In the run up to the COP 21 climate summit, companies are busily positioning themselves as “best dressed and most responsible” on the Paris climate leadership catwalk front.
Whether it’s Ikea pledging €1bn for clean energy and climate action, or European oil and gas majors calling for a carbon price, it’s clear that there is a new level of concern in business sector at the potential stakes.
Based on a more than two decade’s experience following corporate climate strategic thinking, here’s my list of the five top reasons why – more than ever – the private sector wants, and indeed needs, a good outcome in Paris.
1. The level playing field
The holy grail of business is a level playing field, the almost mythical space where competition takes place on equal terms. Companies not blighted by wishful blindness have long understood that climate change is the ultimate non-level playing field. Insurance companies were among the first to understand this, back in the 1990s.
Enhanced climate variability implies a constantly changing physical environment. In turn, this means more supply chain disruption, higher operating costs, rapidly changing consumer demands and increased risk of changing regulations – to name a few. The recent surge in business leader calls for a carbon price are explicitly driven by level playing field concerns.
Some degree of enhanced climate variability is already in the system, but it will make a big difference if we’re heading for 4C or higher, rather than around 2C. Climate change is set to create more losers than winners in the business space. The lower the increase, the more time for everyone to adapt.