A growing number of fleet operators are going electric, citing more power, lower maintenance costs and fewer emissions-compliance headaches versus their existing diesel vehicles. Among the latest is Loblaw Companies, Canada’s biggest grocery chain, which unveiled plans in early November to switch to an all-electric fleet.

Loblaw officials made the announcement against the backdrop of a 53-foot class-8 truck, the heaviest commercial truck category, made by BYD, the Chinese electric bus and truck maker backed by Warren Buffett’s Berkshire Hathaway.

BYD, which recently announced plans to build a truck plant in Ontario, is one of a string of vehicle and parts makers that are taking a growing interest in electric truck technology.

Even Tesla, best known for its cars, unveiled a battery-operated truck, named the Semi, in November. It claims that the rig can accelerate from zero to 60 mph in just five seconds and reach a speed of 65 mph up a five per cent grade, far faster than its diesel counterparts.

Elsewhere, Cummins, known up to now for its heavy-duty diesel engines, recently showed off a prototype electric powertrain fitted to a class-7 truck.

Loblaw said in an email it plans to add about 350 electric or hybrid trucks and more than 2,500 trailers with the goal of an entirely zero-emissions fleet by 2030.

“We’re working with BYD on specifications and delivery timing,” a spokesperson told Corporate Knights. “In addition to BYD trucks, we have ordered 25 Tesla trucks to be added to our fleet as early as 2019.”

According to Loblaw, the move to an electric and hybrid fleet is “in keeping with our broader carbon-reduction commitment.”

The supermarket chain aims to shrink its carbon footprint by 20 per cent by 2020 and by 30 per cent by 2030, using a 2011 baseline. Besides replacing the trucks, its pollution-reduction plans include centralized energy management, improved truck aerodynamics, less landfill waste and new refrigeration systems that use carbon dioxide as a refrigerant.

Loblaw estimates that removing diesel from its trucks and refrigerated trailers could cut its CO2 emissions by 94,000 tonnes a year – equal to pulling 20,000 cars off the road.

Zero:
A cluster of coal deposits in central Mozambique is bringing no end of trouble to Rio Tinto, the Anglo-Australian mining group, and some of its former top executives.

Besides being a dud investment, the coalfields have landed Rio in hot water with securities regulators over its governance practices. In October, the U.S. Securities and Exchange Commission (SEC) charged the company, its former CEO Tom Albanese and ex-CFO Guy Elliott with fraud for deliberately inflating the value of the Mozambican assets.

“Rio Tinto’s top executives allegedly breached their disclosure obligations and corporate duties by hiding from their board, auditor and investors the crucial fact that a multi-billion dollar transaction was a failure,” Stephanie Avakian, co-director of the SEC’s enforcement division, said in announcing the charges.

The commission is asking U.S. courts to order the return of “allegedly ill-gotten gains plus interest” from the defendants, and to impose civil penalties. It also seeks to bar Albanese and Elliott from serving as public company officers or directors.

Rio has vowed to vigorously defend itself against the allegations. Albanese and Elliott also intend to fight the charges. Meanwhile, the company disclosed in October it had reached a settlement with the U.K. Financial Conduct Authority, including a penalty of 27.4 million pounds.

For all its successes over the past 150 years, Rio has also made some huge mistakes. It bought Montreal-based Alcan, one of the world’s top aluminum producers, for $38 billion (U.S.) in 2007, just as commodity markets were peaking ahead of the 2008 financial crisis. It ended up writing off the bulk of its investment, and Albanese lost his job.

In 2011, Rio bought the Benga coal mine and nearby deposits in Mozambique’s Tete province for $3.7 billion. The project went downhill almost immediately. The coalfield turned out to be smaller and of lower quality than expected, and the Mozambique government rejected Rio’s application to ship the coal to the coast on barges.

Less than three years later, Rio sold the properties to an Indian company for just $50 million.

But, according to the SEC, Albanese and Elliott “sought to hide or delay disclosure of the nature and extent of the adverse developments.” According to the SEC, Rio issued misleading financial statements just days before it raised billions of dollars of debt from U.S. investors.

The post Heroes & zeros: Loblaw and Rio Tinto appeared first on Corporate Knights.

At the same time, the myriad risks posed by climate change to corporate bottom lines are becoming clearer every day, a point emphasized by increasingly assertive employees, investors and regulators. A new study by the Center for Climate and Energy Solutions identified more than 1,200 global businesses that have either adopted or are planning to embrace a price on carbon over the next two years.

Even global corporate leaders in sustainability are struggling to reinvent themselves in the midst of this new paradigm, forced into making tough decisions about legacy assets and future investments. Iconic industrial conglomerates General Electric and Siemens, both listed in Corporate Knights’ 2018 Most Sustainable Corporations in the World index (see here), announced global layoffs of 12,000 and 6,900 employees respectively in their power businesses in December. “Traditional power markets including gas and coal have softened,” explained GE in a statement.

A look at the other companies on this year’s index finds utilities shifting their growth models onto renewables, traditional car companies placing massive bets on electric vehicles, food companies beginning to move towards more healthy, sustainably-produced food and a greater emphasis placed on rooting out conflict minerals from supply chains across the board. The transition is anything but linear, but the overall trends are unmistakable.

It’s in the midst of this period of both rising climate risks and sustainability-oriented business opportunities that Corporate Knights has decided to revise the manner in which our rankings are conducted. We are committed to an objective, data-driven approach for assessing global sustainability performance, and are always weighing the availability of data with the desire to measure as much positive and negative corporate impact as possible. With these guidelines in mind, our research team has implemented two major advancements to the ranking process this year.

First, each key performance indicator (KPI) is now weighted to reflect the relative performance or contribution of the sector in question. The energy KPI, for example, will carry more weight for a company in a sector that accounts for significant portion of total energy use (within the universe of ranked companies) than it will for a company in a sector that accounts for a relatively small portion of total energy use.

Second, a clean revenue KPI has been added. It is calculated using multiple research sources that identify potential clean revenues on a product/service segment basis. Findings of potential clean revenues of 10 per cent or more of total revenues are then confirmed via manual inspection of financial statements and sustainability reports on a company-specific basis.

“It was imperative that we design a much more refined identification of which KPIs are most important in which sectors,” says Michael Yow, director of research for Corporate Knights. “Clean revenue is also a big driver of both commercial health and contribution to sustainability, and will add an important new dimension to our ranking.”
—

Class of 2018

Emerging as the top company this year is Dassault Systèmes, the French multinational software company that has become a major force in sustainable innovation. Finishing 11^th last year, its digital technologies have assisted companies and governments alike in adopting renewables, experimenting with various forms of sustainable mobility and the creation of smarter cities (see profile here).

Following closely behind is Finland’s Neste Oil, an oil refining and marketing company that has begun directing more than 90 per cent of its investments into renewable fuel and bio-based materials. Almost a quarter of the company’s revenues is currently derived from green revenue, on track to grow up to about 50 per cent over the next five years. While it is an oil refining company, Neste is attempting one of the most aggressive bets on renewables in its peer group.

