COP21 officially started this week. The media is starting to pick up on the discussion but sadly we keep revisiting the issue of science and the reality of the influence of man on climate change. We desperately need to move beyond this debate and get to the real issue of what to do about it. In an analysis of thousands of peer reviewed academic articles the UNFCCC conclude that 97% of the world’s scientists support anthropogenic climate change. Thousands of civil society groups support them. Business does too.
Businesses recognise man as key driver of climate change and are integrating climate change into their management systems. They are setting ambitious emissions reduction targets and preparing for the impact of climate change which we are unfortunately already going to experience. They are innovating their business models and operating practices. They are identifying solutions and working with other businesses, governments and cities to implement.
‘We Mean Business', a coalition of organisations working with thousands of the world’s most influential businesses, investors and the National Business Initiative (NBI) in South Africa, wants a bold Paris Agreement that creates an enabling policy environment, establishes a level playing field for business worldwide and accelerates the transition to a thriving, clean economy.
The NBI is also partner to CDP, an investor led organisation seeking disclosure on natural capital, and the results of the CDP South Africa survey show that 97% of responding companies have integrated climate change into their business risk processes, 95% have integrated into strategy and 100% have board oversight over this critical issue. All of these businesses have moved beyond the discussion of the science and are treating climate change as a physical and policy reality. The fact that this questionnaire is sent on behalf of $US 92 trillion of assets under management tells us what the financial community think about climate change.
Climate change will impact business and society in a number of ways. For example the massive hail storm in Gauteng a couple years ago was one of the biggest insured losses in industry history. Potentially increasing drought frequency could severely impact food prices and the supply chains of FMCGs and retailers. Increased rainfall peaks in some parts of the country mean companies need to adjust their infrastructure resilience. The cost of pumping water out of mines is a big challenge, how will increased rainfall in some regions combined with increasing energy costs impact mine viability? Certain catalysts stop working at high ambient temperatures. Labour simply cannot work beyond certain temperatures. Wind speeds impact harbour access. Snow and ice impact electricity transmission and mobile phone infrastructure. These are all risks identified and reported by businesses in South Africa.
And the impact is largest on the core of our economy: agriculture, mining, manufacturing and finance.
Businesses are not worrying about the science. They accept it as a given and are translating the science into business impacts and working with other stakeholders to understand and implement solutions. The transition to the low carbon economy is inevitable, the key is how we manage this transition. The world is already decarbonising faster than anyone predicted possible, using both existing technologies and new innovations to reduce global emissions. South African companies are doing their bit. CDP data shows that since 2009 we have seen significant market cap growth, GDP growth of roughly 2% and reporting companies have increased from operating in 48 countries around the world to 75.
Despite this, South African head quartered companies have reduced their emissions by 6.6%. South African businesses have a role to play in understanding the impact of climate change and proposing and implementing solutions alongside civil society, labour and government partners. They are doing just that. During COP21, We Mean Business intends to focus the debate where it really matters and to find the solutions needed to address climate change.
Written by Steve Nicholls, Lead: Climate Change, Green Economy and Water, NBI