Business and Government Must Come Together for Strong Climate Action

It’s time for businesses and governments to step up to the climate challenge and match words to actions.

This week at the annual international climate talks in Warsaw, companies, policymakers, and civil society participated in an event to deepen business engagement on climate policy. Such interaction could not have come at a more critical time.

Global emissions are on the rise. And last year, climate and extreme weather events alone cost $200 billion.

The world clearly needs to accelerate its response to the climate challenge. Businesses and governments need to work together constructively to raise the level of action and ambition. That means policymakers step up to provide a strong market signal and support, while companies come to the table with clear, public, constructive input.

We know that businesses understand the risks. When recently polled at the World Economic Forum in Davos, businesses ranked rising greenhouse gas emissions as one of the top three global threats.

Businesses need support from policymakers. Better policies can provide greater certainty for low-carbon investments. Policies can also help by enhancing communities’ resilience in the face of extreme weather events and related climate risks.

Policymakers likewise need the private sector. The world needs significant financial muscle to shift $5 trillion in business-as-usual investments toward sustainable investments. Businesses can also build resilience and expand awareness across industry, supply chains, and their customer base.

The benefits are clear – and yet we are simply not seeing the response that we need.

Inconsistent Support

Since the major risks from climate change began to emerge some 20-odd years ago, companies have worked to influence government positions in national and international policy discussions. But, the record is quite mixed.

The truth is that companies say they want long-term policies and climate action, but their policy engagement is inconsistent and, at times, contradictory. In fact, a recent UN Global Compact survey found that only 30 percent of companies have aligned their traditional government affairs activities with corporate responsibility commitments, like action on climate change.

And while there are a few promising examples of business support, those voices that oppose climate action– including many influential business associations and trade groups– are much louder and more united.

Changing Direction

What can we do to change direction?

A new report from UN Global Compact, WRI, Ceres, CDP, WWF, The Climate Group, UNFCCC and UNEP outlines practical actions for a company to be a constructive voice in climate change policy debates. It focuses on three main business actions: 1) Identify implications, influences, and opportunities to engage; 2) Align words with actions, ambitions, and influences (both direct and indirect); and 3) Report on policy positions, influences, and outcomes.

The report offers an important framework for companies to be a positive influence on public policy, but results rest on companies’ and policymakers’ willingness to take on the responsibility--and hold each other accountable—for constructive dialogue and action.

3 Ways to Walk the Talk

Here are three ideas for how businesses and policymakers can work together to advance this goal:

Match words with actions. Businesses should ensure that their words are consistent with their corporate and lobbying actions. They should instruct their direct and indirect influences (such as trade groups) to deliver consistent actions. They should be more forthcoming with clear actions—backed by transparent and quantifiable targets and goals—and policy positions that are consistent with international ambitions to keep global warming below 2 degrees Celsius. That includes measuring and reporting on the full scope of their emissions, as well as disclosing policy positions and objectives through reporting measures such as CDP, UNGC, and others.

Find and support natural leaders. Governments should support individuals and industries that are ready to lead the change we need. Policymakers should reward companies that publicly commit to bold action. They should create incentives for companies that embrace sustainability, like renewable energy, greater efficiency, and related low-carbon strategies. Policymakers should respond with clear and strong long-term policies that create a safe operating environment for investments and goal-setting. Mexico, for example, has found constructive partners among industry voices to help shape housing, building, and construction policies, among other sectors.

Create a safe space to talk. Further, both sides need to talk candidly about the risks and opportunities. They can find common ground if they listen closely. Bear in mind that decisions should be transparent. And policy decisions should be driven by the best objective evidence available.

Time to Shift the Approach

The time for timidity and half-hearted measures is over. With each new super-storm, drought, or deluge, we are reminded of the growing risks in our changing world. It’s time to shift the conversation and get on with the action.