Adapting to the

Post-COP15

Business Environment

20 January 2010Pam Muckosy

pam.muckosy@ethicalcorp.com

LCCGE & Ethical Corporation Roundtable Debate

Dire COP15 Outcome

The Copenhagen Accord:

• Target: limit global warming to a max 2°C over pre-industrial times

• No established emissions reduction target

• A thin 12-paragraph document sets no goal for concluding a binding international treaty, thus weakening the Kyoto Protocol and undercutting the European Union’s nascent emissions trading scheme

• Environmentalists, policymakers and the business community all expressed disappointment at the outcome

• Included developed and developing countries

• Active negotiations to occur between the 30 top emitting countries

• Negotiations deferred to the next round of climate talks scheduled for November in Mexico

Business Opportunities

“This could be the largest emerging market (in carbon) the world has ever seen. 40 trillion USD until 2050. You can be invigorated and excited about this.”

Dan Delurey, Executive Director, Demand Response and Advanced Metering Coalition

“What is most damaging to innovation is incrementalism. It encourages you more and more to invest in yesterday technologies because you are not being encouraged to leap ahead. If 20% is on the table, don’t say 30% say 50% because that is going to lead the change and game-altering investments.”

Yvo De Boer, Executive Secretary, UNFCCC

“We were the first state in the country to set a target for jobs created through clean energy. Our original target was 25,000 clean tech jobs by 2020, we have already reached 47,000 as of 2008.”

Chris Gregoire, Governer of Washington State and

a leader of the Western US Climate Initiative

Business Opportunities

Gain market share by portraying your company as a premium environmental leader.

Take advantage of the growing pool of green capital investment.

Be a first mover in markets for climate change related goods and services.

Lower costs through energy and efficiency savings.

Business Risks due to Climate Change

Regulatory patchwork / weak institutions

National legislation and global standards

Engaging consumers and suppliers

Unpredictable operational disruptions

Companies Identify which Key External Indicators will be

MonitoredNick Robins of the HSBC Climate Change Centre of Excellence

compares addressing emerging sustainability challenges in energy, climate and water to the industrial revolution and the IT revolution in its potential to invigorate business growth.

The core opportunity lies in the recent reframing of climate change focusing on green jobs and low carbon growth.

Evidence for this reframing and its opportunities:

1) The ambitious South Korean Green Growth Plan

2) Germany’s leadership in green technology development & their strong Public Private Partnerships in green tech investment

3) US policy - the cap and trade bill is a jobs bill and his significant multibillion dollar commitment to driving the development of clean technology and renewables in the United States

Companies Identify which Key External Indicators will be

Monitored

Keep an eye on:

• The price of carbon

• US climate legislation

• New technologies in energy

• Growing investment opportunities and support

• Competition from emerging markets

• Establishment of national cap-and-trade systems

• Resource management processes

• Outcome of November 2010 meeting in Mexico

Notable Changes in 2009

• 13% companies focused on CSR stated a major cut in CSR budgets (Ethical Corporation)

• UN PRI increased to 500 companies; US$18 trillion of assets

• Greater integration of ESG criteria into mainstream investing (BSR)

• More Equator Principles signatories: 66 financial institutions in 26 countries; 71% of new project finance debt in emerging markets.

• > 3,000 companies in ’07 reported on environmental and social performance (Bloomberg)

• 1/3 UK companies do nothing to reduce environmental impact; 1/5 say climate change is not on the agenda (May Day Report; 1695 UK workers surveyed in May, 2009)

• Heightened interest in resource stewardship. I.e. water.

Also Expect Greater Measuring and Monitoring

Thank you

If you would like internal training, or to be added to our mailing list, please email me at Pam.Muckosy@ethicalcorp.com or visit

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