Presentación Mohan Munasinghe en Almuerzo mensual AMCHAMDR

M I N D Munasinghe Institute for Development
A sustainable future for the
Ozama River and the
Dominican Republic
Professor Mohan Munasinghe
Chairman, Munasinghe Institute for Development (MIND), Colombo
Professor of Sustainable Development, SCI, Univ. of Manchester, UK
Visiting Professor, Vale Inst. for Sustainable Dev., Univ. of Para, Brazil
Distinguished Guest Professor, Peking University, China
Shared the 2007 Nobel Prize for Peace (Vice Chair, IPCC-AR4)
Keynote speech presented at the
AMCHAM Meeting
Santo Domingo, 25 February 2015

M I N D Munasinghe Institute for DevelopmentMunasinghe Institute for Development
Buenos Dias
Greetings
Ayubowan

congratulations to AMCHAM for
organising this MEETING. We
hope to explore how business
can work with Coalicion RIO and
DR Govt. to contribute towards
restoring the Ozama river. This is
a National Project. It will not only
benefit business, but also make
development more sustainable in
the entire Dominican Republic

Brief Introduction to Project & my role: 1
1. Original request by Pres. Medina to restore
Ozama river, when Fund. Tropigas took me to
visit him in 2013.
2. Importance of Ozama/Isabella river system to DR
3. Specific economic, social and environmental
benefits to stakeholders in the river basin.
4. Initial response by Fund. Trop. and San Souci
with civil society leaders to create Coalicion RIO.
5. Much Preparatory work done by Coalicion –
tech. assessments, organisational structure,
linkages with wider group of stakeholders, etc.
6. Presid. Comm. Created: Pres. Medina’s mandate

Brief Introduction to Project & my role: 2
7. Prof. Munasinghe is a Senior Advisor.
8. Enabling framework built on key principles: SD
triangle – LR sustainability, Stakeholder triangle
– participation/collaboration, public-private
partnerships
9. Many encouraging examples of successful
major river restoration projects exist, globally.
But DR must develop its own framework based
on its own needs and experience. Opportunity to
build institutional base (eg. Coalicion RIO),
collaborative coalitions (eg., public-private), and
technical capacity (eg., univ., researchers).

WHAT ? are the challenges
Multiple global threats undermine sustainable
development efforts and poverty alleviation

M I N D
Growing Risks of Global Breakdown
due to Multiple Heavy Shocks
Multiple threats are inter-related and synergistic.
Integrated & comprehensive solutions needed.
Stakeholder interests divergent. Responses are
uncoordinated & piecemeal – lack of political will
• Financial-economic crisis: Asset bubble
• Persistent poverty and growing inequity
• Resource shortages: water, food, energy
• Environmental harm, extreme events, conflict
mass migrations, pandemics
• Climate change: the ultimate threat amplifier
Munasinghe Institute for Development

M I N D
Climate Change – IPCC AR4 Main Findings
• Global warming in unequivocal. Total radiative forcing of the climate
now is unprecedented in several thousand years, due to rising
concentrations of GHG (CO2, CH4 & NO2).
• Humans activities since the 18th century are very likely to have caused net
warming of Earth’s climate, dominating over the last 50 years. More temp.
and sea level rise is inevitable, even with existing GHG concentrations.
• Long term unmitigated climate change would likely exceed the capacity
to adapt, of natural managed and human systems.
•Adaptation measures are available, but must be systematically developed
• Mitigation technologies are also available, but better policies and
measures (PAM) are needed to realize their potential.
• Poor countries & poor groups are most vulnerable to warming, sea
level rise, precipitation changes and extreme events. Most socio-
economic sectors, ecological systems and human health will suffer.
• Making development more sustainable (MDMS) is the most
effective solution - by integrating climate change policy into
sustainable development strategy.

M I N D
NumberofEarths
Sustainable
BAU
1.Ecol. Footprint of Humanity
In 2012 we needed 1.5 earths;
and by 2030 almost 2 Earths
Unsustainable
one
earth
2012 2030
Munasinhe Institute for Development
3. Millennium Development Goals (MDG) & SDG
United Nations Millennium Declaration, 2000 and Post-2015 Agenda
1. Eradicate extreme poverty and hunger 2. Achieve universal primary education
3. Promote gender equality & empowerment 4. Reduce child mortality
5. Combat HIV/AIDS, malaria & other diseases 6. Improve maternal health
7. Ensure environmental sustainability 8. Global partnership for development
Worthy targets, but if the rich consume more than one planet
worth, where are the resources to feed the poor, esp. after CC.
Unfair World Consumption
Pattern 2010
Champagne Glass

M I N D
Growing inequality and wealth concentration
“During past 300 years, the rich have got richer while the poor got
poorer, Growth of returns to capital is faster than general growth rate
– Thomas Piketty, French Economist
“85 richest people in the world, who will fit into a single London double-
decker, control as much wealth as the poorest half of global population
(3.5 billion people).” – Christine Lagarde, IMF Head
“ 300 wealthiest individuals increased their wealth last year by $524
billion - more than the combined revenues of Denmark, Finland,
Greece and Portugal” - Bloomberg Billionaires Index
Inequality in salaries
 Chipotle Mexican Grill: CEO salary $25 million/year - 1200
times wage of av. worker $21000. Plus stock bonus >$100 million.
 Walmart US: CEO salary $13 million/year – almost 500 times
wage of av. worker $27000.
 25 best paid hedge fund managers earned $21 billion in 2013.

