by Matthew Robinson, Accenture
Business leaders understand that climate change is a major issue, but many are awaiting clarity about future regulation. Here are six actions to take today to prepare for climate change:
a. Weatherproof your business: A rise in average global temperatures of 1-4°C under current emission paths could result in rising sea levels and greater frequency of freak weather events. Depending on location and industry, this could have severe consequences for a company’s plant, its transport and logistics networks, its supplier base, the welfare and mobility of employees, and critical elements of IT infrastructure. Companies need to understand these stress points and factor them into their long-range business planning.
b. Factor a carbon price into business planning—now: Caps or taxes will mean that CO2 emissions will have a price, something that will drive initiatives that eradicate carbon inefficiencies. Even if a business does not operate in an industry where carbon emissions are directly regulated, many of the firms in its supply chain will, thereby indirectly affecting costs and prices. Companies can audit their carbon footprint and their supply chains to identify carbon “hotspots”. They can explore various options to decarbonize their supply chains such as clean vehicle technologies, optimization of logistics networks, and low-carbon sourcing.
c. Anticipate the trade-related aspects and risks of climate change: Protective measures imposed by economies with high levels of carbon regulation against those with low levels of regulation may mean that companies inadvertently fall foul of border taxes or import restrictions. Companies will need to be highly attuned to this greening of the trade landscape, and act nimbly to manage its attendant risks.
d. Follow the green-brick road: Buildings, transport networks, energy sources, power generation and industry will all need to be upgraded. Advances in information technology will enable the creation of smart cities. Companies should look to harness green incentives provided by governments. They should reorient R&D functions in order to tailor innovations to meet the green growth opportunity. And they should form partnerships to tap into sources of knowledge, expertise and technology.
e. Go and talk to regulators and scientists: Given the complex and multi-faceted nature of climate change, there is a real danger that policy, science and business strategy could each develop in its own vacuum. Businesses should engage with the scientific community, policymakers and regulators to ensure effective, well-designed policies.
f. Harness the greening power of IT: Technological advances such as cloud computing and green data centers are enabling significant reductions in the carbon footprint of information and communication technologies Video conferencing technologies, social networking tools and software can support remote working and reduce the need for travel; smart grids in electricity supply can enable businesses and households to regulate their energy usage and generate power locally that can be sold back to the grid, enabling significant savings.
Matthew Robinson is a Senior Research Fellow at the Accenture Institute for High Performance, where he leads the global trends research program. His current research interests include carbon economy, the re-emergence of a multi-polar world, open business models, scenario planning, and business simulation. He is based in London. Learn more at Accenture.