As we bid farewell to a tumultuous 2021, and crash into an already challenging 2022, one could be forgiven for thinking that the ever-evolving COVID-19 situation, and its associated chaos, will remain the biggest global challenge for years to come.
But behind the surging daily case numbers, the climate crisis continues to intensify, and the disruption arising from the emerging consequences of climate change will eventually dwarf anything we’re currently experiencing.
And while this disruption has the potential to cause unspeakable and widespread devastation, it similarly holds enormous potential for the businesses and innovators building creative products and solutions to help mitigate it. Even more broadly, businesses of all kinds have a role to play in minimising their impact and positively contributing to the race towards net zero. It’s fair to say that it’s well and truly time for this mindSHIFT in relation to climate change.
COP26: the writing is well and truly on the wall
At the end of 2021, governments from almost every country, alongside the world’s leading scientists, activists and business leaders, converged in Glasgow for COP26 in what was touted as the world’s last chance at keeping 1.5°C of global warming within reach.
But was this actually achieved? The answer: it’s a little complicated.
The final agreement was heavily criticised, because insufficient countries expanded their 2030 ambitions enough to keep temperatures under the threshold. But the agreement still signalled a clear gear shift in the global move towards net zero, with some major global agreements signed into effect. More than 140 countries pledged to end deforestation, mobilising $US12 billion in forest related finance. Other pledges made at the conference mean that 90% of the world’s GDP is now attached to countries with strategies to achieve net zero by 2050. These are big achievements which shouldn’t be overlooked.
And on the pressing matter of keeping temperatures within 1.5°C to avoid the worst physical impacts, signatories have agreed to urgently review and raise their targets ahead of next year’s conference, meaning that all hope is certainly not lost. It also means that the next 10 months in the lead up to COP27 in Egypt will be supercharged by efforts for countries to decarbonise their economies even faster. Excitingly, this energy will create fertile opportunities for business to get involved in the process too.
Post COP26: implications for business
So what does this all mean for business and the business community?
Firstly, no matter what you and your business do, you should be thinking about the carbon footprint of your operations. Simple calculators, like this one, are a good place to start if you’ve never measured your emissions before. Global agenda setting events like COP have a trickle down effect on how governments will act and legislate in the years to come, so business should take note that the tide has well and truly turned and make sure it is operating accordingly.
Specifically, it would be pertinent for businesses to heed warnings about the decisive shift from fossil fuels like coal and gas, to the acceleration of electric and renewable alternatives. By examining value chains, and decarbonising them where possible, businesses can not only avoid the penalties that are sure to come in future legislation, but they can also capitalise on the economic opportunities associated with being early adopters.
Global finance has also well and truly come to the table in the race to net zero, meaning that there is abundant capital available to finance decarbonisation products and services. The time to act is now for startups, scale ups and established businesses working across future food production, energy and transport to name but a few. Hundreds of billions of dollars of global green finance are being mobilised by governments and private equity, with this set to ramp up considerably in the coming years. If that’s not an exciting opportunity, we don’t know what is.
And speaking of opportunities, the momentum off the back of COP has only accelerated what was already a growing consumer interest in being aligned with brands and businesses not just doing their part, but leading the way. This demand gives decarbonising organisations a clear competitive edge, and one that they can use to attract more customers.
But business should not just be thinking about customer growth. At a more granular level, businesses that lack a clear plan to decarbonise may fail to attract up-and-coming young talent, for whom climate change is a major determining factor in where they work.
In spite of these challenges, the business community is still uniquely positioned to capitalise on the changing landscape that climate change presents. Not only can businesses generally move faster and more nimbly than governments, but they also have a direct line to their customers in ways that governments merely wish for. That is a powerful force, especially in a time characterised by so much uncertainty.
Helping you navigate the mindSHIFT on climate change
At the outset, we understand that such monumental shifts can seem a little overwhelming. Indeed, we find that most forms of major disruption are overwhelming. But finding the opportunities in disruption is our bread and butter at Disruptors Co, so remember that we’re here to help you navigate them.