Tag Archives: international

Happiness: the next big business metric?

The Guardian US/UK | September 16, 2013

smiling face made from nature

A smiling face made from nature that was found along a hiking path. Photo credit: Frerk Meyer/Creative Commons

Whether it’s words of wisdom from the Dalai Lama, guidance from an empathetic career counselor or advice from a friend, we’re often told that it’s more important to be happy than anything else.

But for the more than 1 billion people around the world fighting hunger and poverty, happiness seems fairly irrelevant – a luxury for the middle and upper classes. Does happiness matter if daily needs are not met? Certainly the primary focus should be on taking care of the basics. Happiness is a bonus.

Most, it seems, would agree. But increasingly, the answer depends upon whom you ask. In certain academic and human development circles, the stock in happiness has been rising. So much, in fact, that in the last two years, the United Nations Sustainable Development Solutions Network (run by UN Millennium Development goals guru and Columbia University economist Jeffrey Sachs) has published the “World Happiness Report,” researchers’ attempts to measure happiness in 150 countries around the world.

That raises the question: As more thought leaders pay attention to happiness, should companies also consider happiness as one measure of their social impact?

“All businesses should care about happiness,” said Mark Williamson, founder and director of the London-based Action for Happiness Project, who joined Sachs in New York last week to release the latest report. “The happiness of a company’s people is vital to their business success.”

Companies with happier staff outperform their competitors, Williamson said, and a happier staff is sick less often, more engaged, more creative, more productive and better at working collaboratively.

Consumer-facing businesses also affect the wellbeing of their customers, production services and their supply chain, Williamson added, so responsible businesses should not be hawking products or services that they know will decrease wellbeing.

The happiness metric: more important than GDP?

Government will likely play a role in driving the happiness agenda, if it progresses. “There is now a rising worldwide demand that policy be more closely aligned with what really matters to people as they themselves characterize their wellbeing,” said Sachs, one of the report’s co-editors.

Life satisfaction – a self-evaluation of how well a person’s life is going – is the cornerstone of what the report aims to measure. According to researchers, a person’s happiness, or wellbeing, can be traced back to GDP per capita (as a measure of one’s standard of living), but also to the extent of one’s social support, freedom, generosity, healthy life expectancy and perceptions of corruption.

In recent years, Williamson said, Sachs came to believe in wellbeing’s potential as the “ultimate beyond-GDP measure.” Sachs, a senior advisor on sustainable development to Secretary-General Ban-Ki Moon, is pushing to place wellbeing at the heart of the UN’s post-2015 Sustainable Development goals.

Does more happiness really mean more sustainability?

But is a goal to improve the life satisfaction of people around the world really a means to an end? How would this accelerate or enhance ongoing work to secure access to clean drinking water and sanitation facilities, a sustainable food supply and a stable source of education?

“Wellbeing is really the driver that underpins all the development goals,” Williamson said. “Whether we’re aiming to alleviate poverty, ensure maternal health, support gender equality, or promote sustainability, the reason that all these things matter ultimately comes down to their impact on human wellbeing.

“If we get them right, wellbeing goes up,” he said. “If we fail to deliver on them, wellbeing goes down.”

Mental health and productivity

Mother and daughter, Bhutan

Mother and daughter in Bhutan. Photo credit Christopher J. Flynn/Creative Commons

But even Bhutan, the world’s most famous proponent of happiness, is starting to cast doubt on its devotion to the measure. Its society struggles with a range of social concerns including poverty, education, unemployment, gender inequality and a perceived increase of corruption – and even, perhaps, mental illness.

Yet Williamson points to both ends of the scale in this year’s World Happiness Report as examples of wellbeing’s power. The happiest countries – Denmark, Norway, Switzerland, Netherlands and Sweden – all have reasonably high GDP, he said, but likely rank high on happiness because people in these countries tend to have higher levels of social support and more collaborative and supportive social systems than most other developed economies.

On the other hand, countries that experienced the greatest falls in happiness over the last year – Greece and Egypt – are countries whose residents have had to contend with massive upheavals to financial and political systems that influence their quality of life. And it’s no surprise that Syria – now in the spotlight for atrocities inflicted on citizens throughout its ongoing conflict – placed among the most unhappy countries worldwide.

Another reason to include wellbeing in the UN post-2015 Sustainable Development goals, Williamson said, is that its existing goals do not include mental health, something he considers to be the among most important determinants of wellbeing. According to the report, mental illness – which counts depression and anxiety among its forms – is among the main causes of unhappiness worldwide.

