The term “climate change” refers to changes in long-term trends in climate that have been caused by human activity. Since the Industrial Revolution, the extensive burning of coal and petroleum has resulted in large amounts of carbon dioxide being emitted to the atmosphere. Extensive land clearing has had similar results.
Climate change is emerging as one of the most significant risks facing the Australian economy. Increasingly, shareholders, younger employees and investment managers are asking companies about their policies around climate change. Prudent, long-term planning is essential to mitigate its adverse impacts and exploit the opportunities presented by the new environment.
Existing supply chain management practices have traditionally focused on cost, service and quality. The new requirement to manage carbon emissions has resulted in carbon being the fourth criteria. With the possibility of a price on carbon, new opportunities arise for companies to exploit a competitive advantage by effectively managing carbon in the supply chain and to work strategically with their suppliers.
The legislation for the CPRS was rescinded by the Abbott Government in 2014, but we provide this information for historical purposes. The Rudd Government proposed an emissions trading scheme in 2008 as its central policy response to persuade Australian businesses to reduce their greenhouse gas emissions. The scheme is based on a cap and trade system.
Many major organisations in Australia require large amounts of energy to operate. Those involved in power generation, smelting and manufacturing consume the most energy. Substantial opportunities exist for organisations to reduce the expenditure on energy through the introduction of energy efficiency improvement programs.
New sustainability initiatives introduced into organisations require clear communications and energetic support from all levels of employees. This article explores the benefits of enlisting individuals within organisations (known as Champions) who can enthusiastically support and lead initiatives to bring about changes in company thinking and enable organisational change. These Champions emotionally and materially support ideas and projects and will sell these ideas to both the company and to the wider public.
The term “carbon footprint” refers to the amount of pollution an activity generates. It can be ascribed to a manufacturing, a service or a transport activity – or to an individual. It is typically measured by totalling up the quantity of greenhouse gas pollutants emitted by the activity over a year or the life of a product.
Rapid changes in market dynamics have a material impact on the success of businesses. International agreements to limit global warming will restrict the amount of fossil fuels that can be burned in the future. This may create difficulties for the fossil fuel industry, including ‘stranding’ assets.
Author: Ben Scheltus, CEO, Climate Alliance Limited
Re-printed with the kind permission of the Governance Institute Australia
