Canadian Institute for Business and the Environment
Fisherville, Ontario, Canada
Tel. 416 410-0432, Fax: 416 362-5231
Vol. 17, No. 10, June 17, 2013

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Regular readers of Gallon Environment Letter will have heard of, and perhaps visited,, our (almost) every weekday one article version of GallonLetter. What you may not know is that sometime in the next 5 to 10 days GallonDaily will celebrate its 500th anniversary – 500 articles!

To mark this special anniversary we will be awarding the traditional Gallon Environment Letter draw prize – 500 grams of organic fair trade chocolate.

All you have to do to win is visit on the day that the 500th column is published and answer a couple of easy questions. Full details on how to win – very simple – will be published only on the 500th anniversary day. There will be no obligation and no purchase required. We are not telling you exactly when that 500th anniversary day is, and we are not counting in the 500 columns those few that provide solely administrative information, like the one which announces this contest! So the only way to win the chocolate is to visit GallonDaily every day for the next few days until you see the contest announcement.

Draw open only to residents of Canada, the United States, and the UK. Persons associated with GallonDaily or Gallon Environment Letter not eligible!

Watch out for the GallonDaily 500th anniversary draw! 

This issue of GallonLetter looks at the question of Responsible Capitalism - what is it, is it real, and who is practising it? We let Unilever's define it for us, then present some possible examples and some critical views. We review one company's Don't Buy Our Product campaign, a book on Conscious Capitalism, one of the authors of which is the co-founder of Whole Foods Market, some work by Milton Friedman, divestment of investments from fossil energy companies, a way to reduce the environmental impacts of clothing by reducing the number of colours, the cost of perpetual care in the waste management field and the corporate subsidies that taxpayers often provide, one company that seems to be doing waste management better, and a review of the federal government's Responsible Resource Development concept.

In all, the topic makes for fun and interesting reading. It is quite amazing how some corporations and organizations try to twist popular objectives to their own profit goals.

We wrap up this issue with a brief review of the tick problem that currently pervades the natural landscaping surrounding our publishing house.

Our next issue will review a topic that is currently getting much attention across Canada - Extended Producer Responsibility. There is a preview of the topic in this issue of GallonLetter. Whether you are a consumer or a brandowner, an importer, retailer or manufacturer, governments are pushing the cost of recycling on to you. Is this a good thing? We'll do our best to answer some of the questions and we will tell you what we think of the Ontario proposals for changes to EPR in that province.

As always, we invite readers to submit Letters to the Editor for possible publication. Send your comments in support, in disagreement, or in inquiry, to . We will pick a selection of the most interesting for publication.


"Business has a much wider social purpose and value than making money. In the proper hands it can be a real force for good." was the theme of Unilever CEO Paul Polman speaking as the third speaker in the annual Bata Lecture on Responsible Capitalism. He noted the timely nature of the debate on responsible capitalism, "Indeed, the production of books on capitalism is one of the few growth industries at the moment. Capitalism in Crisis.; Capitalism at the crossroads.; Sustainable Capitalism, .What next for Capitalism, and so on. I was thinking of contributing myself, with '50 shades of Capitalism'!"

Polman promotes partnerships and high level collaboration including with UN agencies and groups of business leaders such as an initiative involving Richard Branson and Jochen Zeitz calling for a Plan B for Capitalism for social, environmental and economic benefits.             
Challenges of a VUCA World

After discussing the challenges of a VUCA World (Volatility, uncertainty, complexity and ambiguity) such as political systems unable to adapt to rapid changes of an interdependent world, rapid technology development, increasing lack of trust by citizens of government and business, financial crises, lost generations of youth unable to find jobs and environmental crises such as climate change, population growth and resource depletion, he said that "the only way to guarantee long term prosperity is to grow our businesses in line with the needs and aspirations of the communities we serve. There is a huge opportunity for businesses that embrace this new model of responsible capitalism. But it needs a different approach. This goes well beyond CSR. It’s about moving to a licence to lead, where:
- business sees itself as part of society not separate from it;
- the focus is on the long term, not on quarterly earnings;
- the needs of citizens and communities carry the same weight as those shareholders."

At Unilever, he said, this is the approach they are using including abandoning quarterly profit reporting and changing compensation for long term. He attributes the 2008 financial crisis to short term profit goals including hyperspeed stock trading. He notes the changes that social media and technology in general has had on increasing the interdependence of the world and the need for business leaders to adapt as the world changes. Leaders have to be authentic and trustworthy, not to be changing their behaviours depending on expediency or who they are trying to influence.

The Unilever Sustainable Living Plan calls for growing the company to double its current size but to do so by reducing the environmental footprint and adding to social benefit: "It’s a new model, encompassing all brands, categories and countries, taking co-responsibility for the total value chain.

The Plan has three big goals by 2020.
- To help a billion people take action to improve their health and well-being.
- To halve the environmental impact of our products.
- And to source 100% of our agricultural raw materials sustainably, protecting the livelihoods of more than 500,000 smallholder farmers.
These are underpinned by 50 timebound targets.
This approach, we believe, will become the only growth model acceptable to consumers. We are making progress:
- lowering costs by cutting the use of resources;
- lowering risks by internalising challenges like climate change;
- creating stable supply by working directly with small hold farmers;
- motivating our employees;
- Leveraging our brands as a force for good.
Indeed the biggest force will come from making our brands movements for social change."