M I N D
WHAT ARE OUR VALUES AND
HOW WELL DO WE ESTABLISH
PRIORITIES ?
Poor leadership and values in
dealing with the Triple Bubble Crisis

M I N D
Financial Markets
Productive Economic Assets
Bio-geo-physical Resources
Econ. Growth
Sound financial markets and economic growth
should be based on the true value of the
productive economic asset base. In turn the value
and use of economic assets should closely reflect
the state of natural (bio-geo-physical) resources
Head in the clouds?
Feet firmly on the ground?
Three Levels of Reality

M I N D
Financial Markets
Asset Bubbles
Triple crisis bubbles driven by greed – enjoy now & pay later 2
A few get rich quickly, many innocents pay a heavy price afterwards
2008 crisis

M I N D
Financial Markets
Asset Bubbles
Econ. Growth
2008 crisis Poverty-Inequity

M I N D
Financial Markets
Asset Bubbles
Econ. Growth
Externalities
Climate change

M I N D
Financial Markets
Asset Bubbles
HumanValues/Choices
Econ. Growth
Govt. Bailout >$5 trillion Aid/yr ~$100 billion
Asset bubble >$100 trillion (1012), Global GDP >$60 trillion
World Military Expenditures: almost $2 trillion in 2012
Externalities
Climate change
Few billion $

Poverty, Inequity, Pandemics
Environmental degradation
Resource Shortage, Conflict
Social polarization, Terrorism
Climate Change
Unrestrained market forces increase risk of conflict (erosion of
ethical & moral values underpinning civilization)
Chaos, Break-down
Conflict, rivalry and
competition for
resources overwhelm all
efforts to impose order
Fortress World
Local, regional & global groups
protect their interests within enclaves
How will we cope with such a world,
especially the poor?
Barbarization: One Risky Future Scenario

M I N D
Global Economic Balance Shifting Towards BRICS &
Emerging Economies
•The global balance of economic momentum has shifted. Recently, emerging and
developing economies have grown over 5% faster than advanced economies.
•The NORTH: US, Europe and Japan are still struggling to come out of the
financial crisis, and facing major issues including low growth and high debts.
•The SOUTH led by the BRICS emerging economies (Brazil, Russia, India, China
& S. Africa) appear to be gaining ground – both GNP and HDI have improved.
•Peaceful co-existence & respect for diverse civilizations is key concept,
to protect countries from global financial forces and military might.
•offers greater fairness, rooted in different philosophies of existence, and
based on their own economic and social order
•BRICS can share natural resources - enough to ensure sustainable
development worldwide, and provide the poor their basic human needs.
Multipolar World: BRICS Bank & Shanghai
Cooperation Agreement (SCA)
Human beings are our greatest resource – more valuable
than gold or oil. Yet we are not protecting & building it up !

WHAT ?
HOW ?
are the challenges
development efforts & need integrated solutions
can we move forward to transform risky current
trends into a safer and better future
Apply the SUSTAINOMICS framework to start
making development more sustainable (MDMS)

M I N D
Asset crisis: have we learnt from experience?
Are we not returning to business as usual?
Financial
Sector
Jobless
Poor

M I N D
Ozama Restoration project is in line with
United Nations Post-2015 Process
• Mandates
– Defined at MDG Summit 2010 (High Level Panel)
– Agreed at Rio+20 Conference 2012 (OWG)
• Leadership
– Member States: prerogative to deliver framework
– UN Secretary-General: presented vision to General
Assembly in September 2013 building upon UN
system’s work and consultation processes
– 17 new Sustainable development goals proposed

HOW DO WE GET THERE ?
Addressing Complex, Multiple,
Interlinked Sustainable Development
issues within the Integrated
SUSTAINOMICS Framework

M I N D
Core Concept 1: Make Development More Sustainable
with EMPOWERMENT, ACTION & FORESIGHT
There are many definitions of sustainable development starting with
Bruntland (1987), and its precise meaning still remains elusive.
Parallel track strategy:
1. Short to medium term – make development more sustainable
(apply best practice).
2. Long term - aim for ideal goal of sustainable development
(identify next practice).
Making development more sustainable (MDMS) is a less ambitious
incremental strategy that is more practical to implement because
many unsustainable activities are easier to recognize and eliminate.
PRACTICAL TEST FOR PUBLIC POLICIES:
Does the policy make development more (or less) sustainable?

Lets move forward NOW!! If
we climb uphill, we will reach
the peak eventually
We cannot see the peak!!
Let’s stop to discuss &
analyze how to reach it.
Sustainable Development
Peak – including climate
change (covered by clouds)
Many obviously unsustainable practices exist today.
MDMS encourages us to eliminate them NOW! Examples
include energy wastage and deforestation.
EMPOWERED to Make Development More
Sustainable (MDMS) – BEST PRACTICE
ANALYSING SD and CC –
NEXT PRACTICE

MDMS: Personal & Community Lifestyle Changes

MDMS: Corporate Social Responsibility Plus (CSR+),
Sustainability Accounting & Reporting, Shared Value
• Corporate Social Responsibility (CSR) - considering wider social
interests by being accountable for operational impacts on customers,
suppliers, employees, shareholders, communities and environment.
• Integrated External Engagement goes beyond CSR to push concern
for stakeholders deeply into business decision making at every level.
• Sustainability Accounting & Reporting includes the generation,
analysis, use and reporting of economic, environmental and social
information (monetised wherever possible) to improve corporate
management and performance in those areas. This approach uses
the Triple Bottom Line, which recognizes that the environmental &
social consequences of corporate actions are as important as
monetary profits, and seeks to measure and report on the outcomes.
• Shared Value - making profits, with benefits to environment & to
society through shared sources of value common to firm & society.
• Impact Investment – investing to benefit society & environment

Development
- Sectors (Agriculture, Energy, Industry,
Transport, Health, etc.)
- Systems (Environmental, ecological, etc.)
- Communities (Poor, Vulnerable, etc.)
SustainableDev.
(Social,Economic,Environmental)
Environment
(naturalvariability)
Ozama
OZAMA
clean-up
MDMS: National Level CC-SD Integration
Make decision makers see sustainability as a key element
of integrated national development strategy – eg., Ozama

M I N D
Economic
Social
• empowerment/governance
• inclusion/consultation
• institutions/values
Environmental
• resilience/biodiversity
• natural resources
• pollution
Sustainable Development Triangle – harmonising key elements and
interconnections (corners, sides and centre) Source: Munasinghe [1992], Rio Earth Summit
•growth
•efficiency
•stability
Core Concept 2: Harmonise the SD Triangle for
BALANCE & INTEGRATION - 1

M I N D
Economic
Social
Environmental
• pollution
• inter-generational equity
• values/culture
Poverty-Equity
Climate Change
Ozama Restoration
•growth
•efficiency
•stability
Core Concept 2: Harmonise the SD Triangle for
BALANCE & INTEGRATION - 2

M I N D
Economic
Social
Environmental
• pollution
• values/culture
•growth
•efficiency
•stability
Focus on GREEN
ECONOMY must NOT
ignore SOCIAL issues
Poverty-Equity
Climate Change
Ozama Restoration

Building Assets for Sustainable Development
Social
Capital
Manufactured
Capital
Natural
Capital
Social Capital
• Human
• Cultural
Source: Munasinghe
(1992), Rio Earth Summit
Coalicion
RIO
Key role played by Social Capital embedded in Civil Society:
ignored, undervalued, invisible
• At individual level, it is built on personal networks that help us enormously in
our private and professional lives.
• At community and national levels, it: is the invisible glue that binds society
together – involving values- ethics, culture, behaviour, and social linkages.