Unhappiest people get happier

Perhaps some of the greatest insights into the determinants of wellbeing can be gleaned from the region with countries ranked among the least happy worldwide. All are in Sub-Saharan Africa, a region where residents battle infectious disease, poverty and corruption.

Yet at the same time, Sub-Saharan Africa – along with Latin America – is counted in this year’s report as one of two areas where happiness levels are increasing the most. The reasons? Higher levels of social support, generosity and the freedom to make key life decisions, the report said.

“Social relationships matter much more for happiness than possessions,” Williamson said. “Every organization should recognize that human wellbeing is at the heart of success and progress – and that they can play a role in contributing to this by the way they treat their people, the products and services they offer and the impact they have in the community.”

Bringing happiness to mainstream business

Some organizations, like John Lewis, have always put employee wellbeing at the heart of their business models, Williamson said. But happiness is gaining ground: companies such as Southwest Airlines, BT, Semco, Marks & Spencer, Zappos, Innocent Drinks and NixonMcInnes are increasingly taking it seriously, he added.

Happiness hasn’t yet become a top priority for sustainability-minded companies, but Williamson expects the trend to persist. And if its popularity continues to rise among nonprofits, policymakers and thought leaders, we could soon see it become a common corporate social responsibility metric as well.

Should businesses consider happiness as part of their social impact? And what can businesses do to boost happiness? Please send us your thoughts by commenting below or by tweeting #GSBhappy.

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Can the apparel industry pin down worker safety?

The Guardian US/UK | September 10, 2013 | Original headline: Bangladesh factory collapse: can Gap and others pin down worker safety?

Rana Plaza factory building collapse in Dhaka, Bangladesh

On April 24, 2013, the Rana Plaza factory building collapsed, killing more than 1,100 garment workers and injuring 2,500 more in Dhaka, Bangladesh. Photo credit: rijians via flickr/Creative Commons

Nearly five months after the collapse of the eight-story Rana Plaza building that killed more than 1,100 garment workers and injured 2,500 in Bangladesh, the reverberations continue to impact the apparel industry.

The incident – and it lessons about supply-chain vulnerabilities – has boosted efforts to improve worker and building safety.

“[Bangladesh] is an inflection point for monitoring and auditing supply chains,” said Kindley Walsh Lawlor, vice president for corporate social responsibility at Gap, speaking at the Social Capital Markets conference in San Francisco last week.

But companies remain divided on how best to do this in a country that’s one of the industry’s top suppliers.

Different approaches

Gap is part of an alliance of more than 15 companies – including Walmart, Kohl’s, Target and Macy’s – which has agreed to require factory inspections (and publicly release the results) in Bangladesh, develop common safety standards, provide loans to factory owners to improve safety, establish a worker hotline before the end of the year and establish “worker participation committees” selected by their peers.

The Alliance for Bangladesh Worker Safety has set a five-year timeline for the project.

Lawlor – who has focused on fire and building safety in Bangladesh since 2010, when a factory fire near Dhaka killed more than 25 people – says Gap is bringing in professional engineers to inspect supplier factories and also is following up with remediation.

“We’re seeing the suppliers through the process and making sure they make the changes,” she said.

But Gap’s approach has been controversial. The company and its partners have been criticized by labor rights groups for not including for a requirement to allow supplier workers – mostly women earning low wages – to organize unions.

Meanwhile, more than 70 other companies have signed a different accord, which does endorse the right of workers to organize as part of an overall strategy to improve factory safety in Bangladesh. H&M, Zara, Tommy Hilfiger and Calvin Klein were among the companies to sign the accord, which requires independent factory inspections and public release of the results. Unlike Gap’s initiative, this accord is legally binding.

Taking a systemic approach

Racheal Meiers, head of BSR‘s HERproject, a factory-worker education project in Bangladesh, India, China and a half dozen other countries, said the Bangladeshi government also must play its part in fixing the health and safety problems.

HERproject works with Gap, in addition to Marks and Spencer, HP and J.Crew.

“We have to take a systemic approach for progress to be made,” she said. “If Gap has a robust fire safety standard, there aren’t many people in the country who can do those international fire safety and building safety inspections.”

But many of the factory owners in Bangladesh also have high influence in the government, she said.

“Even if factory owners do make changes – such as the two years it took to raise worker wages by between $6 to $7 a month – the impacts on workers’ lives are limited within the workplace itself,” she said. “Once the slum landlords found out that the workers got a raise, they increased the rent.”