He lists the various brand initiatives such as Knorr's Sustainability Partnership for sustainable agriculture.

In a VUCA world, many of the issues are complex, for example for deforestation which contributes 17% of global greenhouse gas emissions: "An issue as complex as deforestation requires big coalitions, extensive resource and big ambition. No one can do it alone." He gives other examples of partnerships including his being a member of the UN Secretary Generals High Level Panel on Post- 2015 MDGs. (Millennium Development Goals) which set targets for eliminating poverty.

He says that: "Companies like Unilever have extraordinary reach. We are present in more than half of households on the planet. Every day two billion people across 200 countries use one of our products. This gives us the opportunity to intervene and improve the lives of millions by offering them the fundamentals of a decent life - clean drinking water, basic hygiene and good nutrition. It is an opportunity we must not waste, not just because it would be immoral to do so, but because providing solutions to the challenges we face in food security, access to drinking water and poor sanitation is good for business. It fosters innovation and drives growth."

Lecture Series

The Bata Shoe Foundation established the Thomas J. Bata Lecture Series on Responsible Capitalism in honour of the late Thomas J. Bata who believed "that business is a public trust which should contribute to the well-being of the communities where it operates." Every other year the lecture is delivered in Canada organized by the York University Schulich School of Business in Toronto and in the Czech Republic organized by Tomas Bata University.

Polman, Paul CEO Unilever. Bata Lecture on Responsible Capitalism. February 11, 2013.

Paul Polman to Deliver Bata Lecture on Responsible Capitalism.


Patagonia, the sports clothing and gear company, attracted a fair bit of attention with its ad on Black Friday (the day after the US Thanksgiving and one of the biggest shopping days of the year) in 2011 in the New York Times headed "Don't Buy This Jacket". Not many companies promise to make long lasting products which they commit to repair and at the end of their lifecycle recycle. Even fewer companies say, don't buy our product unless you really need to.

In line with Patagonia's goal to become a responsible company, the ad is part of the company's Common Threads Initiative: "Businesses need to make fewer things but of higher quality. Customers need to think twice before they buy."

In the Common Threads Initiative consumers are asked to take the pledge:
WE make useful gear that lasts a long time
YOU don’t buy what you don’t need

WE help you repair your Patagonia gear
YOU pledge to fix what's broken

WE help find a home for Patagonia gear you no longer need
YOU sell or pass it on (eBay is a great place to start)

WE will take back your Patagonia gear that is worn out
YOU pledge to keep your stuff out of the landfill and incinerator

TOGETHER we reimagine a world where we take only what nature can replace."

Patagonia’s Clean Water Campaign Targets Oil Sands

Because of the negative effective of textiles on water quality, Patagonia has supported campaigns for clean water. As part of its campaign, Patagonia is asking for action on tar sands pipelines providing links to the various groups calling for opposition to the Keystone XL pipeline which is seen as threatening freshwater due to spills.

Among the organizations opposing the pipeline highlighted on the Patagonia web page are:
Patagonia. Patagonia's Common Threads Partnership to Reduce Our Environmental Footprint

The Cleanest Line: Don't Buy This Jacket, Black Friday and the New York Times The Cleanest Line Weblog for the employees, friends and customers of the outdoor clothing company Patagonia.'t-buy-this-jacket-black-friday-and-the-new-york-times.html

Patagonia. Clean Water.


Four tenets are explored in the book Conscious Capitalism, described as an antidote to the books about capitalism in crisis. The four are:
The wealth created by a Conscious Corporation includes not only financial but also intellectual, social, emotional, physical and ecological wealth for the stakeholders. The authors John Mackey, cofounder of Whole Foods Market and Rajendra Sisodia, cofounder and trustee of the non-profit Conscious Capitalism, Inc and professor of marketing at Bentley University. give examples not only from Whole Foods Market but many other corporations.

There are a number of examples in the book where GallonLetter think they are a little too inventive in creating their own world of conscious capitalism. While espousing the importance of stakeholders, they want no unions and if they have to have one then only one controlled by the company, something which is against the ISO 26000 Guidance on Social Responsibility which requires good labour practices to have dialogue with workers controlled by worker selected representation not controlled by either government or company. None of the sixty-thousand people working at Whole Foods are unionized and the argument is that happy team members don't want a union.

Climate change is barely mentioned although it is part of a list of "natural phenomena, unintended consequences of rapid industrial growth and greater prosperity "which includes "freshwater scarcity and pollution, energy uncertainty, depleted fisheries, rapid deforestation and climate change". The authors say that climate change gets too much attention drawing attention away from other environmental challenges. While Mackey hasn't overtly been identified as a climate sceptic per se, he just avoids the issue of human-caused climate change. Choosing to avoid addressing climate change which scientific leaders say is one of the most crucial issue of our times reduces the book's credibility especially as the food production sector is likely to heavily affected.