Core Concept 3: Transcend Boundaries of SD
with INNOVATION & FRESH IDEAS
• Values – replace unsustainable, unethical values
• Disciplinary – complex issues need all disciplines
• Space – spans local to global scales
• Time – spans days to centuries
• Stakeholder – need to include all stakeholders
• Operational – full cycle from data to application
•Greed, selfishness and violence are unsustainable
•Selflessness, altruism, enlightened self-interest, and respect for other
humans and nature will make development more sustainable
Transcend Unsustainable Values - Build essential ethical
and moral values especially among YOUTH
Examples: Ethical Dimensions of Climate Change 2006
Interfaith Declaration on Climate Change 2009

M I N D
Wrong Values Drive Unsustainable Development: 1
Social
Capital
Environmental
Debt
Unsustainable
cons. & prod.
depleting NR
Unethical
Social Values
Greed, Selfishness,
Corruption, Inequity,
Violence, Injustice,
Elitism
Source: Adapted from Munasinghe (1992), Rio Earth Summit

M I N D
Social
Capital
Economic
Mal-development
growth based on
unsustainable debt,
waste & inequitable
consumption by
the elites
Environmental
Debt
Unsustainable
cons. & prod.
depleting NR
Unethical
Social Values
Greed, Selfishness,
Elitism

M I N D
Social
Capital
Economic
Mal-development
growthbased on
unsustainable debt,
waste & inequitable
consumptionby
the elites
Environmental
Debt
Unsustainable
cons.& prod.
depleting NR
Unethical
Social Values
Greed,Selfishness,
Corruption,Inequity,
Violence,Injustice,
Elitism
Environmental
Debt
Unsustainable
Pollution &
Depleting Natural
Resources
Drivers of
Unsustainable
Development

M I N D
Social
Capital
Economic
Mal-development
growth based on
unsustainable debt,
waste & inequitable
consumption by
the elites
Environmental
Debt
Unsustainable
cons. & prod.
depleting NR
Unethical
Social Values
Greed, Selfishness,
Elitism
Environmental
Debt
Unsustainable
Pollution &
Depleting Natural
Resources
Drivers of
Unsustainable
Development
(with feedback)

Transcending Stakeholder Boundaries to Ensure
Cooperation for Sustainable Development
Social
Capital
Business
Govern-
ment
Civil
Society
Coalicion
RIO
Catalysing interactions among government, civil society and business to
strengthen local, national and global governance
Source: Munasinghe (1992), Rio Earth Summit

M I N D
Transcending Operational Barriers
Needs Better Stakeholder Cooperation
• Global
• Regional
• National
• Local
• Community
• Individual
Pragmatic balance between subsidiarity and
integration is essential
Integration
Subsidiarity
Top Down
Bottom up
Specific
Projects
Strategy
-Policy

Many practical analytical tools and policy options to build
integrated SD strategy (global to local levels)
Many available case studies and best practice examples
involving sustainomics applications
Core Concept 4: Full cycle application of integrative
tools, from data gathering to practical policy
IMPLEMENTATION
Choosing Appropriate SD
Indicators
- Social
- Environmental
- Economic
- Institutional
many indicators are available;
thus correct choice is critical for
specific task at hand

M I N D Munasinghe Institute for DevelopmentMunasinghe Institute for DevelopmentM I N D
Integrative Analytical Tools
1. Restructuring Growth to Make
Development More Sustainable (MDMS)
2. Optimisation and Durability
3. SD Analysis (Macro Level)
4. Action Impact Matrix (AIM)
5. Green Accounting (SEEA-SNA)
6. Integrated Models (IAM, CGE, etc.)
7. SD Analysis (Micro Level)
8. Multi-Criteria Analysis (MCA), Cost-Benefit
Analysis (CBA) and Economic Valuation
9. SD Indicators
Application
Levels
A. Global-
transnational
B. National-
macroeconomic
C. Subnational-
sectoral
D. Local-
project
Integrative analytical tools and practical applications
(linking across global, national and local levels)
LinkagesAcrossLevels

Main Types of Assets for Sustainable Development
Social
Capital
Manufactured
Capital
Natural
Capital
Social Capital
• Human
• Cultural
Sustainable
Development
Integrating across the three dimensions of SD
Economic approach focuses on optimality - maximise growth
Environmental & social approaches use durability – overall system health

Optimality and Durability: Simple Example
Two modes complementary - tradeoff depends on situation
Optimal Mode
Olympic 100m sprinter – willing to take
high risk and make extreme effort to
minimise running time (single indicator)
for one special event
Durable Mode
Middle aged walker – undertakes regular,
low risk exercise for overall health
(multiple indicators), over many decades
Max. yield
Highest risk
Examples: Iskill
(Voldemart) 2B+
loss at JP Morgan.
Leeson - Bearings
Mod. yield
Lower risk
Yield
Risk
Optimal view – cliff edge – higher risk

WHAT ?
WHICH?
HOW ?
are the challenges
practical analytical tools and policies are available
Many best practice examples exist, worldwide.
Ozama river is good starting point for the DR.

Identifying Priorities: Macro/Sector
Sustainomics Application
Action Impact Matrix applied to the
Ozama river restoration project by
Coalicion RIO

Global Influences,
National SD strategy
(NSDS) & plans
Action Impact
Matrix (AIM)
applied to Ozama
Macro- and Sectoral
Models and Analyses
Implement Dev. Proj.
includingCC Policies
interactions of
national SD strategy
with vulnerabilities{
Identify Links,
Screen, Prioritize
Issues, Select
Remedies
Analysing SD Links using the
Action Impact Matrix (AIM)
National
Policy
Impact on People

