HOW TO  
IMPACT THE ENVIRONMENT AND YOUR BOTTOM LINE POSITIVELY?

Part I : Resource Efficiency

 

Innovative business models driving impact at scale


Corporates have an immense opportunity to accelerate sustainability and create impact at scale. Sustainability also brings business opportunities in many ways. Thoughtful (re)design and strategic investments aligned with their purpose are becoming sources of future competitive advantage.

Discover companies with innovative business models that impact positively a key stakeholder for the future of our planet : the environment.  

We have divided this section in two pages :
Part 1 : solutions driving positive environmental impact through resource efficiency,
Part 2 : solutions driving positive environmental impact  through energy efficiency.

1) Source alternative materials / food

Finding new materials or new foods to consume less water, land or energy or that are biodegradable, can impact a business’s carbon footprint tremendously.

Alternative materials to plastic or cotton, for example, could be game changers (cotton is incredibly land and water-intensive crop). That’s why there are more and more startups doing research to find the best alternatives. To name a few : Loliware raised $7 million to use seaweed instead of plastic, some startups are finding fungi/mushrooms to be a potential alternative to  leather-like fabric (Neffa or MycoWorks), Alga Life has developed a process to turn algae into fiber that is actually good for your skin, and Werewool uses the protein DNA from sources such as coral, oyster shells and jellyfish to create new fabrics without harming the organism…

Some companies are famously using such alternative materials, for example Patagonia‘s entire sportswear collections use 100% organic cotton grown wasting less water and not harming the environment with polluting chemicals. Compared to conventional cotton, there is a 45% reduction in CO2 and 87% reduction in water as a result of growing organic cotton.

In 2018, LEGO launched their first sustainable building bricks made of sugarcane plastic and shaped like plants.

In December 2019, Apple ordered alternative aluminium from the canadian joint-venture Elysis.  Its technology eliminates all direct greenhouse gas (GHG) emissions from the aluminium smelting process and is the first technology ever that emits pure oxygen as its by-product.

In the food industry as well, alternatives to meat, for example, which production is consuming a lot of resources, is attracting more and more investments. The meat industry has been held responsible of 8% of global human water use, on top of exploitation of animals. Companies are trying to replicate the taste and texture of meat with plants (Beyond MeatImpossible Foods), and grow meat in labs from animal cells (Future Meat, Modern Agriculture Foundation, Memphis Meat, Integriculture…).   

Food giants such as KFC or Nestle are investing more and more in these alternative foods. For example, Nestle, announced in May 2020 that it would open a new plant-based food facility. It is also planning to sell its Herta meat brand to invest more in private plant-based brands such as Sweet Earth, acquired in 2017. Nestle also plans to launch a plant-based burger, the Incredible Burger. 

Eco-packaging is another growing sector, especially with the growth of e-commerce. For example, TemperPack makes recyclable thermal insulation for delivery of perishable goods and medicine. 

 

Kering’s Materials Innovation Lab

Kering is a luxury goods group. They own the brands Puma, Gucci or Yves Saint-Laurent.  

Business model innovation :
Created in 2013, the Materials Innovation Lab uses Kering EP&L tool to 
evaluate the impact of a particular material or fiber, and create a library of more than 3,800 sustainable fabrics, enabling design teams of Kering brands to better understand sustainable materials. They also support suppliers by running pilots with them of innovative new materials or dyes.  Startups are now spontaneously proposing their own materials to the lab.  

Impact : Educate and encourage brands designers to use more sustainable materials    

Scale : Among the materials they use today, 3,800 respect their sustainable development criteria

Business value (ROI) : New sustainable materials can reduce costs, dependancy, and attract mindful consumers.  Kering has known a sustained growth over the last few years (30% in 2019) and is performing better than its competitors

GALY

Using biotechnology and synthetic biology to create Lab-Grown materials.

Business model innovation :
Just like lab-grown meat, GALY is making lab-grown cotton. The startup is using biotechnology to grow cotton in a lab, which eliminates the need for the millions of acres of land and tons of water and chemicals used in conventional cotton production. 

Impact : Reducing environmental impact of producing cotton

Scale : GALY’s cotton is still in the research and development phase. 

