Five ways business can make a real difference
Climate warriors come in all shapes and sizes these days. While the popular image of environmental activists persists, increasingly they are being joined by grey-suited businessmen and women whose personal conviction is matched by the hard-headed reality that solving our climate, biodiversity, hunger, poverty and pollution challenges is good for business as well.
Why has this happened? As our inability to live within planetary boundaries has become increasingly clear, so has the fact that governments alone cannot get us out of the state we are in. Business can, and should, play its part. But there is another reason which is becoming increasingly evident: smart companies realise we need their ideas, products, services and technology solutions to fix these problems.
Not all work aimed at solving the wicked problems afflicting our environment and society can be addressed by businesses seeking profit. But our work convening private sector leaders to take on other challenges has been instrumental in driving much-needed impetus towards meeting our climate commitments. As more and more businesses sign up to secure long-term economic growth in a low-carbon world, we are seeing five areas where business is having an important impact.
1. Invest in nature-based solutions
Forests, soil, coastlines and the ocean provide a natural solution to carbon capture. They are one of few technically available options to deliver net negative greenhouse emissions at scale, at lower costs and faster speeds than other carbon reduction options. Marine Protected Areas are essential for ensuring the fishing industry has healthy stocks by preventing resource depletion, protecting endangered species, making ecosystems more resilient to climate change and safeguarding thriving biodiversity. They also promote economic growth through farming and sustainable tourism.
2. Price carbon
Climate failure is an economic failure. Pricing it provides a straightforward adjustment. The more expensive greenhouse gas emissions become, the more likely companies are to invest in cleaner production and reduce their emissions. Although businesses can’t make the rules, they can use the existing carbon market to their advantage and help shape carbon markets we need in the future. Governments can use revenue from carbon-pricing schemes to invest in clean development such as research into fuel cells or renewable energy subsidies.
3. Harness technology
A 2018 Global Climate Action Summit report outlines that technology has the potential to reduce 70 per cent of emissions and 50 per cent of this could be delivered by 2030 through diffusion of existing technology. It is not just the climate challenge technology is helping, it is helping to tackle illegal fishing, increase the traceability of materials, and enabling better management of forests using satellite imagery and on-the-ground sensors.
4. Invest in low-carbon energy
The Global Climate Action Summit report indicates we are only beginning to see the benefits from years of investment in clean technologies. For example, a 23 per cent rise in solar power between now and 2030 – roughly half the rate at which it is growing currently – will translate to a 50 per cent reduction in CO2 emissions from electricity generation.
5. Embrace circular economy
The circular economy, which designs products in a way that enables them to be reused rather than thrown away, is entering the business mainstream. Currently only 9 per cent of the global economy is circular, but there is huge potential to do more. A recent World Economic Forum report found that we lose $62 billion in landfill annually, three times the value of all the silver produced in a single year. New business models, such as the sharing economy, may mean we don’t need to own as much stuff as we did in the past. Some products can become services, so we pay for their use, but at the end of their life they can be taken back for recycling.