On the other hand, at times they make good points highlighting important issues. For example, they discuss the growth in annual economic activity from 1800 when "there were fewer than a billion of us on the planet, and each individual produced and consumed on average about $640 worth of goods and services a year" to today when "there are seven billion of us, each producing and consuming an average of $8,000 worth of goods and services a year (in 1990 international dollars). That is approximately $56 trillion in annual economic activity, compared to about $50 billion in 1800, an eighty-six-fold increase." They project to the next fifty years with growth of population to 9. 6 billion people and over $300 trillion a year of economic activity a year in 1990 dollars and write, "It is impossible to imagine our planet supporting that much production and consumption if we continue to doing things the same way we have been doing them." They suggest that a conscious business seeks to minimize its environmental impacts at the same time as it lowers the cost of doing business, keeps good relations with its customers, raises the morale of team members. Energy efficiency is an example which achieves these multiple goals. John Mackey a number of years ago decided he had made enough money and received compensation of just one dollar a year with no stock options or bonuses.

The authors point fingers at critics of business and capitalism who say corporations are greedy and evil for despoiling the environment in the name of profit by saying that "Most of the environmental harm that has occurred on the planet has not been done deliberately." From their point of view, these environmental damage are unintended consequences of the higher goals of "creating desired goods and services for customers, providing jobs for team members, purchasing needed materials from suppliers and so forth." GallonLetter is sure that this point of view must be very convenient. Just after pointing fingers at critics of corporate operations, they say it is time to stop finger pointing.

Sustainable Food

Whole Foods Market is said to be involved in more sustainable agriculture such as organic and local products, sustainable seafood, reducing energy footprint, green buildings and initiatives towards zero waste in stores. Among the initiatives described in more detail are:
The authors tend to be on the positive side when it comes to business ingenuity and innovations which in some cases is a positive aspect of the book: the idea that once a business is focussed on a problem, positive changes are more likely, e.g. in regard to sustainable fisheries: the collapse of the cod fisheries led Whole Foods on a successful search for a sustainable cod fishery, "As consciousness rises about these issues, we're going to see more fisheries managed in a sustainable way."

However, this optimism also leads to poorly supported conclusions, for example, the idea that higher standard of living leads to a cleaner environment, "People with higher living standards expect and demand a cleaner environment, and this is generally accomplished." GallonLetter notes that both rich and poor people have environmental impacts, but wealthier societies tend to consume more (e.g. in the EU the measure Direct Material Consumption is linked to economic wealth. This consumption tends to increase the environmental footprint of richer people. This is a much more complex subject than can be subject to the simplistic conclusion of this book’s single sentence.) Also the United Nations Global Environment Outlook released at the Rio conference in 2012 doesn't reflect the optimism: "The currently observed changes to the Earth System are unprecedented in human history. Efforts to slow the rate or extent of change – including enhanced resource efficiency and mitigation measures – have resulted in moderate successes but have not succeeded in reversing adverse environmental changes. Neither the scope of these nor their speed has abated in the past five years.

As human pressures on the Earth System accelerate, several critical global, regional and local thresholds are close or have been exceeded. Once these have been passed, abrupt and possibly irreversible changes to the life-support functions of the planet are likely to occur, with significant adverse implications for human well-being."

The authors say that critics of business are trading on fear with their message of "environmental Armageddon" but fear "short-circuits creativity and inhibits innovation and problem-solving." Instead of fear and guilt, businesses are advised to "operate out of love and care for the environment." A role for government is to enact scientifically-based regulations so that conscious and conscientious companies are not put at disadvantage by unscrupulous operators.

Responding to Misconceptions about the Conscious Capitalism

Among the author's responses to criticisms about conscious corporation are:
GallonLetter really doesn't know what to make of this book. At times, we found it vaguely creepy. There is a section complaining about too high taxes, saying that with lower taxes the company would be able to pay its employees (team members) better, have lower prices for customers and a higher profits for investors - maybe so but who is to say to what extent higher profits than the $343 million profits in 2011 would be directed to lower prices or higher wages of any significance although the company does have a profit sharing program for workers.

There is a lot of talk about trust and openness yet Mackey spent seven years messaging anonymously on the Yahoo financial site including some criticisms of competitor Wild Oats which was later bought out by Whole Foods. He predicted that Wild Oats would crash and he was making money shorting it. Some of the remarks are just silly at one time saying he wasn't a Mackey groupie but he admired various things Mackey accomplished but other anonymous comments were roundly criticized such his saying he was genetically disposed to making money and those who didn't like it that he was a wealthy man were just envious because "So many people are stuck on a zero-sum paradigm of the world.". In the book, he says it was all in fun and not taken seriously by the readers of the message board but it must have undermined trust when he was exposed.. When his comments that Obamacare was fascist generated a call for a boycott of Whole Foods, some Tea Party members instituted a buycott.

However, despite the idiosyncratic approach and quasi-libertarian belief system, the book highlights that there are many ways in which a successful business is more than just the bottom line. We don't know whether the Whole Foods culture is really about love and care as the authors represent but it is true as the authors write that although the saying is what gets measured gets managed, that there are also many aspects of the corporate culture that aren't amenable to measurement but are critical to the success nevertheless. Because Mackey has actually built a prosperous business in the highly competitive food retail sector, the discussions on these "soft" elements are more likely to be considered by business leaders than if presented by other commentators.

