Author: Ben Debski

Carbon pricing might be just in time to save the world

Posted on by Ben Debski

“The carbon market is the centrepiece of Québec’s strategy for fighting climate change”, said David Heurtel, Minister of Sustainable Development, Environment and the Fight Against Climate Change, who in February spoke about the province’s latest whip-round. In keeping with ambitions to slash greenhouse gas (GHG) emissions by 20 percent and launch a raft of sustainability projects in the coming years, Heurtel plans to invest CAD 3.3bn in low-carbon development for Québec’s businesses, municipalities and private citizens. Three years and nine credit auctions in, the scheme has so far raised CAD 1bn and should raise a further CAD 2bn by 2020.

Quebec’s government is an advocate of the cap-and-trade system and party to the continent’s largest carbon market, and the province’s achievements are proof discussions on these points are finally making ground. Complex though they are, experiments like this are laying the foundations for systems that will reflect the price of climate change. “Together, we can fight climate change in order to ensure a better quality of life for our children”, Heurtel said. “Let’s do it for them.”

A carbon pricing scheme – done well – creates a financial incentive for participating governments to reduce emissions, and supporters have been keen to present it as the most efficient – and surely the most attractive – means of doing so. “Carbon”, according to Paula DiPerna, who works as a carbon pricing expert and a special advisor to CDP, will “become the most important commodity in the history of the world”.

Almost 40 countries and many more, smaller, jurisdictions have already adopted carbon pricing. Implemented as either a direct tax on emissions or an emissions cap, the policy is finding favour in some unlikely places: it seems even corporations are beginning to recognise its advantages.

According to a spokesperson for the UN Global Compact, a leadership platform for the development, implementation and disclosure of responsible corporate practices, a growing recognition among governments of the threats posed by climate change has established a market price for emissions. Carbon pricing, according to DiPerna, “will be mandatory on almost every large emitting company within the next year or two”, and we’ll likely see the essentials of a global cap-and-trade system within the year.

Corporate support
Six of Europe’s leading oil firms penned a joint letter to the UN last year, asking for support to devise a global carbon pricing system. “We owe it to future generations to seek realistic, workable solutions to the challenge of providing more energy while tackling climate change”, the letter read. Irrespective of its costs, the six were clear that a pricing framework could provide them with a roadmap for future investment, a level playing field for all energy sources, and a clear role in securing a more sustainable future.

BP, Eni, Shell, Statoil and Total are among a growing band of companies for which policies to reflect the price of carbon are becoming an attractive – and in some cases unavoidable – proposition. A recent CDP report found over 1,000 companies are now disclosing to their stakeholders that they price their carbon emissions, or intend to do so in the next two years. This number has tripled in the space of a year and is in keeping with the “ongoing mainstreaming of carbon pricing”. According to the report, the idea is now seen as an essential component of the corporate strategy toolkit.

The UN Global Compact said businesses see carbon pricing as a cost-effective means of driving operating efficiencies and reducing emissions. Many already operate in countries with active carbon pricing schemes and use an internal price in their planning and investments, as shown by a number of recent studies.

“If there’s money to be made, people will try to make it”, said DiPerna. “The world has been dithering around for the last 20 years on climate change. An entire generation of knowledge, institutional capacity and belief has been lost.”

Of a 377-company GreenBiz Intelligence Panel sample, 75 percent felt a mandatory price on carbon would either help their business or at least not harm it. And although GreenBiz’s finding is more environmentally minded than most others, it’s worth mentioning 40 percent of Fortune 2000 companies said a carbon price would create new opportunities in differentiating their products. Climate change is now part of mainstream business decision-making and represents “a bona-fide line item in the standard budget assumptions of successful companies”, according to the CDP report.

Until now, corporations have been largely absent from the carbon pricing debate, but they have been surprisingly strong in taking voluntary action to manage and mitigate carbon risk. What’s different this time around is, rather than develop specific emissions targets, corporations are looking to pre-empt carbon regulation by using an internal ‘shadow price’. Having expanded outside the confines of government policy discussion, the carbon-pricing question is circulating in boardrooms around the globe.

Threefold benefits
An internal price on carbon, according to the UN Global Compact, helps translate carbon into business-relevant terms, increases support and investment for energy efficiency projects, and helps companies achieve ambitious GHG reduction targets.

The biggest benefits, according to Thomas Kerr (leader of the International Finance Corporation’s private sector climate policy engagement), are threefold. The first is strategic, in that companies can use an internal carbon price to alert their CFO to potential climate risks. The second, he said, is more tactical. “Companies are using creative fee/fund schemes to charge higher-emitting activities so that they subsidise energy efficiency, clean energy or other activities that were having trouble getting internal attention and funding.” Third, an internal price on carbon means a company can position itself as a progressive leader in climate action, and perhaps inspire governments to be more proactive supporters of carbon pricing policy themselves.

Advocates have suggested a corporate price on emissions is in fact the future of carbon pricing, and some of the common reservations held by corporations in years past have come to nothing. It’s taken some time, but companies are beginning to acknowledge that rising emissions pose a considerable threat to their bottom lines, and assigning a price per tonne of emitted carbon is an effective means of mitigating – or at least protecting against – the damage.

Businesses, on the whole, are rational creatures, and understand that rising emissions, if left unchecked, could inflict major and lasting consequences on their bottom lines

Microsoft made headlines last year when it published results for the first three years of its internal pricing scheme and carbon fee investment fund. In all, the fund paid for 60 sustainability projects across 23 countries, and the scheme itself sliced $10m off the top of Microsoft’s annual energy spend.

However, of all the regions contained in CDP’s survey, Asia has seen by far the biggest surge in companies choosing to implement an internal price on carbon, with China, Korea, Vietnam and Kazakhstan all advancing plans. Kerr said: “We also have seen a growing understanding by companies that using an internal carbon price helps to ‘stress test’ their business model and transition it to a lower-carbon world.” What’s most noticeable about attitudes towards the scheme, however, is that a huge gulf in opinion exists between corporations in Europe and the US.

Barring a few exceptions, US companies, according to Kerr, are not speaking out due to misconceptions about the effectiveness of carbon pricing in delivering a strong environmental and cost-effective outcome. Spain’s Inditex, for example, abides by a $30-a-tonne internal price on top of an existing EU benchmark price, whereas Exxon Mobil and Chevron publically opposed the aforementioned European campaign to secure a global carbon pricing agreement.

An Ernst & Young study into business attitudes to carbon pricing arrived at the same conclusions last year, noting that carbon pricing can improve overall performance and that US companies are lagging behind their global counterparts. While 64 percent in Europe and 59 percent in emerging markets are in favour of carbon pricing, only 18 percent of US enterprises support it. DiPerna argued companies are not necessarily more receptive in Europe, it’s just that the cap-and-trade system is not voluntary, so they comply by default.

Lack of consistency
Corporate carbon reporting is by no means a faultless enterprise, and it’s safe to say that there are major issues – certainly in terms of consistency – standing in the way of implementation and performance. A KPMG study found carbon reporting lacked uniform standards, which made it problematic for stakeholders to compare one company’s performance against another’s.

“All stakeholders should be able to access good quality, comparable information on a company’s carbon performance quickly and easily from the company’s annual financial or corporate responsibility reports”, said Wim Bartels, KPMG’s Global Head of Sustainability Reporting and Assurance, and lead author of the firm’s Corporate Responsibility Reporting 2015 survey. “That is simply not the case today.” Bartels went on to suggest there was room for improvement and said industry bodies, regulators, standard setters and investors all had a part to play in arriving at global reporting guidelines.

No matter the reasoning, any company that chooses to implement a price on carbon should align itself with the UN Global Compact’s Business Leadership Criteria on Carbon Pricing. Doing so means setting a price high enough to materially impact investment decisions, publicly advocating the importance of carbon pricing through policy mechanisms that take into account specific economic and political contexts, and communicating progress on the above criteria in public corporate reports.

So far, only 65 companies – albeit ones that represent $2trn in market capitalisation – have pledged to meet these standards. Beyond the UN criteria, two-thirds provided no rationale to explain why those targets were selected. Some 84 percent reported on emissions from their own operations, while 79 percent reported on purchased power and only half on emissions in their supply chain.

“The term ‘carbon pricing’ can mean very different things to different people, so yes, consistency and clarity is extremely important”, said the UN Global Compact. “Companies are pricing carbon for many different reasons and in many different ways. Some put a price on carbon to ensure they are competitive in future markets. Others are pricing carbon to pursue ambitious clean energy or greenhouse gas reduction goals. Still others are doing it to test new business models and engage new customers.”

The UN’s Executive Guide to Carbon Pricing Leadership cited a lack of common method or guidance to set a carbon price, lack of clarity and long-term certainty in countries’ climate policies, and difficulty arriving at “the right price” as the three most common issues. Finding a way to compare “apples to apples” remains a challenge.

According to Kerr, the challenge lies in making sure announced internal carbon price levels are actually administered. “Despite the uptick in companies reporting the use of an internal carbon price”, he said, “the actual use of the price in internal decision-making is still quite opaque.” Too often, it’s unclear whether the price is charged as a fee against emitting activities and the monies used to fund cleaner operations, or as a simple risk screen that is only one of many inputs to a company’s decision whether to invest.

On the other hand, DiPerna argued the central issue of consistency was grossly overstated. “It is not a challenge”, she said. “Carbon can trade at different prices worldwide, as long as the physics line up and a tonne is a tonne, and the protocols to accurately measure emissions are all very well known.”

Kerr said there was a need to develop more transparency and case studies so different sectors could compare notes on the different price levels needed to shift investment. And, while there would be a disparity of prices used by different sectors, this wasn’t to say a solution could not be found.

Businesses, on the whole, are rational creatures, and understand that rising emissions, if left unchecked, could inflict major and lasting consequences on their bottom lines. The great unanswered question is what constitutes a ‘correct’ price for carbon and how it should be used differently, if at all, for certain investments. The end goal of carbon pricing after all is to alter investment decisions in favour of low or zero carbon options, so it stands to reason any carbon price should span the length and breadth of the value chain.