The AIM methodology may be used to better understand interactions
among three key elements:
(a) Major pollutants of the Ozama river;
(b) Key vulnerable sectors; and
(c) Main stakeholders and sources of pollution
First, the impacts of (a) on (b) are identified and prioritised. Next the
major pollutants are linked to (c). The AIM approach analyses key
economic-environmental-social impacts of pollution of the Ozama river to
identify potential barriers to making development more sustainable
(MDMS). It also helps to determine the priority projects, policies,
strategies that facilitate restoration of Ozama river restoration, that will
benefit stakeholders, communities, business and the entire nation, in
economic, environmental and social spheres,
Thus, the AIM helps to integrate the Ozama river restoration within
national SD strategy. The method has been used since the early 1990s to
link macro-policies and environment.
Action Impact Matrix (AIM) Methodology

The AIM methodology relies on a fully participative stakeholder
exercise to generate the AIM itself. 30-40 experts are drawn from
government, academia, civil society and the private sector, who
represent various disciplines and sectors relevant to both sustainable
development and Ozama river restoration. In the initial exercise,
they usually interact intensively over a period of about two days, to
build a preliminary AIM. This participative process is as important
as the product (i.e., the AIM), since important synergies and
cooperative team-building activities emerge. The collaboration helps
participants to better understand opposing viewpoints, resolves
conflicts, and ultimately facilitates implementation of agreed policy
remedies. On subsequent occasions, the updating or fine-tuning of
the initial AIM can be done within a few hours by the same group,
since they are already conversant with the methodology.
AIM Process

M I N D
Main Stakeholders, Pollution Sources
& Pollutants of Ozama River
Households (Solid waste/waste water/sewage/detergents)
Agro Industries (Food processing /slaughter houses)
Industries (other factories)
Government (Waste water, Landfills, stormwater)
Ship yards (waste oil discharge, solid waste)
Power Generation (Oil, chemical)

M I N D
Benefits of Ozamo Clean Up to Stakeholders
• Access to clean water for residents living along the river
• Less pollutants in the river leading to fewer health issues
• Better living condition for those living along the river
• Monetary gains from decreased pollution
• Greater industrial productivity
• Increase in tourism –(cruise ships, water sports, hotels)
• Better working conditions and health of workers
• Decrease in health care costs
• Greater participation and empowerment of all stakeholders
• Peoples pressure will push industries to become more
environmentally conscious.

M I N D
Environmental Sustainability of the Project
• Less pollution of water resource and
habitats
• Greater Biodiversity
• Less vulnerable ecosystems

M I N D
Social Sustainability of the Project
• Active stakeholder participation and
ownership of the project
• Capacity building – institutional & individual
• Changes in behavioral patterns of those
living along the river
• Reforestation programmes done by the
community
• Opportunities for business to engage
positively with civil society

Economic
• Reduced costs of pollution cleanup
• Increased industrial resource efficiency
• Higher worker health and productivity
• Improved conditions enhance tourism
Social
• Better water quality
• Better living conditions
• Improved health of communities
(esp. the poor, children, and elders)
Environmental
• Less water/land pollution
• Improved biodiversity
• More resilient ecosystems
• values/culture
Ozama
River
Restoration

M I N D
Risks for existing businesses due to Ozama
river pollution
 how long can they continue to pollute?
 economic costs will rise with pollution levels.
 What is the capacity of the river to absorb industrial waste?
 social unrest against business polluters as socio-economic and
environmental vulnerability increases with pollution
 legal actions against business polluters and resultant costs
 air, land and water – long term capital for businesses in
jeopardy
 business ethics in jeopardy - firms profit from the local
economy, so they have an obligation to maintain and improve
the environment for the benefit of all citizens.
These issues can have high economic, social & environmental costs

M I N D
Future benefits for business
1) Health & productivity - pollution affects the health and
working condition of employees, so output will rise and health
care cost will fall as pollution declines
2) Clean river water is a valuable an industrial input
3) Clean river can be a mode of transportation for businesses
4) New business opportunities
- increased land value
- tourism – “room with a river view”
- opportunity to boost other local businesses with rise in tourism
- water & commercial use – cruise ships, river side restaurants
- River fishing/sports activities
5) New markets for environmental technologies –
eg. waste management.
eg. Ecofriendly enzyme: Coalición RIO initiated a low cost method
to neutralize & convert household waste into useful products.

MACROECONOMY (Multisectoral CGE)
TRANSPORT WATER
RESOURCES
URBAN-IND
ROAD RAIL
OTHER
OZAMA
RIVER
OTHER
RIVER
OTHER
REGION
I
REGION
III
REGION
II
Linking up with DR Economy
Multi-sector Computable General Equilibrium Model
ENERGY

Sectoral and Project Analysis
Sustainable Development Assessment Tools
1. Economic/Financial Assessment (CBA)
2. Environmental Assessment (EA)
3. Social Assessment (SA)
4. Multi-Criteria Analysis (MCA)
5. Poverty Assessment (PA)
6. Technical Assessment (TA)
Choice of appropriate indicators is vital for SDA
Examples of Coalicion RIO Projects
1. Enzyme waste treatment
2. Cleaning up Canadas.
3. Re-afforestation (with communities)

M I N D
Other Example 1: Singapore River
• Took nearly two decades & had a very positive cost-
benefit ratio
• Today, restaurants and condos line the transformed
riverbanks
• Places that had no economic value are expensive
• The land values and economic activity have both risen
National University of Singapore argues:
“ that it would have cost significantly more to leave it dirty, because
the health, social and economic costs would be quite significant”

M I N D
Other Example 2 : Buriganga River
(Bangladesh) restoration prog. Benefits

M I N D
Other Example 3: Citarum River, Indonesia
Some call Citarum the world's most polluted river
Photo: Mother Nature Network
ADB initiated a clean-up
programme in 2008 and
estimated economic benefits to be
more than double
of costs of clean-up.

M I N D
Other Example 4: Private public partnerships
National Ganga River Basin Recovery – India
• World Bank-financing will be used to pilot innovative technologies
and implementation arrangements. The potential pilot areas identified
so far include innovative Public-Private Participation (PPP)
financing models which have not been used in the Ganga basin states.
• Project will identify pollution hot-spots along the river where “no
regret” investments can be made, even while the larger basin
management plan is being drawn up.
• The majority of these investments are expected to be made in cities
along the banks of the Ganga, in wastewater treatment (e.g. plants
and sewage networks); industrial pollution control efforts (e.g.
common effluent treatment plants); solid waste management (e.g.
collection, transport and disposal systems); and river front
management (e.g. improvement of the built environment along river
stretches, improvement of small ghats and crematoria).

