Changing the business climate

Posted: 24 September 2002

Author: Emma Duncan

Critics of the Kyoto Climate Treaty argue that its targets for reducing greenhouse gas emissions are not economically viable. However, many companies have of their own accord put similar targets in place, with benefits not only to the environment, but to profits and productivity as well.

Global warming and climate change are serious threats to our planet and our standard of living. Their consequences - rising sea levels, more frequent and intense extreme weather events such as floods and droughts, and adverse effects on a variety of species from coral to polar bears - are accumulating rapidly, and require the world's immediate attention.

Industry, which accounts for over 20 per cent of total greenhouse gas emissions from industrialised countries, will be a key player in tackling the problem. But the effort required to change industrial practices in order to reduce greenhouse gas emissions need not necessarily be a burden. Indeed, many businesses are realising that reducing emissions can in fact have a positive effect on their bottom line.

Cutting emissions

A few businesses have already boosted their profits by being smart with energy. For example, one of DuPont's largest plants in the United States cut its CO2 emissions per unit of product by close to half between 1993 and 1997, and shaved US$17 million a year from its total energy bill. Other companies are also realising that strategies to improve energy efficiency will be necessary to remain competitive.

To take this further, in 2000 the conservation organisation, WWF, established the worldwide Climate Savers project to encourage industry to reduce greenhouse gas emissions, with a focus on the main global warming gas, CO2.

With technical advice from energy experts from the Center for Energy and Climate Solutions and Ecofys, the Climate Savers team works with companies to tailor a cost-effective strategy for reducing emissions. Climate Savers is not about "greenwashing'. The company's commitment must be cutting edge and well beyond the aims of its competitors. As part of the programme, companies agree to have their emissions verified by an outside party. They also help to spread corporate best practices to others.

Increased efficiency

One of the first companies to enter into a Climate Savers agreement was Johnson & Johnson, which has pledged to reduce its greenhouse gas emissions to seven per cent below 1990 levels by 2010. The company plans to do this by a variety of measures, including increased efficiency, improved buildings, and using more environmentally friendly sources of energy - including solar energy in its US facilities.

Other companies who have made Climate Savers agreements - IBM, Polaroid Corporation, Nike, Lafarge, and the Collins Companies - have similar plans.

The commitments made by these companies will result in a significant dent in global emissions. Lafarge alone currently emits some 70 million tonnes of CO2 per year, equivalent to twice the emissions of Switzerland. They plan to reduce greenhouse gas emissions to ten per cent below 1990 levels by 2010, together with the commitments of the other five companies, is a major step forward in combating climate change and global warming.

Way forward

The actions of these companies show that it is possible not only to meet, but to exceed the commitment made by most industrialised countries under the Kyoto Climate Treaty, which is to cut global warming gases to five per cent below 1990 levels by 2012. They also put an end to the claim made by countries refusing to ratify the treaty, most notably the United States, that meeting its targets not be economically viable.

The example set by the Climate Savers programme and similar efforts shows that business can take a leading role in reducing greenhouse gas emissions and, at the same time, save money and improve productivity. Hopefully these efforts will gain momentum, translating into much broader market transformation.

In the very near future perhaps, climate strategies will be a standard part of corporate environmental management systems. This, together with international agreements such as the Kyoto Climate Treaty, is the way forward to reduce our impact on the Earth's climate.

Emma Duncan is Managing Editor at WWF International, based in Gland, Switzerland.Related link:For further information visit: WWF's Climate Change Campaign