Climate Legislations Growing Globally
How business should innovate and adapt
June 4, 2015 — by Michael Mathres — A lot of times businesses look to, or blame governments for a lack of a national strategic economic direction for tackling climate change. This often leads to climate inertia where each party looks to the other for leadership and action.
However, according to a new report the London School of Economics, this is no longer the case, and business have plenty of climate laws and policies from which to be inspired or adapt.
The report: 2015 Global Climate Legislation at a Glance covered climate laws and legislation in more than 98 countries that represent more than 93% of total global emissions and 46 of the 50 biggest polluters.
The results are inspiring and reveal a global trend that businesses, especially global multinationals, should heed and start planning for.
For example, Since 1997, the number of climate change laws and policies has doubled every 5 years. By the end of 2014 there were 804 climate change laws and policies — rising from only 54 laws and policies in 1997, and 426 in 2009 when the UNFCCC COP15 Copenhagen Accord was signed.
45 countries (including the EU as a block) have economy-wide targets to reduce their emissions, which, as a whole account for over 75 per cent of global emissions.
What is even more encouraging is that the majority of them (80%) have specific targets for renewable energy, energy demand, transportation or Land Use and Forestry.
So what does this all mean for businesses?
Regardless of a global deal on climate in Paris later this year at COP21, many national governments have taken their destiny into their own hands, and businesses should assess each legislative regime in which their operations are situated, and adapt in those countries accordingly. In fact the study offers an analysis for each country.
If they have not done so, CEOs should form an executive cross-departmental team with their Legal Counsel, Chief Financial Officer, R&D, Innovation and Sustainability officers to assess all these laws, and create new global and national strategies.
These laws and policies can also inspire and encourage innovation for business, as corporations will need to go above and beyond those targets to operate within the law in those countries. If you are a multinational operating in many countries, you will have to connect these different climate laws for your global strategy. The study gives a useful database of all those legislations to download.
Lastly, some businesses will most likely need to come up with new business plans or models to adapt to the potential effects of climate change in those countries. Indeed, in 51 countries, adaptation plans do not go beyond the reporting requirements in the national communications to the UNFCCC. Therefore, although a business might have adapted to the legality of a country’s climate laws, the corporation won’t be able to operate because it has not adapted to the effects of climate change.
However, this study clearly shows that there is a fast growing global trend: more and more countries are passing climate laws and policies around the world. In those countries, businesses should have little excuse to act, and should not just wait for a global deal to start innovating and adapting to them.