In third place is another French company, automotive supplier Valeo, which has placed a strong emphasis on helping automakers reduce carbon emissions and integrate intuitive driving into the driving experience. Belgian pharmaceutical corporation UCB and Finnish construction and engineering firm Outotec round out the top five.

Valeo is one of 47 companies new to the list this year, a higher turnover rate than usual that is largely explained by the methodology updates. Companies like Valeo, Itron and Chr. Hansen all have green revenue scores over 40 per cent, for example.

Companies from 22 different countries made the 2018 list, with the U.S., France and U.K. leading the pack. European companies dominated the rankings, accounting for 69 per cent of listed companies, while North America and Asia accounted for 22 and 12 per cent respectively.

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*Svenska Cellulosa Aktiebolaget was split into two new companies on June 15, 2017, named SCA and Essity, respectively.
** We regret that due to a miscommunication, no consolidated waste figure was obtained for Koninklijke DSM N.V. This resulted in the company not making the 2018 Global 100.

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It just didn’t know it at the time.

Founded in 1981 as a spinoff from France’s Dassault Aviation, the company has always been focused on helping its customers to reduce waste and become more efficient. “We invented sustainable development before the term existed, even though it was not explicit in our purpose,” says Valerie Ferret, director of public affairs and sustainability. “At the time it was all about optimizing manufacturing processes.”

Although the company started working on product lifecycle management (PLM) in the 1990s, it wasn’t until 2008 that it stated that its purpose was not just to be a scientific company but “to help industry make products that help to harmonize production, nature and life,” Ferret says.

Its 3D Experience software platform allows customers to “virtualize” the design process for products by creating 3D designs and simulating their use on screen before they are made in the physical world. Virtualization is a powerful tool. Ferret notes that before manufacturers were able to create a virtual mock-up of a plane, a car or a power station on screen, they used to have to build physical prototypes. “Now, you just build one virtual mock-up before you can put a machine in the air. This not only saves resources and materials, but also allows you to be more innovative because you can test an infinite number of possibilities in the virtual world.”

Among the aircraft that Dassault’s software has helped design is the ground-breaking Solar Impulse 2, the first aircraft to fly around the world using only solar power. The project used the company’s Engineered to Fly application to design and test within a virtual environment an aircraft that had to be as light and strong as possible – before any aspect of it was physically produced.

Although the company started out creating design tools for aircraft manufacturers, aerospace now makes up only 13 per cent of its sales. The industries it currently serves include automotive, energy, consumer goods and construction. Its products can now even model, simulate, visualize and experience entire cities as they become increasingly connected, integrated and smart.

“Our aim is to virtualize as many industrial processes as possible so companies can ‘make it right first time,’ eliminate waste and cut out mistakes in the real world at every stage from production to end of life disposal,” says Ferret.

While the rapid development of 3D design creates a fantastic opportunity to optimize production processes, “that is not the most important function of the digital world,” she adds. “You can optimize as much as you want, but if you keep growing, you will still have a problem with sustainability. Digitalization also creates the opportunity to transform business models and create strategies based on the sharing economy and the circular economy. What we do is not just about optimization, it’s also about inventing what doesn’t yet exist.”

Dassault Systèmes has been rewarded by changes to Corporate Knights’ ranking system, which this year includes for the first time a focus on the proportion of a company’s revenue that comes from services or products that are environmentally beneficial. “The emphasis on clean revenue changes the whole direction of the ranking,” says Michael Yow, head of research at Corporate Knights. “All of the other key performance indicators are operational and look at internal competencies. For the first time, we are now looking outside of the company and the impact that its products have for customers and the wider world.”

Corporate Knights calculated that a quarter of Dassault’s revenues come from clean products, while its pay link score is 100 per cent due to portions of senior executive compensation being tied to hitting sustainability targets. However, it is not just this indicator that helped the company top the rankings – it scored more than 75 per cent in carbon, water and waste productivity as well as in innovation capacity, the ratio of CEO-to-average-worker pay, leadership diversity and taxes paid. With tech groups under a great deal of scrutiny over the amount of tax they pay, this last factor is particularly important to the company, says Ferret.

“We believe paying taxes is a way to contribute to society. We pay more than 30 per cent of our revenue in taxes. It’s a way to contribute to healthcare, to education and other important things. This indicator means a lot to us.”

Another way Dassault contributes to society is by supporting a number of startups that are using its software to create new products and business models, ranging from wave energy devices to non-obsolescent washing machines built to last more than 20 years. “We only support 15 companies at the moment because we really want to work with them on models that we know will disrupt industry and society.”

Disruption will be a key theme for the company and the wider economy in coming years, Ferret says. “In the past, you needed a large IT infrastructure to do 3D design. Now, with the cloud, we can provide our software online and a startup can use the same products as a company the size of Airbus. We will see more innovation in the next 10 years than we have in the last century.”

Dassault Systèmes believes that “constraints” are necessary to accelerate the pace of change. Regulation is one such constraint but “we believe we are at the limits of what regulation can achieve. However, we will see a huge amount of change because the technology is right and because people are ready for new models based on sharing, not ownership,” Ferret adds.

“Every industry and consumers are extending their use of virtual technology. Consumers expect experiences, not ownership, now. They want mobility, not a car.

“All industries, if they don’t adopt this trend, will disappear eventually.”

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I didn’t have the heart to tell him no, but according to Arthurian legend, his role counselling governments on the costly risks of delaying action on climate change would be more akin to Merlin, King Arthur’s adviser, prophet and magician. But his question of what and who is a corporate knight has lingered, and is in need of some clarification.

First, corporate knighthood is not bestowed solely through devotion to corporate social responsibility (CSR), which is about large businesses responding to the unintended consequences their operations create in the world – such as Shell stepping up its CSR initiatives in the wake of the company’s alleged complicity in the Nigerian government’s execution of activist Ken Saro-Wiwa in 1995.

As writer Mallen Baker points out, there have been visionary leaders who have taken risks in the CSR space. But these are models of restraint in many ways, Baker says, because the CEOs always have to convince a skeptical investor community that they’re not “taking their eye off the ball.”

That is one of the reasons Corporate Knights rankings like our annual Global 100 place no weight on philanthropy, which is about giving away (usually less than 1 per cent of profits) rather than creating value.

The noble Knights of the Round Table of King Arthur’s court were no slouches on the battlefield, but they fought for justice and adhered to a moral code of bravery, courtesy, honour and great gallantry toward the vulnerable.

The corporate knights of the 21^st century are not that different at their essence, comprised of noble business leaders (all genders) with a moral code beyond making money to creating value for society, with exemplars like Paul Polman and Elon Musk.

Before elaborating on sirs Polman and Musk, a quick word on corporate “knaves.”

Corporate knaves have no moral code and they do not create value for society. One that comes to mind is pharma bro Martin Shkreli, who bought a life-saving medicine in 2015 before jacking the price up from $13.50 to $750 per pill. “I did it for my shareholders’ benefit because that’s my job,” he explained. “The political risk is being shamed – and shame isn’t dilutive to earnings per share.” Shkreli eventually ended up in jail, although he did make money for many of his shareholders along the way.

