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Climate Change and BusinessesClimate Change and BusinessesClimate Change and BusinessesProf. Sushil Kumar
Indian Institute of Management, LucknowProf. Sushil Kumar
Indian Institute of Management, Lucknow
Why has the term, ‘Corporate Environmental and/or Social Responsibility’, attained so much
of prominence these days?
Responsibility: A detachable burden easily shifted to the shoulders of God, Fate, Fortune, Luck or one's neighbor. In the days of astrology it was customary to unload it upon a star
~Ambrose Bierce, The Devil's Dictionary, 1911
Did Something Go Wrong?Bhopal Gas Tragedy
Chernobyl Accident
Seveso: Italian dioxin crisis
The 1952 London smog disaster
Oil spills
The Love Canal chemical waste dump
The Baia Mare cyanide spill
The European BSE crisis
Spanish waste water spill
Global Warming&
Greenhouse Gases
Global Warming&
Greenhouse Gases
Except for nuclear war or a collision with an asteroid, no force has more
potential to damage our planet’s web of life than global warming
Except for nuclear war or a collision Except for nuclear war or a collision with an asteroid, no force has more with an asteroid, no force has more
potential to damage our planetpotential to damage our planet’’s s web of life than global warmingweb of life than global warming
Corporate Environmental ManagementWMP
Class-1
Is Earth Really Melting???
Global Warming: Hoax or a Reality
Global Warming: Effects11 of the past 12 years are among the dozen warmest since 1850 (hottest being 2005)
Average temperatures have climbed 0.8 degree Celsius around the world since 1880
Extreme weathers
Earlier timing of spring
Increase in number of hurricanes, tornadoes
Increased evaporation, higher rainfall
Relocation of precipitation
Agriculture productivity
Recurrence of diseases
IPCC: 4th Report and other studies
Global Warming: Effects
Glacier retreat and disappearance
Global Warming: Effects
Sea level could rise between 7 and 23 inches (18 to 59 centimeters) by century's end, (IPCC 4th report )
Rises of just 4 inches (10 centimeters) could flood many South Seas islands and swamp large parts of Southeast Asia
Some hundred million people live within 3 feet (1 meter) of mean sea level, and much of the world's population is concentrated in vulnerable coastal cities.
IPCC WarnsAt some point in the future, warming could become uncontrollable by creating a so-called positive feedback effect
Emissions must start declining by the year 2015 to prevent the world’s temperature from rising more than 2 degrees Celsius over pre-industrialized temperatures
Only .12 percent of world GDP would be needed to stave off the harmful effects of climate changeONLY THING WE SHOULD BE AFRAID OF IS DOING NOTHING
Ecological Footprints
Ecological Footprint
The global Ecological Footprint - 14.1 billion global hectares in 2003, or 2.2 global hectares per person
The productive area of the biosphere translates into 11.2 billion hectares oe an average of 1.8 global hectares per person in 2003
USA – about 9.6 global hectares per person; UK – about 5.6; India – 0.8; Afghanistan <0.05
Source: Living Planet Report 2006
Humanity’s Ecological Footprint, 1961- 2003
Source: Living Planet Report 2006
Three Ecological Footprint Scenario, 1961-2100
Source: Living Planet Report 2006
Ecological Footprint by Component, 1961-2003
Source: Living Planet Report 2006
Ecological Footprint And Biocapacity By Region, 2003
What is the solution?
Source: Living Planet Report 2006
Sustainable Business: Triple Bottom Line
Sustainable Development
Social goals
Environmental goalsEconomic goals
Socio-efficiency
Eco-efficiency
Eco-justice
Profits are like breathing. You have to have them. But who would stay alive just to breathe?
- Maurice Mascaranhas
The task of holding global emissions constant would be out of reach,
were it not for the fact that:
• all the driving and flying in 2056 will be in vehicles not yet designed,
• most of the buildings that will be around then are not yet built,
• the locations of many of the communities that will contain these buildings and determine their inhabitants’ commuting patterns have not yet been chosen, and
• utility owners are only now beginning to plan for the power plants that will be needed to light up those communities.
Scientific American, 2006
WHY DON’T NATIONS SIT TOGETHER AND FIND SOLUTION?
The torrid economic growth of China and
India will elicit calls from industrial nations for
restraints on emissions, which will again be met by even more adamant retorts that citizens of
Shenzhen and Hyderabad should have the same opportunities to build their economies that those of Detroit and
Frankfurt once did
Scientific American, 2006
Climate Change and the Business Scenario
Six Green House Gases
carbon dioxide (CO2)methane (CH4)nitrous oxide (N2O)hydroflurocarbons (HFCs)perfluorocarbons (PFCs), andsulphur hexafluoride (SF6)
GHG Control: Two OptionsSinks
any process, activity or mechanism which removes a greenhouse gas, an aerosol or a precursor of a greenhouse gas from the atmosphere. Oceans, soils, & forests all offer some potential to be managed as a sink
SourcesBurning of coal, oil and natural gasDestruction of forestsRaising cattle andPlanting riceDisposal and treatment of garbage and human waste
Source: Innovest
Exposure to Carbon Risk
Carbon Neutrality
Global Business Environment
Cross-countries cost of environmental regulations compliance
Over 4000 laws & regulations in Germany and over 1000 in Australia
Voluntary Norms and Standards
Reporting Standards
Market Forces: Consumer Awareness
Global Supply Chain
Peter DarbeeCEO at PG&E
Speaking on climate change
“Leadership isn't about waiting for everybody to agree. Leadership is about doing the right thing and
doing it early”
We are made wise not by the recollection of our past, but by the responsibility for our future. ~George Bernard Shaw
Proactive Changes
Eco-efficiency Analysis
costscosts ((normalizednormalized))
EnvironmentalEnvironmental Impact Impact ((normalizednormalized))
1,01,0
1,01,0highhigh lowlowhighhigh
lowlow
Depending onthe position ofthe analysed product, different strategic recommen-dations are given.
bring to bring to marketmarket!!
reduce reduce environmental environmental impactimpact!!
developdevelopalternatives!alternatives!
reduce reduce costscosts!!
Source: http://corporate.basf.com/en/?id=V00-1AgGG8pXRbcp3*O
Learning from Nature
Biomimicry
Carbon Markets: Show Me The Money!
With KP, environmental concerns have become further
important to industry…
… because by being ‘green’
they can make money
Profits are like breathing. You have to have them. But who would stay alive just to breathe? ~ Maurice Mascaranhas
Most of us can read the writing on the wall; we just assume it's addressed to someone else.
-Ivern Ball
and Finally………
We have not passed that subtle line between childhood and adulthood until... we have stopped
saying "It got lost," and say "I lost it."- Sidney J. Harris
It is ethical and moral responsibility of each and everyone of us to avoid ‘mutually assured
destruction’
Thank You!