Business value (ROI) : More efficient alternative to cotton for the textile industry (it has the potential to grow 10x faster, using only 20% of the resources).

 

Impossible Foods

Develops plant based substitutes to meat products.

Business model innovation :
5 years Research and development to research animal products at the molecular level and select proteins and nutrients from plants to recreate the experience and nutrition of meat products. While Impossible Foods started as a B2B company, selling to restaurants and retailers, it has recently started a direct-to-consumers strategy.

Impact : Shifting consumption habits to plant-based products

Scale : Available in around 17,000 food outlets and 700 retailers in the US (April 2020). Also available in Hong Kong and Singapore.

Business value (ROI) : A recent report by BIS research estimated that the plant-based market will reach $480.43 billion by 2024, with a projected CAGR of 13.82% from 2019 to 2024. 

KFC x 3D BioPrinting Solutions

MNC Fast food chain

Business model innovation :
KFC is working with
3D Bioprinting Solutions, a Moscow-based tech company, to offer lab-grown chicken nuggets. Researchers will use chicken cells and plant-based material to create a chicken proxy that should be similar in taste and texture.

Impact : Citing a study by the American Environmental Science & Technology Journal, KFC says 3D bio-printed meat uses only half the energy required to produce traditional meat products, cuts emissions 25-fold, and uses 100 times less land.

Scale : The companies expect to begin testing the final product sometime this fall 2020, but it will probably take more time before it can makes its way to our plates. 

Business value (ROI) : This investment allows KFC to cater for the growing plant-based diet market, as well as to reduce production costs. 

2) Sourcing circular materials (recycled)

Using existing waste streams and turning them into materials would go a long way to produce without the need to develop any new land.  Recycled fiber is not that new. Martex Fiber has been providing reclaimed fibers made from pre-consumer and post-consumer textile waste for more than 40 years, and Unifi has been using plastic bottles to make fiber since 2007.

A game changer today would be to use biodegradable waste to make fiber that never ends in the landfill.  A few new startups have emerged to make this come true. For example, the startup Circular Systems has received $1,5 million funding to transform food waste into fibers, or the startup Thousand Fell is using recycled materials such as recycled rubber, sugar cane or coconut husks to create sneakers that will never end in the landfill.

 

Unifi

A multinational company manufacturing and selling innovative fiber.

Business model innovation :
In 2007, Unifi develops Repreve, a fiber made out of recycled plastic bottles.
It started as a way to recycle their own manufacturing waste. Then they realized they would have enormous impact if they also recycled PET bottles. The Repreve Bottle Processing Center and Repreve Recycling Center were built to transform plastic bottles into flake, resin and fiber. They also introduced U TRUST verification, with traceable FiberPrint technology to back up their customers’ recycled claims.

Impact : Reducing the number of plastic bottles tossed into landfills

Scale : 20 billion recycled bottles (2020)

Business value (ROI) : Unifi is a listed company and generated $11 million profit in 2019. 

Circular Systems

A startup transforming waste into valuable fiber, yarn and textile products. 

Business model innovation :
Agraloop™ Biorefinery, transforms food waste into fibers useful for yarn, paper and textile manufacturing. 

Impact : Reducing waste, and by removing plant waste that would otherwise be left to rot or be burned, it reduces agricultural greenhouse gas emissions and air pollution. 

Scale : Potential to scale. The company claims that six crops — oil-seed hemp, oil-seed flax, banana, pineapple leaves, rice straw and sugarcane bark — currently offer more than 250M tons of fiber per year, or enough to meet 2.5 times the current global fiber demand.

Business value (ROI) : An efficient alternative to produce fibers at lower cost. $1.7M has already been invested in the company. Levi’s Strauss is one of the investors. 

3) Transform business models to embrace circularity

Many businesses have started to change their business model to take care of the product’s entire life cycle, and avoid waste.

Apple, for example, has launched a new Trade-In program in June 2020 to allow customers to exchange an old iPhone for credit. In some countries, Ikea has created a platform for customers to resell their furniture. MUD Jeans’ leasing model allows you to lease a jean for a monthly fee.