Warren Buffett is one of the greatest investors ever, but he is no corporate knight. It’s not that he lacks a moral code, which he articulates as “do nothing you would not be happy to have an unfriendly but intelligent reporter write about on the front page of a newspaper.” It’s certainly not that he hasn’t made money for his shareholders or that he is not generous with his own winnings, which are mostly dedicated to charity under the guiding hand of his bridge partner at the Gates Foundation.

The problem is he has propagated a parasitic business system premised on buying companies on the cheap, stifling competition, cutting costs and making as little capital investment as possible so as to maximize profits. As he puts it: “I don’t want a business that’s easy for competitors. I want a business with a moat around it with a very valuable castle in the middle … the ideal business is one that takes no capital, and yet grows.”

Now that Buffett has thrown his lot in with aggressive Brazilian private equity fund 3G, he is in danger of becoming a corporate raider, as was the case with 3G-owned Kraft Heinz’s aborted $143 billion (U.S.) hostile takeover attempt of Unilever this past summer. 3G’s modus operandi is to acquire, fire, cut, sell and eliminate anything that isn’t nailed down.

Which brings us back to Paul Polman, who had a long conventional career at Nestlé before being passed over for CEO and then jumping to the top job at Unilever. During his reign, he has redefined the purpose of the company to “make sustainable living commonplace,” cancelled quarterly earnings guidance as an affront to the myopia of short-term capitalism and boldly set out to double sales while halving environmental impact. Oh, and the share price has doubled in the past five years. Interestingly, Polman has even banned the term corporate social responsibility.

And there is Elon Musk. He’s come a long way since his dollar-a-day diet in Montréal and internship under Peter Nicholson at Scotiabank in the early ’90s. Musk cites two books that instilled his moral compass: William Golding’s classic Lord of the Flies, whose hero Ralph wants to create a moral code to save humanity from a Hobbesian fate, and Foundation by Isaac Asimov, where one man tries to save the world from a fast-approaching descent into ignorance and warfare by creating an alternate empire in which science, technology and the arts provide refuge to people.

Similar plots run through SpaceX and Tesla, which is making good on its overarching purpose, in Musk’s words, “to help expedite the move from a mine-and-burn hydrocarbon economy towards a solar electric economy, which I believe to be the primary, but not exclusive, sustainable solution.”

Not that he’s keeping score, but Musk’s financial worth is an estimated $16 billion with a lot of his shareholders benefiting along the way. His value to society is priceless.

On a hot, flat, hungry and crowded planet, there is a big market (estimated by the UN at $12 trillion by 2030) for businesses that create more value for society than they take away through negative externalities. This is fertile ground for a rising movement of corporate knights to roam in the quest for a sustainable world.

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These 17 goals, however, are just the headlines to a detailed framework with 169 measurable targets for each member country to reach. The targets are designed to make it feasible and realistic for entities such as states and companies to work out strategies towards achieving the goals.

The SDGs’ predecessors, the Millennium Development Goals, were mostly seen as a way for charities and well-meaning Western governments to measure the effectiveness of aid, but the SDGs are aimed at quite a different audience. For one thing, they’re not just targeted at developing countries.

The underlying goals and analysis make it clear they offer a structure for all countries and businesses to think about how to align their future – whether in policy terms or business strategy – with the goals to create a more sustainably prosperous world.

They have come at a propitious time; it is generally agreed that the Paris Agreement on carbon emissions hammered out at COP21 started a tectonic change in private sector attitudes towards climate change (goal #13).

Senior business leaders are starting to recognize the risks of doing nothing and the opportunities for new business. Unilever’s chief executive Paul Polman pointed out in a speech last year the symbiotic relationship between the SDGs and company strategy.

“We know that the SDGs cannot be achieved without business,” he said. “At the same time, business cannot thrive or survive long term without the SDGs. After all, there is no business case in enduring poverty and climate change.”

According to a report from the Business and Sustainable Development Commission, authored by Polman and Mark Malloch Brown, focusing on the SDGs could open up $12 trillion (U.S.) of market opportunities in four key economic systems. These are food and agriculture, cities, energy and materials, and health and well-being. They represent around 60 per cent of the real economy and are critical to delivering the SDGs.

Slowly, companies are beginning to see the advantages of reporting on their contribution to achieving the goals – 2018 will see the second opportunity for this progress to appear in annual reports.

Investors are already taking note. Sarah Norris of Aberdeen Standard Investments runs the Global Equity Impact Fund, which uses a methodology based on the SDGs to select the best-performing companies in both financial and sustainability terms.

“We are seeing more and more companies strategically aligning themselves with the SDGs,” says Norris. “We’re encouraging them to use the goals as a framework for reporting.”

She warns, however, that some companies are talking the talk without walking the walk. “There is an issue with what I call ‘impact-washing’; that’s using the language of the SDGs without actually making any changes. If a company claims allegiance to the goals, they should be able to report on the outcomes of their commitment.”

For some companies, reporting on their contribution to the SDGs is just a new way to talk about their business – renewable energy companies, for example, are by their very existence contributing to climate change mitigation.

Others are seeing opportunities to “reapply the technology they have in a more creative, innovative manner,” says Norris. Even sectors that might not obviously leap to mind as bastions of sustainability can use the SDG framework to shape and change their business.

Norris cites the example of Belgian materials technology and recycling group Umicore, which is participating in what she calls “the circular economy,” recycling and repurposing obsolete electronics to create new products. Umicore is not just building individual sustainable business lines – it has applied the philosophy of the SDGs across its businesses.

Umicore claims to be the first company in the world to have developed a sustainable procurement framework for cobalt. Cobalt is used in many applications, notably rechargeable batteries for electric cars, but its main deposits are found in challenging regions such as Central Africa. Ensuring it is sustainably sourced requires attention to the environmental impact of extraction, but also the social impact. Forced labour, poor health and safety conditions, child labour and corruption are all challenges for cobalt sourcing.

Umicore offers one model for how companies can integrate the SDGs into their company strategy. It has identified the three areas where it can make the most material difference (resource scarcity, clean air and vehicle electrification). It has also outlined policies to improve sustainability in its supply chain as well as in the products and services it offers. And it sees these policies as the foundation for doubling its profits in the six years to 2020.

Canadian agribusiness company Agrium (now named Nutrien after a competing a merger with PotashCorp earlier this month) has similarly emphasized eight SDGs where the company has the greatest potential impact. While these efforts are focused on helping growers increase yields to address food needs and increase prosperity, the ripple effects for farmers, especially smallholder farmers, are seen as leading to educational and health care gains, along with greater gender equity and access to clean water.

Other companies have explicitly emphasized the holistic and interconnected nature of the SDGs. Ericsson, for example, has assigned a different senior team member as a champion for each individual goal.

