- Tackling climate change will require working toward shared goals such as developing solutions to scale carbon capture or decarbonize infrastructure.
- Achieving shared climate change goals will require focus from the private sector to scale proven technologies and mobilize needed capital.
- To be effective in tackling climate change, companies must redefine success and shift to shared goals to scale positive long-term change for the planet.
Most nations today recognize both the importance and the urgency of the battle against global warming; but there are still significant differences on how best to achieve net zero greenhouse gas emissions and how to share the cost of doing so. In the polarized world we unfortunately live in, this creates a lot of room for conflict – conflict between cultures, geographies and even generations. That, in turn, leads to an erosion of trust which not only slows our progress on fighting climate change but spills over into other social and political issues.
The corporate sector has a vital role to play in tackling climate goals and, ultimately, helping to build trust. Companies are more agile than governments and can marshal greater resources than communities can independently. However, companies must redefine success and shift to shared goals to scale positive long-term change for the planet. This shift – in mindset and approach – can foster the trust and support we’ll need to develop tactics and collaborations to achieve climate goals.
What’s the World Economic Forum doing about climate change?
Climate change poses an urgent threat demanding decisive action. Communities around the world are already experiencing increased climate impacts, from droughts to floods to rising seas. The World Economic Forum's Global Risks Report continues to rank these environmental threats at the top of the list.
To limit global temperature rise to well below 2°C and as close as possible to 1.5°C above pre-industrial levels, it is essential that businesses, policy-makers, and civil society advance comprehensive near- and long-term climate actions in line with the goals of the Paris Agreement on climate change.
The World Economic Forum's Climate Initiative supports the scaling and acceleration of global climate action through public and private-sector collaboration. The Initiative works across several workstreams to develop and implement inclusive and ambitious solutions.
This includes the Alliance of CEO Climate Leaders, a global network of business leaders from various industries developing cost-effective solutions to transitioning to a low-carbon, climate-resilient economy. CEOs use their position and influence with policy-makers and corporate partners to accelerate the transition and realize the economic benefits of delivering a safer climate.
Contact us to get involved.
The climate change challenge ahead
More than 130 nations have promised to reach net zero emissions by 2050 or even earlier. However, few have set out detailed roadmaps on how to get there. Even with all the new commitments made at last November’s COP26 summit in Glasgow, global temperatures will rise by at least 1.8°C above pre-industrial levels by 2050. If we do not implement those promises, then temperatures will rise by 2-3 °C, with potentially disastrous consequences for our planet.
Much change is needed to create sustainable systems and solutions – and quickly. Some priorities set by the IEA and other groups include:
- Decarbonizing existing infrastructure, such as helping utilities switch from coal and oil to cleaner natural gas and eventually zero-carbon fuels like ammonia and hydrogen;
- Scaling up carbon capture, utilization and storage technologies (CCUS) and building a value chain for CO2 from capture to transport, storage and utilization in industry;
- Building a similar ecosystem for hydrogen that also encompasses production, transport, storage and multiple applications in energy, industry and long-distance transportation.
Tackling goals like scaled carbon capture or decarbonizing infrastructure will require focus from private sector to scale proven technologies and mobilize needed capital. It will also require a shift from individual goals to shared goals.
Tactics to speed climate change action
Shared goals cannot be accomplished any one organization alone. They require collaboration and new tactics for working with others to maximize a range of capabilities that no one firm could offer on its own. These tactics include:
- Working with rivals. Such collaboration requires working closely with those the private sector would not have partnered with in other previous contexts to leverage domain expertise and the full range of a sector’s capabilities. For our part, this has meant working together with companies we would once have regarded only as competitors, as well as with start-ups, industry organizations and academic institutions.
- Shared data. Many new solutions and business models will depend on data that is shared data across sectors. This data can help provide a true, standardized picture of environmental impact and help leaders measure progress and accelerate action toward climate goals.
- New approach to competition. The nature of competition is shifting and to build resilient solutions that can sustain themselves, new partnerships will need to develop new business models, ones that make the most of capabilities built across many partners. While we need to keep some intellectual property secret in order to achieve a commercial return as a company, we are sharing more and more of our technology.
A good example is the recent public testing of our new proprietary CO₂ solvent at a third-party facility in Norway. We succeeded in capturing 95-98% of all CO₂ from the flue gas using this new solvent - this is well above the current industry norms. By sharing technologies like this, we hope to create a network of partners as well as setting the industry standard and opening up much larger commercial opportunities.
A new approach to build shared trust
For these partnerships and tactics to achieve results, openness and trust is critical. Such trust is a symptom of an acceptance that companies are deeply rooted in society and have a responsibility beyond their own individual balance sheet. I believe companies have this responsibility and must work for the overall happiness and progress of society – and do so consciously and explicitly rather than just blindly pursuing profit.
Have you read?
This is a heavy responsibility and the true meaning of what is often labelled ‘ESG’ or ‘sustainability’. Building this trust will require aligning on what I prefer to call ‘human capitalism’. This approach does not just celebrate the growth of any one country or company. This approach values driving shared, sustainable prosperity across generations. Such a mindset can help us envision new and different forms of success for the future, just on a global scale.
Not only do corporations need to listen to the views of their diverse stakeholders; they also need to understand that they can – and do – influence the behavior of customers, suppliers, employees, investors and the community at large – for better or worse. It is a two-way street.
This not a new idea, just one that has been out of favor in recent decades in certain developed economies. This new kind of thinking and investment will pay out important dividends and not just for nature and the planet. In particular, it can help us meet the needs of the young, whose natural anxiety about the state of the world has led many to become disaffected or simply disconnected. We can create systems that position these new generations for health and a sustainable future.
We should not only think of ourselves and the present moment. After all, humans are mortal but society is immortal. This will require us to think beyond the short-term – beyond data that provides quarterly or yearly snapshots. We will need to measure success with new metrics that protect people and planet for the long-term.
As leaders, we must communicate better. We need to inform all stakeholders about what we have already done, about our plans for the future and how these will affect them. We must not shy away from difficult questions and should accept sensible criticism and adapt. Increased openness will restore trust, allowing faster progress toward our common goals. The result will be a simple, virtuous circle. All participants must play their part as responsible citizens to create a better world.