Don't fall behind as more climate legislation rules the world
A lot of times businesses look to or blame, governments for a lack of a national strategic economical 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 from 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 percent 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 five 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.
Forty-five countries (including the EU as a block) have economy-wide targets to reduce their emissions, which as a whole account for over 75 percent of global emissions.
What is even more encouraging is that the majority of them (80 percent) 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. 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 also can 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 climate laws for your global strategy. (The study offers a useful database of all those legislations to download.)
Lastly, some businesses most likely will 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 a fast-growing global trend: More countries are passing climate laws and policies around the world, and businesses should not just wait for COP21 to start innovating and adapting to them.