The sudden evaporation of a goodly portion of the federal opposition's sitting members on Tuesday as the Prime Minister began introducing the bills of her government's Clean Energy Future package might betray a lack of consensus on carbon pricing among Australia's politicians, but it seems big business is well and truly present on the issue. A new major global report has found that the world’s largest listed companies are increasingly embracing climate change policies, regardless of – and even in spite of – broad-ranging uncertainty in politics. The 10th annual Carbon Disclosure Project (CDP) Global 500 report, put together in conjunction with global accountancy firm PwC, has examined the carbon reduction activities of the world’s largest listed companies through an in-depth analysis of 396 of the world’s largest companies, and has found that 68 per cent have climate change at the heart of business strategies, up from 48 per cent in 2010.
The report, Accelerating Low CarbonGrowth, which is due to be released Wednesday, also shows a significant rise in the number of companies reporting reduced greenhouse gas emissions as a result of various emissions reduction activities (45 per cent, up from 19 per cent in 2010). A correlation was also established between higher stock market performance over time, and representation on CDP’s Carbon Performance Leadership Index (CPLI) and the Carbon Disclosure Leadership Index (CDLI). Companies with a strategic focus on climate change provided investors with approximately double the average total return of the Global 500 from January 2005 to May 2011.
CDP's Director for Australia and New Zealand, James Day, said the results highlighted that, despite all the debate in Canberra, emission reductions are being made in large companies throughout the world. “This is the first time in the report’s 10-year history that the majority of responding companies have climate change actions embedded into their business strategies, as a result of growing Board-level awareness of the link between energy efficiency and increased profitability,” Day said. “It’s no longer a question of whether something should be done. Emission reductions are being implemented now by the directors and executives of the biggest companies in the world. Companies are acting for a variety of reasons, ranging from the need to reduce risks and reduce costs, to identifying new business opportunities in the transition to a low carbon economy."
CDP CEO Paul Simpson said that the report shows that it makes good business sense to manage and reduce carbon emissions. "This is a win-win for business – the short ROI many emissions reducing activities have, can help increase profitability. Companies yet to take action on climate change will have to work hard to remain competitive as we head towards an increasingly resourced constrained, low carbon economy.”And PwC's Alan McGill – a partner in sustainability and climate change – said that historical financial performance was being exposed as an outdated model to assess long-term business profitability and growth in the face of changing risks. "Today's investors have different information needs, which are leading to tougher verification regimes, more emphasis on executive and staffing responsibilities and incentives, and much more unforgiving examinations of the contribution of business to society. We are accelerating towards newer reporting models that better balance financial and non-financial performance.”
The report also shows that Australia is performing well on the global stage with Westpac Banking Corporation in the top 10 companies recognised in both the Carbon Disclosure Leadership Index and the Carbon Performance Leadership Index. National Australia Bank (NAB) was also recognised in both the Carbon Disclosure Leadership Index and the Carbon Performance Leadership Index. Thirteen Australian businesses were of sufficient size to be included in the report. A detailed report on the disclosures made by ASX200 companies to investors will be released in November.
Innovation regression
And while Australian businesses might be on the right page in terms of carbon disclosure, they will have to lift their game on the innovation front – an area considered rather crucial to the development of a healthy low-carbon economy. A new report released late last week by the World Economic Forum shows Australia continues to lag on the scale of global competitiveness – slipping to 20th spot on the WEF's Global Competitiveness Index 2011-2012, from 16th last year and 15th the year before. The report said Australia was falling behind stronger nations in areas of business innovation (22nd) and sophistication (29th), two drivers it described as “critical" to the competitiveness of "advanced economies." This contrasted with what the report described as Australia’s “most notable advantages,” being its efficient financial system, and one of the most stable banking sectors in the world.
