What is the role of the private sector in the fight against climate change?
Before the start of the international climate talks at COP23 in Germany, the United Nations Environment Program published the 2017 edition of the Emissions Gap Report, the annual monitoring for the work undertaken by countries to reduce climate-altering gas emissions.
Inside it speaks of a "catastrophic climate difference", the report shows that we will be able to reduce only a third of the emissions to 2030 compared to what would be necessary to achieve the climate goals of the Paris Agreement.
Climate change is a global issue and the action of governments and institutions cannot be enough: this means that the private sector can play a major role in the fight against climate change, concentrating the activities of reducing emissions into low-cost options and conscious choice of financing in line with company objectives and mission.
Benefits for the private sector go far beyond reducing emissions: the voluntary carbon market and the role of voluntary compensation offer a low-emission sustainable development for all operational areas and a company's supply chains.
Carbon credits for sustainable development
Implementing a low-emission business strategy would allow companies to gradually transition to a "low carbon" economy. One of the tools to achieve these results is the use of Carbon Credits, these can be purchased by companies and organizations that they want to take voluntary actions.
Through the simple process of purchasing carbon credits, organizations direct finance to economies and ecosystems in great difficulty. This means that their funding is not only helping to mitigate climate change, but contributes to the concrete improvement of communities by ensuring an improvement in living conditions by guaranteeing social, economic and environmental benefits on a global scale.
In many cases, the adoption of such actions aligns with so-called corporate risk management. In 2017, nearly 500 companies reported to CDP (Carbon Disclosure Project) that they were interested in carbon price regulation. Measuring, reducing and compensating for emissions is not just a good business practice. Not only does it indicate the source and extent of future regulatory risk, but it also helps companies to prepare for such regulation by implementing a carbon price, which can reduce emissions before regulated costs are imposed.
Towards a climate leadership
Leadership in the fight against climate change is a real opportunity for many organizations, from a survey on buyers of the Marketplace Ecosystem 2016 has emerged that this is certainly one of the most common reasons for the purchase of carbon credits. Companies are trying to differentiate themselves from their competitors and build their brand, making it a true business opportunity.
Carbon Offset plays a key role in providing this climate leadership status, together with direct emission reductions. Climate change is a global and multi-decade challenge that requires solutions and input from all stakeholders.
The private sector must confirm its predominant role in achieving Carbon Neutrality with significant and long-term investments.