The Emissions Impact of Coronavirus Lockdowns

There’s a high chance you’re reading this while practicing social distancing, or while your corner of the world is under some type of advised or enforced lockdown.

While these are necessary measures to contain the spread of the COVID-19 pandemic, such economic interruption is unprecedented in many ways—resulting in some surprising side effects.

The Evidence is in NO₂ Emissions

Nitrogen dioxide (NO₂) emissions, a major air pollutant, are closely linked to factory output and vehicles operating on the road.

As both industry and transport come to a halt during this pandemic, NO₂ emissions can be a good indicator of global economic activity—and the changes are visible from space.

These images from the Centre for Research on Energy and Clean Air (CREA), as well as satellite footage from NASA and the European Space Agency (ESA), show a drastic decline in NO₂ emissions over recent months, particularly across Italy and China.

NO₂ Emissions Across Italy

In Italy, the number of active COVID-19 cases has surpassed China (including the death toll). Amid emergency actions to lock down the entire nation, everything from schools and shops, to restaurants and even some churches, are closed.

Italy is also an industrial hub, with the sector accounting for nearly 24% of GDP. With many Italians urged to work from home if possible, visible economic activity has dropped considerably.

This 10-day moving average animation (from January 1st—March 11th, 2020) of nitrogen dioxide emissions across Europe clearly demonstrates how the drop in Italy’s economic activity has impacted the environment.

Source: European Space Agency (ESA)

That’s not all: a drop in boat traffic also means that Venice’s canals are clear for the time being, as small fish have begun inhabiting the waterways again. Experts are cautious to note that this does not necessarily mean the water quality is better.

NO₂ Emissions Across China

The emissions changes above China are possibly even more obvious to the eye. China is the world’s most important manufacturing hub and a significant contributor to greenhouse gases globally. But in the month following Lunar New Year (a week-long festival in early February), satellite imagery painted a different picture.

Source: NASA Earth Observatory

NO₂ emissions around the Hubei province, the original epicenter of the virus, steeply dropped as factories were forced to shutter their doors for the time being.

What’s more, there were measurable effects in the decline of other emission types from the drop in coal use during the same time, compared to years prior.

Back to the Status Quo?

In recent weeks, China has been able to flatten the curve of its total COVID-19 cases. As a result, the government is beginning to ease its restrictions—and it’s clear that social and economic activities are starting to pick back up in March.

Source: European Space Agency (ESA)

With the regular chain of events beginning to resume, it remains to be seen whether NO₂ emissions will rebound right back to their pre-pandemic levels.

This bounce-back effect—which can sometimes reverse any overall drop in emissions—is [called] “revenge pollution”. And in China, it has precedent.

—Li Shuo, Senior climate policy advisor, Greenpeace East Asia

Where Are the World’s Most Sustainable Companies?

Everywhere you look, sustainability is permeating social, political, and business agendas.

In recent years, an impressive number of companies have stepped up to take a more active role in shaping a more sustainable future—not just in the environmental sense, but also by taking social and governance factors into consideration.

Today’s chart draws from the Corporate Knights Global 100, an annual ranking of the 100 most sustainable companies, to visualize exactly how many are located in each corner of the world. The companies on the list are clear winners not only because they aim to leave the world a better place, but because their stocks have also outperformed the market on average.

How is Corporate Sustainability Measured?

The researchers rely on readily available data for all publicly-listed companies with at least $1 billion in gross revenue (in PPP), as of the financial year 2018.

Companies are then screened for several key performance indicators (KPIs), including but not limited to the following categories and examples:

• Resource management
  Example: GHGs and other emissions such as NOx and SOx emissions
• Financial management
  Example: Innovation capacity, or the percentage of R&D spending against total revenue
• Employee management
  Example: Women in executive management and/or on boards
• Clean revenue
  Example: The percentage of total revenue derived from “clean” products and services

The concentration of the most sustainable companies also varies greatly depending on where you look. Here’s a closer view of every region.

Europe: 49/100 Sustainable Companies

Europe is front-and-center in the tidal shift towards more sustainable business, driven by far-reaching regulations. With this in mind, it’s perhaps not surprising to see that Europe is a hotbed of activity.

Nearly half the world’s most sustainable companies are located in Europe. France paves the way with nine sustainable companies in the ranking, followed by Finland with six companies of 100.

Denmark’s Ørsted A/S claims the top of the leaderboard in 2020. Within a decade, the company has completely transformed its business model—shifting away from the Danish Oil and Natural Gas (DONG) company into a pure play renewable energy company. The company recognized the importance of this transition:

Running the company just for profit doesn’t make sense, but running it just for a bigger purpose is also not sustainable in the long term. Doing good and doing well must go together.

—Henrik Poulsen, CEO

Just 10 years ago, DONG was 85%-fossil fuel based, and only 15%-renewables based. Today, Ørsted has flipped these proportions. The company attributes its dramatic transformation to the societal demand for green energy, and aims to be carbon-neutral by 2025.

North America: 29/100 Sustainable Companies

In this region, the U.S. alone is responsible for 17 of the top 100 sustainable companies in the world. What’s more, of the 28 new companies to the 2020 Ranking, Canada is the homebase for nine of these entrants.

Cisco Systems comes in fourth worldwide, partly as a result of its clean revenues worth a stunning $25 billion. Not far behind is Autodesk, which rose an impressive 43 places since 2019. The main factor behind this leap? The software corporation now operates its cloud platforms using 99% renewable energy.

Asia: 16/100 Sustainable Companies

Over in Asia, Japan is a clear leader, boasting six sustainable companies in the list. Interestingly, the companies are from a wide range of industries, from computers (Panasonic) to cars (Toyota).

Japanese plastics manufacturer Sekisui Chemicals comes in first in Asia, after an immense improvement of 77 positions in just one year. The company builds environmentally-friendly housing, and 28% of its revenue aligns with the UN’s Sustainable Development Goals (SDGs).

Rest of the World: 6/100 Sustainable Companies

There are a few notable mentions in other regions, too. Brazil’s Banco do Brasil remains in the top ten list, and is one of the three most sustainable companies in all of South America.

More than half of the companies in these remaining regions are banks. Incidentally, financial services are the biggest group in the Global 100 overall.

The Best of Both Worlds

As it turns out, you can have your cake and eat it, too.

Altogether, the Global 100 most sustainable companies have consistently outperformed*, and outlasted the average company in the MSCI ACWI (All Country World Index):

Corporate sustainability is a significant driving force for urgent climate action, and the sustainable companies on this list acknowledge the triple bottom line of not just making profit, but also creating a lasting impact on people and the planet.