The Global Reporting Initiative (GRI), together with consulting firm KPMG, has recently released, Reporting the Business Implications of Climate Change in Sustainability Reports, the results of a survey that analyzes sustainability reports published in 2006 by 50 leading international companies. It is an interesting read – well-organized and complete with charts, graphs, and mini case studies.
Key takeaway: The survey found that while almost all companies included climate change issues in their sustainability reports, they focused far more on potential opportunities vs. financial risks. The authors note that, “This is in stark contrast with recent new evidence that climate change presents serious global economic risks if measures are not taken.” On the other hand, “…a surprising two-thirds of companies reported new business opportunities from climate change, mostly in the area of emissions trading and carbon credits.”
An article posted on the socialfunds.com website a few days ago discusses the report and its findings. The article’s author, Anne Moore Odell, quotes an SRI fund executive who believes that companies may be reluctant to acknowledge climate changes risks because they prefer to treat losses from droughts, hurricanes, etc. as extraordinary events and therefore “below the line.” Admitting that climate change is causing such disruptions may require accounting for them above the line, which could have significant financial impact.