IPCC Report Reveals Urgent Need for CEOs to Act on Climate

Oct 10, 2018 10:55 AM ET
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The Intergovernmental Panel on Climate Change (IPCC) released a sobering report this week detailing the dramatic effects of climate change and the immediate steps we need to take to make significant progress on limiting warming in the future. The report makes it clear that apathy and inaction are no longer viable options. Unprecedented action is needed by both the public and private sector to transform our energy, transportation and other systems around the world.

Could this report finally be the clarion call to our nation’s business leaders to take responsibility for ensuring a prosperous and clean energy future for all?

There has been encouraging progress to date, but much more needs to be done. Businesses have an essential role to play in building political will for action, which may be the biggest challenge of all. Moreover, new research shows corporate stakeholders want – and expect – climate leadership, including policy advocacy.

Consumers want brands to take stands

Today, consumers expect to hear what CEOs and companies think about issues that affect all of society. In fact, 86% of consumers believe companies should take a stand for social issues and environmental causes, according to new research from the Shelton Group.

This year’s annual Edelman Trust Barometer found that 84% expect CEOs to inform conversations and policy debates on one or more issues, while 64% thought that CEOs should take the lead on change rather than waiting for government to impose it. In the report’s executive summary, Bank of America CEO Brian Moynihan summed up the role of a modern-day CEO by saying, “Our job as CEOs now includes driving what we think is right.”

Corporate CEOs have the clout and credibility to lead the charge for climate action while our federal government lags behind – America is hungry for passionate business leaders who want to drive innovation while safeguarding our planet.

A recent national study by the Pew Research Center found a majority of Americans feel the federal government is doing little to protect our water (69%) and air quality (64%). And more than three out of five Americans (67%) believe the government is not doing enough to reduce the effects of climate change.

"In a world where they no longer expect the government to fix things, people are turning to corporate America to step in and do some good," said Peter Horst, founder of marketing consultancy CMO. "Consumers increasingly want to engage with companies whose values match theirs."

Further, investors and stakeholders are increasingly scrutinizing companies’ engagement in public policy, and demanding consistency with their sustainability goals.

Corporate engagement on climate is on the rise

Thankfully, companies are beginning to stand up for the environment and climate policy, too. Recently, 21 business leaders at the Global Climate Action Summit announced the Step Up Declaration, an alliance to harness the power of new technologies to reduce greenhouse gas emissions. The declaration, developed by Salesforce and Mission 2020 with signatories including Bloomberg, Cisco and Uber, highlights a commitment to accelerate climate action not just within corporate boundaries but also with governments.

The Sustainable Food Policy Alliance is another promising step forward by four influential companies – Danone North America; Mars, Incorporated; Nestlé USA; and Unilever United States – that aims to leverage collaboration to inspire policy action that improves transparency for consumers, supports farm communities, and tackles climate change.

And when representative Carlos Curbelo (R-FL) introduced the MARKET CHOICE Act (H.R. 6463), a bill that would repeal fuel taxes and replace them with a carbon tax, 34 leading companies — including Campbell Soup Company, BP America, Shell, Dow Chemical Co., DuPont, National Grid, and General Motors — signed onto a letter thanking Rep. Curbelo for his leadership.

A step-change in business leadership is needed

True leadership requires courage and carries risk. However, staying quiet on an existential threat like climate change is far riskier. As the IPCC report makes clear, it is no longer enough for companies to tend their own sustainability gardens.

Businesses must work together to improve sustainability across their supply chains and to support public policies that ensure a thriving economy and a healthy planet. Climate change is the defining global challenge of our time. We know what we need to do to meet the challenge; all that’s missing is political will.

CEOs can and must change that, by making climate action a top priority in their policy advocacy in state capitals and in Washington, DC. Who will be first to truly lead on climate?