Last October, Maryland-based spice and flavourings company McCormick & Company released its Purpose-led Performance framework, retooling its previous corporate social responsibility efforts around three pillars: people, communities and planet. A series of commitments and clear performance targets out to 2025 were made, tied explicitly to one or more of the SDGs. Only four SDGs were left off the list.

While these efforts seem admirable, Bhaskar Chakravorti, senior associate dean of international business and finance at the Fletcher School at Tufts University, recommends a different approach. He suggests a “dispersion of efforts is not advisable, as it tends to splinter resources, delink the SDG investments from company strategy and have the paradoxical effect of making orphans out of all the SDGs because none gets the sustained strategic investments needed.”

Chakravorti, who is also the founding executive director of Fletcher’s Institute for Business in the Global Context, prescribes segmenting the goals to understand which of them is most relevant to the business, identifying which goals intersect with the company or its activities. These are the places where the company can have meaningful impact, he says.

Finally, Chakravorti calls for companies to make the business case for the strategy: This may be that there is a business opportunity; it may be about risk management, even reputational risk; it may be about shifting the company strategic horizon to the longer term, when climate change might threaten the profitability of the company.

Although companies globally have been slow to take on the SDGs as part of their corporate strategy, there are hot spots of progress. In Europe, governments have been faster to lead through regulation. In France, companies over a certain size are required to report how their business is aligned with the aim of limiting climate change to 2 C, for example.

The challenge for companies and the investors hoping to select stocks based on their commitment to the SDGs is that there is no standardized reporting framework as yet.

“Companies don’t know what information they should be reporting, because there’s no gold standard,” says Norris of Aberdeen Standard. Although the Global Reporting Initiative, which was set up 20 years ago to promote standardized reporting on sustainability issues, could offer some guidance, Norris feels it “is not fit for purpose any more” given the new framework of the SDGs.

There are numerous organizations offering support to companies wanting to use the SDGs to mold and improve their businesses. KPMG created the SDG Industry Matrix, identifying how different industries could contribute and what companies are already doing in these areas. The Business and Sustainable Development Commission was launched in 2016 at the World Economic Forum to help companies reap the economic rewards inherent in the SDGs.

The Global Compact, set up by the UN in 2000 to support business in adopting sustainable practices, has fully integrated the SDGs into its language. Local chapters such as Global Compact Canada are also working to encourage member companies to realign their business operations around the SDGs.

Two years into the 15-year period to attain the SDGs, a huge amount remains to be done. But companies are beginning to see the goals as opportunities to rethink their business.

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And fall it did. For 30 hours, Hurricane Maria, nearly a Category 5 storm, severely damaged or destroyed roadways, bridges and residences and left citizens without power or clean running water. At Santaballa’s home, a huge mahogany tree, which stood in a park directly opposite, was uprooted and catapulted by the tempest almost to the front door. It was a blessing in disguise. The tree’s vast green crown blocked the 250 km/h winds. “There was water and mud in my foyer but the glass windows weren’t broken,” Santaballa says.

Others, specifically Santaballa’s clients, weren’t as fortunate. Santaballa is a doula, a term used to describe someone who supports women during birth. She is also an International Board Certified Lactation Consultant, as well as the founder of Alimentación Segura Infantil (Safe Feeding for Children).

Not surprisingly, breastfeeding support systems were in shambles. Lactation counselling for new mothers – both in hospital and out – had been curtailed. As soon as she was able, Santaballa ventured out of her home, enduring long line-ups for rationed gas to ensure she could drive to places where she might be needed. The tales of misery were gut-wrenching. Many were without shelter and food and potable water stores were rapidly diminishing in the American territory of 3.4 million. (Oxfam condemned the U.S. government’s response as “slow and inadequate.”) Mothers who hadn’t been breastfeeding were running out of infant formula, says Santaballa. “You’d hear these desperate pleas from women, ‘I need milk for my baby.’” Breastfeeding rates in Puerto Rico are among the lowest in the United States, she adds.

Babies had been born just before, during and after the hurricane. During early postpartum stages, breastfeeding can be challenging, with babies failing to “latch on.” Mothers under stress sometimes find that their milk flow slows, causing many to believe their breast milk has dried up. Normally, lactation consultants step in to attempt to alleviate problems like these. Without such services, women turned to volunteer help at shelters. If infant formula supplies were available, the moms were incorrectly encouraged to switch to a milk substitute. “The shelter staff weren’t trained,” explains Santaballa.

Santaballa was hit with an idea. Why not introduce an emergency training program to support lactation, dubbing it “breastfeeding for the apocalypse.” This included the impromptu training of 15-person groups in Puerto Rico’s most vulnerable neighbourhoods who would act as the local go-to consultants for mothers with infants. Tutored to follow the humanitarian organization Action Against Hunger’s Infant and Young Child Feeding in Emergencies (IYCF-E) guide, the groups advocated for “lactation as the best line of defence.” If the mother had stopped nursing, there were measures to initiate relactation to re-establish breastfeeding.

Alternatively, a wet nurse could be sought. Since a wet nurse may not be able to feed another infant directly, Santaballa taught milk expression by hand into a sterile container. (Breast pumps, most which are electric, weren’t usable.) Perhaps surprisingly, babies can be fed human milk or formula using disposable Dixie cups that are simply thrown away after use to prevent contamination.

“Babies are smarter than we think,” says Santaballa. “You put them at an 80- to 85-degree angle, put the cup to their mouth and they lap it up like a cat. As they get bigger they will grab the cup and help feed themselves.” Finally, if boiling bottles and nipples isn’t possible, sterility can be achieved by soaking items for two minutes in a solution of four litres of water to 15 millilitres of Clorox bleach.

Santaballa also had recommendations for international donors. “You want to help babies in emergencies? Send Dixie cups. Don’t send breast pumps. Send single use, read-to-feed bottles of infant formula. Send humanitarian aid to organizations so they can send lactation consultants to communities. Don’t send infant powdered milk.”

Babies are especially vulnerable in emergencies because their immune systems don’t develop for several months; they must rely upon the antibodies in mother’s milk to ward off disease, says David Clark, an infant nutrition specialist and legal adviser for UNICEF in New York. This is borne out by statistics. In 2016, the World Health Organization (WHO) and UNICEF, based upon a study in The Lancet, estimated that 800,000 child deaths a year worldwide could be prevented by breastfeeding. Contaminated water, as well as a lack of breastfeeding overall, which increases the infant mortality even where then there is access to clean water, are behind the grim statistics.

In Puerto Rico, mothers who weren’t breastfeeding before the hurricane were using infant formula that was either powdered, which isn’t sterile, or concentrated liquid formula. Water must be added to both. (Ready-to-feed infant formula, which is fed unadulterated, is the most expensive of all three types of breast milk substitutes and thus is rarely available as an emergency provision, Santaballa says.) Mothers were forced to mix formula with water that was polluted due to the failure of water purification systems.