In the fall of 2012, Whole Foods Market based in Austin, Texas operated 335 supermarkets: 322 stores in 39 U.S. states and the District of Columbia; 7 stores in Canada; and 6 stores in the United Kingdom. The company's SEC 10K filing says it is the largest retailer of organic and natural foods (defined as "foods that are minimally processed, largely or completely free of artificial ingredients, preservatives and other non-naturally occurring chemicals and as near to their whole, natural state as possible) and 11th largest food retailer in the US. Organic is defined by the U.S. Department of Agriculture’s (“USDA”) Organic Rule. Sales have steadily increased from $7.95 billion in 2008 to $11.7 billion in 2012. The filing gives extensive description of the types of initiatives discussed in the book and a range of risk factors including the potential harm of unions, relying heavily on a particular supplier (United Natural Foods, Inc., supplies almost a third of products) and other retailers picking up more of the same type of products.

Conscious Capitalism.

United Nations Environment Program. Global Environment Outlook 5. GEO-5 Summary for Policy Makers. July 31, 2012.

United States Securities and Exchange Commission. Form 10-K. Annual Report Pursuant to Section 13 or 15(d) Of the Securities Exchange Act of 1934 for the Fiscal Year Ended September 30, 2012. Commission File Number: 0-19797 Whole Foods Market, Inc. Washington, D.C.


Milton Friedman, Professor at the University of Chicago, won the Nobel Prize in 1976 for his work on the role of money in inflation and other ideas such as how longer term income affects consumption and prices. He suggested there were complexities related to stabilizing business and economic cycles. His major work A monetary history of the United States 1967-1960 and work on how policies of the US Federal Reserve System sparked the 1929 crisis were considered very influential.

But for many Friedman's most significant work is an article he wrote in the New York Times, not an academic article but extracted somewhat from his book Capitalism and Freedom. Friedman positions his argument against social responsibility for business yet provides some conditions which are not frivolous and often not mentioned such as the need for a competitive playing field and legal and even moral compliance. It isn't clear whether Friedman ever did any of the studies or academic research for this theory as compared to that for which he won the Nobel Prize. Certainly his article was of an era when humanity didn't expect, with the help of the captains of industry, to have the capacity to destroy a great deal of life on earth through environmental impact (acid rain, ozone depletion, long range transport of hazardous air pollutants, climate change). Or, as brilliant as he was, he could be wrong. As he said in his banquet speech for the Nobel prize: "Delighted as I am with the award, I must confess that the past eight weeks have impressed on me that not only is there no free lunch, there is no free prize. It is a tribute to the world-wide repute of the Nobel awards that the announcement of an award converts its recipient into an instant expert on all and sundry, and unleashes hordes of ravenous newsmen and photographers from journals and T.V. stations around the world. I myself have been asked my opinion on everything from a cure for the common cold to the market value of a letter signed by John F. Kennedy. Needless to say, the attention is flattering, but also corrupting. Somehow, we badly need an antidote for both the inflated attention granted a Nobel Laureate in areas outside his competence and the inflated ego each of us is in so much danger of acquiring. My own field suggests one obvious antidote: competition through the establishment of many more such awards. But a product that has been so successful is not easy to displace. Hence, I suspect that our inflated egos are safe for a good long time to come."

In the article he wrote that only people have responsibilities and corporations are artificial persons which might have artificial responsibilities but cannot as a whole have human responsibilities. He accuses "Businessmen who talk this way are unwitting puppets of the intellectual forces that have been undermining the basis of a free society these past decades."

Among his comments are:
The only trouble is the complexity of defining what the rules of the game are, how and whether there is open and free competition and what role an individual company has to ensure it operates within such a system and what constitutes compliance, deception or fraud.

Ivey School of Business Dean: Companies and Societies Intrinsically Connected

Dean of the Ivey Business School at Western University (London, Ontario) since 2003, Carol Stephenson wrote in the Ivey Business Journal in 2008 about Friedman's article but said that "In our increasingly inter-connected world, where the forces of globalization and technological innovation are bringing massive change, I believe the linkages between business and society will grow stronger, tighter and even more vital to both corporate success and social prosperity." She discussed how social responsibility initiatives by such companies as Nestle have improved quality of life in communities and in turn improved markets for the companies. She concludes, "I have no doubt that the debate surrounding the role of business in society will continue for years to come. Is it fair to hold corporations to account for their contributions to society? Can companies advance social progress and make a profit at the same time? Should corporate social responsibility be an essential part of a company’s business strategy? I firmly believe so. Business and society are inseparable and interdependent. The best business leaders know this is true. And they act with vision, courage and passion to create real and lasting social value. These are the leaders we are educating at Ivey today."

Royal Swedish Academy of Sciences. Press Release. October 14, 2976. This Year's Economic Prize to an American: Professor Milton Friedman, University of Chicago, Illinois, USA.

