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Time to muck in: Soils must take centre-stage in farming policy, study argues

Time to muck in: Soils must take centre-stage in farming policy, study argues

Royal Society study author argues people 'should be as appalled' by badly managed soils as deforestation

Growing evidence of the myriad benefits well-maintained soils can deliver by combating climate change, alleviating flooding, boosting crop yields, and supporting biodiversity, has been highlighted in a new Royal Society report today, which argues the UK now stands at a "critical moment" for the future of the country's soil health.

Bringing together the latest evidence on the "diverse and underappreciated" functions soils perform, the science body's research points to many "win-win" benefits that arise from protecting and improving soils.

As well as enabling 95 per cent of human food production, soils are potentially huge stores for carbon dioxide, have a key role in filtering water to boost water cleanliness and guard against flooding, and provide critical habitats for nature, the report notes.

Better soil management can also help boost farmers' agricultural productivity, control pests and diseases, and deliver wider societal benefits, such as helping to improve air quality and contributing to the UK's 2050 net zero emissions goal.

But the report argues the critical importance of soil health has too often been overlooked by land managers and policymakers alike, and that farmers have not been given enough support or incentives to focus on effective management of the soils on their land.

The study comes amid growing concern about the health of soils both in the UK and worldwide. The UN has estimated the world may only have an estimated 60 harvests left on average before soils are too degraded to feed the global population, while a 2014 study concluded there may only be 100 harvests left in the UK.

The Department for Environment, Food and Rural Affairs (Defra) estimates that topsoil erosion alone costs England and Wales £150m a year, with around £40m of this is attributable to farming productivity losses.

Alastair Fitter, emeritus Professor of Ecology at the University of York and a lead Fellow on the report, said people "should be as appalled by badly managed soils in our fields as we are by the loss of our woods or wetlands".

"Our soils lock away more carbon than the vegetation on them, they provide 95 per cent of our food, and when managed well they limit the risk of flooding, while supporting a vast array of life," he pointed out. "Too often, though, they are 'out of sight, out of mind'."

However, with the UK embarking on a new future outside the EU and the bloc's Common Agricultural Policy (CAP), he said there was now a unique opportunity to change course and take much needed action to restore the health of the nation's soils.

"The government is at a critical moment in setting the course for British farming outside the EU and this evidence synthesis shows how important it is that soils take centre stage in land management policy," Fitter added.

According to the OECD, most agricultural policies around the world today - including $620bn of farming subsidies across the EU and OECD countries - are not well-aligned with environmental objectives. The Planet Tracker initiative estimated this week that if that status quo remains, food-related greenhouse gas emissions could rise by 80 per cent by 2050 and cropland use could grow by 70 per cent, while nitrogen and phosphorus application in fertilisers could also soar.

In the UK, however, there are signs that a change in approach is imminent. The government's 25 Year Environment Plan contains a raft of targets and ambitions for improving the state of the natural environment, including a commitment to achieving sustainable soil management by 2030, with plans afoot to develop a healthy soils indicator to provide a baseline for assessing progress against the new targets.

It has also tabled an Agriculture Bill setting out a new post-Brexit framework for farming subsidies in the UK, with a view to introducing a system over the next few years that rewards land managers for providing public goods services such as healthy soil management and flood protection, although final details of how the scheme will work in practice have yet to emerge.

The proposed changes are urgently needed, according to campaigners. Defra was last month accused of a "staggering" failure to invest in soil health monitoring in recent years by the Sustainable Soils Alliance, but the government insists it is "committed to improving the health of our soils", and has stressed the proposed Agriculture Bill would help address many of campaigners' concerns.

"We are developing a healthy soils indicator to set these new soil health targets and our landmark Agriculture Bill specifically details how farmers will be supported to protect and improve the health of our precious soils," it said. 

Today's Royal Society report said that while many landowners and farmers already manage their soils to a high standard, doing so costs money, and despite the wider societal benefits of boosting soil health, current incentive schemes fail to adequately support farmers to embrace best practices.

Part of the problem is that the negative impacts of soil erosion is rarely felt on farms themselves, but tend to affect neighbours, downstream water users and other ecosystems, meaning the costs of poor soil health are borne elsewhere.