Water became contaminated with the deadly bacterium leptospirosis, believed to be spread by rats. This sparked an official boiling alert: it was imperative that the water added to powdered or concentrated infant formula be boiled first and bottles and nipples sterilized. But boiling could only be undertaken if the tiny camp stoves Puerto Ricans bought pre-hurricane hadn’t run out of fuel, or if people hadn’t run out of gasoline for their home generators, which were breaking down due to overuse, says Santaballa.

If infants succumbed due to the horrific living conditions that Puerto Ricans endured for months after Hurricane Maria, it was impossible to directly link the deaths to the use of powdered or concentrated milk, Santaballa says. “If a baby dies from a bacterial infection from powdered milk, the official cause of death is sudden infant death syndrome (SIDS), gastroenteritis, a respiratory infection or another cause. It’s not related to the hurricane and infant feeding, even though we know differently.”

Some may assume that such chaos is isolated to disasters on small islands or the developing world, where social safety nets are precarious or nonexistent. However, other environmental catastrophes – last year’s Hurricane Harvey in Texas, Hurricane Irma in Florida, British Columbia’s raging forest fires, the evacuation of Fort McMurray, Alberta, due to wildfire in 2016 and Calgary’s catastrophic flooding in 2013 – show that the First World is as vulnerable as poorer nations when it comes to cataclysms. Meanwhile, humanitarian emergencies, sparked by social and political upheaval, also put vast numbers of people into crisis. In all of these situations, infants and small children are most at risk. In a world that is facing increasing numbers of extreme, climate change-linked weather events, one of the best readiness measures that can be undertaken is the encouragement of breastfeeding, says UNICEF’s Clark. “The bottom line is: breastfeeding saves lives.”

Breastfeeding may save lives in emergencies, but Western governments have yet to put into policy or even figure out how best to support mothers and babies when fire, flood, tempests or earthquakes rent the social fabric, says Edmonton’s Jodine Chase, a communications consultant who provides crisis support to breastfeeding organizations, and a co-founder of SafelyFed Canada, which develops policy to ensure safe infant feeding in emergencies.

In the developed world, “there isn’t a single country that has, as part of its emergency planning and preparedness, adopted standard guidance to support safe infant feeding,” says Chase, who is a researcher in an ongoing Canadian Red Cross-funded project in Fort McMurray implementing training for infant and young child feeding practices in emergencies, based upon the experiences of families forced to evacuate the northern Alberta city on May 3, 2016.

Public health nurse and breastfeeding advocate Lucie Lapierre vividly recalls that terrifying day. Lapierre was vaccinating children at Fort McMurray Public Health when a raging forest fire unexpectedly jumped the Athabasca River, which had till then acted like a moat to the city. The citizenry fled.

At the time, Lapierre’s three-year-old son Antoine and one-year-old daughter Elizabeth were in day care. Elizabeth was still being breastfed in the evenings and morning. With time of the essence, Lapierre’s husband Francois buckled the children into his car to join the bumper-to-bumper exodus heading south on Highway 63. Lapierre lagged behind to see if she could help a colleague evacuate hospital patients. There was nothing Lapierre could do, so she joined the highway convoy in her own vehicle. By now the fire had leapt the road, creating a drive-through tunnel of flames. “It looked like hell,” recalls Lapierre, who now lives in Sarnia, Ontario.

Later that night, the family reunited in Lac la Biche, 300 kilometres south. The next day, they registered with the Red Cross with thousands of others at the local community centre. Lapierre noted the lack of privacy for breastfeeding; one mom nursed in the public toilets. Lapierre herself encountered problems. Her milk flow was affected by stress, even though, as a lactation expert, she knew the remedial measures needed to rectify the problem. Other moms would have experienced the same problem, says Lapierre, which highlights the need for an emergency number to connect evacuees with lactation consultants. Lapierre also noted a large amount of out-of-date and even open containers of formula on hand that had been donated and was being offered to mothers. Yet there were no facilities for boiling water.

Being based in Edmonton, Chase was near the frontlines of the Fort McMurray fire. She organized a group of lactation counsellors who went to the Edmonton Expo Centre where thousands of evacuees had descended. Chase was dismayed at the palettes of donated powdered milk, as well as a dearth of private areas to nurse. Some moms, who had given birth in Fort McMurray only in the past day or two, were struggling to initiate breastfeeding. There was nowhere to boil water to sterilize feeding equipment. Meanwhile, viral gastroenteritis was sweeping the facility. The haphazardness of the situation, says Chase, highlights the lack of emergency preparedness and the danger it poses for infant and child health.

Social emergencies can pose just as much danger for infants. Last year, Canada was flooded with asylum seekers – 32,000 by the end of September – after the United States announced it was considering withdrawing the “temporary protected status” given Haitian refugees following the country’s massive 2010 earthquake. (The Trump administration announced last November a permanent phaseout of this status by July 2019.) Most entered Québec and were housed temporarily in Montréal’s Olympic Stadium. The pregnant women were predominantly sent to YMCAs in Montréal, then transferred to hospital when labour began. Hirut Melaku, a doula and International Board Certified Lactation Consultant, decided to check to see how the moms were doing.

She was shocked. The women and their new babies who returned to the YMCA bore boxes of infant formula given them by the hospital. However, there were no facilities for sterilizing. “I asked one mother how she was cleaning the bottles and she pointed to a bucket in the bathroom,” Melaku says. “For me, it’s appalling. There is no way that should be allowed in Canada,” says Melaku, who organized a new group called the Black Birth Workers and Lactation Consultants to provide proper breastfeeding support to the new moms.

UNICEF’s Clark condemns the hospital practice of giving formula to new mothers. “The practice of giving free formula prevents the early initiation of breastfeeding. Companies will often provide as much formula as hospitals want, knowing that it is easier for medical staff to provide formula to a mother rather than provide the support mothers need to initiate breastfeeding,” he says. There are unquestionably times when formula feeding is needed or desired by the mother, but the argument from Clark and others is that it should be an informed choice.

Extreme weather events are here to stay and are likely to worsen as the manifestations of climate change – rising sea levels, torrential rainstorms, hurricanes and dramatic temperatures – grip the planet. It is imperative that, in the face of such potential calamities, governments at all levels implement effective emergency protocols that take into account the most vulnerable, especially families with babies whose very survival is dependent upon access to safe feeding.

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The World Bank has promised to stop virtually all lending for oil and gas projects in the developing world after 2019, sending a powerful message to global producers that financial institutions are reassessing the risks of fossil fuel development.

The manager of the largest fund in the world, the Government Pension Fund of Norway, has recommended that oil stocks be excluded from its equity benchmark index. This would essentially move all oil stocks from a mainstream investment to a speculative grade risk.

Swiss Re, the world’s second largest reinsurer, switched over the entire $130 billion (U.S.) it holds in liquid assets to track ethical indices, the latest move towards principled investments by the insurance industry.

The Caisse de dépôt et placement du Québec, the second largest pension plan in Canada with more than $270 billion in assets, is setting bold targets to shelter its portfolio against the impact of climate change, including plans to reduce the carbon footprint of the overall portfolio by 25 per cent by the year 2025, while increasing its exposure to climate friendly investments like wind power by 50 per cent.