“Carbon markets tomorrow could be global, they could function and they would change the world”, said DiPerna. “You use mathematical models to smooth out what you call the ‘trajectory misalignment’. But you can get regional differences in price just like any other market. So carbon can trade just like any kind of currency. It might be high in China and low in the US, like the pound is high relative to the euro. All these things we somehow manage with money we can certainly manage with carbon.”

Different risk models
Issues of consistency and misalignment, while important, form part of a much broader debate about the creation of models to accurately identify and manage the risks posed by climate change, not just on corporate balance sheets but in government budgeting and economic modelling.

On a fundamental basis, schemes to factor in the hidden – or not – costs of climate change will prepare organisations for the strains of a low carbon transition. Mechanisms such as carbon pricing allow organisations to factor emissions-related externalities into their risk management strategies, and a willingness among corporates to do just that is proof the message is catching on.

“I think the world is lacking in leadership at the moment in general”, said DiPerna. “Climate change is a hard problem on top of many other social problems, and it’s a tomorrow problem for the most part. So, we need to incentivise organisations to see it as a today opportunity, and I think that is where the carbon market comes in. The incentive to reduce is built into the system if every carbon tonne is visible and there’s a price tag on it.”

Those with their finger on the pulse would be wise to make concessions for climate-related risks, although the responsibility does not rest solely with companies: governments, regulators and stakeholders must do their bit too. “If I were getting into business today, I would jump into carbon markets”, said DiPerna. A global system “is just a matter of time”.

Resolute explains how to build a green business

Posted on by Ben Debski

At Resolute, we understand that sustainability and profitability drive our future. We are building that future right now, by continuously diversifying, innovating and growing our business. In 2015, we made significant investments in balancing the three pillars of our sustainability strategy – environmental, social and economic – which will allow us to become not only a more efficient company, but a better employer, a stronger partner for our customers, and more deeply engaged in the communities in which we live and work.

Operating as one team, aligned with a common vision, is a powerful tool for building a sustainable, long-term business. That is why our business and sustainability strategies are interdependent. And it is why we have combined our financial and sustainability disclosures into one report. We have also adopted the Global Reporting Initiative’s new G4 framework, being among the first in our industry to report under this gold standard.

Growing strong
In 2015, we made targeted strategic investments in our operations, while continuing with our gradual retreat from certain paper grades toward more sustainable long-term choices.

We expanded our market presence by diversifying into the steadily growing tissue business. Resolute is now building a $270m, state-of-the-art facility in Calhoun, Tennessee, to manufacture premium private-label tissue, including bath and towel, aimed at the growing retail market. Once fully operational in 2017, this will be one of the most competitive and efficient tissue operations in North America, positioning Resolute as a key player in the market.

Operating as one team, aligned with a common vision, is a powerful tool for building a sustainable, long-term business

In November, we acquired Atlas Paper Holdings, which manufactures a range of tissue products for the away-from-home and private-label at-home markets, including recycled and virgin paper products.

We increased the capacity of our wood products and market pulp businesses with a pellet plant in Thunder Bay and sawmills in Atikokan and Ignace in northern Ontario, and the completion of a $100m project to build a continuous pulp digester in Calhoun. The latter is expected to reach normal operating efficiency early in 2016 and will provide 100,000 metric tons of additional annual market pulp capacity, better operating efficiencies, lower mill-wide costs, and improved overall product quality. These key investments support Resolute’s commitment to creating value for our shareholders over the long term.

Community spirit
Meaningful collaboration with our Aboriginal partners, operating communities and employees has resulted in mutually beneficial business ventures and a diverse and skilled workforce.

Resolute collaborates with almost 40 First Nations in Canada – mainly in Ontario and Quebec – on a number of long-term partnerships of mutual benefit, and on ways to increase Aboriginal employment. The objectives of these partnerships include pursuing economic opportunities for forest management and harvesting activities, training and hiring, delivering wood-based products and biomass fuel to our operations, and investing in Aboriginal businesses in the forest, biofuel and wildlife industries.

In February 2015, we proudly signed a memorandum of agreement that has resulted in CAD 100m in economic opportunities for six of our First Nations partners in Ontario. This groundbreaking agreement includes significant contracts for construction and transportation.

Over the course of the year, we also partnered with First Nations communities and Cambrian College in Sudbury, Ontario to launch a pilot programme encouraging First Nations students to pursue trade careers. Furthermore, we participated in the creation of a leadership chair in aboriginal education in forestry at Quebec’s Laval University. We also joined the Canadian Council for Aboriginal Business, with the goal of expanding our consultative and commercial partnerships, and we continued to engage with First Nations groups and others on sustainable forest management.

Overall, in 2015 Resolute hired 1,250 new employees to meet our business strategy and growth plans. By 2018, that figure is expected to jump to 2,000. In addition to collaborating with our partners on ways to increase Aboriginal employment, we are welcoming new immigrants to our organisation. These social investments – whether big or small, local or global – are allowing Resolute to grow our business, expand local employment, and generate value for all of our stakeholders.

Environmental innovation
In 2015, Resolute made substantial progress in improving our sustainability performance and reinforcing our environmental credentials. We are committed to reducing our carbon footprint and take pride in our results to date. We have surpassed our greenhouse gas (GHG) reduction target of 65 percent, reducing absolute emissions by 70 percent over our year 2000 baseline. Our success stems from focusing on improving energy efficiency and replacing high-emission fuels like coal with less carbon-intensive fuels, which benefits both the environment and our bottom line. During the year, we also sourced 72 percent of our energy requirements from renewable sources, derived 78 percent of our fuel energy usage from biomass, and completed our first full year of 100 percent (scope one) coal-free operations.

The energy we use to produce our products comes primarily from steam and electrical power. Resolute generates power from our seven hydroelectric and seven cogeneration facilities. We use alternative energy such as methane from landfills, used oils, tyre-derived fuel, and waste plastics, recovering their energy value to reduce the consumption of fossil fuels.

Our new wood pellet plant adjacent to our Thunder Bay, Ontario sawmill was recently recognised for its innovative work in lowering GHG emissions by turning waste sawdust into biomass fuel. Additionally, 12 percent of the total fibre inputs for our pulp and paper mills are sourced from recovered paper. In 2015, we used 923,389 metric tons of recovered paper in our production processes, and the recycled fibre content in the newsprint we produced averaged 19 percent. We continue to make significant investments in improving the environmental performance of our processes, including the development of products that maximise our use of fibre.

Our Align brand of eco-efficient papers is made with up to 50 percent less wood fibre compared to traditional freesheet paper, and has an environmental footprint 35 percent to 85 percent smaller than the average freesheet grade – including some containing recycled content. Our Atlas Paper Green Heritage tissue products, made from 100 percent recycled wastepaper, qualify for LEED certification points and carry the Green Seal certification mark of environmental responsibility to assure customers they are choosing truly green products that are better for their health and the environment.

Performance BioFilaments, our biomaterial joint venture with Mercer International, develops commercial applications for cellulose filaments, a new source of biomaterial made from wood fibre. This versatile material can be used to add strength, stability, flexibility and longevity to concrete, composites and coatings used in the aviation, marine, aerospace, electronics manufacturing and construction sectors. Through these innovations, Resolute is blazing a new trail by reducing our carbon footprint and supporting the product stewardship of our customers.

As we focus on building the Resolute of the future, we are aware that our actions today are key to ensuring a sustainable and profitable organisation for the long term. Whether we are expanding our market presence, collaborating with First Nations, or working with local communities to develop efficient operations and innovative, environmentally friendly products, we will continue to seize opportunities to diversify, innovate and grow.

Brazilian management is ready to take on the world

Posted on by Ben Debski

Starting in 2003, the Brazilian Workers’ Party (PT) saw its first few years benefit from huge increases in demand and prices for commodities, and a relatively light touch in domestic market interventions. Significant increases in minimum salaries and pensions linked to it, as well as relatively small but widespread cash distribution for poor families, strongly accelerated the ongoing 15-year trend for better income distribution and consumer spending by low-income families. This very positive result boosted the economy, and produced enormous popular acclaim in Brazil and abroad for the charismatic union leader turned president, Luis Inacio da Silva, popularly known as Lula.

Power transfer
However, all good things must come to an end. With the global financial crisis in 2008, Lula stimulated government spending, artificially boosted consumer markets with tax breaks and continued to mandate salary increases dissociated from productivity gains, while the volume and value of commodity prices fell. His popular support continued to rise, so much so that, amid multiple corruption charges and the conviction of his senior political aides, he managed to get, by a relatively small margin, his inexperienced protégé Dilma Rousseff elected as the first female president of Brazil. An economist with stronger socialist convictions than Lula and an urban guerrilla in her youth, pardoned in the general amnesty towards the end of the military regime, Rousseff intervened disastrously in the economy and increased the budget deficit, taxes, inflation and unemployment, resulting in a 3.8 percent GDP reduction in 2015.

In 2016, an impeachment process for alleged illegal budget overspending and a rock-bottom 10 percent approval rating for Rousseff and PT suggest a political shift towards a centrist and more business-orientated government, most likely under Vice President Michel Temer of the Brazilian Democratic Movement Party.

The current financial crisis, lower asset values and devaluation of the Brazilian currency have generated huge investment opportunities; Brazil has one of the six or seven largest consumer markets in the world for many things, such as shampoo, beer and soft drinks, automobiles, motorcycles, helicopters, cosmetics, books and many other products. It is also one of the two biggest global exporters of iron ore, beef and regional aircraft. All this has been achieved with poor transport infrastructure and an inefficient, regulation-bound and slow-moving system of bureaucracy.