As such, the report argued that 2020 opens up an opportunity to develop new incentives to properly price in these externalities and support a diverse range of actions and measures from farmers, such as planting cover crops rather than leaving fields bare over winter, more careful use of machinery to avoid damaging soil in order to limit flooding and erosion, and emerging new technologies to track and manage soil data.

The report sets out several potential policy scenarios for boosting soil health, ranging from low-cost voluntary reward schemes for farmers who undertake soil monitoring, up to more costly regulatory interventions backed by scientifically-rigorous monitoring systems. Technologies such as GPS and drones that can assess soil health and pollution levels are also likely to be key to developing an effective policy regimes, the study states.

But it warned any pathway for improving soil health would require significantly more support and training for farmers and regional authorities to deliver the range of societal and environmental benefits that high quality soil management can provide.

"The wide variety in the UK's soils, and the ways they are used, means there is no single approach that ensures well-structured soil," report authors said. "A menu of evidence-based interventions will be required so that land managers can pick the method which suits the particular context."

And crucially, too, delivering healthier soils requires a "shift in mindset" about how the agricultural landscape should look. "We need to move away from single uses, and embrace hedges and marginal trees, short-term grass leys and the development of small wetlands, alongside crops or pasture," the authors added.

As events in recent months have further proven - from devastating floods over the winter to the current coronavirus pandemic - the UK's food and agricultural sector is critical for the functioning of society, yet also at risk from a wide range of external impacts. Much of that pressure is borne by land managers and farmers, and if their expertise is to be harnesses to help deliver environmental benefits, a more sustainable food system, and the UK's 2050 net zero target, then providing them with training and support to deliver healthier soils will be critical.

Coronavirus: Scottish government delays publication of beefed up Climate Change Plan

Coronavirus: Scottish government delays publication of beefed up Climate Change Plan

Committee on Climate Change chief describes postponement as 'entirely reasonable in the present circumstances'

The Scottish government has today confirmed it is to delay publication of the imminent update to its national Climate Change Plan in response to the escalating coronavirus outbreak.

An update to the country's decarbonisation plan had been expected by the end of April, following last year's ratcheting up of Scotland's emissions target to deliver net zero emissions by 2045.

But in a statement Climate Change Secretary Roseanna Cunningham confirmed the plan would now be postponed.

"The Scottish Government is fully committed to tackling the global climate emergency and to updating the Climate Change Plan to reflect our ambitious net zero targets," Cunningham said.

"However, in face of the unprecedented health and economic implications of the COVID-19 pandemic we have come to the view that publishing the Climate Change Plan update by the end of April is no longer feasible or appropriate. This does not mean that work on our ambitious plan will pause - indeed it will continue - but it is recognition that we are operating in a changed landscape."

She added that she had written to the Committee on Climate Change (CCC) to request its independent expert advice "on the best way forward in these unprecedented circumstances and how the Climate Change update can contribute, in due course, to a green recovery for Scotland".

Writing on Twitter, CCC chief executive Chris Stark said the delay was "entirely reasonable in the present circumstances".

He also praised the invitation for the Committee to advise on how the economic recovery can be constructed to support climate goals, hailing it as "a welcome sign of what is to follow".

The move comes amidst mounting speculation over how the various timetables to beef up global decarbonisation efforts will be impacted by the coronavirus crisis.

The Paris Agreement requires all signatory countries to submit updated national climate action plans by the end of 2020 and governments had been widely expected to tackle strengthened plans ahead of the COP26 Climate Summit in Glasgow this November. But there is now widespread speculation that the global Summit may have to be postponed in response to the escalating global pandemic.

SDG16: Six top tips for delivering peace, justice, and strong institutions

SDG16: Six top tips for delivering peace, justice, and strong institutions

Many businesses will conclude that SDG16 is mainly the preserve of governments, but there are tangible steps companies can take to help deliver on its crucial targets

SDG16's vision to "promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels" obviously places much of its onus on national and regional governments. It is they, after all, who have the ability to deliver fair justice systems, effective governance, and geopolitical stability. But from anti-corruption measures and sustainable supply chain management to progressive lobbying efforts and labour policies, green and responsible businesses can play a key role in maximising the chances of this vital global goal being met.

