Climate a business issue, but action lacking according to McKinsey. The survey found that 60% of executives believe climate change is important to consider as part of their companies' strategy. 70% see it as important for managing corporate reputation and brands, while over half say it is important to account for climate change in product development, investment planning, and purchasing and supply management.
Climate a business issue, but action lacking according to McKinsey
Environmental Finance, 7 February 2008 - Business leaders across the globe believe climate change is an important consideration, but few appear to have taken significant action to cut company greenhouse gas (GHG) emissions, according to a survey by consultancy McKinsey.
The survey found that 60% of executives believe climate change is important to consider as part of their companies' strategy. Seventy percent see it as important for managing corporate reputation and brands, while over half say it is important to account for climate change in product development, investment planning, and purchasing and supply management.
Around a third of respondents say their companies place more emphasis on climate change than on most other global trends – this is particularly true for executives of energy and publicly-owned companies, and organisations with revenues greater than $1 billion.
One third of respondents also view climate change as representing an equal balance of opportunities and risks. Indeed, 61% of respondents view the issues associated with climate change as having a positive effect on profits if managed well. Respondents in Europe are the most optimistic, while those from developed Asian countries least so.
However, few executives have taken action to tackle climate change. More than 60% of companies where respondents consider managing environmental issues to be at least somewhat important have failed to define emission targets for GHGs, and 15% don't know if their companies have set targets.
More than 80% of business leaders expect some form of climate change regulation to be introduced in their company's home country within five years. Among respondents in countries where regulation has not already been enacted, those in the developed Asia-Pacific region anticipate regulation soonest, with one-third expecting it within one to two years.
Six in 10 executives say they expect regulation in the form of technical standards, while half anticipate either a carbon cap-and-trade system or a carbon tax. Executives in energy and manufacturing companies are most likely to anticipate a negative impact on profits from climate change regulation, while 40% of all respondents expect regulation to have no material effect.
The survey, carried out in December, was based on responses from 2,192 executives around the world, of which one quarter were CEOs or “other C-level executives”.
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