Friedman, Milton. Banquet Speech. Nobel Banquet, December 10, 1976.

Stephenson, Carol O.C. Creating shared value: The inseparability of business and society. From the Dean. Ivey Business Journal. July / August 2008.


A 2013 paper with authors from the Climate Justice project of the Canadian Centre for Policy Alternatives covers a number of ways in which, according to the authors, institutional investors can help move Canada towards a lower carbon future. The authors of the paper are Marc Lee, Senior Economist at the BC Office of the Canadian Centre for Policy Alternatives and Co-Director of the Climate Justice Project, and Brock Ellis with a Masters of Public Policy from Simon Fraser University and research assistant for the Climate Justice Project. Climate Justice is a five year research project by the CCPA-BC and the University of British Columbia.

While Canada's Prime Minister said environmental groups using foreign money were hijacking public consultations on oil sands and other resource extraction projects, the authors say oil sands are Canada's top destination for private investments with foreign capital. Among the forces that could lead "to a bursting carbon bubble" are various forces including divestment campaigns in various jurisdictions. While those supporting the oil sands say that divestment of fossil fuel stocks threaten pension plans and future payouts, these authors say that previous collapses such as the 2008 housing bubble and the earlier high tech bubble could be examples of similar risks in the form of a carbon bubble. Pension funds review risk related to inflation, currency, regulations, political instability, economic conditions but tend not to account for climate risk. While some observers say that accounting for environmental risk will reduce financial performance, the authors say that failing to consider climate risk exposes a pension fund to vulnerability from the carbon bubble. The long term viability of the fund to pay out to now-still-young workers is threatened.

Among the suggestions are:
As long as governments are unwilling to take this type of action, others can divest: campuses, churches, credit unions and other community based organizations can take similar divestment actions as were taken to pressure South Africa to get rid of apartheid.

Fossil fuel divestment is being promoted by Bill McKibben of with four campuses divesting and campaigns at 300 others. In Canada, Fossil Free Canada, is promoting campaigns of university endowment funds.

While some funds such as Ethical Funds screen for military and tobacco they tend not to divest of fossil fuel companies although Ethical Funds announced in January 2013 it was divesting of Enbridge but that was related to Enbridge Northern Gateway project for which First Nations opposition was viewed as a human rights issue rather than an environmental one. Ethical Funds, which had sent a resolution to Enbridge's AGM in 2012 which failed, said "Ethical Funds has divested of all holdings of Enbridge Inc. in its funds. Enbridge Inc. will not be eligible for re-investment in any of the Ethical Funds until such time as it meets the environmental, governance and social (ESG) requirements for inclusion. Enbridge exhibits signs that it is revisiting its current position on the impact of the Gateway Project. Divestment is considered a last resort once all avenues of the engagement process have been exhausted."

Caisse de dépôt et placement du Québec has a policy on responsible investment with consideration of environmental. social and governance reporting ESG and the Ontario Teacher's Pension Plan is considering ESG policies but overall these types of initiatives are marginal. Some global investors have also articulated positions in support of taking climate risk into account.

On divestment the authors conclude, "We have articulated a case that implies divestment is a rational choice, not just for moral reasons, but due to the core financial problem of unburnable carbon. As we noted above, a major drop in asset values for fossil fuel stocks could drive an economic downturn in Canada, and is a systemic concern given the large volume of funds workers have invested through private pension funds. Other private savings vehicles, such as RRSPs, and public investments through the Canada Pension Plan, are also in need of a “managed retreat” from fossil fuel investments. Ideally, long-term savings vehicles in the Canadian economy would be strongly aligned with the need for climate action and low-carbon economic transition."

Lee, Marc and Brock Ellis. Canada’s Carbon Liabilities: The Implications of Stranded Fossil Fuel Assets for Financial Markets and Pension Funds. Canadian Centre for Policy Alternatives. March 2013. Office/2013/03/Canadas Carbon Liabilities.pdf

Ethical Funds. Enbridge / Greatly Concerned over Rights of Indigenous Communities. Toronto, Ontario: January 2013.

Fossil Free Canada.


Reducing the colour range is one of the targets for the footwear and apparel company, Adidas. In designing for the environment, Adidas has set a target of reducing its colour palette by 50% (excluding the production of products for clubs or for products outside of their design control). Over the last two years, they have reduced the colour palette by 19%. GallonLetter notes that among the benefits of fewer colours are fewer containers, fewer chemicals and materials for cleanout of dyeing equipment between colour runs, and waste among other impacts. A common strategy in Design for the Environment is to reduce the number and types of materials used.

Adidas DryDye

The Adidas report says to dye one of their t-shirt uses 25 litres of water (and GallonLetter notes that the water is contaminated with the dye stuff). For some of its apparel, the company is applying DryDye technology which is for polyester fabric using no water, 50% fewer chemicals and 50% less energy than conventional fabric dyeing. The method also improves how well the dye is held in the fabric. GallonLetter notes with appreciation that the claim is based on a lifecycle assessment (by the supplier of the technology, Netherlands-based DyeCoo Textile Systems BV) (1)

(1) DyeCoo announced in April 2013 that its waterless dyeing system has received investment from Ikea GreenTech venure capital, a company of the Ikea Group.