BusinessGreen talks to a number of leasing experts about how business leaders can develop a successful strategy in support of SDG16 and presents their six top tips.

1. Break down what it means to you

Sustainable Development Goal 16's targets can, on the face of it, look rather abstract from a private sector perspective. But Ulysses Smith, director of the business and rule of law programme at think-tank Bingham Centre for the Rule of Law, tells his clients that it's actually the goal that has the most relevance to a company's ability to operate.

"Once you get past the language of the SDGs and the UN-speak it becomes very clear for businesses to understand that it's about institutional frameworks, it's about the rule of law, it's about transparency and accessible regulatory frameworks, it's about fair judicial action. If you can translate it into common-sense everyday things it's about basic governance principles," says Smith.


2. Be transparent

"Business has a significant role to play by modelling the right behaviours, being transparent in its reporting, allowing sensible regulation to come to the fore and giving politicians confidence to put that legislation onto statute," says David Croft, global director of sustainability, environment and human rights for household goods giant RB (formerly Reckitt Benckiser).

Companies can contribute to this in many ways, says Transparency International, including appointing diverse management teams to enhance the openness of the leadership environment and publicly reporting on political contributions and lobbying activities throughout their supply chain.

Transparency International would also particularly like to see progress on beneficial ownership transparency, where the public can see who really owns a company. However, this is a more sensitive topic, says Smith. "There definitely are companies that are calling out for new laws and regulations to require more transparency [but] I guess there is more hesitance to engage on this topic than human rights," he notes.


3. Think global 

Clearly, the context in which a firm operates is going to affect how it can practice. Transparency International's Business Integrity Country Agenda tool analyses the integrity of the broader business environment, and the interplay between the state and private companies.

"What has become clear from these assessments is that the strength of a company's internal integrity management system is critical in markets in which corruption is commonplace," says Matthew Jenkins, research coordinator at NGO Transparency International. "While it is obviously easier to act with probity when one is not being solicited for bribes by public officials, robust anti-corruption policies can help inoculate a firm against governance risks in difficult markets."

He adds that many firms operate in multiple jurisdictions, which are likely to have different standards of good governance and varying levels of institutional strength. "This is another compelling reason for multinationals to establish a strong culture of corporate compliance, anti-bribery policies, codes of ethics and so on, to make it crystal clear that no employee can use discrepancies between jurisdictions as either an excuse or rationale for corrupt behaviour," he says.


4. Corruption-proof your business

Running a global business and supply chain opens a company up to significant corruption and bribery risks, warns Transparency International. It recommends that companies measure their risk of exposure and report on it openly and regularly as a first step towards tackling a problem that is often far larger than many people suspect.

Existing business integrity tools can then provide useful recommendations and suggest good practice on how to prevent or mitigate those risks through comprehensive anti-corruption programmes, says Transparency International.

Rigorous supply chain scrutiny is essential - as it is for all SDGs. Some multinationals like Nestle use third-party organisations such as Ecovadis to undertake independent assessments of their suppliers, although these are usually complemented by unique internal processes to provide a fuller picture.


5. Find partners that share your principles

The majority of sustainable development work has focused on multinationals, says Smith, because they have more clout and bear the highest risks of legal action or reputational damage.  "Whether on the green economy or SDGs more generally, for the most part it has been up until now the bigger companies that have been driving the change," he says.

But smaller organisations play an important role too. "A lot of multinationals can have trouble finding joint venture partners or companies they want to merge with because of that whole issue that whoever they team up with is clean. There's a real incentive for smaller businesses who want to partner with them to improve their practices," adds Smith.

6. Harness the power of technology

The Task Force on Justice - an initiative of UN member states, international organisations, civil society and businesses - highlights promising technologies that can provide justice at scale. These include services that facilitate the resolution of disputes, new technologies that support user-friendly contracts, and alternative private sector legal providers that aim to help large numbers of individuals and small businesses make good use of the law.

