Submitted by E.M. Williams on Mon, 14/11/2016 - 12:24
14 November 2016 – New report, Driving Low-Carbon Growth Through Business and Investor Action, from the New Climate Economy, published today in partnership with CISL and CDP, reveals the critical role of the private sector in driving low carbon growth.
The report, Driving Low-Carbon Growth Through Business and Investor Action, outlines the progress made so far by businesses but highlights the need for more collaboration between companies to enhance ambition and increase business impact and accountability.
The report draws on evidence that shows how climate action is good for business. For example S&P 500 companies that are actively managing and planning for climate change are 67 per cent more profitable than companies that are not (CDP). Companies with superior sustainability profiles outperform their peers in stock market value (CDP’s Climate Leadership Index).
Many businesses are now leading the charge for action. More than 650 companies and 175 investors with over $11 trillion in assets have committed to help implement the Paris Agreement by signing the Paris Pledge for Action. However, the report argues, the private sector needs to go further – business action remains too limited in terms of the numbers of businesses participating and the scale of projected emissions reduction. The majority of business climate emissions reductions targets are too short-term and not ambitious enough to keep global warming at safe levels. Only 10 per cent of the targets go beyond 2020.
The report highlights the importance of international co-operative initiatives to help the private sector go further. These include:
- Collective commitment platforms, which help deliver increased visibility and create a race to the top, such as Science Based Targets, RE100 and ClimateWise Principles.
- Collaborative initiatives that create a critical mass of companies to build economies of scale, transform markets, and ensure continued competitiveness, such as WBCSD’s Cement Sustainability Initiative and the G20's Task Force on Climate-related Financial Disclosure.
- Policy engagement groups that support and call on governments to strengthen environmental policy such as The Prince of Wales's Corporate Leaders Group.
The report concludes that international co-operation between companies can galvanise leadership, generate norms of good practice, and overcome competitiveness barriers. It offers the potential to shift the huge resources of business investment and innovation towards driving a low carbon transition. The report recommends that all major businesses adopt short- and long-term emissions reduction targets and implement corresponding action plans, and all major industry sectors and value chains agree to market transformation roadmaps, consistent with the long-term decarbonisation of the global economy.