Contrary to popular misconceptions, fun-loving Brazilians work long hours. Rigorous project management, attention to detail, focus on objectives, hard work and perspiration are trademarks of outstanding Brazilian companies

FIA Business School’s graduates include CEOs and business leaders in each of the aforementioned industries, and the school has studied their management practices to glean what makes them unique. Their approach represents a particularly Brazilian brand of management, integrating creative strategies, innovative use of technology and resources, flexibility and social consciousness.

Contrary to popular misconceptions, fun-loving Brazilians work long hours. Rigorous project management, attention to detail, focus on objectives, hard work and perspiration are trademarks of outstanding Brazilian companies such as Embraer, the world leader in regional aircraft; Vale, possibly the most efficient mining company in the world; and AmBev, global leader in the beer industry.

Thinking differently
Profuturo-FIA, a future studies centre, was created in 1980 to study economic, social and technological trends, and launched the first executive MBA in Brazil, with international standards but a distinctly Brazilian flavour. The objective was to provide executives with modern management tools, coupled with a global outlook and a sense of social responsibility. A first innovation turned the traditional MBA head over heels; instead of starting with core subjects like accounting, statistics or marketing, it begins with an in-depth analysis of the socio-economic and strategic challenges in a volatile business environment. With a clear vision of companies’ mission and role in society, as well as an understanding of the requirement to create increasing shareholder returns, the subsequent courses focus on leading company-wide transformations to achieve sustainable strategic leadership.

Sustainable leadership requires a strong emphasis on business ethics and corporate social responsibility, which has been taught on the FIA executive MBA since 1993. This has created a lasting commitment to social causes by the FIA Alumni Association, whose primary goal is to give back to society by applying management expertise to charitable NGOs. More than 1,000 volunteer MBA graduates have trained hundreds of NGOs in business practices, and our teaching materials have been provided to 17 countries.

From the outset, we sought to partially reverse the traditional flow of original management thought from more developed centres. In 1984, we published the first scenarios and models that called for companies to create ‘basic products’ specifically designed for low-income consumers in emerging markets. This approach later became internationally accepted through CK Prahalad’s 2005 bestseller The Wealth at the Bottom of the Pyramid. Professor Renata Spers followed up, analysing five years of financial data that showed, for the first time ever, that companies that served low-income groups grew more and were more lucrative than firms that focused primarily on high-income markets in Brazil.

In another innovative line of research, Professor Alfredo Behrens studied how Brazilian samba clubs put on one of the world’s grandest and most creative spectacles, the parades at Rio Carnival. Each club, with up to 5,000 members, competes with a rigorously orchestrated, perfectly timed 55-minute extravaganza of creative costumes, choreographed dances, imaginative floats and distinctive storylines. It is truly an amazing project management feat, which sees thousands of poorly educated but highly motivated club members work solidly for a full year.

World view
Gaining a global outlook is a key part of management development, so, since 1995, FIA executive MBA graduates take at least two international study trips. Every year, regular study trips go to the US, the UK, France, China, India, Dubai, Mexico and Canada. This is a truly international learning experience, which is materialised in comparative studies, seminars and business plans presented on students’ return to Brazil.

Integrating best practices across different business schools, the Americas MBA for executives is a joint programme between ITAM in Mexico, Simon Fraser University in Canada, Vanderbilt University in the US and FIA in Brazil. Students from all four schools study the core subjects at their home university in the first part of the programme, and then meet in four intensive immersions in each country, to study and learn about other business cultures. This programme has shown itself to be a wonderful cross-cultural learning experience, in a very cost and time-effective format.

Other distinctive formats include specialised MBAs in areas such as marketing, finance, retail, banking, international trade and human resources, among others, and a four-year undergraduate programme that has won international competitions for creating sustainable business models.

These initiatives have allowed FIA to be the first South American school to effectively attract a class of full time MBA students from Europe and North America, who come to Brazil to study in English and learn about management with a Brazilian flavour. In this way, FIA feels that it is helping to develop not only capable managers, who are making companies in Brazil more competitive, but preparing international executives who will work together to bring effective and concrete contributions to a better and more prosperous world.

ABC Medical Centre redefines the concept of private healthcare

Posted on by Ben Debski

This year, ABC Medical Centre celebrates 130 years as a leader in healthcare and patient safety, while retaining the philanthropic essence that gave rise to our institution. In the context of this anniversary, we are very pleased to have been recognised as Best Healthcare Provider 2016 by The New Economy, because that tells us that we’re doing things well. An award is a guide indicating that our boat is heading in the right direction, even if we haven’t yet reached port. In other words, it’s a model to follow and to motivate us as we continue our journey; it’s gratifying, but we need to continue working for the health of our patients.

To continue on this path, first of all we need to retain the essence of our institution, because ABC Medical Centre continues to be a not-for-profit private assistance institution (institución de asistencia privada, or IAP), which means we reinvest our surpluses in education, research and charitable clinics, for the benefit of the community, offering medical care with high standards of quality to people in vulnerable economic situations.

ABC Medical Centre is committed to providing health services to those who need them, which is why we have an economic model that allows us to treat both those with resources and those without them; both sectors represent patients, so the services need to be exactly the same.

Day in and day out, we reaffirm our commitment to our patients, to the community and to the training of medical specialists. Towards this end, seven percent of our surpluses are directed to helping economically vulnerable groups through civil associations and providing medical care.

Reflections through time
An institution with 130 years of history needs to pause to reflect and assess its path. Times are different now – medicine today isn’t the same as it was two centuries ago, but we must not lose sight of the institutional mission. Perhaps we need to adapt processes to what is done today, but without losing sight of the philanthropic essence that gave rise to ABC.

Our philanthropic essence is not only found in our assistance programmes, but in the board of trustees of the institution. The board is comprised of 18 members, organised in committees: five members are of UK origin, five from the US, five Mexicans and three from the international community. They are responsible for enriching corporate knowledge and for the executive decision-making that has made ABC the institution of excellence it is today.

We have an economic model that allows us to treat both those with resources and those without them; both sectors represent patients, so the services need to be exactly the same

This commitment of the board, not only to the institution, but to the health of the country, is what has allowed ABC Medical Centre to endure over time, evolving through the decades, keeping us at the forefront and promoting better education for physicians.

Practicalities and philosophies
One of our pillars has always been education, which is why we have 15 residency specialties and 12 high-specialty graduate programmes. In addition, we want our doctors to get the best scores on the national residency exam in their specialty and be in the top 10 percent of the practice nationwide through our simulation centre, which provides physicians with hands-on practice in surgery and specific procedures, in order to improve the skills necessary to reduce risks during surgery.

However, medical education is not enough; having the best physicians and a well-trained group of nurses gives any hospital a competitive edge, but as a complement to this, physicians must also be educated in values. If we only teach medicine, they’ll learn the science of the profession; the challenge is to teach them to balance this science with universal principles. In this way we will be training professionals in the broadest sense of the word.

This is why at the Monterrey TEC-ABC School of Medicine we promote not only medical education, but also the teaching of the values ABC physicians must possess. When students arrive at the TEC, we need to get involved and say that, yes, a career in medicine involves knowledge of anatomy, biology, chemistry and diagnostics, but it also involves values, because whether you’re an accountant, architect or carpenter, values are universal and unchanging. What private healthcare students will ultimately practice in their area of specialty may be different from what they learn; society is always changing and there are always new diseases. Patients will demand an efficient cost-benefit balance in services, and the difference will lie precisely in the healthcare professional’s framework of values.

In this way we are training physicians of the future, because our commitment to our patients is to continue as the leading health institution in Mexico for at least 130 more years. It’s very important for us to continue to innovate with new medical technologies, participate in more research programmes and engage in new channels of communication. This is the way to maintain our vision and to continue with our mission as an institution.

Nursing matters
The other part of the equation is nursing, which increasingly has become an important part of medical practice, and thorough patient care now depends on quality nursing provision. The difference between one hospital and another is often its nursing staff. Precisely for this reason, ABC Medical Centre is seeking recognition as a Magnet Hospital, which will help us better manage the hospital.

The Magnet model promotes professional development, shared decision-making, innovation and a compensation plan, which, at the end of the day, will generate loyalty in the group. So, ABC Medical Centre will become one of the best options for professional development in nursing as well as aspiring to attract professionals outside the institution to join this high-standard team.

Receiving certification as a Magnet Hospital will validate our use of this nursing management model, which will allow us to improve training and development of the nursing staff, which, in turn, will ensure their work is reflected in enhanced patient safety.

The growth imperative
In the future, as the population ages, the demand for health services will increase and ABC must be prepared to meet these needs. Because we need facilities that are adequate in size and investment in equipment, we’re going to have a new campus, in addition to those we have in Observatorio and Santa Fe.

Upgrades have also been discussed. The Observatorio Campus had two options: to close and leave the facilities to the Mexico City government to open a hospital there, or find a way to expand. Fortunately, we were able to purchase several properties adjacent to the facilities, allowing us to expand, upgrade medical equipment and increase areas that were in need of growth due to demand.

Growth is about square metres. It’s about beds, investments and facilities. ABC Medical Centre will be ready with an installed capacity so that, when demand takes off, we can treat more patients.

In addition to this growth, very conservative management is required, because all investments require maintenance or replacement, and, due to the nature of our institution, we can’t invite investors in; everything has to be done with our own funds or with loans that have to be repaid. When you approach a » shareholder and ask them to participate, you are acquiring a very long-term liability, but when you go to a bank, you need to pay off your loan in five years, so you have to generate the resources to cover the debt and continue to provide excellent services. But that’s growth, that’s just buildings, bricks, equipment, investments, gardens and parking lots. Everything is measured in pesos and in metres.

Talent development
To be able to manage our facilities and offer high-quality medical services, a human element is required. Knowledge, values, interaction between people, and best medical practices, that’s what really makes the difference between one service and another. One element without the others would not be possible. Development of talent without growth is very difficult, and vice versa.