Innovative examples include an app developed by the UK government's Department for International Development called 'Pay no Bribe' which allows users to report bribery and identify corruption hotspots. It has already been piloted in Sierra Leone and thereare hopes it could be rolled out more widely.

As well as benefitting from such technology, the Task Force says the private sector can help develop new ways of meeting people's justice needs at low cost. "The public and private sector innovators need space to collaborate and support for innovation through all stages of the process, from researching needs and developing a response, to monitoring impact," it advises.

Coronavirus headwinds: Wind sector forecasts slide but record year still expected

Coronavirus headwinds: Wind sector forecasts slide but record year still expected

BloombergNEF downgrades its 2020 growth forecasts for global wind power capacity as pandemic disrupts supply chains

The global wind power industry looks set for yet another record year of growth in 2020, even taking into account dampened activity and supply chain disruption caused by the coronavirus outbreak, according to BloombergNEF (BNEF).

The influential analyst firm now expects global onshore and offshore wind farm capacity to grow nine per cent in 2020 adding almost 66.5GW of capacity in what would be the biggest growth year in the sector's history, according to Bloomberg.

Yet that still marks a significant downgrading on the firm's previous growth forecasts for 2020, which before the pandemic outbreak had predicted a 24 per cent growth rate globally.

It follows similarly dampened expectations unveiled last month by BNEF for the solar, battery, and electric vehicles sectors in 2020 in the wake of the Covid-19 crisis.

Last week the Global Wind Energy Council (GWEC) also said it would be reassessing its expectations for 2020 in the wake of the current crisis, having initially predicted another record year ahead for the industry after surging capacity growth of more than 60GW worldwide in 2019.

Deep uncertainties remain as to how swiftly supply chains and investment confidence can recover, with much of the world's key economic powers still largely on lockdown.

But despite the weaker expectations, the latest growth forecasts from BNEF demonstrate the resilience of the global wind industry, which is largely reliant on long-term power purchase agreements (PPAs) and is therefore shielded against price fluctuations such as those seen in the oil industry, the firm noted.

It said the offshore wind sector in particular - which enjoyed a record year of growth in 2019 - was least likely to be least affected by the economic fallout from the coronavirus crisis, with the world's largest developer Orsted expected to largely continue with its build plans in 2020 as before.

Moreover, many wind projects have been delayed as a result of the pandemic, rather than cancelled altogether, causing BNEF to revise up its growth forecasts for 2021, 2022, and 2023 should the global economy shift into recovery mode later this year, according to the news agency.

Concerns over staffing in the sector remain, however, with factory production of turbines and blades hampered in many parts of the world due to fears over the virus spreading. Siemens Gamesa is one of several manufacturers which has been forced to shut most of its plants in Spain due to strict measures enforced by the country's government to combat Covid-19.

Yesterday, trade body WindEurope said the sector had a "critical role" in ensuring continued supply of electricity across the continent, and issued a public plea to European governments to allow production of essential wind power equipment to continue in factories during the current crisis.

"The industry is organising its workforce to protect health and safety, in many cases significantly reducing the number of workers on site," it said in a statement. "But national governments need to allow for essential manufacturing processes to continue, in particular for the production of components without which global wind energy supply chains will grind to a halt."

The trade body pointed out that 300,000 European's work in wind energy, which currently provides 15 per cent of the continent's electricity and is seen a key part of the EU's Green Deal plans to achieve net zero by 2050.

Separately, meanwhile, WindEurope also teamed up with Solar Power Europe, RE100, CDP, and the World Business Council for Sustainable Development (WBCSD) to launch a new report on Monday aimed at identifying the potential risks associated with corporate PPAs for renewable energy.

Spearheaded by the RE-Source Platform for corporate renewable energy sourcing, the report is set to be updated on a regular basis in a bid to help companies increase their awareness when considering long-term PPAs for solar and wind power, it explained.

Trump administration guts Obama-era fuel efficiency standard

Trump administration guts Obama-era fuel efficiency standard

California and the Natural Resources Defense Council have pledged to challenge the regulation, which the government is touting as its largest deregulatory initiative to date, in court.