BlackRock and Vanguard, which wield outsized clout (a combined $9 trillion) as the world’s two largest asset managers, are putting pressure on companies to explain themselves on issues including how climate change could affect their business.

Even the perennial climate bugaboo, ExxonMobil, has been forced to succumb to these investors’ demands and will now report on the impacts of climate change to its business – marking a milestone in a 28-year effort by activist investors.

While the sun sets on old ways of investing in the old energy economy, the sun is rising in the new energy economy.

In its first full year of performance through June 30, 2017, the Clean200 (representing the 200 largest publicly traded companies making significant revenue from clean energy) generated a return of 16.5 per cent versus a decline of 1.2 per cent for its fossil fuel benchmark, the S&P Global 1200 Energy Index.

The 2018 Global 100 Most Sustainable Corporations in the World Index (scheduled for release January 23) added another year of healthy outperformance compared to its benchmark, the MSCI ACWI, showing significant outperformance over the 13 years since the Global 100’s inception in 2005.

And the Greenchip Global Equity Fund, which invests in companies that operate in targeted environmental sectors, celebrated its 10th birthday ahead of its benchmark and ranked as the No. 1 global equity fund over the past year in the RBC Pooled Fund Survey.

There are three ways an average investor can catch this train.

If you are a member of a big pension plan, you can write your fund and request that it offer a socially responsible and climate friendly option, ideally as the default (as the HSBC U.K. pension plan has already done). If your fund is a defined benefit plan like the Canada Pension Plan, you can write both the fund managers and your finance minister to ask that they let go of risky investments in certain fossil fuels and boost investments in renewables to ensure they do not miss the clean economy transition.

If you pick your own stocks and funds, there are lots of ideas in the Clean200 and Global 100, not to mention the solid income returns you can get from retail green bonds like Solar Share and CoPower in Canada.

If you prefer to invest in funds that are investing their money and the power of their voice for a more just and environmentally friendly world, we have crunched the numbers for over 600 equity funds available to Canadian investors, and present the synthesis as Top 10 Better World Funds.

Methodology:

1. The 3-year returns are per cent ranked against funds in same category, then weighted 50 per cent.

2. The fund’s net market exposure to green versus red flagged holdings is per cent ranked against other funds from the same category, then weighted 40 per cent.

Green flagged holdings are companies that earn at least 20 per cent of their revenues from clean scores, or score top decile (90 to 100 per cent) on Corporate Knights Sustainability Rating methodology and have no red flags from the list below.

Red flagged holdings are those that have bottom decile scores (0 to 10 per cent) on CK Sustainability Rating, and/or are involved in or are laggards on any of the aspects listed below:

Nuclear energy; oil & gas, coal utility; pure-play thermal coal; thermal coal miner; utilities (>50 per cent renewable energy); access to medicine; animal welfare; corporate human rights; access to nutrition; conventional weapons; controversial weapons; blocking climate policy; sustainable cotton; tropical deforestation; child or forced labour violations; new energy finance; sustainable seafood; severe environmental damage; tobacco; sustainable palm oil; science-based targets; renewable energy commitments; gambling; pornography; for-profit prison; animal testing (non-medical); factory farm; small arms; GMO-pesticides; predatory lending; corporate crime (fines, penalties, convictions).

3. Focused small/mid cap equity – reclassified as “equity.” “North American equity” is reclassified as “global equity.”

4. The fund manager’s voting record is assessed, and weighted 5 per cent. The fund manager’s voting records for 10 environmentally related resolutions were tracked and received a score if it supported the vote or no score if it didn’t support the vote. The number of times a favourable vote out of all possible opportunities to cast a vote is calculated and weighted 5 per cent.

5. The fund manager’s intention to exercise voting rights using responsible guidelines according to Responsible Investment Association – Canada is given a score of 5 per cent.

6. The final score is the sum of 1, 2, 4 and 5 above. If a fund is less than three years old and therefore has no 3-year return, its final score is based on 2, 4 and 5 above grossed up proportionately to 100 per cent.

7. Only funds with at least 66.6 per cent of their holdings covered in the Corporate Knights Research Universe are eligible for the ranking (all companies with revenues > $1 billion U.S.).

8. Where a fund has no data for any one of the four indicators, the weight of the indicators for which data is available is scaled proportionately to 100 per cent.

Sources: Fundata, RIA-Canada, Proxy Insight, Corporate Knights Research Database

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Glimmers of progress since then – namely, the Caisse de dépôt et placement du Québec announcing plans to slash the carbon footprint of its portfolio by 25 per cent by 2025 and a coalition of funds that includes the Caisse, Public Sector Pension Investment Board and British Columbia Investment Management Corp. calling for enhanced climate disclosures from Canadian companies – have not tempered claims that the sector as a whole is dragging its heels on climate action.

And nor should they. These steps, however positive, represent only a handful of the 17,000 pension funds in Canada, collectively worth over $1.5 trillion. But while the sector’s persistent investment in oil (as well as its close relationships with the extractives industry) has faced scrutiny, a key reason for our plodding pace on climate action often goes overlooked: Canada’s pension regulation.

It’s not as yawn-worthy as it sounds. Regulation goes a long way in shaping how funds invest, and a motivated government could use regulation strategically to accelerate the shift towards a low-carbon economy without compromising the pension promise.

Unfortunately, current pension regulation in Canada actually serves as a barrier to climate-conscious investment in several ways.

Case in point: the lingering ambiguity over the limits of fiduciary duty, the legal responsibilities that pension trustees have to their beneficiaries. In theory, these obligations should make climate action a no-brainer. Trustees have a duty to both current and future beneficiaries, and a wealth of evidence warns that unmitigated climate change will have catastrophic effects on financial portfolios (research also increasingly suggests that green investments produce similar or even superior returns).

In practice, however, a great deal of uncertainty remains among pension trustees about the legal permissibility of acting on climate change, especially among smaller, private funds.

Recent interviews conducted for Fiduciary Duty in the 21st Century, the landmark report from the Principles for Responsible Investment, UNEP Finance Initiative and others, reveal that Canadian pension trustees are split over whether or not fiduciary duty even allows them to consider non-financial factors, such as the environment, in investment decision-making. This comes despite major public funds such as the Canada Pension Plan explicitly endorsing responsible investing practices. Moreover, legal advisers and consultants continue to reinforce a narrow definition of fiduciary duty that excludes environmental considerations.

The reason for this confusion? A lack of clarification from regulators. To date, only Manitoba and Ontario have issued guidance informing trustees in their respective jurisdictions that fiduciary duty does not preclude them from considering environmental factors. The federal government has refused to follow suit, despite calls to do so for more than a decade. Adding another layer of ambiguity, neither regulator that has broached the topic has stipulated that funds should consider environmental factors as part of their fiduciary duty – only that they can.

