In this interview with Mark McDivitt, Head of ESG Solutions at State Street Corporation, we unpack some of the creative ways his firm is advancing climate leadership while at the same time promoting better health and gender equality in the developing world. Tim Nixon, Managing Editor, Sustainability.
Tim: Tell us about State Street’s broader perspective on the role of the financial services industry in addressing climate change?
Mark: We believe the financial services industry has a unique opportunity to take a leading role in affecting climate change. As an example, State Street sent a letter to the boards of corporations that we invest in, asking for more transparency in how they are approaching climate change and other environmental and social issues. Further, we are committing to science-based targets to reduce our own global carbon footprint on a per square meter basis of which includes water and recycling; effectively aligning the company with the evolving global standard.
Tim: How about State Street’s goals for its own carbon footprint?
Mark: In addition to the answer to the last question, I would add that reducing our corporate carbon footprint, both locally and globally, is something that we take very seriously. Our goal is a 30% reduction in carbon emissions by 2025 from a 2015 baseline. We are already offsetting all of our GHG emissions from business travel across our operations and taking this one step further whereby we purchased and retired enough Carbon Offsets in 2017 to claim a carbon net negative footprint. We purchased both Renewable Energy Credits (RECs) as well as Carbon Offsets from diverse projects around the world that not only help meet our sustainability goals relating to our carbon footprint but also deliver co-benefits worth highlighting.
Examples include supporting local jobs and retaining our status as an EPA Green Power Partner. Relating specifically to our Carbon Offset purchases, we also focus on giving back to the local communities. In both 2016 and 2017, we purchased carbon offsets from two cookstove projects located in East Africa. Not only were we able to claim carbon net negative impact from our global business travel but these projects supported the empowerment of women, contributed to improving the health and welfare of the citizens as well as helped stimulate the local economy.
Tim: How do cookstove projects help reduce carbon emissions and provide additional benefits to health?
Mark: Initiatives like the Cookstove Project and the Paradigm Project replace inefficient open fires, the traditional cooking method in rural villages around the world, with clean, efficient and affordable stoves, thereby burning the fuel more completely and reducing the amount of black carbon produced. Using locally sourced materials, the cookstoves contain and direct the fire to produce cleaner, hotter energy with much less smoke.
The higher heat achieved burns off the toxic gases and uses far less fuel than traditional three-stone cooking practices. The stove’s airtight cooking chambers and built-in chimney ensure that any remaining fumes are not released into the home. This helps protect forests across the developing world, further combating climate change. In addition to the climate impact, clean cookstoves help to prevent and control chronic and acute health effects- such as child pneumonia, lung cancer, chronic obstructive lung disease and heart disease- by improving air quality in the home.
Tim: How much GHG emissions can such projects offset, and at what cost?
Mark: It varies by project, but we are talking about significant scale, up to 40,000 metric tons per year. The cost generally comes in the range of 6 to 7 dollars per metric ton, which is very competitive with other offset programs globally.
Tim: Given the importance of climate change and promoting sustainable development for State Street, are you looking increasingly for this kind of leadership in your own supply chain, such as those firms which provide goods and services to State Street?
Mark: Absolutely. From data providers to consultants to heating contractors, sustainability is an increasingly important factor in how and where we choose to do business. We see supply chain management as an important lever not just for State Street, but for the entire marketplace to promote sustainable development and contribute to a more healthy and prosperous world.
Editors Note: The images in this article were provided by Joanna B Pinneo Photography. Joanna is a professional photographer with moving and extensive coverage of developing world issues.