The Trump administration formally launched its plans to roll back fuel efficiency standards for cars and trucks on Tuesday, in what could prove to be a devastating blow to the country's fight against climate change and air pollution.

The new rule, released by the Environmental Protection Agency (EPA) and the Department of Transport, allows car manufacturers to average 40 miles per gallon across their fleet in 2026, rather than the 54 miles per gallon goal set under the Obama administration. The move shrinks the annual improvement in vehicle fuel efficiency required of automakers from five per cent to just 1.5 per cent.

"We are delivering on President Trump's promise to correct the current fuel economy and greenhouse gas emissions standards," said EPA administrator Andrew Wheeler said in a statement on Tuesday, adding that the loosened regulation "strikes the right regulatory balance that protects our environment, and sets reasonable targets for the auto industry".

But an analysis of EPA statistics published by environmental group Natural Resources Defense Council (NRDC) highlighted how the previous standard was set to cut carbon dioxide emissions by 455 million metric tons, saving drivers $86bn in fuel costs.

In contrast, the new rule is set to produce 1.5 billion additional metric tons of climate-warming pollution by 2040, or the equivalent of running 68 coal plants running for five years, according to an analysis by the Environmental Defense Fund. The analysis also estimates that the new rules will contribute to more than a quarter-million asthma attacks and 18,500 premature deaths by mid-century.

In response, the Trump administration touted the rollback as the "the largest deregulatory initiative of this administration", predicting it would knock the average price of a new vehicle down from $37,000 to $36,000 and reduce traffic deaths by encouraging drivers to switch to newer and safer cars.

But former President Barack Obama, whose administration set the previous standard, condemned the administration's move on Tuesday. "We've seen all too terribly the consequences of those who denied warnings of a pandemic," he wrote on Twitter. "We can't afford any more consequences of climate denial. All of us, especially young people, have to demand better of our government at every level and vote this fall."

It remains to be seen if the new standards come into force. Vehicle emissions standards have the been the subject of legal battles in the US for decades. The Obama standards were themselves the result of a compromise between the Federal government and a group of states, led by California, which have previously fought numerous legal battles in defence of their ability to set their own tailpipe standards creating a de facto standard for the US as a whole.

The state of California and the Natural Resources Defense Council immediately pledged to challenge the EPA's new regulations in court. A number of Democrat-run states are expected to join California - a veteran in fighting the Trump administration on issues of climate and environment - in challenging the new regulation. Meanwhile, should the Democrats prove successful at this autumn's election they would immediately look to strengthen the standards.

"Gutting the clean car standards makes no sense," said Gina McCarthy, NRDC president and chief executive and a former EPA administrator under the Obama administration. "It will harm the air we breathe, stall progress in fighting the climate crisis and increase the cost of driving. The only winner from this action is the oil industry, which wants us stuck driving dirty gas guzzlers as long as possible."

California Attorney General Xavier Becerra slammed the administration's decision to relax auto pollution rules amid a pandemic that compromises citizens' respiratory systems in a press conference on Tuesday. He wrote on Twitter: "The EPA's Andrew Wheeler says that this new rule would save lives, reduce pollution, and would provide significant benefits to the American economy. In each case, he's wrong. We're prepared to debunk him."

However, John Bozzella, president and chief executive of the Alliance for Automotive Innovation, welcomed the change in a statement posted to the industry group's website on Tuesday. The previous standards were "no longer appropriate" in light of shifting market conditions and consumer preferences, he said, adding that the final rule "establishes near-term compliance obligations, understanding that the auto industry and our nation face economic challenges due to the COVID-19 public health emergency".

"The greatest opportunity for environmental benefits will happen as we look to longer-term policies beyond 2026," he added.

But there has been some division amongst auto companies on the issue, with some backing Trump's deregulatory drive and others remaining broadly supportive of the current regulatory regime. 

Meanwhile, European carmakers are even more clearly divided about whether to push for a delay in EU carbon emissions standards amid coronavirus shut-downs.

While the European Automobile Manufacturers Association (ACEA) and three other associations requested "some adjustment to the timing" to regulations last week,  German carmakers that have invested heavily in electric vehicle development are reportedly opposing a delay.

