Business commitments to COP21
Paris Climate 2015: Businesses must act to combat climate change
Although it is States which are at the forefront of global climate negotiations, the issue affects all public and private stakeholders. "The time for climate action has come, and businesses need to play their full part." Whether directly or indirectly, businesses are contributing to climate change; it is therefore essential that they help come up with effective solutions. COP21 is a unique opportunity to promote business initiatives in the area of energy and ecological transition.
The private sector holds part of the solution to climate change
This is now clear, as was highlighted by Laurent Fabius: "Businesses have shown that they are increasingly sensitive to this issue, both because CEOs have strong convictions [...] and because green growth is also good "business". Companies which fail to embrace this "business" could encounter major difficulties." The development of low-carbon strategies is beneficial to businesses. Ecological transition and economic growth are not mutually exclusive: businesses must mobilize and take action for the climate.
More so than in the past, the climate commitments made by businesses stretch beyond the simple framework of Corporate Social Responsibility (CSR) and are today better integrated into their long-term economic strategy. The fact remains, however, that according to the latest report from the Carbon Disclosure Project which analyzes the green strategies of major global firms, the emission reduction paths taken by most listed businesses fall short of the 1.5 or 2°C target. The statement of commitment is therefore the first step but implementation must follow without delay. In 2015, COP21 is a priority framework for action and dialogue enabling businesses to set out their areas of focus and take a concrete position to tackle this global issue.
COP21: an unprecedented opportunity for private-sector mobilization
For several decades, stakeholders in the economic field have generally kept a low profile as regards this issue, waiting for incentive policies before taking action. Today, major businesses are somewhat more proactive. They appear to be seeking managers to spearhead their actions and gain recognition for them. In this regard, within the context of COP21, public stakeholders have set up the conditions to promote non-governmental initiatives.
Throughout 2015, several international summits will be held in France, bringing together public and private stakeholders for discussions in the run-up to COP21. The aim is to show that the fight against climate change stimulates innovation and to encourage all businesses to be competitive in taking action for the climate. To this end, at the Business & Climate Summit, 1,500 representatives from the economic world expressed their commitments for future-oriented global green strategies.
Promoting and encouraging private initiatives
In December 2015, private initiatives will be included in the Lima-Paris Action Agenda, which is an initial form of intergovernmental response. Led by France, Peru and the United Nations, the famous "Agenda of Solutions" highlights the solutions implemented by businesses, territories and local government, associations, governments, etc. By showing that the fight against climate change is already underway, the Action Agenda encourages non-State actors to play their part. It also encourages government institutions to reach an agreement.
To show their commitment to climate change, businesses are invited to join existing cooperative alliances; many have already done so. Caring for Climate brings together innovative firms seeking to set out the principles of an environmentally-friendly development strategy. The We Mean Business Coalition assembles dozens of businesses and investors for whom the transition towards a low-carbon economy is the key to securing economic growth. Finally, the Portfolio Decarbonization Coalition aims to encourage private stakeholders to decarbonize at least US$100 million in institutional investments. These are all sector-based collaborations fully encouraged by the Secretariat-General of the United Nations, the UNFCCC, the Peruvian and French Presidencies of COP20 and COP21 respectively, as well as the various governments leading the negotiations.
By 20 August 2015, a total of 1,122 businesses had already committed to climate action on the Nazca portal, which lists both collaborative and individual initiatives, 75% of which were CAC 40 businesses. Climate change mitigation and adaptation projects developed by private stakeholders will be brought to the fore at COP21: they will be officially presented at Action Day on 5 December, a high-level event organized as part of UN negotiations.
The French government wants this work and the private projects to receive full recognition. It has also invited all stakeholders to announce their aims and to ensure that the fulfilment of these commitments can be monitored.
Innovative French businesses working for the climate
The major French businesses are on-board. Buoyed by the public authorities’ reiterated support for green innovation and incentive mechanisms, they are tackling climate change. The French Environment and Energy Management Agency (ADEME) identifies examples of private and public-private actions, such as adaptation plans, strategic clusters and exchange platforms. A growing number of stakeholders are becoming involved. According to the Carbon Disclosure Project, however, mature French businesses in terms of carbon strategy only account for 35% of the market capitalization of the 250 largest French companies.
Several of them are involved in strategies to limit carbon emissions, improve environmental performance, innovate in the field of energy, promote recycling, etc. For example, by 2020, Lafarge has committed to reducing emissions linked to its cement production by 33%. Also by 2020, L’Oréal aims to reduce its emissions by 60% by investing in renewable energies (photovoltaic, biomass, etc.) on all its sites. Energy producers like Engie, EDF and Primagaz are also going green by seeking to limit the impact of transporting energy. Michelin, PSA, Renault, Airbus and the SNCF are innovating in the area of sustainable transport: hybrid vehicles, tyres which improve vehicle performance, reduced aviation and noise emissions, etc. Meanwhile, major building-industry players like Schneider, Saint-Gobain and Bouygues Immobilier are ensuring that their buildings and equipment are energy efficient.