Here’s another hurdle: Canada has a glaring deficit of regulations to encourage climate consciousness among pension trustees, even if only to ensure Canadians’ benefits are adequately protected. Without these, funds are left to their own devices in assessing and managing climate risks. This wouldn’t necessarily be a problem, except for the sector’s notorious short-termism. As the CIO of the world’s largest pension fund, the Government Investment Fund of Japan, recently acknowledged, institutional investors remain preoccupied with short-term returns, despite many having long-term mandates. In a November 2017 piece for Investment & Pensions Europe, Raj Thamotheram and Edward Waitzer lamented several “elephants in the room” of the global investment industry obstructing systemic change. These metaphorical pachyderms include: performance incentives that run against long-term value creation; questionable asset mixes; and a “narrow gene pool” of trustees committed to innovation. Add in the unfortunate norm of herding behaviour, and we can see that any widespread shift in investing practices faces considerable inertia.

Recognizing both the ethical and financial costs of inaction, other countries have begun experimenting with tools to help guide the game-changing assets of pension funds towards low-carbon investments. These include: disclosure requirements about how funds are considering environmental factors (U.K., Germany and others); mandatory reporting on how funds are considering climate risks and how their investment policies align with national climate change goals (France); compulsory carbon reporting (threatened in Sweden if the sector could not get its act together on self-reporting); mandatory climate stress-tests (also considered in Sweden); and most drastically, divestment from coal (Norway).

Of these tools, only one has been adopted in Canada and this, only in Ontario. As of 2016, pension funds there are required to annually disclose if and how environmental (and social and governance) factors are addressed in the plan’s investment policies. This measure is light-touch (some might say too light-touch), intended to nudge funds towards considering sustainability without being prescriptive. But even being pain-free for asset owners, it has failed to find wider uptake outside Ontario: recommendations for similar regulation in other provinces have gone ignored, and two private member’s bills to mandate such disclosures by federally-regulated pension funds failed in the House of Commons.

Disclosure requirements bring up another angle in this discussion. The information that funds make available to beneficiaries affects the latter’s ability to monitor and challenge their pension’s environmental footprint. Despite the contentiousness of turning pension funds into a hotbed for climate activism or mingling retirement savings with socially-responsible investing goals at all, pensions do have inherent democratic potential. And for decades, beneficiaries have been claiming a say in how their money is invested, with examples of successful divestment campaigns worldwide from tobacco, arms companies and, yes, fossil fuels. But more basically, beneficiaries are entitled to know how their investments are being protected against potentially devastating losses. Weak disclosure requirements create a stumbling block over the very first step in holding trustees to account and, unfortunately, weak disclosure requirements are what we have.

As noted, only Ontario requires funds to disclose if and how they consider environmental factors, leaving approximately 10,000 funds outside the province with no such requirement. Nowhere in Canada are funds obligated to disclose their proxy voting records (though a few do so voluntarily), yet shareholder engagement is frequently cited as a preferred method to manage climate risks among funds claiming to care about these. And might we think further about Ronald Davis’ recommendation in Democratizing Pension Funds: Corporate Governance and Accountability, that Canadian pension funds be required to disclose corporate governance policies in their Statement of Investment Policy and Procedures?

Underpinning all of these barriers to climate-conscious investment is another problem, perhaps the thorniest of all: remedying any one issue at a sector-wide level requires navigating a minefield of regulators. Canada’s pension scene has 10 independent regulators. Plans are overseen by either their respective provincial authority or the federal Office of the Superintendent of Financial Institutions (OSFI), depending on employees’ line of work. Exceptions to this are funds in the territories, which are regulated by OSFI; those on P.E.I., where there is no regulator at all; and funds that are the product of specific legislation, such as the CPP, which are governed by their respective acts.

Despite a national association intended to harmonize pension oversight, coordination between jurisdictions is limited, and calls for a single, overarching regulator have been muffled under the wheels of inefficiency. Successful alignment of pension assets with climate goals, in other words, requires either a piecemeal approach, herculean efforts of coordination and leadership or restructuring the regulatory framework altogether.

None of this is to excuse climate inaction by pension trustees (look at the initiative taken by the Caisse and other individual funds). Nor is it to say that we should leap headlong into using Canadians’ retirement savings for political purposes.

Rather, my point is that against the urgent need for green investment, Canadian pension funds are playing in a system that is largely rigged against climate action. Let’s untilt the table. Addressing the barriers discussed here requires an array of regulatory amendments across multiple jurisdictions, but most of these measures, such as clarifying the limits of fiduciary duty, are relatively painless. More broadly, let’s bring pension regulation into our thinking about climate solutions in Canada. At a time when governments seek quick wins on climate change, when divestment campaigns aimed at large public funds face an uphill climb, and when Canadian pensioners deserve security against devastating, preventable losses, targeting pension regulation could reach beyond the investment practices of the few biggest players, and shift the course for the entire sector.

The post Failure to launch appeared first on Corporate Knights.

His book Maximum Canada delves into this very question, detailing Canada’s long legacy of what he calls “minimizing” policies during the century after Confederation – high trade tariffs, limited immigration from outside of the British Isles and an overemphasis on immigrant farmers over entrepreneurship, all of which have resulted in our current population of only 35 million.

Other periods in Canadian history have seen the growth of “maximizing” policies, including over the past 50 years or so. The country should expand its ambitions even further, argues Saunders, and shoot for a population of 100 million by the end of the century. The book details the myriad benefits that would result, but one of his more intriguing arguments involves a substantial environmental dividend.

Corporate Knights recently sat down with Saunders to discuss the need for bigger and denser cities, the growing immigration shift to second-tier cities and the international development gains from migratory ties, among other things.

CK: Can you outline the ecological benefits Canada stands to gain from a larger population?

Saunders: Canada has a low population density, spread across a very large geography. Now, this is due in large part because we developed accidentally. We developed our cities not by planning to have concentrated, dense cities that were centres of business and invention, but rather as an afterthought. Well into the 20^th century, Canada viewed itself as a rural country and a country of resource extraction, and we saw the cities as being side effects of that. As a result, our cities did not grow from concentrated centres outward, but they grew as collections of housing, with a few churches in between.

We have very large areas of extremely low population density housing and, much more frustratingly, those are the areas where new immigrants settle now. Immigration is a suburban experience now in Canada, almost 100 per cent, and it happens in places with big empty spaces, with apartment blocks with huge empty spaces between them within places with single family housing. Now, these neighbourhoods, and this form of development, not only create problems for the improvement of human conditions through transit efficiencies and mixed-use neighbourhoods and so on, but are also extremely ecologically inefficient.

By my calculation, about half of Canada’s carbon output comes from the effects of low population density in cities. This includes passenger vehicles in urban areas, which we rely on overwhelmingly because of our lack of transit both within and between cities that’s high speed and efficient, as well as our inefficient heating of buildings, itself a consequence of low population density with our reliance on single-family houses that are inefficient to heat. There’s also our reliance in several provinces on emissions-heavy energy sources, which is much easier to physically transition away from when you have a higher population density.