M I N D
• A campaign to restore the Ganges was initiated by prime
minister Rajiv Gandhi in 1984, but the river’s problems
proved to be too numerous and complex.
• Modi has restarted it - Total estimated cost $15billion. The
government may provide about 30% of the funding.
Expect the rest to come through a public-private
partnership model. Foreign direct investment rules are
expected to be relaxed to attract both funding and
technology.
The success of this project will have a massive ripple effect
on India’s entire water system
Other Example 4: Private public partnerships
National Ganga River Basin Recovery – India

WHAT ?
WHICH?
HOW ?
are the challenges
WHO ? must respond and how
Business & civil society can act now - sustainable
consumption & production in DR & globally.

M I N D
THE SUSTAINABILITY AGENDA –
ACT NOW
Sustainable Future for the DR
and Key role for Business
Partnership of Sustainable
Consumers and Producers

M I N D
FUTURE VISION:
3 main challenges for the DR
• How to build a sustainable economy that is prosperous
and resource-efficient, but respects critical
environmental and social sustainability limits?
• How to build a sustainable society that meets basic
needs of all human beings especially the poor &
vulnerable, ensuring peace, harmony, social justice &
security?
• How to respect nature and keep resource use within
the sustainable capacity of the country?

M I N D
3 Main Action Priorities for the DR
• Develop a sustainable economy and 21st century eco-
civilization that promotes sustainable lifestyles, consumption
patterns and production practices - will require more focus on
human well-being and happiness rather than pure material
consumption.
• Strengthening social capital and sustainable values, especially
among youth, to improve poverty and inequality, nutrition,
health and education. It is vital to build human resources --
the DR’s greatest asset.
• Targeted action programmes to restore and maintain
environmental quality and ecosystems – on water, land and
air. The Ozama river restoration project and strengthening
disaster risk reduction efforts are good areas to start with.

M I N D
DR can become a Leader in Innovation &
Making Development More Sustainable
1. Growing economy able to leapfrog and find new
SD path for 21st century (tunnel)
Economic: innovation, resources, skills
Social: social and human capital, committed to peace & prosperity
Environmental: long tradition of respect for nature

M I N D
• Eradicate Poverty - economic growth and reduced poverty across
all regions and strata of society
• Combat Hunger and Malnutrition – need for proper resource
allocation policies to be implemented
• Health – reduce child and maternal mortality; need to halt or reverse
spread of HIV and other diseases
• Sustainomics requires balance within SD triangle - If social and
environmental issues worsen, economic growth will be jeopardized
• Inequality – social and gender inequality has worsened
• Environmental & domestic resource costs are high
• Education – onl y 60% of children finish primary education
• Unemployment - high quality job creation is critical
• Infrastructure – provide clean energy and water
DR’s SD Challenges

M I N D
• Poverty - population living on less than 1 US dollar a day: has
decreased but considerable urban –rural disparities.
• Literacy Rate of 15-24 Year-Olds: 96.8%
• Gender - The rate of youth unemployment for women is more
than double the rate for men
• Health - Infant mortality rate decreased - 45.2(1990 )to 20.9
(2011)
• Health – Maternal mortality rate decreased but still
considerable – 220 (1990) to 150 (2010)
• Sanitation - population with access to safe drinking water
slightly decreased - 88% (1990) to 86% (2010)
• Carbon dioxide emissions per capita increased from 1.33MT
(1990) to 2.08MT (2009)
• Number of internet users (per 100 inhabitants) increased 0.02
(1995) to 35.5 (2010)
DR – Selected MDG indicators in 2010-2012

M I N D
DR: Selected Indicators of Sustainability
World ranking is medium
Human
Development
Index (HDI)
UN measureof country development
based on factors like life expectance,
adult literacy and GDP per capita
DR ranked 96th of 186 nations
countries (HDI 0.702). Norway is
first with HDI 0.975. (2013 )
Environ-
mental
Performance
Index (EPI)
General ranking of performance under:
Environment, Health, Air Quality, Water
Resources, Productive Natural
Resources, Biodiversity and Habitat, &
Sustainable Energy using 16 indicators
DR ranked 72nd out 132 countries
with score of 52.4. Switzerland is 1st
with score of 76.7. (2013)
Ecological
Footprint
(EF)
Tracks demand of human populations on
planet’s ecosystems relative to
biologically productive land and
available water
DR ranked 48th of 152 nations:
ecological footprint is 1.5. United
Arab Emirates has largest footprint of
10.7 and Timor-Leste the least with
0.4. (2010)

M I N D
• Fast growing green economy
• Stable society with a high quality of life for all, and having sustainable livelihoods
• Better infrastructure: electricity, water, schooling & health care
• Maintain the best of culture, traditions and long standing global identity
• Become emerging market economy, competitive internationally and integrated into the
global economy, with a knowledge-based society
• Reduce vulnerabilities & increase resilience of socio-economic and ecological systems
• Some MDG targets
– Eradication of hunger and hard-core poverty.
– Universalization of primary education for all.
– Reduce the maternal mortality ratio by 3/4
– Reducing malnutrition rate of children.
– Reverse the spread of HIV/ AIDS, dengue, tubercolosis, malaria
– Increasing access to clean water in urban areas from 60 to 90 percent.
– Raising forest coverage from 14-28 percent.
– significant improvement in the lives of at least 100 million slum dwellers
Short-Medium Term perspective:
SD integrating economic, social and
environmental areas with prosperity for all

M I N D
Key CC vulnerabilities in the DR
•Hydrological resources are important for drinking water, power generation and
irrigation of agricultural lands
•Annual drinking water availability per capita decreasing
•Irrigation is a major consumer of water, but drainage is a problems resulting in
thousands of acres of unproductive land
•Industrialization and water stress: tourism is increasing and consuming 4 times more
water than domestic use
•Salt water intrusion
•Agriculture is highly vulnerable to climate change impacts, especially storms.
•In 1998 Hurricane Mitch caused total crop losses totaling US $278 million , and one
third of the area planted with crops was destroyed.
•Tropical storm Noel, 2007, is thought to have destroyed the entire plantain and
vegetable crops in some areas of the country (World Bank, 2009).
•Agricultural sector is also susceptible to drought and floods.
•High costs of food production for domestic sector
WATER
AGRICULTURE
ENERGY infrastructure is vulnerable to impacts from tropical storms and hurricanes

M I N D
Train future business leaders
Top business management schools worldwide are starting
to integrate sustainability and SD concepts into their core
curricula. Developing countries are leading in this area
MBA oath of ethics is emerging, which includes
sustainability ideas.
Educate sustainable consumers & producers
Educating business and public and awareness building
about sustainable development is crucial, especially youth
Human Resource is greatest asset
mobilize and empower business & civil society to synergise
with government, to make development more sustainable
Business and civil society to work with Govt.