Adidas Group. Never Stop. Sustainability Progress Report 2012.Herzogenaurach, Germany.


One of the problems of the ideal of a free competitive market is that the capitalists aren't the ones paying both the financial and non-financial costs, costs which may continue to accumulate years after the capitalists and corporations are gone.

Recently Walmart in the US was found guilty of mishandling disposal of hazardous materials from their stores over a number of years. Even though the penalties are tens of millions of dollars, one regulator commented that the company gained competitive advantage at the time. Walmart sent 2 million pounds of material to a company which lacked the necessary registration for recycling certain pesticides and also lacked the capacity to handle certain products. Some chemicals ended up in sewers and dumpsters. With a $466 billion annual sales (2013 fiscal), the penalty is insignificant or as Walmart says "not material" but people who drink the water in which the pesticides and other products returned or damaged was dumped may pay in more than cash over time.

Quite a few practices involve future generations paying in perpetuity for contamination and waste caused in the past and ongoing. While some businesses will make money and their activities measure as positive towards Gross Domestic Product, the costs mean many more socially beneficial services won't be affordable and harm to health and the environment is done. Attention-grabbing examples include the abandoned Giant Mine Site, north of Yellowknife, for which costs to deal with such chemical wastes as arsenic are rising to close to a billion dollars to be paid for by taxpayer funds. The remediated site will cost several millions a year to maintain in perpetuity. Declaring bankruptcy is a legal strategy which can also absolve the company from environmental liabilities. Nuclear waste and other hazardous waste sites also have huge costs as storage sites must be maintained for 1000 years or more.

Unless Extended Producer Responsibility Programs (see separate article) result in eliminating waste going to landfill, an unlikely scenario, municipalities have responsibility for perpetual care of closed landfills. For example, the 2013 waste management report for Northumberland County, Ontario says the County has three active disposal sites (2 landfills and 1 transfer stations) but seven closed landfills for which it has responsibility and which have an annual cost of $3.6 million for perpetual care. Because of tipping fees, the active landfills/transfer station make an annual profit (at least until they are closed) of $226,325 making the net annual cost of closed and active landfills $3.4 million for just one county in Ontario with a small population (around 80,000).

Walmart Corporate.. Walmart Resolves Government Investigation into Environmental Compliance. Bentonville, Arkansas, May 28, 2013.

US. Environmental Protection Agency. Wal-Mart Stores, Inc. Washington, DC: May 28, 2013.

Northumberland County. 2013 Business Plan & Budget. Waste Services. Cobourg, Ontario.


Newalta's 2013 Sustainability report highlights its role in technology and material recovery, "providing engineered environmental solutions. Our skilled team serves customers directly at their operations and through a network of facilities in Canada and the U.S. Each year, we recover approximately $400 million worth of products from industrial wastes." Overall in 2012, the report says, "we recovered 2.1 million barrels of crude oil, 65 thousand tonnes of lead and 23 million litres of base oil and lubricants, about the same in total as 2011, but slightly less than the five percent increase we targeted. In 2013, we will continue our efforts to increase product recovery volumes."

Newalta created a new structure in 2012 with three divisions:
The focus of these divisions is said to be to commercialize new technologies e.g. in 2012, technology was demonstrated for recovering hydrocarbons, water and solids for contaminated drilling wastes. 

With increasing pressure on oil and gas companies to address environmental concerns, Newalta identifies its role as working with its customers to develop operations in a responsible way while also reducing operating costs, for example in the shale gas operations of Statoil in North Dakota. Newalta and Statoil have built a mobile waste treatment plant which recovers oil as well as reducing costs of transporting and other handling of wastes. This removes 130 trucks a month from North Dakota highways and prevents waste from filling up landfills.

Life-cycle Assessment

The company says it has completed life cycle assessment on its key recovery processes. It is using the LCAs for such initiatives as reducing CO2 emissions and improving recycling processes. The 2012 target to improve net carbon impact by 20% over 2011 was achieved with 8.000 tonnes less CO2 released in 2012.


Water consumption increased from 273,950 cubic metres in 2011 to 370,784 cubic metres mostly due to increased demand for processing and new operations. An example of water conservation practices includes use of recycled site surface water instead of fresh water in used oil "de-ashing" process. This reuses water five times for a saving of 20 cubic metres of fresh water per month.

Research at UWO

Newalta scholarships for graduate students at the Faculty of Engineering, University of Western Ontario in London, Ontario for five years is funding environmental research and development of clean technologies in wastewater treatment, recovery and recycling.

Newalta. Sustainability. It’s Our Business. Sustainability 2013. Calgary, Alberta: 2013.


The federal government calls Responsible Resource Development part of its Economic Action Plan but the section lacks what most people would consider a plan e.g. what is the base line and where are we going from there, measurable targets (results), timelines, who is responsible for what, etc.