This institution needs to grow and develop, because once we fine-tune the formula to receive patients from different social classes in a financially sustainable model, we will have high demand and therefore we need to make very important changes in terms of talent availability.

With a third campus and more clinics planned, each entity needs to be operationally independent. The regulations need to be the same, but you can’t have executives in each area in each location. In other words, overall standards should stay the same, but each institution will have specific operational characteristics, because each one is different, from the facility to the patients using it.

The organisation we have today in 2016 does not use the organisational structure we are proposing; it has to change. We need to create a true corporation that has very specific functions that comply with regulations, rules and policies. In addition, generations to come will manage this hospital and we must, therefore, prepare them for when that time comes, because today’s executives aren’t like those that came before them.

The issue of four generations working together makes this even more complicated. The social, cultural and workplace contexts developed over time mean communication norms for Millennials, Generation X-ers, baby boomers and traditionalists are completely different.

For example, traditionalists are motivated by loyalty, which Millennials value less. While the former tended to join an organisation with long-term commitment in mind, Millennials tend to give you a chance with less focus on building a relationship over time. This means core values need to be put into place now. Earlier generations had these values in their DNA, but that’s no longer the case. Millennials need to be trained in the organisational culture required by ABC as an institution, rather than be expected to absorb such
values over time.

Our duty is to generations to come, and to this end we are building a better ABC, bringing together appropriate talent, both medical and administrative, developing it, and giving it the confidence that it deserves.

Community assistance
As part of our philanthropic mission, we have a commitment to the community at all times to continually develop new projects. The advantage of ABC and our model of social responsibility and community relations is that seven percent of revenues generated are dedicated to care for economically vulnerable communities and teaching. This seven percent is equivalent to MXN 300m. In 2016, MXN 184m will go to charitable healthcare and MXN 112m to education.

To quote CEO Alejandro Alfonso: “People trust us. They trust ABC for our commitment and service vocation. However, trust is only a part of the picture; the fact is, we have a commitment to society in general, to patient and family members, and to the authorities. So, every day we have to work at 1,000kph, because we simply can’t fail; there are no second chances when it comes to health issues.

“That’s why our commitment as an needs to grow every day, because, in the end, what we are doing is creating an institution that is not for any one group, but for all of us. In other words, this isn’t just something we envision for ABC; we want people to say the country is going to create more institutions like ABC Medical Centre. If we are an example to follow, I believe that will mean we have planted the seed and will be impacting on a better healthcare model for other institutions.”

ImmuPharma looks to end the scourge of lupus

Posted on by Ben Debski

Across the world’s major medical markets, it is estimated five million people suffer from lupus. With no cure currently available, those diagnosed are condemned to a life in which the inflammatory disease attacks multiple organs, such as kidneys, heart and lungs, as well as skin, joints and blood cells. The need for a knockout therapy for lupus is self-evident. Thankfully, ImmuPharma is on the brink of developing just such a therapy, called Lupuzor.

ImmuPharma is a pharmaceutical development company that has been listed on AIM since 2006. Since its founding in Basel, Switzerland, and with its headquarters in London and research centre in France, ImmuPharma has dedicated itself to the development of innovative drugs to treat serious medical conditions.

ImmuPharma has been taking important and successful strides in the development of a treatment for lupus. The company’s major breakthrough has been with its lead compound, Lupuzor, which is progressing through its pivotal phase III study with development partner Simbec-Orion. With an adequate therapy yet to be developed for lupus, ImmuPharma hopes Lupuzor will revolutionise treatment for sufferers of the disease, while also putting the company at the forefront of the fight against the ailment.

In February, ImmuPharma successfully raised £8.4m through a share subscription. Under the leadership of the company’s new Chairman, Tim McCarthy, the management team has positioned ImmuPharma to forge ahead with this pivotal phase III trial, which is currently estimated to provide top line results at the end of 2017. Raising this capital has allowed the company to draw closer to the last chapter. The next phase, therefore, could be one of the most exciting developments and breakthroughs in the biomedical industry for many years.

Phase progression
With lupus being an autoimmune disease, the drug developed by ImmuPharma is geared to modulate patients’ immune systems. This is achieved by modifying the behaviour of a number of the key cells involved in the development of the disease. Other accepted therapies for treating lupus have largely resulted in unwanted side effects, resulting in lower doses being administered and, therefore, inadequate treatment results.

ImmuPharma’s revolutionary Lupuzor therapy stands out from other attempts to treat lupus through a novel mechanism of action. This method is aimed at modulating the immune system of the user, in order to ensure it does not attack healthy cells, without causing unwanted or potentially damaging side effects. This gives it the potential to stop the progression of lupus in a large proportion of patients.

The recent fundraising of the necessary capital to complete the final phase of this trial was preceded by the initial completion of both phase I and phase II studies. The first phase started in 2006, with healthy volunteers showing no demonstrable side effects due to the compound’s extremely strong safety profile. Lupuzor then successfully completed a phase IIa and phase IIb trial in lupus patients.

The phase IIa trial was intended to determine proof of concept – whether or not the drug therapy worked as intended – as well as to determine the dose range and safety. Those who received Lupuzor on three occasions every two weeks showed a significant clinical improvement in their condition, as well as a decrease in their biomarkers, making the trial a success and meeting its primary end points.

Due to Lupuzor’s excellent safety and efficacy profile, the FDA has granted Lupuzor’s phase III trial a Special Protocol Assessment and fast-track designation

The phase IIb clinical trial started dosing of patients in February 2008, in Europe and Latin America, comparing Lupuzor to a placebo in lupus patients. An interim analysis demonstrated the statistically significant superiority of Lupuzor over the placebo, and was performed and reviewed by an independent data monitoring committee, according to ICH guidelines. This analysis was conducted after 125 randomised patients had completed the 12-week treatment period, half of them having also completed the additional 12-week follow-up (week 24).

The primary efficacy measure was a SLEDAI response, defined as a decrease of at least four points in the SLEDAI score, a scale generally accepted by physicians as an assessment of the clinical activity of lupus patients, a lower score representing lower disease activity. The analysis of the data demonstrated that a 200mcg dose of Lupuzor administered every four weeks was statistically significantly superior to the placebo.

Coming to market
On completion of the phase IIb trial, the results were submitted to the relevant authorities, including the US Food and Drug Administration (FDA). Following this, the FDA gave the go-ahead for the pivotal phase III trial, which has now commenced. The study will take place in around 45 sites – 10 in the US and 35 in Europe. The first US patients have commenced dosing, with European sites now opening and patient dosing expected to start soon.

Importantly, due to Lupuzor’s excellent safety and efficacy profile, the FDA has granted Lupuzor’s phase III trial a Special Protocol Assessment and fast-track designation. This is considered in industry to be a ‘gold standard’ endorsement by the FDA, and can be interpreted as comfirming that the FDA strongly supports the quality of the phase IIb Lupuzor data.

Lupuzor could provide a revolutionary new way to treat lupus. If the pivotal phase III trial is approved, the results will be life-changing for lupus sufferers worldwide. This also presents a key commercial opportunity, as it is meeting a largely unmet market need, with GSK’s Benylsta being the only lupus drug currently on the market. As ImmuPharma has commented before: “Lupuzor has the potential to be a game changer in the treatment of lupus, if it delivers clinical success at phase III.”

Being such an important and revolutionary product, Lupuzor, once approved, is expected to generate good financial returns for both ImmuPharma, its directors (who still own over 20 percent of the company) and its investors. It should be viewed as a good investment opportunity, not only for the above reasons, but also for the key fact that ImmuPharma owns 100 percent of the Lupuzor asset. This is a unique position for a small pharmaceutical company, and means interest from new investors and potential licensing partners, as progress continues, is likely to increase, with long-term handsome returns.

Businesses help refugees to integrate across Europe

Posted on by Ben Debski

Arriving in a new country, unwillingly, with few belongings is scary enough – let alone with no money and having to provide for an entire family. Jobs are not always easy to find in a foreign country, especially with language barriers and a lack of connections.

However, businesses can help make the process easier and more comfortable for those arriving from conflict zones such as Syria, and many have already started the process. Refugees, who may be highly skilled and have the right to work, give businesses both an opportunity and a purpose – especially in markets struggling to find the appropriate skills and experience.

Some have started expanding their training programmes to include refugees; German companies Siemens and Deutsche Telekom have provided Syrian refugees with paid internships to gather the necessary skills to become full-time employees. International carrier Continental Airlines has also extended its training programme to refugees, while Daimler is providing refugees with training in machinery and tooling, even if they enter the training period with little experience in the sector. Paid internships provide income and should eventually land workers a contract with the company.

Uber’s campaign is an example of how one company can help alleviate the refugee crisis. If all companies launched a similar campaign, the effect would be colossal.

Another problem refugees have to overcome when gaining employment is language barriers– especially if the position requires customer communication. German tech company Trumpf is working with Ditzingen to create German language courses exclusively for refugees. Creating language courses, or funding external courses, could have a major impact on employment prospects.

Additionally, some companies are choosing to launch their own campaigns in order to raise awareness and encourage donations, especially in light of the refugee crisis. The most effective way to do so is to work cooperatively with charities and other organisations.

Giving it out
Last September, Uber ran a pan-European campaign called Uber Giving in response to the refugee crisis. The campaign ran in 20 European countries and more than 40 cities participated.

A spokeswoman for the company said: “The campaign varied per city as all of the charitable partners were selected at local level in order to be most effective and responsive to what the city organisations needed.”

The Uber Giving campaign meant pairing each country with its own partner charity. For example, the UK was partnered with Save the Children to collect donations of used clothing from high-street shops, profits from which funded their Child Refugee Crisis Appeal.

The spokeswoman added: “In Hungary and Prague, Uber collected goods on behalf of Caritas, which delivered to distribution centres for aid in refugee camps. In France, Uber collected donations to send to the French Red Cross. In the Netherlands, Uber collected sleeping bags with a local organisation that then delivered them to refugees on the Greek Isles. In Belgium, Uber worked with Doctors of the World to provide logistics support to medics who were attending to refugees currently housed in Brussels’ parks.”

