Explicit support for a strong climate policy to emerge from the upcoming Paris climate summit;
Pledged commitment to climate action, including $140 billion in new low-carbon investment and more than 1,600 megawatts of new renewable energy generation; and
A second round of additional businesses expected to sign the pledge this Fall.
I think this is fantastic – businesses taking action to reduce their environmental impact is a wonderful thing. But, what really stood out to me in the news articles about this initiative was a quote by Eric Schmidt of Google:
“We need the world’s political leaders to confirm that investments in clean energy are sound, and that the laws and policies meant to enable such investment will be designed for the long term.”
For all the praise I heap on businesses that they are best poised for action on climate because they are more nimble operationally and have funds more readily at their disposal, it’s necessary to remember that policy is a crucial piece of the climate action puzzle. Businesses need to have confidence that their investments in renewable energy and energy efficiency are going to pay off. When policy mandates action, it takes the risk out of the decision to invest in sustainability; it evens the playing field in that regard. Companies may be wary of taking action if there’s the possibility that political favor will shift away and start incentivizing behavior at odds with their sustainable investments.
For some reason, this pledge also reminds me of an important fact: businesses exist to serve the consumer. Yes, businesses need to make a profit, and in that way they are beholden to their shareholders; but they also need to listen to their consumers. These businesses are listening to the consumers that say climate action is important (68% of Americans say that corporations and industry should be doing “more” or “much more” to address climate change.[Climate Change in the American Mind: March 2015, p. 42]), and they are taking steps to mitigate their climate impact. So, this should also serve as a reminder that we, as consumers, need to communicate what we value to the companies we patronize – they can’t read our minds, as much as their marketing departments would hate to admit it!