Despite the lack of global agreement on climate change, carbon management is becoming a strategic business priority and competitive driver for the largest global companies, according to a new report.
The 2010 Global 500 Report was released yesterday by the Carbon Disclosure Project (CDP), produced by PwC and sponsored by Bank of America Merrill Lynch.
Nine out of tencompanies surveyed identified significant commercial opportunity arising from climate change, separating the companies driven by risk-factors, from those companies identifying and seizing competitive advantages and cost-benefits.
Significantly, 85 percent of these leading global companies reported having board or senior executive level responsibility for climate change and nearly half (48 percent) are now embedding climate change initiatives into the overall business strategy and across the organization.
Companies with the highest performance scores are entered into a Carbon Performance Leadership Index (CPLI). The top five Global 500 leaders for 2010 were Siemens, Deutsche Post, BASF, Bayer and Samsung Electronics.
North America significantly lags Europe in disclosure and performance, however, with three times as many European companies making the CPLI than their North American counterparts.
The global report shows two main areas of focus for action: the energy efficiency of operations, driven by potential cost savings, and the development of innovative products and services to enable customers to cut their emissions.
“Fuelled by opportunities to reduce energy costs, secure energy supply, protect the business from climate change risk and reputational damage, generate revenue and remain competitive, carbon management continues to rise as a strategic priority for many businesses,” said Paul Dickinson, CEO of CDP. “Companies globally are seizing commercial carbon opportunities, often acting ahead of any policy requirements.”
The report also highlights a disparity between incorporating climate change strategy across the business and actually seeing concrete cuts in emissions, however. While 65 percent of Global 500 respondents had implemented emissions reduction targets, only 19 percent are showing ‘significant’ emissions reductions.
The Global 500 Report was launched yesterday at the CDP Global Forum at Bank of America headquarters in New York, marking the beginning of Climate Week. Influential business leaders and government officials from around the world will explore key issues and solutions around the central theme of: Climate Innovation = Commercial Opportunity.