Uber Giving was also announced in Germany, Italy, Portugal, Spain, Ireland, Poland, Romania, Slovakia, Finland, Sweden, Estonia, Denmark and Bulgaria, where cars collected material goods (warm clothing and camping equipment) and donated them to refugee centres.

Uber’s campaign is an example of how one company can help alleviate the refugee crisis. If all companies launched a similar campaign, the effect would be colossal.

Making a difference
Businesses have begun to mobilise as governments and local communities are helping to provide refugees with temporary accommodation. Hotel owners are providing free bedrooms to refugee families while they organise more permanent accommodation. Moreover, companies are holding cultural events to help refugees feel more settled in foreign countries. PwC has encouraged community integration through cultural events, sports programmes and language lessons. Others have provided information to refugees to help them find their way around new cities. One German newspaper has published Arabic language guides for refugees, and BVD, Berlin’s public transport network, has published Arabic language versions of its rail map, main underground stations and essential public transport information.

The crisis has affected countries on a global scale since the influx of Syrian refugees. There are camps in Germany, France, Greece, Turkey and many other European countries. All camps are in need of volunteers, though the non-profit organisations based at the camps often do not have the funds for their upkeep.

Therefore, an additional initiative for employers to alleviate the crisis is to encourage employees to volunteer in refugee camps, on the grounds that they will still be paid their salary. Even a day’s work volunteering at a refugee camp could make a difference – whether it means helping with distribution, cooking or organising donations. Not only does this heighten a company’s reputation, but it also meets the growing demands of consumers. It is evident that there is growing pressure from consumers for companies to be a part of the bigger picture – generating profit and providing customer service is no longer enough for a business to uphold a respected reputation.

Business and aid essentially go hand in hand; those in need are provided with the assistance they need, and employers gain skilled employees, help integrate refugees into communities, and maintain a good reputation.

Ingenuity Lab’s technology could transform agriculture and save the planet

Posted on by Ben Debski

Given the importance of the agricultural industry and its relevance to local economies, improving outdated systems and processes is more crucial now than ever before. With such a huge task at hand, the best research institutions in the world are being charged with resolving the problems facing agribusiness today. One such firm taking the challenge head-on is Alberta-based nanotechnology specialist Ingenuity Lab, which is working on reducing the negative impact of agriculture not only in its own backyard, but for the entire planet.

The agricultural sector plays a vital role in Canada’s federal and provincial economies, with a contribution to the country’s GDP that exceeds $100bn each year. In fact, Canada is the fifth-largest agricultural exporter in the world, and with over 2.2 million individuals working in the sector, it represents 12 percent of Canada’s total employment. Being the country’s second largest agricultural producer, Alberta has earned an international reputation as a source of advanced agricultural technology, which accounts for 22 percent of the country’s farm cash receipts.

Industrial agriculture practices, severe ploughing and monocrop systems have caused nutrient depletion and large-scale soil erosion

“Since it is one of Canada’s core industries, Ingenuity Lab has chosen agriculture as one of its key areas of focus. Our research team in this area is focused on developing innovative technologies for sustainable agriculture, while maintaining environmental quality. The strategies that we use are cost-effective, fast and accurate in order to help farmers to improve their crop yield with fewer resources”, said Charles Van Neste, Group Leader for Instrumentation Development at Ingenuity Lab. “Ultimately, our technology goals are aligned with local priorities to support the agriculture sector to be sustainable in the national market, as well as within global markets.”

Water, water everywhere
The agriculture sector is facing a growing number of challenges, which include resource depletion, water pollution, land management and livestock management, yet all these issues centre around one basic constant: soil.

“A healthy soil provides sufficient nutrients and water to support plant growth, which can then feed humans and livestock. However, industrial agriculture practices, severe ploughing and monocrop systems have caused nutrient depletion and large-scale soil erosion. On the other hand, the over-application of fertilisers and pesticides continues to contaminate both soil and ground water”, said Prashanthi Kovur, Ingenuity Lab’s Group Leader for Fabrication and Devices. “The soil nutrient cycle is greatly affected by the frequent harvesting of crops, as well as grazing livestock. Unfortunately, there is no stable supply of decomposing plant material to restore nutrient levels within the soil.” Added to this is the mounting problem of food waste. “One third of the world’s food is lost during production, handling and consumption. For example, in North America, a large percentage of this loss comes from consumers wasting food. Landfills filled with organic waste are the largest source of greenhouse gas emissions.”

Although contaminated water is most commonly associated with heavy industries, the expansion of farming to meet with population growth and soaring demand has turned it into a far broader issue, making a deep environmental impact that is often overlooked. In order to tackle this growing problem, Ingenuity Lab has been developing a state-of-the-art water purification system, using nanotechnology that will enable the reversion of soil and water back to their natural states. As research into nanotechnology continues, Ingenuity Lab expects to find a way to reclaim nitrogen from soil runoff, which could have a huge impact on agricultural yield.

“Due to the industrial revolution, water pollution has become a global issue. One of our solutions to this issue is presenting a way in which we can purify contaminated water and then reuse it for agricultural purposes”, said Van Neste. “Ingenuity Lab is developing a bio-inspired hybrid membrane system to address the environmental impact of contaminants to our water supply; these bio-inspired reverse osmosis membrane systems are suitable for industrial scale applications and exceed the performance of existing membrane technologies.”

Another strand of Ingenuity Lab’s research is the development of desalination technology. “The desalination technologies that we are developing will support coastal regions with drinking water and help them to grow their own crops”, said Van Neste.

While agribusiness is becoming increasingly damaging to the environment, heavy industries still remain a culprit in this story as well. “The potential harmful effect of industrial pollution on agriculture from organic waste and mining activities has been raised by many environmental agencies. Mining activity is associated with high levels of pollution and the loss of agricultural livelihoods, which results in stressed vegetation and downcast production”, said Kovur. “As a team at Ingenuity Lab, we are always thinking about ways that we could clean industrial waste water and use it to grow crops and transform industrial-scale pollution into an agricultural solution. At present, we are working on developing state-of-the-art membrane technologies to filter away waste and enhance water flux across the membrane with high levels of salt rejection, so that the resulting clean water can be used for agricultural purposes.”

More for less
“Agriculture is the dominant use of land in Canada, and the leading source of pollution. One ongoing challenge is the contamination of soil and water caused by excess pesticides, in addition to the ammonia compounds that enter our marine systems from runoff water. These toxins remain in the environment for generations – many are even suspected of disturbing our ecosystem. However, by minimising toxin transport mechanisms, monitoring plant health and ensuring early detection of diseases, we can reduce excess levels of pesticides”, said Kovur.

“We always hope for a better quality of life for future generations. But what about the excess pesticides that are already present? The analytical methods that we are developing can facilitate the collection of data concerning particular target pesticides that may impact human health and the environment. Our advanced miniaturised micro/nanofabrication technologies have led to the development of sensitive and selective sensor devices for field-based environmental monitoring and the early detection of plant diseases”, said Kovur. “We hope to develop next generation technologies where the earth could filter away excess pesticides and recycle fertilisers at the molecular level.”

When it comes to increasing yield potential, soil holds the key once again. This would make an incredible difference to agricultural industries all around the world. “Precise measurements of soil nutrients are desirable for efficient agricultural production, including site-specific crop management, where fertiliser nutrient application rates are adjusted spatially, based on local soil requirements”, Kovur said. In order to increase crop yield, while simultaneously improving performance and reliability, cost-effective sensor technologies can interface directly with entire growing and herding fields.

“Ingenuity Lab has access to world class talent, as well as the hi-tech facilities required to undertake advanced research. The combination of these two assets helps us in developing innovative solutions for complex problems. Our state-of-the-art sensing techniques can detect trace amounts of various chemicals and fertilisers present in the soil. Additional research and the development of nanotechnologies with the power to reclaim nitrogen from soil runoff have further potential to help our agriculture industry increase its yield”, said Van Neste.

All around the world, land that could be used for large-scale agricultural production goes unworked due to its unsuitability for agricultural activities. Solving this problem would result in a huge boost in production for communities, not to mention the health and environmental benefits of local food. Ingenuity Lab believes the age-old problem of arid land can be solved by technology.

“The quality of soil, landscape, climate and temperature are the limiting factors of how the Earth’s surface can be used for agriculture. In areas where land is less productive, agriculture requires more advanced techniques and inputs in order to address poor soil quality. Those zones that have received few modern inputs can greatly increase productivity and raise the value of agricultural land”, said Van Neste.

“Excess deposits of salt in the soil, especially near coastal areas, prevent plants from absorbing water, thereby making it unsuitable for farming. However, with recent advancements in technology, we can convert the unsuitable land into usable land, where agriculture can be practiced far more successfully. Our research team at Ingenuity Lab is developing biodegradable cellulose-based hydrogel technologies that are used as water reservoirs and nutrient carriers in agriculture. Such advanced technologies will have a huge impact on the reduction of water consumption, together with water resource optimisation, in both agriculture and horticulture”, said Van Neste. “The technologies that we are developing have great potential in converting biomass in Alberta into value-added products. These hydrogel-based technologies make cultivation possible in infertile areas of the world, thus supporting large-scale agriculture.”

Visions of the future
Agriculture – the oldest industry on earth – is as vital today as it was at the beginning of civilisation. Finding new ways to improve, through cutting-edge innovation and technology, is the only hope for dealing with humanity’s continued expansion.

“The global population is expected to reach over nine billion by 2050. With growing demands on the world’s food supply chain, we rely on farmers to enable a sustainable food supply”, said Kovur. “However, farmers are facing various challenges in food production that make it hard to produce more crops with a lower environmental impact. One way to address these issues is through precision agriculture, although current precision techniques require a robust IT infrastructure and substantial resources, which can only be achieved by bigger companies. The inability to obtain soil characteristics rapidly and inexpensively remains one of the biggest limitations of precision agriculture.”

