This insight has been provided by SAI Global. In this article they delve into the risks associated with climate change and the impact this is having on business, including the impact it may continue to have in the future.
It’s no longer a question if climate change is going to happen or why an organization needs to prepare. The firms that can assess, communicate, and mitigate their carbon emissions stand to gain market advantage.
Climate change is a growing risk not only to the global economy but also to food security, public health, our homes – to our very way of life.
Greenhouse gases (GHGs) from human activities is the most significant driver of climate change and in the past decade alone, we have put more than 350 metric gigatons of carbon dioxide into the atmosphere from burning fossil fuels and other industrial processes, according to the World Resources Institute. And worldwide fossil fuel emissions are expected to be up 0.6% in 2019 over 2018, according to projections from the Global Carbon Project.
More needs to be done to reduce concentrations in our atmosphere. By changing our lifestyles and behaviours, we can help reduce the human impact on the environment. But primarily the seed of change needs to come from the private sector, as the role of business in contributing to sustainable development remains indefinite.
As organizations and business leaders, climate change presents a huge opportunity to redefine not just how we operate in the world, but it also offers us the possibility to get past the controversial debates and overcome the current paralysis in dealing with the issue. The spotlight on the organization is that much bigger than that of individuals. The imperative of an organization to ‘do the right thing’ becomes even greater. Through the use of innovative technology and the creation of transparent, accountable and sustainable business cultures, organizations can take a significant step towards reducing the impact on our planet.
The Environment is Everyone’s Business
Protecting an organization’s capital base is a well-accepted business principle. And in this new activist, social media-fuelled culture, where one simple ethical misstep can lead to reputational ruin, companies are now coming to terms with the fact that they need to demonstrate greater and sustainable environmental performance management to protect their brand and reputation, which ultimately affects a business’ bottom line.
This is being further fuelled by the world of investing and capital markets as sustainable and ethical investing, once a niche area of interest, has moved into the mainstream. Globally, environmental, social & governance (ESG) investing assets stood at US$30.7 trillion at the start of 2018, a 34 percent increase in two years, according to the Global Sustainable Investment Alliance (GSIA). The increasing number of investors seeking out ethically operating companies to invest in is driving more companies to take this issue more seriously.
What’s more, with a shift in the consciousness of consumers as well as the swelling investor scrutiny, those organizations that do foster a strong ethical culture – where environmental excellence becomes part of its strategic thinking – can significantly differentiate themselves from competitors.
Trust is at the forefront of this new era we’re in. It’s defined by complex relationships with our employees, customers, suppliers and the communities we serve. And organizations that dismiss this new era as a passing fad or fail to recognize the need to integrate environmental considerations into every aspect of business, have a higher chance of facing negative reputational damage. It is in their best economic interests to do so. In fact, with change we often find opportunities.
Ambition, Appetite, and Innovation
Before organizations can control and prevent any negative environmental effects as a result of their operations, they need to measure and record the impact their business activities have on the environment. Failure to monitor and control key environmental factors could have massive ramifications to not only the environment we hand down to the next generation, but also for an organization – significant fines, compensation claims, clean up costs, and loss of reputation and brand value.
While all organizations can make a positive contribution, the ability to make a difference varies by sector and organizational size as there are many environmental factors that need to be monitored and controlled. These include business waste, emissions, energy use, use of transport, consumption of materials, water use and pollution, and impacts on surrounding wildlife.
This is where technology can play a significant role in helping organizations reduce global GHG emissions. Large-scale engineering technologies, such as carbon capture and storage, can help drive a decrease in global carbon emissions by removing GHGs from the atmosphere in large power generators, whereas increased renewable generation can help decrease grid intensity. By implementing emissions management software, organizations can ensure regulatory compliance and provide reliable information to demonstrate continuous environmental performance to regulators, to customers and the public.
Growing In Size, Shrinking In Footprint
There’s much more technological innovation for review and discussion based on industry, ambition and appetite but ultimately the inevitability of climate change has never been clearer. The success and failure of business in the near future will be determined by how the private sector adapts to, and reduces, risks associated with climate change. And for those organizations that look ahead and turn detailed risk assessments of climate change into innovation will be much better equipped to meet the new world that awaits us.
Ultimately, the future of the next generation depends on the actions that we take today.
For more information on environmental health and safety and how you can manage risk, head to the SAI Global website by clicking here.
About the Author
David Irvine is the Senior Vice President, EHS for SAI Global. David has worked in the EHS software industry for 19 years in senior leadership positions with a global remit including professional services, product development and business development. David has extensive experience in a range of functional and technical areas across EHS software as well as being involved directly with a broad cross-section of customers.