“By all measures Australia is falling behind on innovation," GE Australia's ecomagination director Ben Waters said in response to the report (GE came to a similar conclusion on this subject earlier this year after the release of its Global Innovation Barometer). "Yet innovation and a creative approach to addressing the newest business problems, such as a need to reduce carbon emissions, will be crucial to international business competitiveness," he said. “There seems to be a perception in Australia that innovation should be driven by hard science and is the sole remit of large companies or governments. This view is outdated. In reality, innovation globally is increasingly driven by small-scale creativity from individuals and SMEs. It’s also driven by partnerships and collaboration, where organisations – both public and private – partner to focus on addressing human needs in the belief that lasting competitiveness will derive from solving the big problems. Access to technology and the need for integration have been the great levellers in the innovation playing field – there’s no reason that every Australian individual or business with the drive can’t be involved.
European countries continued to show a strong performance in the rankings – with seven nations featuring in the top 10, including Switzerland (1st), Sweden (3rd), Finland (4th), Germany (6th), Netherlands (7th), Denmark (8th) and the UK (10th) – despite slow decelerating growth throughout the region. High unemployment and increased financial vulnerability decreased growth in Japan (9th), United States (5th) and Europe. Meanwhile, Singapore held its 2nd-place ranking on the index, while China moved up one place to 26th. The US, having fallen to 5th place from 4th last year, ranked poorly in several crucial areas, such as trust in politicians (50th), ability to maintain relationships with the private sector (50th) and the government spend was reported to highly wasteful (66th). China, the world’s fastest growing economy, moved up one place to 26th, despite a long prolonged period of inflation. According to the report, the world’s most populous nation has a favourable macroeconomic situation and is within 10 places of Australia in business innovation and sophistication. India and Brazil, the world’s two other fastest growing economies featured 56th (down five places) and 53 (up five notches) respectively.
US PV OK
While US-based solar manufacturers struggle to survive, the nation's commercial-scale development is experiencing somewhat of a boom, as the cost of solar panels continues to head down towards the $US1 per watt threshold. Climate Progressquotes new analysis by SolarBuzz that shows America's non-residential PV pipeline (ie. projects in all stages of development) has increased from 17,000MW to 24,000MW in two months. According to earlier analysis by GTM Research and the Solar Energy Industries Association, the scale started tipping on cheaper US PV in 2010, when the cost of installed solar panels dropped by 20 per cent, driven by the increase in size of projects and the decrease in module and hardware prices.
US-based First Solar and SunPower are heading current supply to the non-residential projects, while production has largely been moved off-shore to Asia. At the end of 2011 it is widely believed there will be 50,000MW of manufacturing capacity, most of it being developed in China and other Asian nations. Still, despite the fact that many of the modules are being sourced from outside the country, these domestic installations provide enormous value to local economies, says Climate Progress, with around 73 per cent of the total value of a solar system staying in the US, according to a recent study from GTM Research. And while America's installed capacity currently represents only 5 per cent of the global market, SolarBuzz expects total market activity to double this year, matching last year’s 102 per cent growth and possibly giving the US a 12 per cent share of the global market by 2015.
Wind, by popular demand
Dutch homeowners who want to use green energy but are unable – or unwilling – to fit out their own homes with its own renewable power source, now have another option: the chance to secure part-ownership of a local windmill and a proportionate amount of the green energy it produces. A brainchild of the Dutch Energy Cooperative, with support from the Doen Foundation, the project is being run by local outfit Windcentrale which, according toSpringwise.com, has divided up a single windmill’s output into units with an expected wind output of 500kWh each per year. Interested parties can purchase one or more units to meet their household's annual power needs, which average about 3500kWh. Power is delivered through the local utility, and on wind-free days is supplemented with its traditional electricity supply. It's also a great solution for renters, because if people move they can take their shares with them. Windcentrale is currently accepting email addresses of interested Dutch consumers – it needs at least 3,000 and hopes to begin operation of its windmill in Goeree Overflakkee in 2013. Meanwhile, the company is looking for other projects that can be operated similarly.