In light of this, Ingenuity Lab has charged itself with an important task. “We are developing cost-effective, innovative sensor technologies to enable precision soil nutrient management by monitoring soil and plant health in real time. These smart sensors can rapidly respond to target ions, making them suitable for in-field rapid detection. A swarm of robots integrated with our sensors have the ability to monitor nutrients and plant health foot by foot. Our SWEEP robotic technologies allow the robots to be powered and controlled wirelessly”, said Kovur.

“Ingenuity Lab envisions a day when farmers in remote areas can use mobile devices to manage their own agriculture. We call it ‘networked agriculture’. Integrated sensors will continuously monitor soil health and transmit the information wirelessly to a handheld device. This user-friendly technology would help farmers to make proactive decisions, save money, and maximise crop yields and food production, while also minimising the environmental impact they have.”

Ingenuity Lab looks to transform carbon into useful substances

Posted on by Ben Debski

A great deal has been said about Canada’s change of direction since Prime Minister Justin Trudeau took charge last year, and nowhere is this volte-face more apparent than on the hot-button topic of climate change. While some way short of the all-out U-turn predicted by some of the more hopeful commentators, the decision to double down on climate mitigation is part and parcel of the ruling party’s plans to shake Canada’s reputation as a producer of dirty fuel and a notoriously slow mover. When, in the dying months of last year, Trudeau outlined his plans for a national framework to slash emissions and, in March, all 13 provincial and territorial premiers agreed to some form of carbon pricing, it could no longer be said that Canada was standing in the way of real and progressive action on climate change.

Far from being the only country to ramp up the rhetoric since COP21, Canada is in many ways representative of the transformative effect last year’s Paris meeting has had on the world economy. A little over six months on from when the landmark agreement was struck, it’s clear that more countries than ever before are taking a proactive approach to climate change. Innovative technology is one thing, but a willingness to pursue broad-based and sustainable gains has made all the difference between the worlds of pre and post-COP21.

Arise, Alberta
The western Canadian province of Alberta is home to some of the most impressive advances on the climate front, and promises to play a key part in reshaping not just the country’s, but the world’s, energy strategy. Ehsan Jenab, Project Lead at Alberta-based Ingenuity Lab, described the province as the country’s “energy powerhouse” and believes it will be instrumental in the all-important issue of carbon transformation.

Each year, according to Jenab, Alberta generates billions of dollars in revenue through extracting and marketing its abundant natural resources to consumers around the world. Looking at the last 20 years, Alberta has ranked consistently among the top 10 energy producers in the world and has led in terms of average annual economic growth. “However, with energy demands expected to rise by 35 percent, not only do we require an increasingly diverse energy supply base, we also need to manage our collective output of emissions more effectively”, said Jenab.

Ingenuity Lab is a funded research and development initiative at the University of Alberta’s Faculty of Engineering, in the Department of Chemical and Materials Engineering, and Director Carlo Montemagno is a tenured professor in that department. Widely regarded as a change agent in enabling the world’s foremost researchers and innovators, the institute uses unique governance and operational structures to create an enabling interdisciplinary environment, sustain effective partnerships, and create unsurpassed knowledge and technology transfers. “To this end, it provides an ideal vehicle through which we can partner and develop business relationships with industry, to put Alberta at the forefront of greenhouse gas (GHG) technology development and deployment.”

Our global population is growing, and so too are our demands for energy, which are expected to increase another 35 percent by the year 2035. In order to address the twin issues of spiralling demand and rising emissions, we must not only create a diverse energy supply base, but also manage our collective output more effectively, according to Jenab.

Ingenuity Lab
The research body’s multi-enzyme platform, which is based on Montemagno’s award-winning work, generates valuable, organic molecules from CO2, produced by industrial processes, sunlight, water and electricity. Essentially, the solution facilitates photosynthesis without the energy requirements found in traditional biological carbon fixation platforms, and, as Jenab explained, “the process is designed as a cascade of bioreactors, which allow for optimised reaction conditions for each stage of the process”.

Our global population is growing, and so too are our demands for energy, which are expected to increase another 35 percent by the year 2035

The technology is particularly pertinent for Canada and its revised commitment to climate change, given that 90 percent of the country’s emissions are derived from the energy sector. Ingenuity Lab, therefore, is an important piece of the puzzle, and the research institution has unearthed findings that promise to transform the province’s signature natural resource industry. For one, CO2 from industrial flue gas emissions can now be captured using sunlight by mimicking plant photosynthetic processes on a large scale, to be transformed into valuable chemical compounds and marketable products.

“This technology not only provides the opportunity to build on this success”, said Jenab. “It promises unconventional discoveries that may well prove to be cornerstones of Alberta’s future energy industry. By transforming carbon emissions into marketable products, our main emission will be value.” Assuming there is a one percent increase in the technology’s adoption per year, it follows that, at the end of the 10-year period, the average of the combined emissions for all industries will be reduced at a rate 10.8 tons per year.

Cases like Alberta are indicative of a wider shift, not just in technology but also in the way in which we as a population perceive carbon emissions. Ingenuity Lab’s work in particular is proof that we need not necessarily see carbon as a threat, and advances in the field of carbon transformation could hold the key to converting carbon into valuable products and, in a broader sense, realising the broad-based and sustainable gains set out in Paris.

Looking at Canada in isolation, however, makes it appear as though COP21 has radically reshaped the landscape for action on climate change, where the truth is that it has less to do with any promises made in Paris, rather, it is a combination of factors resulting in an all-round increased willingness to change. This was an international agreement that stopped short of the scope envisaged by many of the meeting’s more optimistic attendants, and ultimately, the responsibility rests with political, corporate and academic leaders to drive real and meaningful change going forwards.

Corporate cooperation
Businesses, in particular, are beginning to recognise what’s being asked of them, and Frances Way, COO at CDP (formerly the Carbon Disclosure Project), said in an interview with World Finance that climate change is not just a physical and regulatory threat, but a significant business opportunity. In 2012, for example, the low-carbon economy was valued at $5.5trn, and has grown at a rate of over three percent a year since then.

What’s more, initiatives such as the Business for Innovative Climate and Energy Policy, or BICEP, have seen over 1,000 companies – Apple, Intel, GM, Nike and Unilever among them – sign up to a ‘coordinated effort to combat climate change’, while the We Mean Business coalition includes over 300 companies and investors committed to reducing their carbon footprints.

“After decades of debate, the scientific community is agreed on the science that shows that human activity is causing dangerous climate change”, said Way. “Just as importantly, this is now an established fact for leading businesses who understand that there is no greater threat to the global economy than climate change.”

Risks abound for companies that choose not to rethink their assumptions about ‘business as usual’. Whereas in years past the responsibility fell on governments, communities and the third sector to shoulder these costs of climate change, multinationals can ill afford to ignore the issues anymore if they’re to survive.

“More and more companies are understanding that it is in their own business interest to take action to address climate change. CDP’s 2015 climate change report reveals that, compared to 2010, when just under half of companies said they had activities in place to reduce emissions, now nine in 10 engage in these activities”, said Way. “We see that corporations are clearly shifting their strategies to become part of the solution to the climate challenge. The momentous and global nature of climate change means that, ultimately, we need everyone on board to take action.”

This increased awareness is essential if the work being carried out by research institutions like Ingenuity Lab is to receive the support and funding it so sorely needs. And, while increased willingness is an important piece of the puzzle, it’s unlikely to come to much without technological solutions to speed its advance. On the issue of climate change, business and scientific interests have aligned, and real and meaningful changes, such as those in the case of Ingenuity Lab, are beginning to take hold.

Mixed approach
The energy sector is one area in which scientific research is finding more practical uses, as opposed to merely theoretical ones. For one, the ability to convert CO2 into value-added chemicals could revolutionise the energy landscape, not just in Canada, but across the globe. And, assuming research firms like Ingenuity Lab can scale up these technologies and put them to commercial use, developments, particularly in the field of carbon transformation, could create thousands of jobs and clamp down on the issue of wayward emissions.

A great many administrations, post-COP21, have already opted to double down on their efforts to reduce emissions, and, in countries where pollution is posing a considerable threat to public health, carbon transformation and carbon capture could have an important part to play in securing a more prosperous future. In China, for example, the ability to not only capture carbon, but market it as valuable products, represents the next logical step from the country’s existing investment in carbon capture and storage (CCS); it could not only spare its people considerable harm, but also go some way towards attracting considerable wealth.

Carbon capture technology is capital-intensive and asks a great deal in terms of operational costs, but it remains one of the surest methods of reducing industrial emissions. Incremental cuts are all well and good, but only through carbon disposal and transformation technologies can heavy emitters make the requisite reductions. The process of carbon disposal, which consists chiefly of burying CO2 in the ground, has for years been included on emissions reduction strategies across the globe. However, it has often been the first in the firing line when funding has come up short – as was the case in November of last year, when the UK axed £1bn in funds ringfenced for the commercialisation of CCS.

An optimistic International Energy Agency said in 2012 that technology could account for nearly 20 percent of the emissions reductions required to cut GHG emissions in half by 2050, only for project overruns and runaway costs to destroy any initial promises. Speaking to The New Economy about whether CCS has indeed failed to make good on its promise, Paul Fennell, a reader in clean energy at Imperial College London, gave a resounding “no”. He elaborated: “[The technology] works as well as anyone could hope – it is fairly basic engineering. What has failed has been global appetite to do anything about climate change.”

Proponents of the technology, including Fennell, argue governments are wrong to discriminate against CCS on the basis that higher emissions in the future will make investment in CCS all the more expensive further down the line. Speaking to The Guardian about the UK Government’s decision not to invest in CCS, Myles Allen, Professor of Climate Dynamics at Oxford University, said: “Saying that we should not [invest in this technology] because it is expensive and hard, when we know we are going to need it, is just daft.”

