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Corporate Responsibility Under The Microscope

As we eagerly await the findings of the IPCC AR5, it is interesting to see how attitudes towards climate change have changed since the release of AR4 back in 2007. Back then, Delphis Eco was simply an idea, Tony Blair was still our Prime Minister and the smoking ban had only just been enforced. In the six years between now and then the interest in renewable energy and the shift towards greater corporate social responsibility (CSR) has been drastic and we believe that real progress is being made.

 

Early reports are suggesting the IPCC will lower their predicted range of warming from 2 to 4.5 degrees Celsius to 1.5 to 4.5 degrees. This, in my opinion is a reflection not only of better modelling and understanding of our climate, but in the progress made over recent years in already reducing carbon emissions. The UK has this year entered its second carbon budget period meaning that we are on course for a 50% reduction in carbon emissions from 1990 levels by 2025. This is a really fantastic achievement and one in which we think the progress will only accelerate.

 

A recent study conducted by the Climate Disclosure Project (CDP) in the USA (a country which did not ratify the Kyoto agreement) indicates this trend, and with Britain already ahead of the USA in terms of climate change mitigation, it is apparent that these trends can be witnessed here. The CDP states that companies are now beginning to realise the costs of climate change to their business, and in particular, the costs as a direct result of increasing amounts of extreme weather events. These extreme events are set to increase as the world warms, and it is this fear that appears to be driving more companies to make an effort to mitigate their contribution. In total a 6.1% reduction in emissions was calculated which has continued the trend of reduction that started in 2009. More importantly however, it was seen that companies now have a deeper understanding on climate change and the energy saving measures which they can put into place. The change in attitudes from companies however has primarily been driven by the attitudes of the consumer.

 

Individuals are now demanding more transparency from companies regarding their CSR policies as the environment has now become a factor in determining which product they buy. This is reflected in the CDP report which reveals that companies being proactive towards climate change and its challenges are now out-performing their less progressive, less innovative rivals. Being green has now not only become a necessity in terms of climate change, but now has become a real USP and growth opportunity for companies, with companies who do not show change becoming disadvantaged.

 

It is for this reason that we feel our initial progress in reducing CO2 emissions will only accelerate as the power of the consumer to dictate corporate strategy will only increase. There will be a shift away from price and product as the deciding factors in a purchase towards questions of transparency, supply chain and corporate responsibility towards mitigating climate change. This is something that we at Delphis Eco think is a wonderful trend and long may it continue.

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