For that reason, Meiers says, HERProject focuses on increasing the wellbeing of workers by educating the mostly female workforce on menstruation, infectious diseases, maternal health and HIV/AIDS. It teaches women how to make more nutritious food choices and how to access improved health care.

Education sessions are designed for a workplace setting and present factory owners with the business case for a healthy workforce. “The business case is important,” Lawlor said.

Boosting the business case

Aside from working with HERproject, Gap also runs a life skills education and technical training program – called Personal Advancement & Career Enhancement (P.A.C.E.) – for female garment workers.

“It’s proven these women [who participate in P.A.C.E.] have longer tenure and are being promoted more often,” Lawlor said. “They are making more money, can stay consistently in one location and factories are coming to us now. Management is starting to understand the workers aren’t replaceable.”

Michael Kobori, vice president of social and environmental sustainability at Levi Strauss & Co. – which has said it will not join the Bangladesh accord – said that getting suppliers to agree to sustainable production methods through market demand will be a motivating force for change.

“We can try to get suppliers to comply [with us] and struggle,” he said. “But they will respond to consistent business.”

Kobori shared a success story: Levi’s 501 WaterLess jeans, debuted a few years ago, cut the amount of water used in the production process by almost a third, on average, and were favorably received by consumers.

But the benefits expanded beyond conservation and sales.

“That connection [of the product] with the consumer was rewarding to suppliers,” he said. “This way worked much better – we harnessed the power of market and the consumer to drive sustainability.”

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Cloud technology brings clean drinking water to India

GreenBiz | September 4, 2013 | Original headline: How cloud technology can bring clean drinking water to India

Women and children collect drinking water from tanks at an urban resettlement slum in Delhi, India

Women and children collect drinking water from tanks at an urban resettlement slum in Delhi, India. Credit: Frog Design

Imagine not having access to clean drinking water because you refused to vote for a particular politician, or didn’t pay bribes to the driver delivering your supply. Even after doing both these things, you’re still not sure just exactly when the next delivery will arrive.

This is the case in India, where access to drinking water is not universal. As India increasingly urbanizes and water becomes even more scarce, solutions that raise access will be more important in the coming decades.

That’s why the Piramal Foundation — which addresses India’s development challenges through social ventures — funded Sarvajal, a company that uses cloud technology to provide water via filtration stations and solar-powered ATMs.

UNICEF reports that water-borne diseases such as cholera, gastroenteritis and diarrhea in India are responsible for $600 million in medical bills and lost productivity per year, but it could get worse. The national government estimates that demand for clean water will rise 50 percent by 2031 if current delivery models stay the same. According to the World Bank, 220 million Indians will migrate to cities over the same 20-year period.

The problem: Steady access to clean water

In rural areas, residents often have no other choice than to capture groundwater.  “The water was brackish, there were no pipes, no tankers, and filters were too expensive,” said Anand Shah, former head of the India-based Piramal Foundation, of the lack of access. “They’d sift it but would still have large amounts of kidney stones, joint pain, arthritis and gastrointestinal problems.” Plus, the reverse osmosis process to desalinate and filter out impurities was inefficient.

In urban slums, the situation can be better, but not optimal. Although tankers arrive to dispense water for free, they’re intermittent and unpredictable, Shah said. Residents invest large amounts of time pursuing the tanker, jostling to fill containers they carry home. And even if the driver has the best intentions, the country’s rough roads lead to unexpected roadblocks.

Through a monitoring device attached to each filtration unit, embedded sensors and an RFID reader, Sarvajal tracks water quality in real time. It follows user activity, how many times the water has been backwashed and rinsed, when filters need changing, how much water a station has dispensed and how many times the power went out.

Service and maintenance were costly, so a monitoring device was built in-house allowing the company to diagnose machines from one central location.

The company grew from one pilot location in 2007 to more than 200 filtration station-ATM combos in villages of at least 5,000 people each across India. One resident per village can purchase a franchise for about 30,000 Indian rupees, about $500, and sell the filtered water for a penny per liter, he said.

Users pre-pay for their water, and funds are loaded onto Sarvajal ATM cards.

Selling, really?

Shah said he realizes that selling water in a country that has offered water as a public resource could appear off the mark. But delivery via the tankers is unpredictable, and it takes families time to collect water from the tankers and filter it at home.

