Climate Action - Assisting business towards carbon neutrality

Popular Articles

View interview - Dr. Hamadoun Touré, Secretary General, International Telecommunications Union (ITU - 24 Jun 2008

ICT’s smart answer to climate change - 02 Jul 2008

ITU Symposium on ICTs and climate change - 02 Jul 2008

Telecom solutions to energy and climate change - 08 Jul 2008

Leading market providers back new registry system for the Voluntary Carbon Standard - 02 Jul 2008

Jyoti Parikh, Executive Director, Integrated Research and Action for Development (IRADe)

Increasingly, businesses in developed countries are recognising their responsibilities regarding greenhouse gas (GHG) emissions and climate change. But as well as clearing up their own houses, they have the potential to help mitigate the global impacts of climate change, by working with NGOs, governments and developing country businesses to ensure the mistakes of developed countries are not repeated in new growth. In addition, businesses, through an agenda of corporate social responsibility, can help alleviate the hardship of the most vulnerable groups who stand to bear the brunt of much of the impacts of climate change.

INTRODUCTION

Businesses wishing to adopt a corporate social responsibility agenda can approach this from a number of different fronts:

• Reduce GHG emissions in their own countries by introducing green procurement, energy efficient processes and systems and rigorous GHG accounting.
• Provide assistance to developing country businesses through:
  
• Offering best technologies and best practices.
  
• Purchasing carbon credits to ensure developing country businesses are active in reducing emissions and making correct technology choices during their growth paths. The Clean Development Mechanism (CDM) is one such instrument.
  
• Joint Technology Development suited for large populations that does not repeat the mistakes made by the developed countries but charts new growth courses.
• Create an agenda for Corporate Social Responsibility (CSR) and:
• Help vulnerable groups in the developing countries who are subject to much hardship through no fault of their own. Those who earn US$1-2/day emit as little as 100 to 200 Kg of CO2 per year as compared to 4,000 Kg per person as global average and 8,090 kg y the EU.
• Provide risk protection and insurance to vulnerable groups.

A SECTORAL APPROACH WITH FINANCIAL INCENTIVES

Mainstreaming climate issues in development opens a vast number of opportunities for partnerships and collaborations. A sectoral approach with financial incentives and technology inputs is one favoured by many and especially suited for large countries, such as India, China and Brazil. Sectors can be classified into three categories: production, energy and consumption. Production sectors are those with large energy consumption, such as steel, aluminium, fertiliser and cement. Energy sectors include coal, power, renewable and nuclear. Consumption sectors include transport and building, including houses.

Production sector

Emphasis is on upgrading technology, Best Available Technology (BAT) or best practices (BP). Incentives may be required for such international technology cooperation initiatives for carbon savings.

In the steel sector, China is the world’s largest producer, accounting for nearly 35 per cent of world production. Indian consumption of steel has risen 14 per cent in the past 15 years, while global consumption grew at six per cent. Steel is a large GHG emitter; one tonne of steel releases around 2.7 tonnes GHG. The corporate sector can help develop acceptable baselines and there is no reason why global benchmarks cannot be established for steel, cement and aluminium.

Cement contributes five per cent of  total global CO2 with Asia Pacific countries accounting for 61 per cent of the world’s cement production. Opportunities to reduce CO2 from cement are found through the introduction and/or replacement of technology, primarily the wet kiln process, in favour of dry processing technologies, energy efficient technologies, process improvements, power generation from waste heat recovery and enhanced coprocessing of low grade primary fuels and industry wastes.

Energy sector

World total coal consumption is 6,100 million tonnes; the USA consumed 18 per cent of  the world’s total coal production in 2004 with Europe consuming 17 per cent. Asia Pacific Partners collectively generate approximately 65 per cent of world primary coal production. Improving the efficiency of the mining and processing of coal and improving the monitoring and control of coal mine methane gas can make a significant contribution to emissions reductions and workplace safety. Renewable energy and energy efficiency promotion can be a major area of cooperation.

Consumption sector

artnerships are needed to build nations. Good planning and design will be needed to fortify bridges, flyovers and major roads to ensure they withstand extreme events, high precipitation and dry periods. Construction companies and building material manufacturers must address this challenge in partnership with planners in developing countries.

Energy efficiency must become the prime criteria for manufacturing processes, products and purchase decisions for household appliances, industrial machinery and large scale infrastructure. Green procurements will have to be introduced to government procurement policy which normally favours the lowest bidder.

FRAMEWORK FOR A SOCIOECONOMIC AGENDA FOR POOR

Corporate social responsibilities need to expand to address climate change impacts. On one hand, the poor have to be lifted above poverty levels and on the other, GHG emissions must be significantly reduced. The conscientious corporate sector needs to recognise the debt it owes to the poor. But just who are the most vulnerable groups? Rural female populations in developing countries are still largely responsible for securing food, water and energy for cooking and heating. Drought, deforestation and erratic rainfall force this group to work harder to secure these resources. These are the most vulnerable groups to climate change.

Energy efficiency

Rural poor are already playing a role in using biomass, biogas, plantation and solar devices.

