Corporate Canada grooms green image, changes ways

By Susan Taylor - Analysis

OTTAWA (Reuters) - Canadian companies are trying to cultivate a green competitive edge as concern about the environment mounts, but they risk investor wrath if their claims don't hold up.

Shareholder and consumer pressure have fueled an unprecedented green marketing push that has moved beyond products like soap and light bulbs to whole sectors ranging from oil sands to telecoms equipment.

Nortel Networks (NT.TO: Quote, Profile, Research, Stock Buzz), for example, is aggressively promoting its new network gear as twice as energy efficient as arch rival Cisco's (CSCO.O: Quote, Profile, Research, Stock Buzz) posting videos on YouTube and running ads about a Cisco energy tax.

Nortel - which once asked "What do YOU want the Internet to be?" in advertisements - boasts that its equipment lets people work from home instead of commuting, or run energy-sucking data centers more efficiently.

"They're saying hey, some of the stuff we do isn't just a good technological idea, it also happens to be really energy efficient. And when your electricity bills are going up that's a really good idea," said Duncan Stewart of Duncan Stewart Asset Management and manager of the DSAM IQ CleanTech Fund.

Nortel is not alone.

Canada's oil sands producers, in an effort to polish their environmental image, have launched a communications campaign to counter growing concern over the ecological costs of their developments.

Alberta's oil sands represent the largest source of crude oil outside the Middle East, but the operations to extract the oil are major emitters of greenhouse gases, while swathes of forest are ripped up for open pit mines.