Report: Businesses must do more to slash carbon emissions
The world's largest companies are not doing enough to reduce their greenhouse gas emissions, says a new report entitled 'The Carbon Chasm', released by the Carbon Disclosure Project (CDP). The Intergovernmental Panel on Climate Change (IPCC) says developed countries' emissions should be reduced by at least 80% by 2050 to avoid the worst impacts of climate change. However, the CDP report reveals that the companies studied will not achieve this target until 2089 - 39 years too late. The study also finds that many companies are waiting to see the outcome of the UN Conference of the Parties (COP-15) in Copenhagen, Denmark before setting long-term targets. At COP-15, which will be held in December of this year, countries hope to agree on binding emissions reduction targets for the period after 2012. 'Most large companies now measure their carbon footprint and many have set carbon reduction targets. But how many of those targets are actually in line with the required reductions to prevent dangerous climate change?' commented Chris Tuppen, Chief Sustainability Officer at British Telecom (BT), which supported the report. 'The research highlights a significant gap between what is needed from the corporate sector and what's currently promised. We in the business world need to find a way of closing this carbon chasm.' The CDP is a not-for-profit organisation that gathers corporate climate change information from over 2,000 major businesses worldwide. This study drew on the latest data provided by 92 of the 'Global 100' (the world's 100 largest publicly quoted companies) in 2008. The CDP also carried out detailed interviews on target setting with executives from 12 of the Global 100 companies. The survey revealed that 73% of the Global 100 have some kind of emission-reduction target, meaning that over a quarter (27%) do not. The study found that targets are set on the basis of business factors, and not scientific evidence. Among other things, companies said that they set targets to reduce inefficiencies in operations, achieve cost savings and stimulate innovation as well as to minimise climate change impacts and prepare for future emission-reduction rules. Some companies also cited environmental concerns, and staff motivation and recruitment as factors driving their targets. The vast majority (89%) of targets have a target year; most (84%) of these targets are set for 2010 or 2012. Just five companies have targets running to 2020, and only one has a target to 2030. Furthermore, not all companies set a baseline year or starting date making it hard to determine whether a target has been reached. The report underlines the importance of setting long-term emissions-reduction goals, noting: 'The high proportion of targets which run to 2012 suggests that a global deal in Copenhagen is essential to provide businesses with more certainty on credible long-term reductions. Many companies report to CDP that the outcome of the COP-15 meeting in Copenhagen will have a significant impact on their long-term planning.' In addition, many targets are simply not ambitious enough. To cut emissions by 80% by 2050, an annual cut of at least 3.9% is needed. Going by the Global 100's current emissions target, emissions are set to fall by a mere 1.9% per annum. If they carry on at this pace, these companies will not achieve an 80% emissions cut until 2089. 'In essence the corporate sector is currently failing to deliver reductions in line with scientific requirements to stop dangerous climate change,' the report reads. The report recommends that all companies set greenhouse gas emission reduction targets, with clear baseline and target years. These targets should be based on the latest scientific advice from the IPCC. For their part, governments must agree on clear medium- and long-term emission-reduction targets in Copenhagen, to provide businesses with the framework they need to set targets. 'While 73% of Global 100 companies have set some form of reduction target, the majority need to be far more aggressive if they are to achieve the long-term reductions required,' said Paul Dickinson, CEO of the CDP. 'This is a time of huge opportunity for businesses to gain competitive advantage by reducing their own impact on the climate and benefit from associated cost savings, as well as sparking major innovation around the production of new, lower carbon products and services.'