Business Actions to Mitigate Climate Change

Roger McFadden President, Senior Scientist

McFadden and Associates, LLC roger@mcfaddenassociates.com

GreenLane Luncheon Presentation Climate Change Series: Part 2 & 3 May 4, 2016 Hilton Hotel, Eugene, OR

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Picking up where Dr. Philip Mote Left Off Last Month

Source: Dr. Philip Mote Presentation in April 2016

United Nations Paris Climate Agreement

175 nations sign historic Paris climate deal on Earth Day 2016 – Including the two largest emitters China and U.S.

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Over 375 Businesses Sign White House Pledge on Climate Change Action

Global companies sign White House pledge on climate change action

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What Business Leaders Are Saying About Need for Climate Change Action

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Traditional Media, Social Media and The Awakening Consumer

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There is only ONE Planet Earth

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Current Status of the Environment Decline

Snow Packs/ Glaciers

Fisheries

Wetlands

Top Soil

Forests

CO2 Concentration

Earth Temperature

Population

Waste

Pollution/Toxins

Increase McFadden and Associates, LLC

Environmental consequences of climate change, such as extreme heat waves, rising sea-levels, changes in precipitation resulting in flooding and droughts, intense hurricanes, and degraded air quality, affect directly and indirectly the physical, social, and psychological health of humans.

http://www.niehs.nih.gov/research/programs/geh/climatechange/health_impacts/index.cfm

Climate Change Threatens Human Health

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• Possibility of harm to human health and ecosystems that arise from some human activity

• Possibility of financial damage to a business that arises from environmental change or from social concern about the environment

• Possibility of personal liability or criminal penalties for executives that arises from their business’ environmental activities.

Risk and Uncertainty for Business and Environment

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Source: Down to Earth, Forest Reinhardt Harvard Business School Press, Page 133

Drivers for Businesses

• Government Policy • Incentives, regulations and R&D

Funding

• Consumer Demand • Demand for green products,

services and companies

• Technology Innovation • New products and new

opportunities

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Why Take Climate Change Action

• Awakening Consumer – Communicates through social and traditional media.

• Business customer commitments to reduce GHG Emissions

• Public procurement initiatives that expect accountability

• Executive orders from state, local and federal governments.

• Foreign and domestic legislation. • Emerging science revealing human

health impacts. • NGO campaigns focused on businesses. • Innovative alternatives

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Drivers for Businesses

Risks for Businesses

• Climate Change Policy Risk • World wide governmental commitment

• Market Risk • Price volatility in carbon and energy

• Climate Change Impact • Adverse weather conditions

• Reputational Risk • Public pressure – activist disruption

• Credit Risk • Pressure on credit ratings

• Financial Risk • Investor pressure

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Why Take Climate Change Action

Business Actions

• Adaptations • Comply with regulations and

improve efficiencies

• New Investment Opportunities • Invest in strategic technologies

and market opportunities

• New Revenue Streams • Modify existing products and

services, gain a competitive advantage and capture climate change revenue

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Why Take Climate Change Action

• Electric Utilities – Demand could exceed

capacity

• Integrated Oil and Gas – Hurricanes

and tornadoes

• Food and Beverage – Food supply

interruptions

• Building Design and Construction – Design standards

• Building Operations – Supply and

value chain interruption

• Insurance – Risk models change

• Agriculture – Water/soil impacts,

livestock impacts

• Motor Transport – Vulnerable transport

systems

• Retail – Supply and value chain

interruptions

Business Sector Risks Resulting from Physical Effects of Climate Change

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Company and Regulatory Emissions Policy

• Create an open and transparent dialogue with your suppliers, customers and regulators.

• Many countries, states, provinces and cities already use carbon pricing mechanisms.

• More than 25% of the U.S. population live in a state with a price on carbon and some states are considering policy as a way to implement new power plant emissions standards.

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Monitor, Report, and Verify GHG Emissions

• Building a GHG inventory allows a company to :

• better understand its direct and indirect emissions.

• Help anticipate the company’s exposure to new carbon pricing regulation.

• Early establishment of MRV systems and practices provides a company with more time to prepare internally for regulatory reporting requirements.

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From Crisis to Opportunity

• Solar Panels

• Geothermal Power Stations

• Fluorescent Lightbulbs

• Green Roofs

• Hybrid Cars

• Hydrogen Fuel-Cell Mass Transit Vehicles

• Wind Power

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Engagement with Stakeholders

• Create an open and transparent dialogue between business, government and community.

• Early leadership role on climate change can build credibility.

• Collaboration with other businesses, environmental groups, and key stakeholders can help build consensus on policy design and result in better outcomes.

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• Public health • Energy • Biodiversity • Agriculture • Coast Zones • Forests • Soil & Water Resources

Adaptation

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Adaptation refers to dealing with the impacts of climate change. Mitigation means dealing with the causes of climate change by reducing emissions.

Economy and Sustainability

OLD THINKING

Businesses exist to make money and doing good is the business of philanthropy and faith based organizations.

NEW THINKING

The economy and sustainability are not enemies; on the contrary, not only can they live together, but they actually need each other.

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Proactive Prevention

OLD THINKING

Wait until the problem happens and then take action

NEW THINKING

Whenever possible, prevent the use of chemicals that contribute to greenhouse effect.

When elimination is not possible then reduce emissions as much as possible.

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Radical Transparency Builds Trust

OLD THINKING

Corporate Jargon

Basic Compliance

NEW THINKING

Radical transparency and disclosure builds credibility and trust. Beyond Compliance can become a competitive advantage

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Managing Greenhouse Gas Emissions

OLD THINKING

Design controls to reduce emissions.

NEW THINKING

Eliminate greenhouse gas emissions from product and/or process at design stage. If the greenhouse gas is not in the product then it cannot contribute to greenhouse gas emissions.

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Create Shared Value

OLD THINKING

Enrich shareholders

NEW THINKING

Enrich lives

Create shared value for customers, community and company.

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Don’t Argue With Status Quo Create a New Model

“You never change something by fighting with the existing reality. To change something, build a new model that makes the existing model obsolete.” Buckminster Fuller

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Thank You

Contact Information: Roger McFadden President, Senior Scientist McFadden and Associates, LLC roger@mcfaddenassociates.com Phone – 503-915-4640

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