Volkswagen and German industry group VDA want the standards to stay in place, according to statements published earlier this week in trade publication Electrek.

In February, one month after the enactment of the EU's new carbon dioxide emissions performance rules for new vehicles, sales of electric vehicles were up 92 per cent from the same month a year prior. Overall car sales, on the hand, fell by seven per cent. Some auto companies are betting on this trend becoming a permanent shift, while others appear to be betting on at least one more generation of carbon intensive SUVs making it to market. 

The coronavirus crisis will provide governments around the world with cover to try and roll back environmental regulations if they are so minded. Businesses of all stripes are going to be forced to pick a side.

HSBC: Companies focused on climate change 'outperformed' as virus spread

HSBC: Companies focused on climate change 'outperformed' as virus spread

Research note suggests companies with strong ESG credentials are proving more resilient than their peers to coronavirus turmoil

A growing body of research has in recent years highlighted how listed companies with strong environmental credentials outperform the wider stock market, but now HSBC has released evidence that suggests greener stocks' relatively impressive performance is largely holding true throughout the coronavirus crisis presenting a good defensive opportunity for investors facing a worsening economic crunch.

The bank published a research note late last week from Ashim Paun, co-head of Environmental, Social, and Governance (ESG) research at HSBC, which details how "within the stock market turmoil, shares of companies focused on climate change or ESG issues - environmental, social and governance - outperformed as the virus spread".

The note argues that while the environment has been directly impacted by the Covid-19 pandemic through reduced air travel, home working, online deliveries, and temporarily lower industrial emissions, there are also signs that ESG factors provide useful guidance for investors looking to understand how companies and sectors are exposed to the crisis.

The hypothesis is that companies with good governance practices and high levels of exposure to long term growth markets such as clean technologies should find themselves better positioned to manage short term economic shocks and subsequent recovery.

Paun said HSBC analysed 613 shares of global public companies valued at over $500m where climate solutions generate at least 10 per cent of revenues, as well as the 140 stocks with highest ESG scores and values above the global average. It then analysed the stocks' performance between the start of the crisis on 10 December 2019 and 23 March this year, and from 24 February until 23 March when the crisis escalated sparking high levels of market volatility.

It found that in the pandemic's early weeks, shares in ESG-aware companies outperformed the market, although with some big regional differences.

The climate-focused stocks outperformed others by 7.6 per cent from December and by three per cent since February, while the ESG shares beat others by about seven per cent for both periods.

A more granular analysis assessing the performance of the four categories HSBC uses in its Climate Solutions Database - Environment and Land Use Management, Low Carbon and Energy Production, Energy Efficiency and Energy Management, and Climate Finance - found all segments beat the market over both periods, with Low Carbon companies outperforming by more than 11 per cent since 20 December.

The regional picture was more mixed, with some regions seeing environmentally-focused companies outperform their peers, with Asia Pacific to the fore, and others, such as North America, seeing modest underperformance from ESG stocks.

"European stocks with higher ESG scores beat the regional equity index by about six per cent since 10 December and by around four per cent since 24 February and the Asia-Pacific shares outperformed their region's index by 8.9 per cent and 9.6 per cent respectively," Paun explained. "However, the American shares underperformed their regional index by 0.5 per cent since December and by four per cent since February."

He added that ESG performance provided useful insights for investors as they seek to ride out the pandemic-sparked recession.

"They should use ESG analysis to consider whether estimated earnings growth is still realistic, what increasing volatility means, whether to change risk premia - and what are the best-case, worst-case, and highest-likelihood scenarios," he explained. "Our core ESG conviction is that issuers succeed long-term, and hence deliver shareholder returns when they create value for all stakeholders - employees, customers, suppliers, the environment, and wider society. When crises like COVID-19 manifest, particularly with social and environmental causes and implications, investors can see ESG as a defensive characteristic."

The new analysis joins a raft of studies that have consistently shown how firms with strong ESG ratings tend to outperform their peers. Consequently the past year has seen the launch of a wave of new ESG funds and market research services, designed to provide investors with more detailed information on how well positioned companies are to manage climate risks and the transition towards a net zero emission economy.

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