Business Responses to Climate Change

Introduction

In the previous Chapters V and VI the issues of adaptation and mitigation regarding climate change were introduced. Key concepts were defined, several questions were addressed and potential responses and policies were summarized, based on the findings of scientific research, including valuable sources such as (IPCC, 2007) and (Stern Review, 2006). It is particularly interesting to explore how businesses have perceived these issues and, even more important, how they have actually responded to the challenges of climate change. The issue of global warming, with its pervasive impacts on the society and economy, is not only an issue of public policy and, of course, it is not just an academic issue to be discussed among researchers. The extent and ways that businesses participate in world’s efforts to stabilize greenhouse concentrations is of vital importance, as businesses in different sectors of the economy produce large quantities of greenhouse gases (GHGs) and thus have a significant share of the responsibility for the problem. On the other hand, big corporations possess the organizational, technological, and financial resources to cope with environmental problems, including global warming. Indeed, big corporations’ involvement is a critical factor in the policy deliberations relating to climate change, as they are main suppliers of consumers with goods and services as well as main developers and disseminators of new technology. In addition, they implement and finance a substantial part of governments’ climate change policies.

It is therefore evident that without businesses’ active participation in tackling global warming, the problem will not be resolved. Businesses are increasingly showing that they recognize the magnitude of the problem and the importance of their role in tackling it. As a confluence of events is forcing governments worldwide to enact limits on the pollutants that are trapping heat in the atmosphere, businesses acknowledge that these trends present enormous risks and opportunities for companies and investors (Cogan, 2006). Corporations’ ability and willingness to monitor and report their activities and issues related to global warming reflect the inexorable rise of climate change from debate at the fringes of society to the boardroom agenda (CDP, 2008). Reports from the business world show that the climate issue is being integrated to an increasing extent into business strategies and operations. However, not all businesses have formally integrated climate change into their agenda, at least not the least proactive and cautious about the world’s future, and theirs as well.

An overlook of the history of corporate responses to climate change is presented in (Levy & Jones, 2008), where it is pointed out that, in the U.S., a wide range of sectors responded aggressively to the prospect of regulation of GHG emissions. Indeed, during the 1990s, U.S.-based companies, either individually or through their organizations, were particularly active in challenging climate science, pointing to the potentially high economic costs of GHG controls and lobbying government at various levels. Examples include the Competitive Enterprise Institute (CEI) and the American Legislative Exchange Council (ALEC). Businesses from across the range of affected sectors formed a strong issue-specific organization, the Global Climate Coalition (GCC), to coordinate lobbying and public relations strategies. In SourceWatch (http://www.nytimes.com/2009/04/24/science/earth/24deny.html?_r=2&pagewanted=1&am).