The looming global economic recession won’t stand in the way of company plans to adapt their strategies for the effects of global warming. Instead, 90% of the bosses of the FTSE-100 companies believe action in favor of the environment is an impetus for business. A report just out by the Carbon Disclosure Project (CDP) reveals that corporations are stepping up their efforts to measure and reduce carbon emissions in their supply chains. They also are getting more on target to elimininate carbon emissions linked with product use and disposal.
The Carbon Disclosure Project is an organization which represents 385 global institutional investors who have assets worth a total of around $57 trillion. The not for profit organization collects in depth information about the climate change actions of more than 1550 corporations and multinationals and their supply chains in periodical reports which are published on its website for the public.
The latest report was compiled by PricewaterhouseCoopers (PwC) and Richard Gledhill, who is a partner at the Sustainability and Climate Change department there comments that the survey’s high response rate demonstrates that the carbon agenda in the UK has moved from debate to action.
Paul Simpson, chief operating officer at CDP said that failure to reduce emissions is a big risk. He compared it to the “credit crunch” in the banking sector saying that like the banks borrowed money against assets they proved unable to pay back, companies are using up the natural resources of the planet which they can not pay back either. This “carbon crunch” will have serious financial consequences as well because companies that do not make environmental efforts will end up being fined government charges.
“Everything, including our economy is reliant on the ecosystem. What we are doing is pushing the ecosystem beyond its sustainable limits to the point where it breaks and that is basically what we have done with the economy by lending money that does not really exist and people cannot afford to pay back,” Simpson was quoted as saying in the Telegraph newspaper.
The opportunities related to climate change cited by business leaders are mainly found in the Retail & Consumer and Technology sectors, but there were also plenty of positive signals in the raw materials and mining sectors for businesses focusing on sourcing low carbon energy sources and materials.
The most significant opportunities cited within the low carbon-intensive sectors, include:
- Change in consumer preferences – in response to escalating energy costs, consumers may opt to holiday in the UK thus benefiting tourism and leisure services
- Customer awareness – Increased public awareness of climate change related issues is met by more in depth environmental information regarding performance and products, green marketing and new low-carbon products.
- Construction & Building Products: regulations promoting energy efficiency and greener buildings increase demand for new building products, particularly in respect of adaptive construction to existing infrastructure.
- Metals & Mining: opportunities identified included the increased utilization of aluminum for lighter, more energy efficient metals in transportation products, higher demand for platinum as fuel cell technology develops, the prospect of rising sea temperatures leading to an expansion in the shipping period for ports that traditionally become ice-bound during the winter.
- Pharmaceuticals: development of medicines in response to the changing profile of disease. Many companies in this sector are well placed to profit from these opportunities, the company bosses also face material challenges apparently. A total of 84% of responding companies cited critical risks from climate change, due to factors including increasing extreme weather events, and new regulation, technology and changing consumer sentiment rapidly changing market dynamics.
- Teleconferencing and distance learning – within technology, media and telecoms sectors, the mounting cost of travel is expected to benefit companies engaged in the provision of online distance learning, audio and video conferencing.