M I N D
Sustainable Consumption &
Production Pathway (SCP) to
Sustainable Development (SD) &
Global Eco-Civilization:
Millennium Consumption Goals
(MCGs) are an important tool

M I N D
Economic
Social
•fairness/empowerment
•inclusion/consultation
•institutions/governance
Environmental
•natural resources
•resilience/biodiversity
•pollution
• values/culture
SD based on
Happiness &
Well-Being (GNH)
•efficiency
•growth
•stability 21st Century
Global Eco-
Civilization
VISION: Global Eco-Civilization of the 21st Century
focusing on Happiness & Well-Being (GNH) -
depending not only on material consumption (GNP)
“Happiness” is a state of mind like “Business Confidence”

SUSTAINOMICS & BUSINESS SUSTAINABILITY
Evolution of Attitudes in the Business Community
“Few trends could so thoroughly undermine the very foundations of our free
society than the acceptance by corporate officials of a social responsibility
other than to make as much money as possible for stockholders.”
Milton Friedman (1962), Capitalism and History
”The crisis has led many in the UK, France and the USA to demand the right
of inventory. Should the Managers be only asking: how do we maximize
shareholder’s value? Or, should they ask: what is the importance of values?
What are our values?
Stephen Green (2009), CEO of HSBC, "Good Value: Reflections on Money,
Morality and an Uncertain World”
“Over the past decade, sustainability has moved from the fringes of
the business world to the top of the shareholders' agenda….”
PriceWaterHouseCooper (2009)

M I N D
AMCHAM and Business Community in
the DR should develop a similar vision

M I N D
NumberofEarths
Sustainable
BAU
1.Ecol. Footprint of Humanity
In 2012 we needed 1.5 earths;
and by 2030 almost 2 Earths
Unsustainable
one
earth
2012 2030
Munasinhe Institute for Development
2. Unfair World Income
Distribution 2000
Champagne Glass
Richest fifth of world
population receives
83% of world income
One fifth of the
Worlds Population
Poorest fifth of world
population receives
1.4% of world income
Ratio of
60:1
between
highest &
lowest 20%
3. Millennium Development Goals (MDG)
United Nations Millennium Declaration, 2000
1. Eradicate extreme poverty and hunger 2. Achieve universal primary education
3. Promote gender equality & empowerment 4. Reduce child mortality
5. Combat HIV/AIDS, malaria & other diseases 6. Improve maternal health
7. Ensure environmental sustainability 8. Global partnership for development
Commendable targets for 1-2 billion poor, but where are the
resources to meet them, especially with Climate Change
1.4
billion

ClimateRisk
(e.g.percapitaGHGemissions)
Development Level (e.g. per capita income)
Resource Use Model for Making Consumption and
Production More Sustainable
Source: M. Munasinghe (1995) "Making Growth More Sustainable," Ecological Economics, 15:121-4.
Poor
Middle Income
Rich
Incentives/resources for developing countries
1. Adaptation fund (safety net) for poorest and
most vulnerable.
2. Technology cooperation/support to leapfrog
Leapfrog
(China, DR)
Transform
Decarbonise

Food for a Week:
Affluent Family
Unsustainable – must
transform/dematerialise
towards sustainablity:
Millennium Consumption
Goals: MCG
Source: Menzel, 2005
Food for a Week:
Poor Family
Unsustainable/Unethical –
must leapfrog/tunnel to
prosperity: Millennium
Development Goals: MDG
Example: 1/3rd World food production lost/wasted. In homes:
USA - 50% & Europe - 30%. Yet about 1 billion are starving.

M I N D
The consumption of the rich is crowding out
the development prospects of the poor.
As resources (like energy, water and food)
become scarce, the “market” solution is for
prices to rise – but this will simply ration
those resources in favour of the rich and
deprive the poor of even their basic needs.
Recent events in many countries show that
deprivation leads to violence
We can enhance poverty eradication and
protect nature by complementing the MDGs
with Millennium Consumption Goals that will
help make the rich consume more sustainably

M I N D
Sustainable Consumption empowers households
Influence people’s behaviour to promote sustainable change
• Empower and motivate – using prices, labels
information, psychology and advertising.
• Change values, habits and socio-cultural
contexts to shift to low-carbon products and
behaviour. Eg., public attitude to smoking
• Adapt material and physical elements of
production - goods and infrastructures are
inter-connected
Social capital embedded within individuals and communities, can
be better mobilized, organized, and empowered to work
synergistically with business and influence government, to make
development more sustainable (MDMS)!
Individual
Community
Producer

M I N D
EXAMPLE: Food Spoilage is a Major
Cause of World Hunger
3.9 billion tons (approx.) of food is currently
produced annually for human consumption
1.3 billion tons of food spoiled annually
1/3 rd of world food production is lost or wasted
(in homes: USA-50% & Europe-30%)
FAO ,2011

M I N D
Launched at Rio+20
SustainoMusica is an international consortium of musicians and music
lovers who believe that music and song constitute an universal language
that can be used effectively to communicate the message of sustainability
to everyone on the planet. We are confident that our new music of
sustainability will appeal to the heart, especially to empower and motivate
young people. We feel that this complementary approach will have greater
appeal than the messages of science and policy, which are aimed mainly
at the mind. Music and song will help to make sustainability a practical
and living reality, by harmonising people and planet, to achieve
prosperity, peace and happiness - that is what our logo shows.

M I N D
Sustainable Production: Insights from Workshops
& Seminars on Business & Sustainability for Senior
Managers of Leading Multinationals
Recent Examples:
• BASF, Germany (Chemicals)
• TESCO, UK (Supermarkets)
• Unilever, Coca Cola, Reckit-Benkeiser, Johnson SC,
Danone, Nestle (Retail)
• Petrobras, Brazil (Energy, Oil and Gas)
• OPEC (energy, oil and gas)
• Sime Darby, Malaysia (Plantations Conglomerate)
• Novozymes, Denmark (Biotechnology)
• Vale, Brazil (Mining)
• Siemens, Shanghai Electric Group (Heavy Industry)
• WCW, Denmark (300 CEOs in Europe)

M I N D
Sustainomics: Ideas for Enterprises
1. Training management and staff on sustainability and
bringing about value change within the firm.
2. Engaging deeply with govt. and civil society to make
development more sustainable: beyond CSR (CSR+)
3. Transparency in declaring bold sustainability goals
and reporting on performance.
4. Identifying appropriate economic, environmental
and social performance indicators (both internal and
external), and monitoring them.
5. Undertaking research and studies to improve
performance and implementing the results.
6. Disseminating relevant information on sustainable
development to the community, country and world.