“We looked at every alternative out there, and even if a family buys the cheapest water filter, we’ve priced it still under what it would cost them per liter,” he said. Bottled water costs 32 cents and water pouches 14 cents per liter on the street, and creates more waste than refilling reusable containers.

According to Shah, local franchise owners can earn a good living — up to two to three times what they would make for unskilled labor. While Sarvajal still owns the water filtration equipment, it takes less than a year for the franchise owners to start returning profits, he says. Sarvajal, on the other hand, doesn’t expect to profit for another five to 10 years.

Shah says Sarvajal launched as a for-profit company in part because a non-profit would have a harder time attracting technical talent.

Scaling into urban areas – with some help

Sarvajal has secured the go-ahead from the local government in the metropolitan area around New Delhi to set up some 50 filtration station-ATM units — areas without regular access to drinking water.

Because Sarvajal mostly had operated in more rural areas, it needed help. To that end, the company hired Frog Design, a consultancy that engineers and designs products and services in energy, health care and social innovation.

Jan Chipchase, Frog’s creative director of global insights, set up a team of staffers from India. They spent over a month in Delhi interviewing and observing how residents navigated securing drinking water. The group also spoke to water providers who had opened businesses related to supplying clean water.

Savda Ghevra, a resettled slum on the edge of Delhi, was the focus of the research. Frog wanted to find out the value of clean drinking water, how a delivery system would meet residents’ needs and what might arise during the implementation of an alternative system. (The extended research was funded by the Institute of Money, Technology and Financial Inclusion at the University of California-Irvine).

“A water ATM allows stored value to convert to digital credit. As the world digitizes, we wanted to find out to what extent a low literate community was willing to invest in these types of technology,” said Chipchase.

Using digital tools to store value in less developed countries is not unheard of, says Chipchase, who cited Kenya as a country where much of the population banks online.

As a result of their research – detailed in a report, “Journeys for Water” released Tuesday – Frog concluded that in the context of the current water delivery model for Savda Ghevra, the “belief that water is a right and should be free is moot. In the slum residents pay for their water in one way or another – with time and money, with their ability to move and make political choices based on their interests.”

“It’s realizing that the current practice of water tankers isn’t working from a social and practical perspective,” Chipchase said. “This project is far more about understanding politics and economics in the broader sense.”

But Frog found that despite all the advanced technology enabling a water delivery system such as Sarvajal’s to exist in a country lacking adequate infrastructure, it must give residents some ownership and control for the system to be sustainable.

Shah said his team estimates that Sarvajal needs to scale to 1,000 to 1,500 locations to break even.

Democratizing of technology

Chipchase said Sarvajal is a perfect example of how “reverse innovation” is taking place through combining “mature” technologies such as the mobile telephone system, RFID tags and sensors. “The ability to prototype is becoming mainstream. It’s not just Silicon Valley anymore.”

Shah is a CalTech and Harvard-educated Indian-American who grew up in Houston, then spent 13 years in India after college, yet most of the 120 employees at Sarvajal are Indian nationals. His team of 25 engineers developed the filtration system’s monitoring device, coined the Soochak.

Coin-operated water filtration stations exist in Vietnam and Thailand. Yet Sarvajal’s pairing of cloud-based monitoring and an ATM service appears to be unique.

Capital returns should be secondary

Shah has been contacted by the Indian division of water giant Pentair and an array of venture capitalists about potential investments. But after learning more about the company’s timeline for return, he said, they lost interest. The same thing happened, he said, with larger companies interested in moving into the space themselves.

“My response to them was you’re asking the wrong question – you should be asking how long it’s going to take to solve the problem,” he said. “We’re in this to solve the problem, not for money to be made. Things like water — where innovation hasn’t happened in 50 years – these are really big opportunities to think about them freshly from a new perspective. Returning capital should be a byproduct or a secondary [outcome].”

Middle image: Women collect filtered drinking water at a solar ATM and filtration station operated by Sarvajal. Bottom image: Sarvajal’s filtration stations are operated by local villagers and are monitored for maintenance using sensor technology. All photos courtesy Frog Design

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Carbon standard aims to benefit women worldwide

GreenBiz | April 18, 2013 | Original headline: How a new carbon standard seeks to benefit women worldwide

Laotian woman using biogas to cook

Using a biodigester means that women (here, in Laos) can use biogas as fuel for cooking and prevent their exposure to pollutant-emitting cookstoves. Photo: SNV

Women are the majority of the world’s farmers, yet carbon mitigation projects in agriculture and forestry are rarely designed in ways that benefit their economic and social status.