A good amount of startups such Lablaco or VeChain are betting on the blockchain technology to make it easier to buy second-hand products as it will help keep track of the whole life cycle of a product.

Some models are also extending the life of packaging, such as Loop Circular Delivery Service by Terracycle, or The Body Shop which is offering refillable shower gels, where customers pay slightly less when refilling their bottle, or avoiding completely any packaging such as the solid shampoos or soaps or machines to make your own at home, e.g., SodaStream to avoid buying sparkling water bottles. 

Another inspiring initiative is the one started by Unilever with Algramo in Santiago, Chili. Algramo and Unilever will bring refill machines to the consumer’s doorstep via electric tricycles for laundry and dishwashing liquid. An RFID tag link the package to the customer’s profile in the Algramo app. Using the app, the consumer can schedule a delivery, as well as specify the amount of product they watn to purchase. Each dispensation is translated into the amount of plastic the use is avoiding and into a discount applied to the next purchase. 

 

Apple

World’s leading electronics manufacturer.

Business model innovation : Apple has launched a Material Recovery Lab in Austin, Texas, focused on innovative electronics recycling technology. Its robot « Daisy » disassemble iPhones returned to the stores to be recycled as part of the Apple Trade-In program. This program lets consumers  trade in their iPhone, either in-store or online, for credit towards a new phone or towards monthly payments to their carrier. Trade In offers you as much as $500 for an iPhone XS Max. 

Impact :  Reducing e-waste which is now the fastest-growing waste stream in the world.

Scale : All iPhone, iPad, Mac, and Apple Watch devices released since mid-2019 are made with recycled content, including 100 percent recycled rare earth elements in the iPhone Taptic Engine — a first for Apple and for any smartphone.  Apple decreased its carbon footprint by 4.3 million metric tons in 2019 through design and recycled content innovations in its products. 

Business value (ROI) : More loyal customers (credits towards a new phone), reduction of dependance on mining companies (and on China, dominant supplier of raw rare earth elements), smoothening up its supply chain thereby improving lead times. “Daisy” is a part of the company’s plan to become a “closed-loop” manufacturer.  Additionally, recycling can somewhat insulate Apple from rising commodity prices. 

Reebonz

Leading luxury second-hand platform in Southeast Asia.

Business model innovation :
All products sold by Reebonz from its inventory since January 2019, will have a digital certificate.  This digital certificate will bear a QR Code which contains information such as product details, transaction details and history, and provenance of ownership. Products can be verified through the Reebonz mobile application, which will provide the digital certificate. As part of Reebonz’s MOU with VeChain, signed in February 2019, the digital certificate will be hosted on the VeChainThor Blockchain. Further functionalities such as “Transfer of Certificate” and “Revoking” to other individuals will be introduced later. 

Impact : Scale authentication efforts, build trust with the customers and grow the second-hand market faster. 

Scale : The project is in Proof of concept stage. In its initial phase, approximately 50,000 unique products will bear a digital certificate in the blockchain and was live by late December 2019.

Business value (ROI) : Build trust and loyalty with the customers, bring efficiency in operations with the digital certificate. 

MUD Jeans

Jeans leasing and recycling.

Business model innovation :
A pioneering lease system. Every garment that comes back to them gets recycled, repairs are provided for free and the customers can keep the jeans for as long as they want and can swap them for a new pair after the one-year rental term is complete. 50% of clients are choosing that option.

Impact : Reducing fashion waste

Scale : 25,000 pairs of jeans produced in 2018 and 3,200 pairs returned for recycling 

Business value (ROI) : Growing interest of consumers in lease models as brands are facing a dilemma on how to shift away from disposable fashion without obligatring their revenues.  The company is profitable : MUD Jeans is currently being sold in 29 countries through 300 retailers (2020). They just raised 1 million euros to expand.

Idle Fish (Xianyu)

Alibaba’s re-commerce platform to buy and sell second-hand items in China.

Business model innovation :
In a few clicks, clothes are collected at the user’s house in exchange of a payment, then sent to partner companies which sell or recycle the items.  All this is done in no time and safely as the app is integrated with Alibaba’s mobile payment Alipay and its notation system Sesame Credit.

