Businesses have been struggling to implement concrete methodology in promoting and executing sustainability efforts, unsure of the when, where and who of the issue. Dr. Chyi-Rong Chiou shares his insights on the ESG aspects in the industry during an interview with 《The Icons》.
Carbon Storage and Sustainable Development
Wood could potentially serve as a vital starting point for businesses to achieve their ESG objectives. “Wood has the ability to sequester carbon, allowing businesses to turn trees into furniture to store carbon, also known as carbon storage,” Dr. Chiou explains.
Dr. Chiou mentioned Taipei City’s recent self-government ordinance requiring carbon-sequestering materials for school desks and chairs, encouraging the use of wood instead of plastic to promote carbon storage. He points out Japan’s accomplishments in increasing its self-sufficiency in timber and large-scale utilization of wood in construction, showcasing the potential of wood in carbon storage. Japan’s efforts are noteworthy, especially since their timber self-sufficiency rate had dropped to 18% in the past, leading them to plan to increase it to 50% by 2025. To reach this goal, they established urban forests within cities, used wood in construction, and enacted laws in 2010 requiring public buildings with three floors or fewer to use wood structures. In 2021, they passed another law encouraging private buildings to adopt wooden structures. These approaches not only contribute to higher timber self-sufficiency but also reflect environmental concepts, ensuring a 100% recycling and reuse rate for wood.
Dr. Chiou emphasizes the importance of further promoting diverse wood utilization. He cites the example of Taiwan Incense Cedar growers in Nanzhuang who produce essential oils and other non-timber products from wood, generating multiple income streams. He urges Taiwanese businesses to consider cultivating a habit of wood usage among domestic populations to raise self-sufficiency.
Green Finance for Sustainable Win-Win
Another approach for businesses to fulfill ESG goals is through carbon trading. Companies can collaborate with landowners to attain a mutually beneficial outcome. However, this also requires a focus on sustainable land management to enhance production value.
“Business owners want carbon credits; landowners want profits. If you only provide carbon credits without managing the land, growth won’t be favorable, and you won’t even get those ten tons,” explains Dr. Chiou. He suggests that managing forested land requires support in terms of land scale, funding, technology, teams, and sales.
Dr. Chiou highlights Microsoft’s remarkable performance in carbon trading. The company aims to eliminate all carbon emissions since its founding in 1975 by 2050. Starting in 2012, they implemented internal carbon pricing based on emissions within departments, cutting departmental emission reduction through fines. The funds generated are invested in carbon projects, forming a business model known as “Environmental Carbon Services,” which specializes in emission management.
In Taiwan, some businesses might face financial constraints, but integrating ESG practices with investments could channel profits into carbon projects and emission reduction, thus achieving sustainable development. Dr. Chiou emphasizes that achieving ESG objectives requires a multifaceted approach, encompassing aspects from carbon storage in wooden furniture to investment management in carbon trading. With the rise of international green finance and climate change issues, Taiwanese businesses should actively engage in international activities, understand the latest trends, and incorporate ESG principles into their operations to achieve sustainable development goals.
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