• Sustainability Accounting or Triple Bottom Line (TBL)
Accounting corresponds to the three dimensions of the
SD triangle – People (social), Planet (environmental)
and Profit (economic)
• It requires firms to expand the usual reporting
framework of financial performance, to include
ecological & social issues
• The TBL concept demands that a company's
responsibility lies with stakeholders much as
with shareholders.
• “Stakeholder" refers to anyone who is affected, either
directly or indirectly, by the actions of the firm.
Sustainability Accounting & Reporting 1

M I N D
From Corporate Social Responsibility (CSR)
To Creating Shared Value (CSV)

M I N D
Source: Adapted from Munasinghe et al. (2009)
Raw material
production
Manufacture
& processing
Logistics
distribution
transport
Retail Consumer
use
Recycling
&
disposal
Light bulb (UK 11W)
2% 1% 1% 95% 1%
Sustainable Production - life cycle analysis of CO2
emission hot spots along the supply/value chain: 1

M I N D
Raw material
production
Manufacture
& processing
Logistics
distribution
transport
Retail Consumer
use
Recycling
&
disposal
Light bulb (UK 11W)
2% 1% 1% 95% 1%
Orange Juice (Brazil freshly squeezed 1L)
28% 19% 47% 5% 1% 0%

M I N D
Raw material
production
Manufacture
& processing
Logistics
distribution
transport
Retail Consumer
use
Recycling
&
disposal
Light bulb (UK 11W)
2% 1% 1% 95% 1%
Orange Juice (Brazil freshly squeezed 1L)
28% 19% 47% 5% 1% 0%
Milk (UK, National Tesco)
76% 5% 4% 10% 3% 1%

M I N D
Case study: Life Cycle Value/Supply
Chain Analysis of Garment Industry in
Sri Lanka
(Focus on CO2/Energy/Labour)
The product – Bra manufactured
at MAS Intimates, Thurulie factory
Sri Lanka.
•Identification of HOT SPOTS
•Trade-offs among economic-social-
environmental indicators

M I N D
Detailed Life Cycle Process Map of Product
Wing mesh
Galloon lace
Mechanical stretch mesh
Narrow stretch lace
Embroidered Fabric
Denier
Bow
Wires
Stretch satin
Strapping
Hook and eye
Fortitube
Binding
Seam tape
Rings
Slides
Mesh elastic
Plain elastic
Autograph tab
MAS
RM STORE
CUTTING
MOULDING
SEWING
PACKING
WAREHOUS
E
Electr
icity
Energ
y
Material
Waste
COLOMBO
PORT
COLOMBO
PORT
Warehouse
Retail store
CUSTOMER
USE PHASE
WASHING
DRYING
UK PORT
Disposal
Packaging
Waste
Electri
city
Packaging
waste
Energ
y
Raw materials
Packing material
Manufacturing
process
Retail operation
Consumer phase
Energy/Electricity
Waste
Disposal
Land Transport
Sea transport
Electri
city
Packaging
Waste
Packaging
Waste
Packaging
Waste
Hanger
Hanger Sticker
UPC
Collar Card
Price sticker
Care Label
Bell Sticker
Raw Material Manufacture Transport Retail End Use & Disposal

M I N D
Life cycle analysis of CO2/Energy hot spots
along the supply/value chain for garments
Raw
Material
Incoming
Transport
Manufac
turing
Distrib
ution
Storag
e/ retail
Use Disp-
osal
56% 3.1% 19.5% 1.9% 5.0% 10.1% 4.7%
16.8%* 5.7% 22.6% 25.8
%
0.42
%
28.5% Lack
of
Data
Carbon reduction: Raw Materials - sust. procurement is key
Energy reduction: Manuf., Distrib. & Use stages are all critical
Car-
bon
Ene-
rgy

M I N D
Procurement: Detailed C-footprint of Raw
Materials – Elastics, Laces & Packing are key
Fabrics,
13%
Laces, 17%
Elastics, 28%Strip cuts, 4%
Trims &
Accessories, 9%
Cup, 11%
Packing material,
17%

M I N D
Energy efficiency gains
The product is manufactured in an eco-friendly plant (MAS-
Thurilie) that uses less energy than a standard plant.
Energy savings: Thurulie vs. standard factory (also MAS owned)
0
0.5
1
1.5
2
2.5
Thurulie Plant A
Remaining Components
Manufacturing Footprint

M I N D
Social Aspects:
Labour Input at the manufacturing Plant
Gender Balance
Job Type Female Male Total
Manager 2 14 16
Executive 21 47 68
Staff 55 76 131
Worker (indirect) 52 97 149
Machine Operators 829 121 950
Total 959 355 1314

M I N D
Integrating Sustainability
into Tourism Industry:
Case Study of Eco-Tourism
from Sheraton Hotel Chain

M I N D
An integrated approach
• An effective sustainability approach for hotels
is based on the several disciplines
– Energy Measurement and Management
– Carbon Footprinting and Mitigation
– Water Footprinting and Mitigation
– Waste Management
– Resource Efficient Cleaner Production
• All these aspects come together to form an
integrated approach to sustainability rather
than a piecemeal method with limited focus

M I N D
Energy Flow Analysis
Input
Oil
Elect-
ricity
Gas
Renew-
ables
Waste
Output
CO2
SOX,
NOX
etc
Kitchen
Rooms
Laundry
Usage
Point

M I N D
Water Flow Analysis
Input
Ground
Piped
Harvested
Rain
Recycled
Waste
Output
Waste
Water
- Drain
- Recycle
Kitchen
Rooms
Laundry
Usage
Point

M I N D
Waste Flow Analysis
Input
Water
Energy
Raw
Mate-
rial
Waste
Output
Waste-
Water
Energy
loss / Heat
loss
Solid
Waste
Noise
GHG
Particulate
Matter
Kitchen
Rooms
Laundry
Usage
Point