Assuming the political landscape stays the same, new technologies in carbon disposal could face yet more of the same obstacles, as governments choose not to front the costs in favour of more incremental mitigation strategies. And while, on the surface, any new carbon transformation technology could be set to suffer the same fate, the important issue of political willpower – or lack thereof – has improved since the Paris meeting. Carbon transformation, therefore, could find a place in the hearts and minds of politicians and businesses keen to do their bit for the climate.

With the pressure to pay heed to the issue of climate change greater than ever, new entries to the mainstream climate debate, such as carbon transformation, are likely to be received warmly by political and business leaders alike. Far from being exclusive to Alberta or indeed Canada, the contributions of Ingenuity Lab are indicative of a new post-COP21 world, in which action on climate change is the expectation, as opposed to the exception.

Digital channels allow utilities firms to redefine customer engagement

Posted on by Ben Debski

Innovative utilities are discovering that, when they tap into self-service and automated mobile communication channels to connect their customers and their employees with mission-critical information systems, they are able to significantly improve operational efficiency and customer satisfaction. At a recent DistribuTECH annual conference, utility technology provider Advanced Control Systems (ACS) said JD Power and Associates, and Standard & Poor’s had researched the relationship between customer satisfaction and improved electric utility financials.

“When consumers experience an interruption in service, the first thing utilities need to get better at is providing comprehensive information about the outage – including the cause and extent of the outage, when power will be restored, and status of work crews and any equipment that needs to be replaced”, said Jeff Conklin, Vice President of JD Power’s utility practice. “And the best utilities are now getting proactive with outage information by providing it to the consumer at the contact point of their choice.”

To survive, utilities know they must adapt smart technology for day-to-day business operations on the grid. Our ever-increasing reliance on electricity takes the energy management industry to the grid-edge as utilities undergo a massive transformation. New and advanced utility automation systems are taking the centre stage in the global electric power industry and, now more than ever, technology is allowing direct, personal engagement of utility consumers. Not only does this enable more customer-informed decisions to be made about energy usage, but it also allows the utility to leverage grid-edge information to further enhance its entire network efficiency.

Utilities can easily optimise the channels consumers use every day (i.e. the web, mobiles and social media) to push rich, relevant and timely information to their customers

“We understand how critical energy management is, and that the industry is challenged with securing the supply of energy to consumers in a sustainable way”, said Kevin Sullivan, ACS CEO. “We are committed to a long-term relationship as a trusted partner.”

Where utilities need to focus
According to Sullivan, the keys to a successful enterprise include three areas of thought leadership: a real-time integrated platform; advanced energy management; and the human grid.

Energy is delivered at near light speed and utilities can be more efficient with an open, precise, real-time information system management platform, enabling them to make the energy management decisions that must occur in real-time. “The edges of our grid are changing with the deployment of disruptive technologies, such as distributed energy resources, that also require integration and control in real-time”, said Sullivan. “It is critical for utilities to address current and future grid operational challenges.”

According to ACS Chief Technology Officer Gary Ockwell: “As the energy industry has developed and evolved, solution providers must help utilities face different complications while managing network, new business, operational and technical challenges.”

In order to manage current and future grids, advanced applications must be able to rapidly adapt to a continuously evolving environment with an ever greater number of disruptive events, from extreme weather conditions to forced outages. Many utilities across the planet lose revenue because of fraud and revenue leakage; these non-technical losses occur because of meter manipulation, reading errors, late payments and under- or over-charging. The cost-analysis to justify utility automation is overwhelming, but most C-suite executives may opt-out because it’s extremely expensive.

More than ever before, technology is allowing direct, personal engagement of the utility consumer. Not only does this enable more informed decisions on the part of the consumer regarding energy usage, but it also allows the utility to leverage grid-edge information to further enhance the overall efficiency of the network.

“This personal engagement optimises the use of existing assets, including distributed resources, while minimising the environmental impact of network operations”, said Ockwell. “Leveraging advanced controls with environmentally responsible behaviour through the human connection is what we call ‘the Human Grid’.”

The most cost-effective and productive way for utilities to integrate real-time solutions is during power outages. To maximise smart grid opportunities, utilities must proactively encourage cooperation between their crews and their customers while leveraging the Human Grid, using multiple communication channels on a customer-engagement platform. The main effort is helping utilities improve customer cooperation while deepening customer engagement every day, not just during outages. “If the customer is satisfied with the utility providing grid reliability, with a small automation investment, the utility can transform a satisfied customer into a cooperative and participating consumer”, said Ockwell. “So, when electricity is unavailable, the consumer accesses the same communication tools used during ‘business as usual’ times… with a full mobile application using iOS, Android or BlackBerry operating systems, in the form of interactive SMS texts, emails, social media, or as a web portal full of engaging outage-management and energy-efficiency tools.”

In other words, utilities can easily optimise the channels consumers use every day (i.e. the web, mobiles and social media) to push rich, relevant and timely information to their customers. They can do this in real time as informative outage reports, utility bill updates, and even load information for both the system and utility customer.

Information from the grid-edge
“We proactively meet utility expectations with technology efficiency, while adding value to customer sustainable solutions through an innovative suite of extensive offerings”, said Ockwell. “Most utilities typically seek to minimise complexity, treating primary smart-grid technology as a solo deployment, aimed at meeting a single specific business objective. Most utilities are pleased to improve reliability through self-healing, [and] cost reduction through loss minimisation, or deploying a greater share of renewables.”

“We encourage utilities to enable consumers to leverage grid-edge information to enhance two-way communications and allow everyone to have energy control at their fingertips”, said Sullivan.

To provide the most cost-effective solution seamlessly so consumers can experience the best customer satisfaction, utilities can implement smart-grid optimisation to provide a value proposition in an evolving environment with ever increasing disruptive events. The ability to manage real-time events and effectively adapt and restore power while maintaining grid stability is of paramount importance to the industry in every corner of the world.

Customer engagement
“Now more than ever, innovative technology is allowing direct, personal engagement of the utility consumer”, said Ockwell. “Meter data systems with their entire organisation and customer base allow utilities to leverage grid-edge information to further enhance the overall efficiency of the electricity network.”

Smart utilities can effectively adopt a mobile enterprise platform with single easy integration that is accessible through all major mobile and remote channels. This personal customer engagement with mobile and social media optimises the use of existing assets, including distributed resources, while maintaining the environmental impact of network operations.

Innovative technology combined with engaged customers, bridges a reality of efficiency and trust, serving communities around the world. The benefits provide a win-win opportunity for improving customer satisfaction, while proving fast, reliable service can also be cost-effective. Communication devices uploaded with apps integrated with utility information (SCADA, distribution management, outage management, feeder automation, substation automation) yield cost-savings for utilities and each one of us.

China looks to dominate the burgeoning virtual reality scene

Posted on by Ben Debski

Last month China overtook the US for the first time as the world’s biggest acquiring nation for mergers and acquisitions in the technology industry. According to a report from Dealogic, China accounted for a 45 percent share of the market in the first four months of this year – confirming the country and its investors as noteworthy competitors in the multi billion-dollar virtual reality (VR) industry.

However, China will have to show true innovation to sustain investment in the market and create a VR domain viewed globally as the market leader.

According to London consultancy Preqin, venture capital investments in China surged 50 percent to $12.2bn in the first quarter of 2016 – indicating that the VR market will have plenty of opportunity to excel in terms of investment.

The three lead investors, Baidu, Alibaba and Tencent – often referred to collectively as BAT – have a combined market capitalisation larger than Israel’s GDP, and the trio serve 688 million internet users in China alone.

Growth imperative
The investment surge comes as President Xi Jinping aims to strengthen China’s slowing economy (which hit its slowest growth rate in 25 years earlier this year) through innovation and a reduced dependence on industries such as manufacturing and agriculture.

The country launched a campaign to support entrepreneurship in 2014, and has since opened 1,600 high-tech incubators. The VR industry is the perfect opportunity for China’s newfound entrepreneurs to invest, at a time when there is still a gap in the market to further develop the technology.

President Xi Jinping aims to strengthen China’s slowing economy (which hit its slowest growth rate in 25 years earlier this year) through innovation and a reduced dependence on industries such as manufacturing and agriculture

According to BI Intelligence, the compound average growth rate will be 99 percent from 2015 to 2020 for the VR hardware market. It also predicts that the VR hardware market will hit $2.8bn by 2020, while its revenue in 2014 was just $37m.

If this prediction turns out to be true, China’s VR industry will overtake the country’s mobile gaming industry, after years of development and more than one billion devices.

However, the industry will have to be quick moving and businesses will have to offer true innovation in order to live up to the market’s expectations.

In order to beat neighboring competitors such as Korea and Japan, China’s VR businesses and investors will need to go above and beyond customer demands. Ideally, they will develop VR devices into a product that needs no support from external accessories such as smartphones and consoles – an advancement that has not yet been discussed.

Competitive field
It appears everybody wants to get in on the action – from corporate giants to established players and small start-up businesses.

Online marketplace company, Alibaba – which claims it has 400 million users worldwide – invested in the VR market earlier this year. The company said it had already created VR visuals for hundreds of its products, and thinks VR has a bright future ahead of it, with endless possibilities such as customers being able to shop on New York’s 5th Avenue from the comfort of their own homes.

Instead of contributing to the devices production line, like Sony and Facebook have been doing, the BAT trio are said to be positioning themselves as middlemen for start-ups and opening their platforms to developers of content, as they await the materialisation of a more developed headset. Nevertheless, it seems Baidu is taking a step back from the market this year. A spokesperson said: “Baidu is currently not very active in the VR market and we don’t have any plans to launch a VR product this year.”

Additionally, at least 200 startups are working with China’s virtual reality market. A strong competitor is Palapple, an IT solutions start-up based in Hong Kong. Similar to other VR startups that have immersed themselves in the market, Palapple has started developing its own VR products.