So says Jeannette Gurung, a Bangkok-based women’s development advocate whose group WOCAN (Women Organizing for Change in Agriculture and Natural Resource Management) is trying to change that through the Women’s Carbon Standard. According to Gurung, no such standard currently exists for carbon projects or any other type of project that specifically addresses women.

“By and large, gender issues are not considered important to most climate change mitigation projects,” Gurung said at the standard’s launch on Wednesday in San Francisco. “There are a number of projects out there — for example, improved cookstoves — [developed] without even a thought about how to improve women’s [status]. We wanted to see if we could use the carbon markets to benefit them.”

The Women’s Carbon Standard aims to boost project benefits in income, health, food security, education, leadership and increased discretionary time. It requires that a portion of the profits from carbon offset sales be channeled back to the women’s community where the offset is based.

But despite its name, it’s really a social standard designed to measure outcomes benefiting women who participate in carbon mitigation projects.

“We call it ‘carbon’ because we feel like there’s a market around carbon,” Gurung said,“but it can be used on all sorts of activities.”

The mitigation project must exhibit certain indicators in income, health, food security, education, leadership and increased discretionary time before it can achieve third-party verification. For example, has the project increased access to education and improved air quality? What about water quality? Has it increased community funds under women’s control?

Christiana Figueres, the head and Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC), expressed support. “This approach to set up a carbon standard that measures in six different categories the very concrete impact that mitigation projects can have is a very good way of making sure that those projects are really making a difference in the quality of life for women,” Figueres said at the launch event.

To illustrate how the standard would apply to improve women’s lives, Gurung said that the choice to install a biodigester to provide energy for a gas cookstove makes a big difference. Just the one decision to use a biodigester, she said, will result in a number of improved outcomes for women’s well-being alone – not just reduce carbon emissions.

By stirring the contents of the biodigester a few times a day, gas is released up a pipeline to a kitchen stove.

“There’s no more smoke, there’s no more walking to the forest,” she said. “It relieves all those women from the drudgery of the fuel wood collection – something we see all over most of Africa and most of South Asia … The dependence on fuel wood for women means long work hours for women and health problems – respiratory problems and eye problems for those who have to work in smoky kitchens.”

And less kitchen time means more free time for women to pursue education, community leadership or entrepreneurial activities. In some cases, men have started cooking once the household has access to biogas, according to Gurung — an action representing a shift in traditional gender roles.

Figueres spoke about the need for women to be involved in the design and building of cookstoves used to replace open fire. When her daughter worked on a Clean Development Mechanism project in Guatemala, Figueres said, her daughter discovered that the first thing that needed to be done was “to get the women to be the builders of the stoves, and teach them how to maintain the stoves.” If the stoves didn’t work, she said, the stoves would be placed outside and open fire would return.

“If these women are given the entrepreneurial training to figure out how to build as a business, then now we have a very different type of leadership,” Figueres added.

The Women’s Carbon Standard was field tested in Western Kenya at an agroforestry project funded by SIDA, Sweden’s international development agency. WOCAN is also getting ready to launch three pilot projects using the standard in Laos (an improved cookstoves project), Cambodia (biodigester) and Vietnam (waste treatment) funded by the Asian Development Bank.

Gurung started developing the standard two years ago as a way to address the funding gaps she observed throughout her three decades of international development work with organizations such as the United Nations Development Program, CARE and the Peace Corps.

Gurung immersed herself in learning everything she could about the carbon market. She emerged determined that it could serve as an alternative system to provide social benefits and revenue to women around the world.

“After decades of attempts in influencing how those international aid allocations were made, it was high time to look for alternative ways to attend to the needs of those women,” she said.

Both the World Bank and the International Monetary Fund have expressed interest in using the Women’s Carbon Standard, according to Gurung.

“The IMF told me all of the investors that they deal with are calling for green investments, and if we can give them green plus women, we don’t have a single investor who won’t jump on that,” Gurung said.

Business has also expressed interest in using the standard.

“We’ve had interest in companies we can’t name — a company who flies your documents around the world and is offsetting your carbon,” she said. “We’ve also heard indications of interest from pension funds who use corporate social responsibility guidelines to make guidelines about who they buy their offsets from.”

WOCAN has not determined which company will provide third-party verification services, but Gurung reported that she has already met with energy and sustainability company DNV KEMA in regards to this task.

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