M I N D
Key findings – Energy
• Converting Energy Waste to steam
through Heat Recovery Systems
• Harvesting wasted energy, mobilizing
clean energy based on gas & wind power
• Improving and implementing Solar
Energy
• Viability of implementing a Bio Gas Plant

M I N D
Key Findings - Water
• Lack of waste water harvesting in many
instances
• Potential to re-cycle water use from the
swimming pool filtering system
• Additional rainwater harvesting potential
• Potential to reduce water consumption by
up to 10% in year 1

M I N D
Key Findings - Carbon
• Setting up systems to measure waste and
carbon emission on a regular basis
• Greening the supply chain
• Greening the vehicle fleet
• Integrating a sustainability software into day to
day operation to track daily carbon output
• Setting reduction targets for carbon emissions
• Calculating the carbon footprint of a guest
night to offer guest the option to offset their
own footprint

Caution – Jevons Paradox & Limits of
Resource Efficiency
Economic Behaviour
Stanley Jevons (1865) first noted the “Jevons’ paradox” - any
technological advance that increases efficiency of resource
use eventually increases the consumption of that resource.
Efficient resourse use  Savings  Greater resource use
Biological Behaviour (instinct)
Species tend to live near the short-term carrying capacity
their habitats. Until constrained by negative feedback
(scarcity, disease, conflict, etc.), they will: (1) occupy all
accessible habitat; and (2) use up all available resources (for
humans, 'availability' is extended by improved technology).
Consumerist culture, greed & focus on material consumption
reinforce these behaviours

Improved technology and increased
efficiency of resource alone use
cannot solve our problems.
Human beings need to use rational
analysis based on long term thinking
to adopt more sustainable values and
lifestyles that will over-ride
instinctive short term behaviour

FUTURE: Potentially Disruptive Technologies!
1. Mobile internet
2. Automation of knowledge work
3. Internet of things
4. Cloud technology
5. Advanced robotics
6. Autonomous and near-autonomous vehicles
7. Next generation genomics
8. 3-D printing
9. Energy storage
10. Advanced materials
11. Advanced oil and gas technology
12. Renewable energy

Sustainable
Consumers
Sustainable
Producers
Civil
Society
Busi-
ness
Bringing Sustainable Consumers & Producers Together: 1
Sustainability Culture - Making Development More Sustainable (MDMS)
Sustainability leadership by a few consumers and producers

Other
Sustainable
Consumers
Sustainable
Consumers
Sustainable
Producers
Other
Sustainable
ProducersCoalicion
RIO
Govt.
Civil
Society
Busi-
ness
Bringing Sustainable Consumers & Producers Together: 2
Sustainability Culture - Making Development More Sustainable (MDMS)
Sustainable behaviour spreads throughout the country

Key Role of Communications & Responsible Media
in Making Developmenty More Sustainable
Social
Capital
Business
Govern-
ment
Civil
Society
Responsible
Media
Media must play greater role in disseminating correct information to
strengthen civil society and business in supporting and influencing
government to move towerds a more sustainable development path.
Source: Munasinghe (1992), Rio Earth Summit

WHAT ?
WHICH?
HOW ?
are the challenges
WHO ? must respond and how
Business & civil society can act now - sustainable
consumption & production in DR & globally.

M I N D
Mildly optimistic final message for DR & the World
Multiple global problems pose a serious challenge to us all –
poverty, hunger, water, energy, climate change, economic crisis,
resource scarcities, ecosystem harm, etc. are interlinked.
Although the issues are complex and serious, these problems
can be solved together, provided we begin now.
We know enough already to take the first steps towards making
development more sustainable (MDMS) by using the
Sustainomics framework, that will transform the risky
“business-as-usual” scenario into a safer & better future.
Governance systems (at all levels) must be transformed to deal
with multiple crises in an integrated way.
Business and civil society can help government in identifying
issues, changing values and implementing solutions.
Restoration of Ozama river is a key step in the DR to to build
the new sustainable development model of the 21st century

“DEVO VASSATU KALENA
SASSA SAMPATTI HETU CA
PHITO BHAVATU LOKO CA
RAJA BHAVATU DHAMMIKO”
“May the rains come in time,
May the harvests be bountiful
May the people be happy & contended
May the king be righteous”
Even in ancient times, a favourable environment,
economic prosperity, social stability (and good
governance), were clearly identified as key pre-requisites
for making development more sustainable.
Environmental:
Economic:
Social:
Ancient Pali Blessing (Sri Lanka)

M I N D
M I N D
Environment
Society Economy
"making development more sustainable - MDMS“
10/1 De Fonseka Place, Colombo 5, Sri Lanka
Phone: +9411-255-1208; Fax: +9411-255-1608
E-mail: <MIND@mindlanka.org> ; Web: <www.mindlanka.org>

MIND PROGRAMMES
• Awards
Research fellowships, Scholarships, MIND
Sustainable Support Service (MS3), Book donations
• Dissemination & Research
Dissemination & Training workshops
Expert meetings & conferences
Applied research studies and evaluations
UN “Centre of Excellence” for Asia in the Climate
Change Capacity Development (C3D) network of the
United Nations Institute for Training and Research
(UNITAR).

M I N D
MIND CC-SD Training Course, CMA, Beijing, July-Aug, 2006
270 Senior Chinese Officials

M I N D
MIND SD Course, Delhi, Feb. 2007
25 Senior Indian Civil Service Officers

M I N D
MIND-ERC CC-SD Training Course, University of Cape Town, October 2007,
for 30 Senior Decision Makers from Government, Business and Civil Society

Suggestions for Further Information
1. Munasinghe, M. (2010) Making Development More
Sustainable Development, Second Edition, MIND Press, Sri
Lanka – Translated into Chinese and Portuguese.
2. Munasinghe, M. (2009) Sustainable Development in Practice –
Sustainomics Methodology and Applications, Cambridge
University Press, UK.
3. Munasinghe, M., and Swart, R. (2005) Primer on Climate
Change and Sustainable Development, Cambridge University
Press, UK – Translated into Chinese.
4. Website URL: <www.mindlanka.org>

MIND Press
Book:
650 pages
Second
Edition
Published in
April 2010 -
Translated
into Chinese
& Portuguese

Muchas Gracias
Thank You
Sthuthi

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