Resources are said to include energy, mining, forestry and various trades but isn't clear what the definitions are and because the government has proven itself rather too dedicated to claiming all good things about the oil sands, the claim of employment in these sectors need to be well-supported. Statistics Canada in its overview of Canada’s System of National Economic accounts describes the importance of defining sectors and the related accounts saying, "Because these accounts all use a common set of definitions, concepts and classifications, and are explicitly related to each other, they form an integrated system. As a result, the economic stories assembled from the CSNEA data are coherent and credible." Credibility is important because the dominant claim is the economic benefit and job creation, 1.6 million jobs direct and indirect.

Graphics Fail to Illustrate Environmental Responsibility

Even if one could confident the government wasn’t overstating the economics, one has difficulty finding out about the environmental responsibility part. Pictures are supposed to be worth a thousand words but most of the pictures illustrate big: big machines, big piles of material in a big building, big pipes, a big stack of stack lumber. There's an artistic shot of the sun in a bunch of trees, not terribly illuminating of responsibility and only a small fraction of photos could be said to be illustrating any kind of responsibility: a view of someone planting a tree and a couple of shots of what could be monitoring equipment. If the photos speak, they say there is little understanding of what responsible resource development has to do with protecting the environment.

GallonLetter knows there are many examples of photos and graphics that would illustrate commitment to environmental protection, even artistic ones. For example, the Canadian Standards Association sustainable forestry certification has photos of three pairs of arms around a tree far too big to reach around, a young couple building a home with sustainable lumber and a child reading at the base of an old growth tree but the idea of treehugger would probably be anathema to most of the federal cabinet including Natural Resource Minister Joe Oliver. His 2012 open letter about foreign funding and "environmental and other radical groups". as well as political involvement in initiating auditing of environmental groups by the Canadian tax agency didn't raise nearly the scandal that perhaps it should have. Certainly similar politically-motivated actions of US IRS in dealing more stringently with critics of the White House were subject to loud objections by members of the Tea Party and others. Although the so-called EthicalOil which claims support from "Canadian" oil companies said it was a really good read and the most honest letter ever written by a senior Canadian politician, some observers think that many Canadians were at least somewhat alienated by the inclusion of such groups as the much respected David Suzuki Foundation in accusations of extremism, and fiscal fraud of the tax system. Foreign money doesn't seem to be a problem for the gander as the Harper government was recently reported to have increased its advertising budget to promote the Keystone XL in the US from $9 million last year to $16 million this year.

Money Commitments

There are some statements in the EAP such as $13.4 million over two years to strengthen pipeline safety including doubling the number of annual comprehensive audits but one doesn't know what this money will achieve or indeed who is getting the money. Ditto for the "$35.7 million over two years is being provided to strengthen Canada’s tanker safety regime."

Enforcement Commitments

Claims in this section of the EAP include that there is generally more enforcement as in Environment Minister Kent's "better enforcement of responsible resource development in the oil sands and elsewhere" do not show up on Environment Canada's enforcement web site. With such strong lobbying of the US government by the Canadian federal government, enforcement is likely to be political rather than consistent. GallonLetter notes that just as in the financial field where auditors and rating agencies were giving passing and even triple A ratings on fraud, leading to near financial collapse, charges of corruption associated with Canadian engineering companies in relation to major infrastructure projects also undermine enforcement as it is often engineering firms who verify that environmental conditions of major projects have been met.

There is a commitment "Financial penalties of up to $400,000 are being introduced for companies that do not meet environmental assessment requirements". Of course that "up to" means that fines could be considerably lower or depending on interpretation perhaps higher if penalties can accumulate. But if that is really the size of the fine for failing to meet the conditions of environmental assessment projects then it is too small for the large projects in the oil sands: one of the tires on a big truck operating in the oil sands costs over $60,000 and all four tires are changed once a year so that penalty is operationally not material for the very large companies.

According to the Environmental Law Centre in Alberta, proposed changes to regulations will further remove more projects from environmental assessment. Except for projects individually designated by the Minister, the only projects subject to federal environmental assessment are on the list in Regulations Designating Physical Activities (RDPA). Proposed changes will add some projects but more will be removed including heavy oil and oil sands processing facilities and groundwater extraction facilities. According to the Energy Resources Conservation Board (Alberta), about 80% of the oils sands oil is too deep to mine so must be extracted by drilling wells using specialized techniques which require a large amount of water. So most of the operations of the oil sands will no longer be subject to federal environmental assessment. A recent US Congressional Research Report discusses in what way the environmental impacts of these in-situ oil sands are greater than commonly presented.
RDD Not in Draft Federal SD Strategy

In reviewing the draft Federal Sustainable Development Strategy, the interim Commissioner of the Environment and Sustainable Development Neil Maxwell, at a hearing of the House of Commons Standing Committee on the Environment and Sustainable Development on June 4 said, "Some key initiatives are missing, such as government's responsible resource development agenda and plans to monitor water, land, and biodiversity in the oil sands regions." As well as questioning what funding is to be allocated to achieving targets, the CESD highlights lack of clarity in the targets which makes it difficult to assess progress e.g. lacking the extent of reductions such as in air pollution and lacking a time frame.