Instead of contributing to the devices production line, like Sony and Facebook have been doing, the BAT trio are said to be positioning themselves as middlemen for start-ups and opening their platforms to developers of content

iQIYI, a subsidiary of Baidu and leading video-streaming company, announced its plans to tap the sector earlier this year. “In recent years, the investment in VR hardware development has made significant gains, but this cutting-edge technology still remains a futuristic concept to ordinary people in the absence of a VR content platform”, said Gong Yu, founder and CEO of iQIYI.

Although the competition is evidently fierce, fortunately China’s economy will benefit regardless of whether start-ups or corporate businesses are lead investors of the market.

Europe leads the way in renewable energy provision

Posted on by Ben Debski

Europe’s renewable energy supply has grown immensely over the last few years, and the EU is on course to exceed its 2020 targets. However, inaccurate predictions could drive away the sector’s investment, which would result in losses across the board.

The sector proved its ability to surpass targets after both Germany and Portugal recently ran their entire countries on renewable energy.

A spokesperson from the European Commission for Energy and Climate Action said: “The European Union is committed to becoming the world leader in renewable energy, the global hub for developing the next generation of technically advanced and competitive renewable energies.”

However, in order for the EU to become a world leader, the commission will have to set higher expectations for the sector, taking into account both modern and conventional renewable sources, in order to encourage investment.

Renewed hope
The renewable energy sector is evenly divided between modern and conventional renewable sources – including solar, wind, geothermal and hydropower.

Traditional renewables such as biomass continue to have a higher share than modern renewables – contributing to 8.5 percent of the global energy market share, while modern renewables account for approximately 8.2 percent.

Portugal kept its lights on with solely renewable energy for four days consecutively. Electricity consumption was powered by solar, wind and hydropower in an outstanding 107-hour stint

Moreover, in terms of employment, the renewable energy sector opens a variety of job opportunities. All sources of renewable energy require hand-on jobs, from project development to operational work.

During the construction phase, hydropower and wind power create the most jobs – and after the systems are manufactured and authorised, personnel are required to carry out operational work, meaning there is a multitude of jobs available in these sectors alone.

It is also estimated that three to four indirect jobs are generated for every person employed directly within the wind industry, according to data released by a trade association of wind and marine energy providers.

Another economic advantage is consumers saving money on their utility bills. According to uSwitch, production of renewable energy is more efficient and cheaper than that of traditional energy sources. Therefore, companies can afford to charge less, and in turn build a satisfied, loyal customer network.

Investing in renewable energy can also have a huge positive impact on government expenditures. If predictions such as ‘Germany will run solely on renewable energy by 2050’ come true, then money spent on the traditional energy market can be used elsewhere.

Investment incentive
It should be noted that the renewable energy sector is a great investment for businesses of all sizes. Aside from the encouraging financial implications, the industry is unlikely to collapse, and appeals to those who want to contribute to an ethical, environmentally friendly market.

Renewable energy is a global market and doesn’t have the same international limits as fossil fuels. A significant amount of people do not have access to fossil fuels, especially in areas of Asia and sub-saharan Africa, where consumers are heavily dependent on biomass. Renewable energy can reach both wealthy and deprived countries, and is able to function in both rural and built-up areas.

Public and business sensitivity towards building a green planet and putting a stop to global warning is expanding everyday. Investing in the sector would put start-up businesses in the same category as corporate giants such as Intel, Apple, and Microsoft – who all claim to be running their companies on green energy to reduce carbon emissions. This essentially creates a domino effect of investors and subsidiary companies also converting to renewable energy.

Hydropower is one of the biggest renewable sources. Electricity generation from hydroelectric sources increased by 29 percent between 1990 and 2014. As of 2010, it supplied about 3.3 percent of the world’s energy consumption and is estimated to be worth $74bn.

Wind power generation tripled over the period 2005-2014. Since 2000, it has been the second largest contributor to renewable electricity, replacing wood and other solid biomass.

In 2013, solar energy supply surpassed wood and other solid biomass, and is now the third most important contributor to renewable electricity production. Solar electricity generation accounted for 11 percent of all renewable energy in 2014, and has since continued to grow. Additionally, bioliquids and biogas, which were negligible in 1990, reached seven percent in 2013.

Location information
Germany and Portugal are currently ahead of the game, after recently hitting renewable energy milestones. Both countries reached over 95 percent renewable electricity supply this month.

Germany set the standard after it announced clean energy had supplied nearly all of its electrical needs for an entire day – 90 percent powered by solar, wind, biomass and hydro. The breakthrough came from a combination of reduced demand and a strong supply of solar and wind energy. Usually, renewable energy supplies an average of 33 percent of Germany’s power.

Renewable energy is a global market and doesn’t have the same international limits as fossil fuels. A significant amount of people do not have access to fossil fuels, especially in areas of Asia and sub-saharan Africa

Portugal then stepped up to the plate and hit a zero emissions landmark; the country kept its lights on with solely renewable energy for four days consecutively. Electricity consumption was powered by solar, wind and hydropower in an outstanding 107-hour stint.

As recently as 2013, Portugal generated half its electricity from combustible fuels, with 27 percent coming from nuclear, 13 percent from hydro, 7.5 percent from wind and three percent from solar, according to Eurostat figures.

Countries that have also reached above and beyond their renewable energy supply targets in the last year include Norway, Sweden, Latvia, Finland and Austria.

However, one possible reason behind the EU’s low targets for renewable energy is because inevitably not all member states are on the same level. For example, countries such as Poland are unlikely to surpass the EU’s target of 20 percent, based on their figures from 2010 that stated only seven percent of the country’s energy was sourced from renewables.

The EU needs to focus on all member states hitting a similar, much higher target in order to successfully be a world leader in the renewable energy sector.

Regardless, there are a number of countries that are devoted to producing as much renewable energy as possible simply for the good of the planet, as oppose to obsessing over targets and figures.

Social media platforms fail to tackle hate speech

Posted on by Ben Debski

Censoring hate speech on platforms with millions of users can’t be the most straightforward job. With hashtags, videos and pictures going viral in a matter of seconds, social media giants have to be on top of censoring offensive content 24 hours a day. Ranging from antisemitic comments to islamophobic slurs and racist abuse, hate speech covers a wide range of offensive language that is illegal in a number of countries, and can cause huge financial implications for even the wealthiest organisations.

Breaking the law
Three French organisations – the Union of Jewish French Students, SOS Racisme and SOS Homophobie – recently brought a lawsuit against web giants Facebook, Twitter and YouTube on the grounds of hate speech.

Together, the three organisations reviewed 586 offensive posts over one month, and found that Facebook deleted 34 percent of the flagged posts, while YouTube deleted seven percent and Twitter only four percent.

The Union of Jewish French Students sued Twitter for $50m regarding antisemitic tweets

The chairman of SOS Racisme, Dominique Sopo, said in a statement: “Given the profits made by Youtube, Twitter and Facebook in France, and the few taxes they pay, their refusal to invest in the fight against hatred is unacceptable. The mystery surrounding the functioning of the moderation teams of social networks prevents any serious progress in reducing racist and antisemitic messages. Since the major platforms do not respect French law, not even their own conditions, they have to face justice.”

Similar to French law, hate speech is a criminal offence in countries such as the UK, US, and South Africa, where authorities can now legally impose imprisonment by court of law on the grounds of online abusive behaviour, and social media users and platforms are no exception.

Rep reducer
Although the exact figure for the aforementioned lawsuit has not been revealed, a similar lawsuit was brought by the Union of Jewish French Students against Twitter in 2013. The organisation sued Twitter for $50m regarding antisemitic tweets. The most shocking part of the lawsuit was that, despite the fact Twitter deleted the tweets, they were still sued the enormous sum for protecting the identity of their abusive users.

Notably, this means simply deleting hate speech is not enough to avoid financial repercussions. Web giants and social media platforms need to actively tackle the issue by establishing a functioning process in which hate users can be identified quickly and reprimanded appropriately.

It is not only the organisation’s bottom line that will take a beating if they are not quick to act upon hate speech. The reputational consequences of spreading hate speech are grave – providing users with a platform to encourage serious offences such as racism, religious hate and supporting terrorism can lower the reputation of a company in the eyes of not only users, but also shareholders.

Freedom or censorship?
The main defence in favour of web giants who fail to censor content is the notion of free speech. Article 10 of the Human Rights Act 1998 states: “Everyone has the right to freedom of expression.This right includes the freedom to hold opinions, and to receive and impart information and ideas without interference by public authority, and regardless of frontiers.”

However, the act does not directly discuss the limits of freedom of expression in regard to online hate speech. Although it is evident that there are laws in favour of free speech, and laws in favour of censoring hate speech, there is no clear line which a social media platform cannot cross.

A spokesperson for Twitter said the company is not able to comment on the lawsuit, but its policy clearly states: “You may not promote violence against or directly attack or threaten other people on the basis of race, ethnicity, national origin, sexual orientation, gender, gender identity, religious affiliation, age, disability, or disease. We also do not allow accounts whose primary purpose is inciting harm towards others on the basis of these categories.”

YouTube’s community policy states that the platform does not support content that “promotes or condones violence against individuals or groups based on race or ethnic origin, religion, disability, gender, age, nationality, veteran status or sexual orientation/gender identity, or whose primary purpose is inciting hatred on the basis of these core characteristics”.

Facebook’s guidelines are similar to those of YouTube, adding that it does allow “clear attempts at humour or satire that might otherwise be considered a possible threat or attack”.

The problem is that, although all three sets of guidelines are reasonably similar, they lack a clear, unified policy that states the legal procedures for tackling hate speech, including analytics and algorithms to detect content. If there were a more universal approach, establishing guidelines for all online platforms to follow, the rules and regulations would be far more straightforward. Websites would not be forced to create their own independent policies that do not necessarily follow the given law.

Regulated guidelines could help online companies avoid financial, legal and reputational consequences, in addition to eliminating the risk of offending users.