Climate change presents organizations with the need to redefine Corporate Social Responsibility (CSR) from a voluntary luxury to a necessity
By midcentury, climate challenges are expected to seriously disrupt business-as-usual and change the way citizens live their lives around the world. At the current rate of global greenhouse gas emissions, climate change could displace two billion people due to rising ocean levels and more severe weather, costing the U.S. economy billions of dollars, and causing upwards of 250,000 additional deaths per year — all before 2100. Indeed, many countries are already experiencing the vanguard of challenges and many organizations are planning for the projected risks they will face (e.g., limited clean water, expensive and unreliable energy).
Climate change challenges present organizations (e.g., companies, corporations, nongovernmental organizations (NGOs)), communities, and citizens with the need to redefine current views on corporate social responsibility from a voluntary luxury as being a necessity. Climate change is a challenge of unprecedented scale, without doubt the most momentous and pressing concern of the twenty-first century. But unlike economic transformations, technological breakthroughs or other disruptions, climate change affects all levels of society.
The three main lines of CSR, identified by John Elkington in 1994 as the triple bottom line–the three Ps of people, planet and profit–are commonly translated as social, environmental and economic. As the impact of climate change is increasingly felt, the environmental part of CSR is becoming increasingly important. With each day that passes it’s clearer that simply reducing carbon emissions is no longer enough, we need emergency measures that go much further.
Climate change impacts the business world on every level. As political momentum to achieve the Paris Agreement goals grows, new laws, regulations and emission trading systems are established. At the same time, customers increasingly expect firms to provide full transparency over their emissions targets and results and bring their performance into line with their ambitions. These external drivers create considerable new risks for companies, which are faced with making groundbreaking strategic decisions in a highly uncertain and volatile environment.
Business needs to shift to a new competitiveness paradigm in which climate action is the key determinant of future growth. This involves identifying the major external drivers that determine the company’s competitiveness in the new economy, and then managing those drivers appropriately. LSG can help your company respond to the climate challenges ahead while building or enhancing your CRS framework.