US companies issue declaration urging government to act on climate change
Group tells Congress to enact strong legislation and see climate change as 21st century's greatest economic opportunity
US companies are flipping the script: instead of lobbying government to relax (or even gut) environmental regulation, a corporate group is urging Washington to enact strong policy aimed at curbing climate change. Their climate declaration, in addition to making an eco-appeal to the scientific consensus that excessive carbon emissions cause climate change, also makes a clear-eyed business case. "Tackling climate change is one of America's greatest economic opportunities of the 21st century," it says.
"The cost of inaction is too high," says Anne Kelly, director of Business for Innovative Climate and Energy Policy (Bicep), a project of Ceres, the Boston-based nonprofit network of investors and companies that advocate for sustainable prosperity. "Policymakers should see climate change policy for what it is: an economic opportunity."
Economic opportunity? The 33 signatory companies, who already integrate climate management into their policies and practices, believe so. They're wagering that the business-as-usual economy, which benefits from society footing the bill for companies externalising pollution, is already on the way out of the door. The future portends a carbon-constrained economy that prices greenhouse gas emissions.
These companies – which include Unilever, Nestlé, Swiss Re, Intel, Nike, and Starbucks – are already preparing for a carbon tax (or similar pricing mechanism) by embracing clean energy, boosting efficiency, and limiting carbon emissions. And now, they're calling on Congress to enshrine such practices in lawbooks. They think the cost-benefit analysis favours their approach. For example, a recent Pew study forecasts 8% compounded growth annually of revenue linked to developing renewable power. On the cost side, climate disruptions – such as increasingly intense superstorms, heat waves, droughts, and rising seas – are already creating significant risk for corporate bottom lines and investment portfolios.
"From droughts that affect cotton crops to Hurricane Sandy, which caused extensive damage to our operations, climate affects all aspects of our business," says Eileen Fisher, CEO of whose operations were halted by the 2012 storm.
"As a socially and environmentally responsible company, we are trying to affect positive change, but business can't do it alone. We need the support of strong climate legislation."
The declaration is taking a grassroots approach, encouraging other companies – as well as individuals – to sign on, as a means of documenting the kind of broad support needed to convince legislators to act. Indeed, a recent New Yorker piece pinned the 2010 failure of cap-and-trade legislation in the US on the top-down tactics of the environmentalist community, which departed from the movement's bottom-up roots.
Belief in global warming has shifted back into the majority in the US,according to data news site, Gallup, with even stronger popular support for strong governmental action to combat climate change, according to a Yale/George Mason University survey. The climate declaration seeks to crowdsource this popular energy to create change from atop the legislative food chain.
Some companies, impatient with government inaction, are introducing their own carbon taxes. Disney, Microsoft, and Shell, for example, have enacted self-imposed carbon taxes internally, to prepare for what they see as inevitable legislation heading in that direction. Similarly, many Bicep companies are acting to address climate change in advance of legal mandates, for example by reducing their carbon emissions.
EMC sets the gold standard on this front, having set carbon emissions targets that align with scientific climate stabilisation models – which the Carbon Disclosure Project recommends in its Carbon chasm report that all companies do.
Ben & Jerry's was the first company to base its carbon target on scientific climate stabilisation scenarios in 2006 – yet it's parent company, Unilever (also declaration signatory), has yet to embrace this method. The climate ceclaration would resonate stronger if all Bicep companies walked this talk.
However, this low walk/talk ratio exposes the very chicken-and-egg dilemma companies face when addressing climate change, underscoring the urgency of the declaration.
First-movers risk absorbing the costs of early action, while free riders jump on the bandwagon after the risks has been mitigated. Legislation and regulation levels the playing field. With this in mind, the more companies and individuals who sign the declaration, the stronger the message to US senators to enact strong climate legislation (including bills currently in the pipeline) — and thereby set examples for other governments to follow suit.