Bull's Eye

GallonLetter thinks that the omission of Responsible Resource Development from the federal SD strategy fits into our reading of this RDD as more a story than a plan. Unfortunately it might be all too similar to a story in a children's book called More True Lies: 18 Tales for You to Judge told by George Shannon. In one of the stories, a neighbour stares at a barn in which every arrow is on the target. He asks the child, "Did you shoot all those arrows?" Yes, says the child. The neighbour is impressed. The reader is asked "What's the truth, the whole truth and where's the lie." The whole truth: The boy shot all the arrows and then painted the targets afterwards. The federal government seems to be doing a lot of painting as well.

Canada/ Responsible Resource Development | Canada's Economic Action Plan l

Canada. Natural Resources Canada. The Media Room. 2012/1 An open letter from the Honourable Joe Oliver, Minister of Natural Resources , on Canada’s commitment to diversify our energy. January 9, 2012. Resource Minister calls out “radical” foreign saboteurs .January 10, 2012.

Environmental Law Centre (Alberta). More Changes to Federal Environmental Assessment Laws on the Horizon. May 2, 2013.|

Office of the Auditor General. Opening Statement to the Standing Committee on Environment and Sustainable Development. Draft Federal Sustainable Development Strategy. Neil Maxwell, Interim Commissioner of the Environment and Sustainable Development Strategy.

Environment Canada.. Main Page for Environment Canada’s Enforcement Branch.

Environment Canada. The Federal Sustainable Development Strategy. Main Page. and consultation to June 14, 2013 on Public Consultation on the Draft FSDS 2013-2016 Planning for a Sustainable Future: A Federal Sustainable Development Strategy for Canada 2013–2016 - Consultation Paper February 2013.


In a special feature on Extended Producer Responsibility in the Journal of Industrial Ecology, Duncan Bury, now with his own company Duncan Bury Consulting (Ottawa, Ontario) and formerly with EPR responsibility at Environment Canada, predicts that while EPR will continue to grow in Canada, more will be expected from governments and producers "to ensure that EPR delivers, not just on cost shifting, but also on clearer and more rigorously measured environmental objectives in an increasingly national context. "

Some of his other observations include:
One of the issues he discusses is the use of the Environmental Handling Fee. If a fee is paid by the consumer, he suggest the program isn’t really a producer responsibility program. Quebec has banned the use of visible EHFs although producers can add the cost of the program to the product and tell consumers that it is there in advertisement, product pricing and at the till; however, the price has to be inclusive of the fee.

Another issue is one of national management of programs e.g. used oil and container programs have one administration and one web site. The Electronics Products Recycling Association EPRA is also moving in the same direction.

Bury, Duncan. Canadian Extended Producer Responsibility Programs: The Shift From Program Roll Out to Program Performance. Journal of Industrial Ecology (Yale University). Vol. 17 No. 2. April 2013. p167-169


"Explosion of ticks biting pets and people: Public health officials wonder if dog ticks are a bellwether for Lyme disease-carrying cousins' arrival" was the front page story of our nearest big city paper, The Hamilton Spectator June 5, 2013. People in the area around Hamilton have been sending samples of ticks, which are small spider-like bloodsuckers, to the public health authorities. All those from the Hamilton area were identified as dog ticks rather than black-legged ticks (deer ticks) which are the ones that carry Lyme disease.

Although it is treatable, Lyme disease, if left untreated, can include nervous system disorders, arthritis, skin rashes, extreme fatigue and other nasties. The reasons the Public Health Agency of Canada identifies for the expansion of the dog ticks: warmer winters, conversion of wildlife areas to suburbs bringing animals (birds, squirrels, small rodents) closer to people, growing deer population and fewer insecticides used may set the stage for expansion of deer ticks as well although that may not be inevitable.

PHAC has information about ticks identifying areas where deer ticks have been long established (the longer the ticks have been in an area, the more likely that they will be infected with the bacteria which causes Lyme disease). Some provinces not on the list such as Alberta are allocating funds to conduct tick surveillance for the first time because of the possible emergence of lyme-disease carrying ticks.

Here in Fisherville for the first time we are picking dog ticks off ourselves after a trip to the composter. It has affected our social life as we have to find alternative locations to get together with families with younger kids who would otherwise have to be constrained to stay on the deck. Our yard is perfect tick habitat as it is naturalized and full of trees and shrubs (ticks like wood edges apparently) with many nesting birds but despite never using insecticides, we haven’t had any ticks for the last 15 years until this year. One noticeable short-term change is that in the last two years after first never seeing a squirrel and then only seeing one or two when the hazelnuts ripened, squirrels are now raising young here due in part to more food from the maturing of nut trees and shrubs.

Our public health has identified the ticks as dog ticks as well with no specific risk of disease. Although it is off-putting one tends to find them either scurrying across the skin or even if already attached for bloodsucking before they are too embedded but the nymphs of the deer tick are very small, some as tiny as a poppy seed so it is unlikely one would be able to find them never mind getting rid of them. Permanent slathering ourselves with insecticide or bug repellent seems also to present risks.

Hamilton Spectator. Explosion of ticks biting pets and people in Hamilton. June 5, 2013. p1

Public Health Agency of Canada. Lyme Disease Fact Sheet.

Alberta Health. Lyme disease & tick surveillance


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