The sudden evaporation of a goodly portion of the federal opposition's sitting members on Tuesday as the Prime Minister began introducing the bills of her government's Clean Energy Future package might betray a lack of consensus on carbon pricing among Australia's politicians, but it seems big business is well and truly present on the issue. A new major global report has found that the world’s largest listed companies are increasingly embracing climate change policies, regardless of – and even in spite of – broad-ranging uncertainty in politics. The 10th annual Carbon Disclosure Project (CDP) Global 500 report, put together in conjunction with global accountancy firm PwC, has examined the carbon reduction activities of the world’s largest listed companies through an in-depth analysis of 396 of the world’s largest companies, and has found that 68 per cent have climate change at the heart of business strategies, up from 48 per cent in 2010.
The report, Accelerating Low Carbon Growth, which is due to be released Wednesday, also shows a significant rise in the number of companies reporting reduced greenhouse gas emissions as a result of various emissions reduction activities (45 per cent, up from 19 per cent in 2010). A correlation was also established between higher stock market performance over time, and representation on CDP’s Carbon Performance Leadership Index (CPLI) and the Carbon Disclosure Leadership Index (CDLI). Companies with a strategic focus on climate change provided investors with approximately double the average total return of the Global 500 from January 2005 to May 2011.
CDP's Director for Australia and New Zealand, James Day, said the results highlighted that, despite all the debate in Canberra, emission reductions are being made in large companies throughout the world. “This is the first time in the report’s 10-year history that the majority of responding companies have climate change actions embedded into their business strategies, as a result of growing Board-level awareness of the link between energy efficiency and increased profitability,” Day said. “It’s no longer a question of whether something should be done. Emission reductions are being implemented now by the directors and executives of the biggest companies in the world. Companies are acting for a variety of reasons, ranging from the need to reduce risks and reduce costs, to identifying new business opportunities in the transition to a low carbon economy."
CDP CEO Paul Simpson said that the report shows that it makes good business sense to manage and reduce carbon emissions. "This is a win-win for business – the short ROI many emissions reducing activities have, can help increase profitability. Companies yet to take action on climate change will have to work hard to remain competitive as we head towards an increasingly resourced constrained, low carbon economy.”And PwC's Alan McGill – a partner in sustainability and climate change – said that historical financial performance was being exposed as an outdated model to assess long-term business profitability and growth in the face of changing risks. "Today's investors have different information needs, which are leading to tougher verification regimes, more emphasis on executive and staffing responsibilities and incentives, and much more unforgiving examinations of the contribution of business to society. We are accelerating towards newer reporting models that better balance financial and non-financial performance.”
The report also shows that Australia is performing well on the global stage with Westpac Banking Corporation in the top 10 companies recognised in both the Carbon Disclosure Leadership Index and the Carbon Performance Leadership Index. National Australia Bank (NAB) was also recognised in both the Carbon Disclosure Leadership Index and the Carbon Performance Leadership Index. Thirteen Australian businesses were of sufficient size to be included in the report. A detailed report on the disclosures made by ASX200 companies to investors will be released in November.
Innovation regression
And while Australian businesses might be on the right page in terms of carbon disclosure, they will have to lift their game on the innovation front – an area considered rather crucial to the development of a healthy low-carbon economy. A new report released late last week by the World Economic Forum shows Australia continues to lag on the scale of global competitiveness – slipping to 20th spot on the WEF's Global Competitiveness Index 2011-2012, from 16th last year and 15th the year before. The report said Australia was falling behind stronger nations in areas of business innovation (22nd) and sophistication (29th), two drivers it described as “critical" to the competitiveness of "advanced economies." This contrasted with what the report described as Australia’s “most notable advantages,” being its efficient financial system, and one of the most stable banking sectors in the world.
