Big Businesses Make Amends Ahead of COP21

Big businesses make amends ahead of COP21. It is nothing short of hopeful that CEOs of global big businesses have summoned the emergency of climate change and the urgent need for clear-cut, innovative and daring solutions for a sustainable future. And all against the background of the United Nations Climate Change Conference taking place in December, also in Paris.

Mister Jean Pascal Tricoire, CEO of Schneider Electric, played the leading role in the Business and Climate Summit. Tricoire said that this is a move designed to impose action taking at the highest political levels. The May Summit already paved the way for world leaders to finally seal a meaningful deal on climate change and carbon emission reduction.

The main goal of the Summit was to get businesses to seal an agreement pushing for a higher carbon price, increased green technology usage and a jump forward for renewable energies. Although these objectives do not represent a novelty, the fading reluctance of the business environment in the face of such challenges does.

From a purely financial perspective, business as usual seems to have become a losing option. So it is quite remarkable that big businesses make amends ahead of COP21. The volatile climate in the energy sector, with the emphasis falling on the oil sector, is putting billions at risk.

Renewable energies and their inclusion in new, smarter grids are gaining momentum and trending. Confronted with this background, the Business and Climate Summit participants realized the fact that climate action makes good business sense.

As the Calderon Report – Better growth, better climate, 2014 underlined, one of the key challenges is to create higher price tags for carbon emissions.

The Clean Development Mechanism (CDM) needs to become more flexible and such market-based tools need to be improved. Up to this moment businesses have adopted voluntary schemes for reducing their carbon print and aiding with the reduction of greenhouse gas emissions (GHG), yet the time has come for the political landscape to change and thus binding targets and concrete policies to emerge at the political level.

Talking about carbon pricing, Mr. Tricoire stated that the price needs to be high enough to make a difference and not volatile, so companies can factor the price into their long-term planning. Before it has been difficult for policy makers to take a position because of industrialists saying no to a carbon price as it would price us out of the market.

Photo Credits: Wikimedia