Summary:
A coalition of 99 companies is for the Kyoto protocol's successor to include targets for cutting greenhouse gas emissions and to establish a global carbon market. Coalition argues that cutting emissions must be made to carry economic advantages. Following Stern review and IPCC data, CEOs conclude that a responsible risk management approach to the issue requires political and business leaders to take action now. Government needs to create right environment. Environmentalists criticise lack of short-term targets and aspirational nature of targets, rather than being set in stone. Some companies are clearly in it for economic opportunities arising from climate change solutions. (Published: 20/06/08)
Notes:
- coalition of 99 companies
- includes: Alcoa, British Airways (BA), Deutsche Bank, EDF, Petrobras, Shell and Vattenfal
- companies involved span all of the G8+5 countries and virtually every major industrial sector
- ask political leaders to
- set targets for cutting greenhouse gas emissions and
- to establish a global carbon market
- argue that cutting emissions must be made to carry economic advantages.
- coalition believes that taking climate action now would be prudent
- based on scientific and economic evidence assembled by the Intergovermental Panel on Climate Change (IPCC) and the Stern Review
- "While recognising that there are still some uncertainties in the scientific and economic evidence available, these CEOs conclude that a responsible risk management approach to the issue requires political and business leaders to take action now"
- some key recommendations:
- All major economies, including developing ones such as China and India, should be included in the post-Kyoto deal, with richer countries committing to deeper and earlier emissions reduction
- Governments should aspire to halve global greenhouse gas emissions by 2050
- Governments and businesses should urgently explore bottom-up approaches to reducing emissions
- A global carbon trading system should be established as soon as possible
- Emissions caps should be applied flexibly across industry, with some sectors allowed leeway to preserve competitiveness.
- Willie Walsh, CEO BA
- "It's important that the business community demonstrates a desire to work with governments to tackle the challenge that climate change represents. But the report makes it clear that business can't operate in a policy vacuum - we need strong leadership from governments."
- Environmentalist criticisms
- EU's ambition is to make cuts of 20% from 1990 levels by 2020
- shorter term targets are needed
- progress towards them is easier to gauge and backsliding more obvious
- business coalition decided against setting a short term figure
- promoting a 2050 target that is "aspirational," not set in stone
- will allow wiggle-room for high-emitting industries
- may lead to a relatively weak post-Kyoto deal
- Steve Lennon, managing director of the South African energy giant Eskom
- "Creating an environment that will encourage people to do things differently is more important than setting a global target."
- some of the companies see economic opportunities arising from climate change solutions
- Caio Koch-Weser, vice chairman of Deutsche Bank
- "We see enormous opportunities for the financial industry, beyond the challenge we face as global citizens. If leadership is there to create a Kyoto successor that is based on cap and trade, then it creates a global carbon market - and then we are in business."
- blueprint for tackling climate change handed to Japanese Prime Minister Yasuo Fukuda
- ahead of next month's G8 summit in Japan
- aim of which is to produce a successor to the Kyoto Protocol
- current targets expire in 2012