“By all measures Australia is falling behind on innovation," GE Australia's ecomagination director Ben Waters said in response to the report (GE came to a similar conclusion on this subject earlier this year after the release of its Global Innovation Barometer). "Yet innovation and a creative approach to addressing the newest business problems, such as a need to reduce carbon emissions, will be crucial to international business competitiveness," he said. “There seems to be a perception in Australia that innovation should be driven by hard science and is the sole remit of large companies or governments. This view is outdated. In reality, innovation globally is increasingly driven by small-scale creativity from individuals and SMEs. It’s also driven by partnerships and collaboration, where organisations – both public and private – partner to focus on addressing human needs in the belief that lasting competitiveness will derive from solving the big problems. Access to technology and the need for integration have been the great levellers in the innovation playing field – there’s no reason that every Australian individual or business with the drive can’t be involved.
European countries continued to show a strong performance in the rankings – with seven nations featuring in the top 10, including Switzerland (1st), Sweden (3rd), Finland (4th), Germany (6th), Netherlands (7th), Denmark (8th) and the UK (10th) – despite slow decelerating growth throughout the region. High unemployment and increased financial vulnerability decreased growth in Japan (9th), United States (5th) and Europe. Meanwhile, Singapore held its 2nd-place ranking on the index, while China moved up one place to 26th. The US, having fallen to 5th place from 4th last year, ranked poorly in several crucial areas, such as trust in politicians (50th), ability to maintain relationships with the private sector (50th) and the government spend was reported to highly wasteful (66th). China, the world’s fastest growing economy, moved up one place to 26th, despite a long prolonged period of inflation. According to the report, the world’s most populous nation has a favourable macroeconomic situation and is within 10 places of Australia in business innovation and sophistication. India and Brazil, the world’s two other fastest growing economies featured 56th (down five places) and 53 (up five notches) respectively.
US PV OK
While US-based solar manufacturers struggle to survive, the nation's commercial-scale development is experiencing somewhat of a boom, as the cost of solar panels continues to head down towards the $US1 per watt threshold. Climate Progress quotes new analysis by SolarBuzz that shows America's non-residential PV pipeline (ie. projects in all stages of development) has increased from 17,000MW to 24,000MW in two months. According to earlier analysis by GTM Research and the Solar Energy Industries Association, the scale started tipping on cheaper US PV in 2010, when the cost of installed solar panels dropped by 20 per cent, driven by the increase in size of projects and the decrease in module and hardware prices.
US-based First Solar and SunPower are heading current supply to the non-residential projects, while production has largely been moved off-shore to Asia. At the end of 2011 it is widely believed there will be 50,000MW of manufacturing capacity, most of it being developed in China and other Asian nations. Still, despite the fact that many of the modules are being sourced from outside the country, these domestic installations provide enormous value to local economies, says Climate Progress, with around 73 per cent of the total value of a solar system staying in the US, according to a recent study from GTM Research. And while America's installed capacity currently represents only 5 per cent of the global market, SolarBuzz expects total market activity to double this year, matching last year’s 102 per cent growth and possibly giving the US a 12 per cent share of the global market by 2015.
Wind, by popular demand
Dutch homeowners who want to use green energy but are unable – or unwilling – to fit out their own homes with its own renewable power source, now have another option: the chance to secure part-ownership of a local windmill and a proportionate amount of the green energy it produces. A brainchild of the Dutch Energy Cooperative, with support from the Doen Foundation, the project is being run by local outfit Windcentrale which, according to Springwise.com, has divided up a single windmill’s output into units with an expected wind output of 500kWh each per year. Interested parties can purchase one or more units to meet their household's annual power needs, which average about 3500kWh. Power is delivered through the local utility, and on wind-free days is supplemented with its traditional electricity supply. It's also a great solution for renters, because if people move they can take their shares with them. Windcentrale is currently accepting email addresses of interested Dutch consumers – it needs at least 3,000 and hopes to begin operation of its windmill in Goeree Overflakkee in 2013. Meanwhile, the company is looking for other projects that can be operated similarly.