Canada’s cities are small compared to other countries, and have not yet made the transition to what is called the ecological Kuznets curve. This is when you get above the population of Canada’s six largest cities. Each addition of population decreases the per-capita carbon footprint and creates efficiencies. Now, a lot of those efficiencies have to do with green policy; they’re the consequence of shorter travel distances, of economies of scale, of shared resources and so on.

As the studies I highlight in the book point out, a city of eight million is twice as ecological as a city of four million. Economies of scale are important, not just for economic and for business reasons, not just for the clusters of knowledge and expertise and entrepreneurship that they create, but also because of the ecological efficiencies they create.

Now, as much as Canada needs to make that transition towards being carbon neutral much sooner than we anticipate, we also need to be able to make ourselves resilient to whatever climate change effects do happen. Those types of infrastructure investments, particularly if they’re going to be done in a green way, are best done in places with a high population density.

CK: One relatively new concern being raised by urban studies theorist Richard Florida and others is the growing economic gap between superstar cities and the rest of the population, in both the U.S. and Canada. He argues that overly strict land-use rules and NIMBY sentiments, by artificially restricting the supply of new housing, have increased housing prices so much that it has slowed this gap from growing even further. As immigrants tend to settle in the biggest urban environments, won’t increasing levels of immigration only increase this gap between white, rural and smaller cities and super-diverse superstar cities?

Saunders: Canada’s five or six largest cities will continue to be major places of population growth, and generally it’s to be encouraged. These cities are not overcrowded; they suffer from low population density. However, that housing market effect that Richard Florida mentions does have some interesting consequences in Canada.

We do have a crisis of housing supply in our largest cities, that’s quite obvious. We need to address that, and in large part it’s due to a bias towards the single-family house. Apartment living should be destigmatized and accepted as a normal way of living – we’re the only country in the world that has a word for living in an apartment, “condo”, that is a form of ownership tenure and not a form of building, and somehow, we treat that as a stigmatizing term.

That said, the place where we start to see the interesting effects of that divergence in housing markets is in the very interesting effects that are happening in what get called the second-tier cities in Canada. These are post-industrial cities that have suffered from population loss, aging and therefore a loss of tax base and shops and economic activity, but that are becoming the new hubs for immigration and for population growth because they happen to have post-secondary institutions in them.

What immigrants want in Canada are known business, employment or entrepreneurial opportunities. Second of all, they want clusters of people from similar cultural or linguistic backgrounds to help them integrate and build up a network. Thirdly, they want post-secondary institutions, because about six out of 10 immigrants to Canada have a university degree and need their skills upgraded. And fourth of all, they want housing they can afford.

Immigrants will always drop the last point if the first three are available; people will settle in a place they can’t afford to live for a while if it has all the other factors. But the fact that housing is getting close to unaffordable in the largest cities is causing a big shift in immigration settlement to post-industrial second-tier cities with post-secondary institutions and reasonably decent connections to larger markets.

So Kelowna, Lethbridge, Kitchener/Waterloo, Hamilton, Kingston, Ottawa, Trois-Rivières, Moncton, Halifax, St. John’s – those are the places that are going to become really significant centres of growth because of the interesting combination of affordable housing costs and post-secondary institutions. And we need to recognize that these places are ideally situated to become dense clusters of knowledge, invention and expertise, and they are also places that can become really green, ecologically efficient cities. We need to be investing in electric rapid-transit links in and between those second-tier cities and the established larger markets. We need to be investing in data infrastructure in those places, and we need to be investing in green housing and building initiatives as well.

CK: Andrew Griffith and others have hypothesized of resistance from Indigenous peoples and Quebecers to a large increase in Canada’s population due to the likelihood of a reduction in their relative political clout.

Saunders: What makes Canada different from a lot of former colonies is that Indigenous nations see themselves as being leaders in population growth now. The century during which Canada was subject to what I call the minimizing impulse, where Canada pursued a bunch of isolationist policies, was a period that was devastating for Indigenous nations. The attempts to settle Canada by filling the land with people rather than by creating cities and economies from the 1850s to the1970s, that period saw Indigenous nations’ population fall to about a tenth of its previous level.

Now today, Indigenous nations are the population growth leaders in Canada. They have by far the highest rate of population growth in Canada, and there’s a broad consensus that this leading level of population growth is an important part of Indigenous nations becoming independent and so on.

That’s key because Indigenous nations are having their own internal debates around population density. The fact that schools on reserves and in remote communities are horrifically bad and under situated is in large part because of a lack of commitment from the federal government to this, but it’s also because the population density is too low in these places. The absolute population is much too low. Now we’re starting to see solutions emerge – on-reserve population growth has been much higher than the population growth off reserve over the last two decades. And the record-breaking levels of population growth in Indigenous communities will serve them very well in the future, by creating much more concentrated communities in these places.

In Quebec, similarly, there was a big debate in the 1940s-’50s about whether francophone Quebecers should see their challenge as being one of relative population or one of absolute population. And there was, for a time before the 1950s, a belief that relative population was what French Canadians should seek – which was, they should do whatever they could in regards to Quebec policies but also in terms of Canadian national policies to ensure that Quebec has the largest proportion of population in Canada, so that Quebec maintains its share of MPs, PMs, etc.

This butted up against a vision of Quebec that said no: absolute population is what’s important here. We want to have a robust enough population that we can have an autonomous economy, that we can have a robust and well-published Quebecois culture, and that we can have the resources and institutions that we need within Quebec to stand on our own (whether your view is sovereigntist or nationalist, this debate took place in both).

By the end of the 1960s, there was a very broad consensus that absolute population matters more than relative population in Quebec. There’s a great understanding that Quebec is underpopulated – you could say that francophone Quebecois are a generation ahead of English Canadians in recognizing the shortfalls of absolute population and the need to have a more robust population.

CK: Most of the pro-immigration arguments in both your book and in the broader public discourse in Canada centre on the economic gains from immigration. What about the global development gains?

Saunders: Canada’s migratory links to the global south are Canada’s most important form of international development. Just the remittance flows from families living in Canada alone are many times higher than all of the foreign aid spending Canada has ever contemplated.

The way immigration works is that you have networks of people in clusters of villages or in urban districts in ascending countries who link themselves up permanently to clusters of people with similar cultural backgrounds in specific urban areas in Canada. And they form lasting links – they send people back and forth, credit, money, knowledge, and they contribute to the development of those places.

A big part of that development is creating ecological efficiencies. Take, for example, the Philippines, which has been the largest centre of immigrants to Canada for the last decade. The Philippines, if you look at the clusters of villages in Luzon, the big island that most Filipinos in Canada come from, those areas that have migratory links to the western world have seen much higher standards of living, lower infant mortality rates and higher life expectancy, but are also more likely to have made the transition from subsistence to commercial agriculture.

Most importantly, they’ve also been much more successful in making the fertility transition, going from having six children per family to fewer than two children. So, you could say that Canada, in creating migratory links to places in the developing world, is helping those places develop in terms of human development, in terms of economic development and in terms of ecological development, because stabilizing population growth is probably the most important ecological target.

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