Impact : Reducing waste

Scale : 24 million pieces recycled since launch (2020), 76 million users per month (2020)  

Business value (ROI) : Generate upwards of RMB 100 billion in annual gross merchandise volume in fiscal year 2019, accordin to the company. China’s resale goods market is growing. The platform also helps the brand create community engagement with many interest-based communities on the platform, and gather insightful data about consumption habits. 

Loop (by TerraCycle)

Loop is a shopping platform selling zero-waste products from your favorite brands.

Business model innovation :
Loop has partnered with leading brands to reimagine how they can be waste free. These products are available exclusively through Loop. The consumer just pays a small fully refundable one-time deposit to borrow the package. Loop delivers the products and pick them up once they have been used.Its cleaning technology hygienically cleans the empty packages so that they are ready for reuse.

Impact : Eliminating waste through ending single-use

Scale : Loop already operates in the US and France, and coming to Australia, Canada, Germany, Japan and UK.

Business value (ROI) : Attractive concept for consumers willing to reduce plastic packaging as it brings the same convenience. The pilot has been the object of much hype with a reported waitlist of 85,000. As it requires a great deal of logistics and reverse logistics, the model is still in pilot phase, and is designed to only serve 5,000 households (2020). 

4) Address food waste

Addressing food waste is a major component of reducing climate change. The target 3 of the United Nation’s SDG on Sustainable production and consumption is to halve food waste by 2030.

« Roughly a third of the world’s food is never eaten, which means land and resources used and greenhouse gases emitted in producing it were unnecessary. The food we waste is responsible for roughly 8 percent of global emissions », according to The Drawdown Project.

« There are numerous and varied ways to address key waste points. In lower-income countries, improving infrastructure for storage, processing, and transportation is essential. In higher-income regions, major interventions are needed at the retail and consumer levels. »

Amazing innovative solutions have emerged, leveraging on technology or new business models to reduce food waste at each stage of the supply chain, such as in-kitchen food waste trackers (Leanpath) to understand better how food is wasted in restaurants, dynamic pricing on shelves to encourage consumers to buy food which is about to expire (Wasteless), discounted marketplace for imperfect food (Imperfect Foods) or food from restaurants that otherwise would have been thrown away (Too Good To Go) or edible coating to make aliments last longer (Apeel Sciences or Mori). 

Higher on the supply chain, technologies are also helping to make agriculture more efficient and marketplaces better connect farmers with retailers allow to avoid wasting any crops (Ninjacart or Waycool in India, for example). 

 
 

Ninjacart

Indian startup connecting producers of food directly with retailers, restaurants, and now consumers using in-house applications. 

Business model innovation :
Ninjacart assembles a responsive and real-time logistics network to manage inventory, reduce processing time and improve efficiency and forecasting models.

 

Impact :  Reducing food wastage.

Scale : They are equipped to move 1400 tonnes of perishables from farms to businesses, every day, in less than 12 hours, with less than one per cent food wastage (they report that the traditional supply chain has 30% food wastage).

Business value (ROI) : Businesses working with Ninjacart see their cost  reduced by 12%, retailers save 3 to 4 hours a day, it improves efficiency with 100% traceability, and hygiene is also improved. 

Leanpath

Since 2004, Leanpath has been developing food waste tracking solutions to make it simple to weigh and track food waste data in restaurants kitchen.

Business model innovation :
Innovative solutions include:
– a tracking terminal that includes a built-in scale, camera, and touchscreen user interface, combined with deep data analytics.
– a smart bin that automatically records wasted food as it is discarded, saving time and seamlessly integrating with the kitchen workflow.

Impact : Understand how food is wasted to adapt purchase decisions. The solution eliminates food waste as well as saves money. 

Scale : Leanpath reports an average of 50% reduction in food waste per site.

Business value (ROI) : More efficient use of resources lead to cost reduction. 

Wasteless

An Israeli startup  offering dynamic pricing tags for products with a shorter expiration date to supermarkets.

Business model innovation :
The Pricing Engine uses machine learning to automatically map inventory stock and time of day into a series of optimal prices.