However, the poor should not be denied the use of fossil fuels, such as LPG or kerosene in the name of climate change. If the climate change problem requires the reduction of use of fossil fuels, then the wealthier have a key role to play. Disadvantaged people, without access to modern energy, are faced with problems relating to indoor air pollution and bear huge health burdens. Projects promoting renewable options should not leave poor people on the margins of decision making. Reducing vulnerability to climate change would mean finding appropriate technologies that take into account the specific socioeconomic realities of different rural areas, reduce workload, free up time and enable them to become micro or macro entrepreneurs.
Agriculture and food security

Climate change is predicted to reduce crop yields and food production in some regions, particularly the tropics. Women are responsible for 70–80 per cent of household food production. Traditional food sources may become more unpredictable and scarce as the climate changes thus invariably affecting women. Stronger public distribution systems will be needed that target such vulnerable groups.

Water and other resource shortages

Climate change may exacerbate existing shortages of water. Women, largely responsible for water collection in their communities, are more sensitive to the changes in seasons and climatic conditions that affect water quantity and accessibility, which makes its collection even more time consuming. The large river basins of the Niger, Senegal and Lake Chad as well as those of South Asia have experienced a 40-60 per cent reduction in the water level, according to UNEP figures. Water harvesting and storage systems will be needed to deal with shortages.

RISKS AND INSURANCE

Currently, the insurance sector is the world’s largest industry, generating about US$4 trillion in 2006. Hundreds of new insurance initiatives, including ‘green’ building credits, drought protection in developing countries and incentives for investing in renewable energy and carbon emissions trading are being offered to tackle climate change and weather related losses in the US and globally, according to a major new report announced at the annual conference of the International Association of Insurance Supervisors.
The report, commissioned by the nonprofit group Ceres, outlines more than 400 climate related activities in the US and abroad – double the number of products and services identified in a similar report just 14 months ago. The report observes that, despite the impressive increase in recent activity, most insurance companies are still not focused on the climate change issue and fewer still are offering climate related products.

• Among the recent offerings that show promise for customers and insurers alike are:
• Renewable energy related insurance products that allow more companies and investors to participate in renewable energy projects.
• Pay as you drive insurance products are now being offered by 19 insurers worldwide, who recognse that reduced driving means reduced accident risk, as well as reduced energy use. Tests have shown that PAYD products can reduce overall miles driven by
  10-15 percent or more.
• Munich Re and Swiss Re are offering microinsurance to parts of the developing world where insurance did not previously exist. Swiss Re created, the Climate Change Adaptation Program in 2007 that uses climate models and satellite data to determine when weather related claims are to be paid in response to severe drought conditions causing food shortages in villages in Kenya, Mali and Ethiopia. Swiss Re has also sold weather risk products to 320,000 small farmers in India.

These need to be extended to the developing world where such measures enable them to take risks to reduce GHG emissions. The dearth of innovative products that would reduce climate risks and preserve insurability for developing courtiers is a particular concern. A large number of people live on coastal zones and high temperature zones vulnerable to disasters.

PROGRAMMES, INSTITUTIONS AND POLICIES

There is a need for an integrated approach to climate change monitoring and adaptation based on livelihoods of vulnerable communities. An integrated approach would:

• Make and demonstrate a compelling case for alternative approaches to climate change adaptation based on reducing the danger from climate change to vulnerable groups.
• Promote natural resource-based approaches for the reduction of vulnerabilities and mitigation of climate change effects. Such approaches would provide multiple benefits such as generating immediate economic returns to poor people, sustaining and diversifying their livelihoods and conserving ecosystems.
• Offer convincing demonstrations of how on the ground livelihood activities can be linked with policy processes to reduce existing and future climate related vulnerabilities of poor.
• Identify multistakeholder, participatory processes for selection, implementation and appraisal of adaptation strategies.
• Critique and analyse the prevalent policy approach for addressing adaptation and the assumption that adaptation needs to focus on global rather than local processes.

The ultimate goal is to implement a socioeconomic model for sustainability as well as poverty reduction and conservation of biological diversity. Adaptation and vulnerability need to be mainstreamed into partnerships while maintaining the tempo for mitigation.
Adversity can bring people together and forge new partnerships among business, NGOs, governments and communities. Let us hope that conflicts give way to cooperation.

Improving the efficiency of the mining and processing of coal and improving the monitoring and control of coal mine methane gas can make a significant contribution to emissions reductions and workplace safety.

Author

Professor Jyoti K Parikh is Executive Director of Integrated Research and Action for Development (IRADe), New Delhi. She has worked for IPCC as a convening lead author and reviewing editor, served on Scientific and technical panel (STAP) for GEF and is on the Prime Minister of India’s Climate Change Council. She has served as energy, environment and climate change consultant to the World Bank, the US Department of Energy, EU and UN agencies such as UNDP, FAO, UNU and UNESCO.

Organisation

Integrated Research and Action for Development (IRADe) serve as a hub of network among various stakeholders. It carries out multidisciplinary, multistakeholder analysis in local areas such as Energy System, Climate Change, Natural Resource and Environment Management, Infrastructure, and Rural and Urban Management. IRADe works with government ministries and departments, bi-lateral and multi-lateral agencies like UNEP, UNDP, World Bank, national and international non-government organisations like SEWA, ENERGIA and Stanford University.

Enquiries

IRADe, C-50, Chhota Singh Block
Asian Games Village, Khelgaon
New Delhi - 110049, India
Tel: +91 11 26495522, 26490126
Fax: +91 11 26495523
E-mail: