Business And Climate Change March 12 2009

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Business and Climate Change lecture given in March 2009 to students on my CSR course as part of the Birkbeck College Corporate Governance and Ethics MSC. Birkbeck is a college of London University.

Transcript of Business And Climate Change March 12 2009

  • 1. Business and Climate ChangeBirkbeck College, University of London, March 12 2009 Lecture to MSC Corp Gov and Ethics Class. Toby Webb, course lecturer [email_address]

2. Business and Climate ChangeThe future? 3. Business and Climate ChangeClimate change: The facts (well, some of them)

  • Climate change is happening!
  • It's definitely man-made, whatever else nature is doing
  • Research shows accelerated warming since 1950
  • Earliest rough measurements began around a century ago
  • Some species: Costa Rican frogs, already extinct due to CC
  • Pre-industrial levels were around 280 PPM in 1750 (guesswork extrapolated from 1850)
  • Earth currently at 380-90 PPM CO2
  • Top ten years in highest ever temperatures since 1990

4. Business and Climate ChangeExtreme weather is here to stay 5. Business and Climate Change

  • If we stabilize at 400 PPM: 50/50 chance of2 Degreerise
  • BUT only pollution (aerosols reflecting solar radiation) is keeping us below 400 PPM now!
  • At 550 PPM there is a 50/50 chance of a3 Degreerise, (which could be 4.5-5 if wrong)
  • Currently: Headed for2-3.5 degreerise in next fifty or so years
  • This could rise to 5-12 degrees by 2099 (different temps in
  • different areas, season and latitude dependent)
  • IPCC says "peak carbon' date is2015= Copenhagen negotiations in 2009 vital as Kyoto set to expire!

6. Business and Climate ChangeExtinct in the wild soon? 7. Business and Climate Change

  • Signs : Lowest ever recorded Arctic sea ice in 2008
  • Some say summer sea ice (supports Polar Bears) may go inten years(IPCC had said 100 years!)
  • Many earlier predictions on CC are now being brought forward, some changesaccelerating
  • Feedback loops : Output from an event orphenomenonin the past influences the same event/phenomenon, increasing speed of change
  • In 100 years: possibleone meterrise in sea levels world-wide: Huge rise in flooding, disease, migration

8. Business and Climate ChangeYour insurance will cost more 9. Business and Climate ChangeWhat will GHG's and global warming affect?

  • Temperatures / Rain Pattern / Sea Levels / Glaciers (60,000 retreating) / Ice Caps / Sea Ice / Extreme Weather events
  • By 2080 UK could be seeing up to4.5 degreerises in Summer months: Huge impact on agriculture, water, health
  • Increased risk ofconflict : Bangladesh, climate refugees, Darfur, African agriculture, water shocks)
  • Oceanacidification : impact on coral, fish stocks, sea biodiversity
  • Agriculturewill be hugely affected: Tropics and poles see more rain. Semi arid areas will see less (Mediterranean)
  • Globalbiodiversitywill change, species will die out, natural resources will be affected

10. Business and Climate ChangeTuvalu: Potential climate refugees 11. Business and Climate Change

  • Goal should be to limit rise to2 degreesabove pre-industrial levels (1750, 280 PPM)
  • Reality will be more like4 degree rise : Suggestions are: Mitigate for 2, prepare for 4
  • OECD nations (the richest!) need to cut CO2 output by 80% by 2050
  • UKonly country to have passed laws mandating this, BUT: Keep changing the targets: E.G. 26% by 2020, then 34% by 2020, then 42% by 2020
  • 50% global reduction in CO2 needed by 2050 to aim for 2 degrees. Unlikely to happen!
  • EUtarget is to cut emissions by 30% on 1990 levels by 2020 (Poland all coal!)
  • IPCC 's budget is tiny! $30 million a year: whatGEspends on R&D every3 days !

