Ethical Performance
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This green and pleasant land?

September 2015

Smart technology and low emissions cities are emerging across the globe. Elisabeth Jeffries reports on how businesses large and small are defining their roles and driving local government policy

Local business went up a gear when Bristol in the south west of England became European Green Capital in 2015. Local electric cycle retailer sales, Atmosphere Bikes, increased substantially. It is one of several SMEs engaged in lowering the city’s emissions. Bristol’s role not only as Green Capital, but as a partner in the COP21 climate change negotiations in Paris in December, has attracted a peloton of corporate campaigners of all shapes and sizes probably for similar reasons.

That is not always the case, of course. Whether in infrastructure sectors or not, corporates are usually known for their resistance to environmental or emissions regulations set either by local or central government.

“High policy goals scare off industry and that affects income. You end up compromising. Yet a lot of cities are capable of exceeding the minimum standards,” says Roman Mendle of Local Governments for Sustainability (ICLEI), a global association of local and metropolitan governments dedicated to sustainable development.

Yet Bristol’s activities have achieved the reverse. Companies scrambling to associate with the city’s ambitions as official partners are accountants KPMG, First Bus company and construction and infrastructure group Skanska. It has ten official supporters, ranging from Airbus to Ikea.
The city’s position appears subversive given a central government decision to block environmentally-friendly council initiatives in its July 2015 Housing Standards Review. It will be left to transport, commercial and public building initiatives to close the emissions gap. Among them, Skanska aims to play a role.

Working for the council since 2006, it has built or refurbished more than 40 Bristol schools. In one project, the company converted an old police station into a school rather than use up greenfield land. Another used straw bales as insulation material, generating average annual fuel bills around 40% lower than comparable size schools.

More recently, a school has taken over a disused office building and contains features designed to lower its emissions such as PV panels, an intelligent building monitoring system, smart lighting and water systems.

Partly as a result of its schools connection, the company can associate itself with an educational role championing emissions reduction. “Our status as Official Partner to Bristol2015 does allow us to promote the green values which we as a business share with Bristol2015. We’re using a variety of channels - print, online, events and so on - to deliver that message, as well as allowing the hoardings on our site at 66 Queen Square to host a number of banners showing the aims behind the Green Capital year,” explains John Mitchell, Communications Business Partner for Skanska UK.

It is a role shaded with a hint of innovation and progressive thinking. Bristol City Council, after all, is headed by architect George Ferguson, a mayor who chose not to be associated with any major party when running as an independent in 2012. He is Bristol’s first elected mayor. Its collaboration contrasts with many city procurement activities across the world. Local companies, many of whom are employers, utilities and suppliers, tend to opt for minimum standards.

“Regulation and standards are definitely very important. Industry really needs to know which standards they have to adhere to,” points out Roman Mendle. In China, for example, many buildings have failed to meet the better standards despite the urgent need to cut pollution. “They need private investors to construct buildings but almost no-one wants to build to a platinum standard. They can stay at the basic level and pocket the rest of the profits. No-one adheres to the higher standards,” he says.

There are exceptions, of course, and many of these may be found in smart technology and low emissions cities emerging across the globe. Among them, the C40 Cities Climate Leadership Group is a network of the world’s megacities committed to addressing climate change by acting both locally and collaboratively. “Ending climate change begins in cities,” runs its mantra. These range from Addis Abbaba in Ethiopia to Yokohama in Japan. Most of its partners are philanthropic foundations or charities. ICLEI itself runs a similar GreenClimateCities programme including the ICLEI broad aim to foster better relationships between mayors, councils, smaller and international businesses for the benefit of the climate, inhabitants and visitors.

So far, many of the initiatives are showcase projects whose individual buildings and zones go beyond the average standard. They include Masdar, the United Arab Emirates planned city investing in low carbon technologies and Tianjin, the eco-city in China. In Scotland, Glasgow has won a £24 million government demonstrator project award to make its city safer, smarter and more sustainable.

It includes a city observatory using data technology to improve the urban environment and operations rather like a control room. In London, Siemens runs the Crystal building, home to the world’s largest exhibition on the future of cities and claiming to be “one of the world’s most sustainable buildings.” A few have managed to mainstream low carbon technologies at least in some districts, such as the Black Forest city of Freiburg.

Well performing cities attract investment, of course, and that is another reason councils want to improve them. But what distinguishes each city from its competitors is the extent of collaboration between the local government and businesses sited there. In some cases, the urban environment is a battleground for power between central government, big business and local authorities - and the council loses out.

As Roman Mendle explains: “In developing countries and in some cities, as well as in smaller cities everywhere, the council may not be able to engage with large companies with big legal departments and may not have the expertise, so this [collaboration] may be risky,” he says. In some cities, much of the innovation has been driven by the council. Nevertheless, business partnerships with councils have been operating for many years. They take several forms.

They can be local businesses and SMEs working in the economic ecosystem or local branches of bigger corporate players.
Then there are engineering and infrastructure companies such as Netherlands electronic and lighting company Philips, GE or Siemens. Their engagement can be a solution to the environmental problem, but they are not necessarily based in the city. Utility providers may carry out work outsourced by the local authority. Finally, a local company can take a formative role in developing the fabric of a city.

But as the economic conditions evolve and climate change concerns increase, more are being formed. “We will see an increase in city-business cooperation in the future,” says Mendle, drawing attention to the “severe budget constraints” of local government. “They need to look into non-traditional sources of financing and investment such as international finance, but also private investment.” In addition, the private sector may offer much of the expertise needed by cities on available technologies, cost-efficient approaches to urban concerns, and innovative business models.

The best and most innovative partnerships bring positive branding benefits to the corporates involved while maintaining city autonomy. “Given the profit interest of the private sector, city-business cooperation or any private sector driven solution to urban challenges is an instrument that can be used to do certain things well like energy efficiency, but nothing else. The local government needs to remain in control to serve as a broker of citizen interests. If this principle is watered down or undermined, things can go very wrong,” says Mendle.

Europe | sustainable cities


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