Companies that implement policies to reduce carbon emissions perform better on the stock market compared with those that do not. — BBC, 2011
Large Companies Leading the Way
Despite a global economic crisis and uncertainty around the outcome of the UN climate treaty process, the world’s largest companies have been stepping up their commitment to address climate change. A recent study by PriceWaterhouse Coopers — the Carbon Disclosure Project (PDF) wich tracks nearly 400 publicly traded companies — shows a dramatic increase in the number of businesses that have made climate change a central business concern — more than 2/3 of all companies, a 42% increase from 2010. And companies now reporting their carbon emissions more than doubled — from 19% to 45% in just one year.
The Carbon Action Initiative which is now backed by 34 leading investors with over $7 trillion in management, is calling on all Global 500 companies to commit to year-on-year reductions on carbon emissions. It’s clear businesses and investors have decided that the time is now to reduce energy expenditures, to invest in clean energy production, and to begin the process of managing their own carbon emissions. A few examples:
- Fedex CEO calls for an end to the use of oil from the company’s truck fleet.
- Walmart is developing plans to eliminate 20m tonnes of greenhouse gas emissions from its supply chain.
- GE has announced it has bought 25,000 electric vehicles, the largest single EV purchase in history.
- IKEA has set a 100% renewable energy target and developed a fully integrated supply chain.
These and many more businesses are are moving forward even without policy incentives because they see the market opportunity. They are going “green” in both senses of the word — searching for economic opportunity while working towards more sustainable business practices. And while these actions do not eliminate the need for legally-binding national and global climate commitments, they do show a new found awareness of the importance of climate change and the desire to take action today.
The Growing Cleantech Sector
While many Fortune 500 companies are making progress to include carbon emissions in their CSR (Corporate Social Responsibility) policies, one particular sector of the economy is working to directly address the causes of climate change — the cleantech sector. According to Roland-Berger Strategy Consultants the global market for environmental products and services is projected to double from $2.1 trillion per year at present to $4.2 trillion by 2020. Half of this market is based in energy efficiency with the balance in sustainable transport, water supply, and waste management. These investments will translate to huge job opportunities:
Investments in improved energy efficiency in buildings could generate an additional 2–3.5 million green jobs in Europe and the United States alone. The potential is much higher in developing countries.
At the same time investments in renewable energy are rapidly increasing. According to Bloomberg New Energy Finance, global investments in renewable energy will double, to $395 billion per year by 2020, increasing to $465 billion by 2030. Roland-Berger again projects major job growth:
Projected investments would translate into at least 20 million additional jobs in the sector, making it a much larger source of employment than today’s fossil energy industry… which, in spite of rising production, has been shedding jobs through technological advances.
Though this is indeed a significant investment (a total of $7 trillion by 2030) it is important to note that it falls far short of the investment required to keep us below 2 degrees C of temperature rise. A combination of investments in Energy Efficiency, Smart-Super Grid technology, Water & Waste Management, Alternative Transportation, Avoided Deforestation (AD) & Afforestation/ Reforestation (A/R), and other innovative solutions along with a global agreement on carbon emissions will all be required to prevent the worst impacts of climate change.
In the interim, Green Businesses are providing much-needed leadership and the innovative solutions that will one day set our climate back on course.
The Climate Group, a nonprofit association of private and public sector organizations working to further the clean energy revolution, showcases businesses working toward climate solutions.
The Guardian’s Sustainable Business Hubs provides news and information across a spectrum of green business topics, from buildings and information technology, to cleantech innovation and supply chain management.
BICEP (Business for Innovative Climate & Energy Policy) a project of CERES, is an advocacy alliance helping businesses work with policy makers to pass meaningful energy and climate legislation that will enable a rapid transition to a low-carbon, 21st century economy.
CERES also offers a Roadmap for Sustainability that serves as a vision and practical guide for integrating sustainability into the DNA of business — from the boardroom to the copy room.
- Projected investment in renewable energy could translate to some 20 million jobs in the sector — making it a larger employer than today’s fossil fuel industry. [UNEP]
- Over 900,000 people are now employed in the UK in low pollution business and jobs in these sectors have been growing strongly despite the UK’s economic downturn. [Climate Institute]
- The wind sector employed 550,000 people worldwide in 2009. In the year 2012, the wind industry is expected for the first time to offer one million jobs. [WWEA]
- Some four million direct green jobs based on improving energy efficiency, particularly in building and construction already exist across the economy in the United States and in certain European countries. [UNEP]
- Over the coming decade raising the EU’s climate target from 20% to 30% can create up to 6 million jobs Europe wide. [UNEP]
- Investments in improved energy efficiency in buildings could generate an additional 2-3.5 million jobs in Europe and the United States alone. [International Labor Organization]
- Solar energy alone employed 93,502 American jobs in 2010 and could grow 25,000-50,000 in
2011, economy willing, and potentially up to 4 million jobs by 2030. [IdeaLab]
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About the AuthorKarl Burkart is the Digital Communications Director for the GCCA, the Global Call for Climate Action, and TckTckTck, a network of 400+ diverse organizations working around the world for greater action on the growing problem of climate change. Karl also blogs on technology and the environment for a variety of publications. You can follow him on Twitter @greendig.
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