Climate change: The predictions 12. Business and Climate ChangeKilimanjaro: Lot less snow and national parks 13. Business and Climate ChangeMcKinsey scenarios: 1)No change in policy= temp rise up to7 degrees/ 1-2 billion people overwhelmed / 4 bn people at risk RE water / total ice cap melt / Amazon may die 2)Dev nations lead the way,spend$350 bnper year by 2030 = sea levels rise / low level islands threatened / hunger increases slower than scenario 1 / Canada and Northern Europe become more productive / Major increase in extreme weather events 3)Global action , spend is$565 bnper year by 2030 = World warms only 2 degrees / hotter areas suffer on crop yields / some ice at poles remains / increase in bad weather and floods, but manageable / tropical disease spread is significant, but limited 14. Business and Climate ChangeBangladesh: Heading north? 15. Business and Climate ChangeThe future agenda: policy

  • Need to valueecosystem services(forests, wetlands, mangroves, peat bogs, clean air etc)
  • Externalitiesneed to be internalised (cost of running coal plant don't include pollution)
  • Science and technology will be vitally important
  • Tackling emissions fromagriculturev difficult area due to politics andtradedisputes!
  • Voluntarismin environmental progress has not been seem to work. Solutions both regulatory, structural and incentive based

16. Business and Climate ChangeMaldives: Looking to move 17. Business and Climate Change

  • Governance structuresare vital: OECD nations need to tighten up, developing nations must understand the challenge
  • Technology transferto developing nations (China, India, Brazil etc) will be vital. IP disputes must be resolved
  • Energy subsidies, structures of energy market and investment must be reviewed:Renewables growthneeds to be massive
  • Other key areas: Coal use / Vehicles / Agriculture /Carbon capture and storage/ Forestry / Nuclear / Switching coal to gas

The future agenda: policy 18. Business and Climate ChangeEthiopia: Farming issues 19. Business and Climate ChangeThe future agenda:

  • Electric vehiclesand electrified transportation systems: Toyota, Hybrids, plug in cars...
  • Decarbonised electricity : power generating firms and CCS
  • Decentralised power generation:renewables
  • Big solar technology (concentrated solar power, mirror farms): big energy firms and start ups needserious incentives
  • Improvementsto what we have: insulation, efficiency gains: British Gas, utility, DIY firms
  • Biofuels : second generation (non food crops): BP, many others.. Shell's energy scenarios interesting. Search for article

20. Business and Climate ChangeBusiness a big climate factor 21. Business and Climate ChangeThe future agenda:

  • Carbon capture and storage has to play one of the biggest roles. BUT is still in infancy. Nothing coming online until at least2020
  • Only test projects exist: Canada, Algeria, Norway, China, but technology mostly used to take out oil! Uses lots ofwaterandpower
  • Dozen EUdemonstration projectsunder way in EU. RWE building power plant with CCS built in
  • If CCS is problematic, or does not work -what then ?
  • Sources: / Tyndall Center / Hadley Center / Professor Bob Watson, Chief Science Adviser, DEFRA, Head of Tyndall Center. March 10 2009

22. Business and Climate ChangeBiodiversity not just on land 23. Business and Climate ChangeThe future agenda: consumers

  • Increased awarenessvital
  • Concern about severelack of current awareness
  • "Tragedy of the commons" worries: mutual 'destruction', the 'what can I do' attitude
  • Governments, institutions, business needs to tackleapathy
  • Incentivesneeded:
  • White goods labelling, carbon labelling, pricing incentives on flying, transport, energy sourcing, insulation

24. Business and Climate ChangeLarson B Ice Shelf: Melting fast 25. Business and Climate ChangeWhat companies are doing:

  • Corporate sector directly responsible for at least40%of all greenhouse gas emissions
  • Firms havestopped denyingclimate science! (BP in 1997, Exxon in 2008)
  • Joint corporate statements urging for long term market based frameworks
  • Companies such as: BP, BA, BT, Ford, HP, HSBC, Rio, Toyota signed up with CEOs.USCAPin US does similar work
  • Companies said they wanted to make investments AND have investor surety on frameworks
  • Lobby groups such as theCBIin UK urged action for several
  • years, before every major summit
  • Some US companies found to be members oflobby groupson different sides of the debate!(USCAP)

26. Business and Climate ChangeSunsets may get more spectacular 27. Business and Climate Change

  • 2009 PWC CEO survey said that40% of CEOswere not concerned about CC
  • 7% extremely concerned, while 42% were extremely concerned about economic downturn
  • Suggestions ofclimate fatigueamong businesses in current economic climate
  • Many big companies have done the ' easy wins ' on energy efficiency. Where next in recession?
  • Aviation has beenin denial : 2% of emissions, 5-6% by 2050.
  • Now industry says will use 10% alternative fuels by 2017

28. Business and Climate ChangeSea levels will rise 29. Business and Climate Change

  • Wal-Ma