Strategic response

Climate change is an increasingly significant business issue. It is important that companies understand their exposure to the problem and the potential impacts throughout their value chain.

  • There are increasing commercial, reputational and regulatory reasons for taking definitive action
  • Relative performance will be a critical issue once accepted standards become more widespread and clear benchmarking is available to analysts and customers

Early response is important to enable strategy and resources to be adapted as required to secure future competitive position. There will soon come a time when every company will actively consider climate change in every part of their business. There will be a tipping point once:

  • Businesses are at a major competitive disadvantage if not taking appropriate action: pressures from customers, investors, staff or supply chain are unavoidable
  • Regulative pressures are more widespread: the financial burden from tax or other penalties as a result of not being informed and acting accordingly will become too penal

The main reasons driving companies to take action are:

  1. Competitive pressures
    - Customers
    - Suppliers
    - Competitors
  2. External pressures
    - Investors
    - Regulatory
  3. Improved performance
    - Financial motives
    - Commercial opportunities
    - Operating efficiency
  4. Prudent management
    - Risk management
    - Employee concerns
    - Corporate responsibility