Climate Change

Five essential steps to take right now to tackle climate change

The sun appears behind Tereos sugar factory in Escaudoeuvres, France, November 19, 2019. REUTERS/Pascal Rossignol

Is the sun rising on a new world of climate action? Image: REUTERS/Pascal Rossignol

Robin Pomeroy
Podcast Editor, World Economic Forum
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Climate Change

This article is part of: World Economic Forum Annual Meeting
  • New report focuses looks at concrete steps possible to tackle climate crisis.
  • Governments, companies, individuals all have roles to play.
  • Technology exists, barriers to action are overstated, report says.

The climate crisis is bad news: the world is getting hotter and greenhouse gas emissions are still rising despite decades of warnings about the dire consequences. But a glimmer of good news is that we can act - right now - in ways that will start to address the problem.

In a new report, The Net-Zero Challenge: Fast-Forward to Decisive Climate Action, the World Economic Forum and the Boston Consulting Group set out clear steps that companies, governments and individuals can - or rather must - take. Here are five of them.

Have you read?

Companies and carbon

Companies have to reduce their carbon intensity - the amount of CO2 they emit per unit of production. The report recommends companies put a price on emissions:

"All should actively monitor and manage their climate-related risks and increase their efforts to achieve a 1.5-2°C world (for example, with internal carbon pricing), anticipating a future with more stringent policies and greater societal mobilization."

Company action on climate change
Three levers that companies need to pull. Image: World Economic Forum/Boston Consulting Group

And companies should seek out the opportunities posed by confronting emissions.

"Climate action is still too often perceived as a cost or a trade-off with other priorities. In light of the facts, it should be viewed as an opportunity," the report says.

"Most [companies] can develop new business models that contribute to achieving a low carbon economy and capitalize on the new value pools for 'green' products and services."

Share the technology burden

"Through cooperation in coalitions, companies can share the risks of technology development and coordinate related investments in the development of low carbon solutions," the report says, citing several examples where companies have collaborated to develop emissions reduction systems.

climate change - Ecosystems can help overcome barriers
Pooled resources. Image: World Economic Forum/Boston Consulting Group

Investor action

Investors can require climate action from the companies they put money into.

The report cites the example of Climate Action 100+ which has brought together a consortium of investors managing a total of $35 trillion to push for disclosure and emission reductions in their portfolio companies.

But it sounds a note of caution: "On a global scale ... the impact of investor pressure is still not sufficient. In one-on-one interviews, CEOs say the pressure to deliver short-term returns by far exceeds any demands for long-term decarbonization. Unless this trend changes, CEOs will have little incentive to take decisive action."

Regulation

Voluntary action will not be enough to solve the climate crisis.

"While many large companies have been motivated to act progressively on climate change thanks to public scrutiny and the desire to differentiate their brands vis-à-vis consumers, employees and investors, the long tail of companies that undergo little or no public scrutiny is significant," the report says.

Paris targets are not achievable without policy action
Why voluntary action is not enough. Image: World Economic Forum/Boston Consulting Group

"Ultimately, time has run out. Past inaction has dramatically increased the pace at which the world needs to decrease emissions. Complying with 1.5-2°C pathways would require drastically reducing emissions in the next decade. Voluntary action and unregulated markets will not deliver that shift. Hence, governments need to step in to drive the change"

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What’s the World Economic Forum doing about climate change?

Individual action

Each of us can make more climate-friendly choices: low-carbon homes, transport and diets for example. But even more important, perhaps, is our power as consumers, voters, leaders and activists.

"Individuals can impact political leadership – in their role as voters and by influencing public opinion. They can work 'within the system' to drive change, in businesses, governmental institutions, non-governmental organizations and schools. Demonstrations, principally among the youth – who will soon join the voting population – have had impact at the national and international levels, and could continue to be a catalyst for climate action."

Significant barriers to broader and bolder corporate climate action
Significant barriers to broader and bolder corporate climate action Image: World Economic Forum/Boston Consulting Group

The report, based on interviews with 24 CEOs and executives and 13 climate experts, concludes:

"The coming decade will determine whether humanity retains a fighting chance to limit warming to 1.5°C or even 2°C. The later action is taken, the more dire our position will become. The technologies for a low-carbon transformation are largely available, the barriers to action are vastly overstated and the consequences of inaction are well known."

You can follow all the sessions from the World Economic Forum's Annual Meeting in Davos here, and see news and views on the meeting across social media using the hashtag #WEF20. Highlights about the environment will appear here. And you can submit your own ideas on the environment - and six other ways to make the world a fairer place - here.

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The views expressed in this article are those of the author alone and not the World Economic Forum.

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