Businesses see climate change as major issue

Posted: 1 February 2008

Business executives around the globe increasingly see climate change as a major issue they must address if they are to achieve and sustain high performance into the future, according to the international management consultancy Accenture.

Accenture surveyed more than 500 business leaders from China, Germany, India, Japan, the United Kingdom and the United States on their attitudes to climate change and how their businesses are affected.

The resulting report, Achieving High Performance in an Era of Climate Change, examines both the impact of climate change on global businesses and the responses that leading companies are taking to achieve and sustain high performance in the face of profound global change.

Climate change is not yet a strategic business priority
Climate change is not yet a strategic business priority
Climate change is not yet a strategic business priority. Responses to the proposition: 'Climate change is a strategic priority for my business' (% by market). Click on image for larger graphic.

According to the report’s findings, businesses worldwide recognise climate change as a major issue but few are taking strategic action in response – and emerging markets are not taking climate change as seriously as the West.

Highlights in the global responses include:

  • Forty-five per cent of all respondents said that climate change was currently a major issue for their business.
  • A much higher proportion - 59 per cent - believe that climate change will be a major issue for them within five years.
  • At the same time, climate change is not high on the list of strategic priorities for many companies. Only 5 per cent of survey respondents named climate change as their top strategic priority. In no region of the world did that number rise above 8 per cent. Just 11 per cent of businesses stated that climate change figures as their second or third strategic priority.
  • Nearly 70 per cent of Chinese businesses have no climate change initiatives in place.
  • One in five of Chinese businesses believe that climate change is over-hyped.
  • Over one in three (35 per cent) of US companies say climate change is over-hyped.
  • Two thirds of global businesses think that climate change will increase the cost of doing business.
Among the responses from UK companies:
  • Nearly two thirds (60 per cent) of UK businesses see climate change as a major issue today.
  • However, UK businesses need direction to act on this feeling, with 63 per cent of UK businesses struggling to understand the implications of climate change to their business.
  • They are looking to Government to provide that direction – Government is number one stakeholder influencing UK business response to climate change (47 per cent).
  • Consumers are the second most influential stakeholder for UK business on climate change (39 per cent).

Climate change costs and opportunities
Climate change costs and opportunities
Companies too rarely consider the business opportunities represented by climate change. Perceptions of the costs and business opportunities of climate change (%). Click on image for full-size graphic.
There are a number of steps that businesses should take if they are to position themselves to achieve high performance in a carbon-constrained world, concludes the report.
  • Conduct a stakeholder analysis: Businesses need to understand the key sources of influence shaping the climate change agenda, such as government and consumers, and engage them accordingly.
  • Develop “green” products and services: Businesses should assess how existing and new products can meet the demands of increasingly environmentally conscious consumers and also satisfy related regulation in this area.
  • Track external developments: Businesses need to ensure they are able to monitor closely developments in the political, economic, social and technological arenas and take action accordingly.
  • Optimize supply chains: Businesses should explore the extent to which the reworking of their supply chain can be an important source of cost savings as well as reducing their impact on the environment.
  • Use smart technologies: Businesses should seek to deploy “green” technologies (e.g., green data centres, which use less energy) as a source of cost reduction as well as competitive advantage, both through enhanced reputation and more efficient delivery of services.
  • Ensure senior support: Businesses must ensure that the environmental agenda is owned at a senior level and underpinned by regular communication on progress.
  • Drive human performance: Businesses should seek to refine performance-management regimes so that they reward activities that support the organization’s environmental agenda.

Source: Accenture