2016. However, due to lower revenues and capacity utilization, ABB’s energy intensity, measured as MWh per million US dollar sales, was 13 percent higher in 2016 than the 2013 baseline.

Energy Efficiency

A wide variety of energy savings projects were implemented across the company to achieve the reductions observed in 2016. Most commonly, and cost effectively, facilities implemented energy-efficient lighting solutions.

Other activities included : optimizing heating, ventilation and cooling processes ; investments in more efficient equipment ; investigating and optimizing compressed air systems ; behavioral change programs ; implementing or updating heat recuperation from machines and processes using their own technology.

Renewable energy

As part of ABB’s goal to cut both direct and indirect GHG emissions, ABB seeks to reduce the carbon intensity of their energy sources. Several ABB countries – Belgium, France, Italy and the Netherlands – now purchase all of their electricity from renewable sources. In Sweden, almost 20 percent of electricity purchased was “green” energy, while globally, 130 GWh, or almost 8 percent of ABB’s 2016 electricity was purchased as certified “green” electricity.

Figure 2.3.3 : Reduction in GHG emissions since 2013

Increasing numbers of ABB facilities are also focusing on installing on-site photovoltaic (PV) power plants to reduce environmental impact and demonstrate ABB’s solar capabilities. PV plants are now installed at 33 sites in 22 countries across Asia-Pacific, Europe and Latin America. While contributing only a small proportion to ABB’s global electricity needs, these plants are the key to local energy strategies to replace diesel generation with low carbon reliable power.

In late 2016, ABB has announced that they would install a fully integrated microgrid in Gujarat, India to help to boost renewable energy generation while reducing the dependency on fossial fuel.

Human Rights

Training and capacity building

ABB has been on its human rights journey for more than 15 years, publishing a formal policy in 2007, carrying out different forms of due diligence, and starting to embed human rights criteria in business processes before the UNGPs took effect in 2011.

  • Publishing a formal policy in 2007
  • Carrying out different forms of due diligence in 2011
  • Starting to embed human rights crateria in business processes before UNGP has taken effect in 2011
  • The launch of an international network of human rights advisors at ABB was achieved at the start of 2016, which is one year ahead of schedule.
  • Human rights are made part of ABB’s Sustainability Objectives of 2014 – 2020
  • Aim to raise awareness among managers to ensure human rights are understood and well managed by 2020

Figure 2.4.1 : Progress on human rights

Resource Efficiency

Waste and recycling

ABB’s products contain mostly steel, copper, aluminum, oil and plastics. Consequently, the main waste streams at ABB facilities are metal, oil and plastic, as well as wood and cardboard from packaging materials and paper from office activities.

Figure 2.5.1: ABB Group Sustainability Performance Report 2016 (Waste and Recycling)

ABB aims to optimize material use by reducing the amount of waste generated and increasing the share of waste that is reused or recycled. ABB is committed to reduce the amount of waste sent to final disposal – both hazardous and non-hazardous – by 20 percent by 2020. This is measured based on the proportion of total waste that will be sent to final disposal and compared to 2013 baseline.

Around 80 recycling or waste reduction projects were under operation in 2016, half of which focused on improved recycling practices. A number of these programs included a detailed waste analysis to ensure improvement activities were well-targeted.

Water in our global operations

Although the majority of our manufacturing processes do not consume significant amounts of water, ABB is still committed to reduce impact on water resources. Across ABB Group, water withdrawals were reduced by 6 percent (570 kilotons or 570,000 m3) during 2016.

Water Efficiency Projects = Monitoring (water flows) + Recycling/Reuse (of water) + Repair/Refurbishment (of water systems) + Conservation (of water) + Awareness-raising (of saving water)

The use of closed-loop systems for process water and the reuse of water in other ways, such as in gardening, saved approximately 4,800 kilotons (4.8 million m3) of water in 2016. Without this recycling and reuse, ABB’s water withdrawals would have been 52 percent higher. In addition, the use of closed-loop systems for cooling water eliminated more than 5,800 kilotons in water withdrawals.

Almost 50 percent of ABB’s total water withdrawals were used for cooling processes, 20 percent for manufacturing processes and the remainder for domestic purposes such as sanitation, cooking or garden maintenance.

Figure 2.5.2 : Graphic of water withdrawals and water reused/recycled

Corporate Social Responsibility in University of Zurich

Financial-Economic Analyses of the Relationship of Sustainability Attributes and Firm Performance

Cooperation: University of Zurich, Zurich Cantonal Bank

Supported by: Commission for Technology and Innovation (CTI)

This project studies the concept of sustainability on a disaggregated firm. The research group collected the databases of listed companies from established data providers on governance, environmental performance and media reputation. They also merged the environmental, social and governance (ESG) information with the financial data, which leads to the evaluation of risk-return profiles of portfolios. This method enabled the team to identify the risk and return-related characteristics and to gain insights about the ESG performance of certain industries.

Empirical Analysis of the Relationship between Corporate Sustainability and Financial Performance

Cooperation: Bank Sarasin

This project aims to analyze the relationship between the corporate social responsibility (CSR) ratings of American and European corporations and their stock returns. The analysis of econometric showed that a firm’s environmental and social activities (in comparison with other firms in the industry) are associated with positive stock returns.

The Effects of CSR and Environmental or Social Policy on Stock Returns: An Application of Modern Event Studies

Supported by: Swiss National Science Foundation (SNSF)

This project empirically examined the effects of corporate social responsibility (CSR) and environmental or social policy (ESP) on stock returns. The workings of this relationship are of particular importance for investors, managers, and policy makers. To this end, the project employed statistical event studies, which analyzes the influence of unexpected market information regarding CSR or ESP on firms’ so-called abnormal returns. Another focus of this project was the preparation of a robust international financial dataset (CCRS Financial Dataset). This dataset served as the basis for the application of modern asset pricing models.

Appendix – Figures & References

Figure 1.3: “2000 – Watt Society” – Greencity

Figure 1.4: Ilegal traffic of rosewood

Figure 2.3.1: Reduction in ebergy consumption since 2013

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Figure 2.3.3 : Reduction in GHG emissions since 2013

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Figure 2.4.1 : Progress on human rights

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Figure 2.5.1: ABB Group Sustainability Performance Report 2016 (Waste and Recycling)

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Figure 2.5.2 : Graphic of water withdrawals and water reused/recycled

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References :

Zurich City: https://www.ouest-france.fr/leditiondusoir/data/837/reader/reader.html#!preferred/1/package/837/pub/838/page/5

Greencity: https://www.bouyguesdd.com/greencity-a-zurich-le-premier-ecoquartier-suisse-certifie-site-2000-watts/

Zurich Zoo: https://www.zoo.ch/fr/protection-de-la-nature-animaux/projets-de-conservation/masoala

ABB Report of 2016: http://sustainabilityreport2016.e.abb.com/servicepages/downloads.html

Projects in UOZ: http://www.ccrs.uzh.ch/en/research/sustainable-finance/projekte/abgeschlossene-projekte/csr-eventstudies.html