Impact :  Ensure products are sold when they get closer to the expiration date and therefore don’t go to waste

Scale : They report reducing waste by 50%. 

Business value (ROI) : Wasteless has piloted with an international Spanish retailer and demonstrated that its algorithm increased revenue of piloted perishables by 6.3% and decreased the cost of waste by 32.8%.

Mori

All-natural protective layer slowing down the spoiling process of fruit, veggies, meats and seafood. 

Business model innovation :
Using natural silk, they create a protective layer that slows down three key mechanisms making food spoil: dehydration, oxidation and microbial growth. Mori is a Massachusetts Institute of Technology spin-off formerly known as Cambridge Crops.

Impact : Food stays fresh longer, reducing waste as well as the need for single-use plastics or chemicals

Scale : They report extending shelf life by x2. 

Business value (ROI) : Extended shelf life means more revenue. 

5) Support regenerative agriculture

Regenerative agriculture is a method of farming that “improves the resources it uses, rather than destroying or depleting them,” according to the Rodale Institute.

Companies like PatagoniaEileen Fisher and Kering have started to invest in this form of agriculture that is increasingly being viewed as an essential part of any sustainable supply chain. 

 

The Savory Institute

The Savory Institute is on a mission to regenerate the grasslands of the world and the livelihoods of their inhabitants, through Holistic Management, a method developed by Allan Savory in the early 1980s. 

Business model innovation :
Savory Institute’s Land to Market program, deployed by the Savory Global Network, is the world’s first outcome-based, verified-regenerative sourcing solution. The program connects conscientious brands, retailers, and consumers directly to supply derived from land that is verified to be regenerating.

Impact : Healthy grasslands lead to carbon sequestration, drought resilience, food security, and financially viable communities.

Scale : 13 million hectares of land managed holistically

Business value (ROI) : Brands participating to the program become « Verified Regenerative Suppliers » and get a EOV seal (Ecological Outcome Verification); attracting conscious consumers. 

6) Buy carbon credits 

Carbon credits and carbon markets are part of an international attempt to mitigate the growth in greenhouse gases.  A carbon credit represents the right to emit one tonne of carbon dioxide. More and more companies are now trading carbon credits in an effort to offset the emissions that are too difficult to eliminate and be able to claim carbon neutrality and reach their net-zero targets.

To remove carbon, companies can plant trees, build wind farms or use carbon removal technologies such as DAC (direct air capture). DAC is still in early stages of development, though several commercial plants are in operation or planning across Europe and the US, such as those operated by Climateworks.

 

Emergent Forest Finance Accelerator

A.nonprofit dedicated to accelerating the speed and scale of forest conservation by being a marketplace for carbon credits. 

Business model innovation :
Building on the international climate change frameworks under the Warsaw Framework for REDD+, the Cancun Safeguards, and the Paris Agreement, Emergent connects buyers and sellers of large-scale emissions reductions from jurisdictional REDD+ programs, providing a reliable means of transacting large volumes of high-quality international forest carbon credits.

Impact : Reduce climate change 

Scale : Reforestation represents the most promising large-scale and cost-effective opportunity to manage climate change. 

Business value (ROI) : Carbon credits help businesses achieve net zero and climate neutral targets, which serves their branding as well as prevent from regulation risks. 

Climeworks

A Swiss start-up that pioneered a technology that sucks carbon out of the air and turns it into stone

Business model innovation :
Powered by waste heat from a geothermal energy plant, it harnesses direct air capture technology (DAC) to draw ambient air into giant vacuum cleaner-like machines called CO2 collectors. The carbon is then separated from the captured air, combined with water and pumped 700m underground. Through natural mineralisation, the carbon dioxide reacts with basalt rock and turns into stone within a few years, while the remaining air simply returns to the atmosphere.

Impact : Remove carbon from the air.

Scale : Climeworks CO2 collector is 2,000 times more efficient per area than a tree. The company is rapidly expanding, with a new facility in Iceland, capable of permanently removing several million tonnes of carbon per year, due to open by the end of 2020.

Business value (ROI) : Accessing cheaper carbon credits will help brands reach their carbon neutral goals faster, which is beneficial for their branding/reputation and to be more resilient against regulation risks. 

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