From our review of over two thousand climate positions statements, we found that companies are now routinely acknowledging their acceptance of climate science. For instance, they routinely acknowledge that rising concentrations of CO2 are causing climate change and that human activities are driving this trend. They also acknowledge that climate change is increasing the occurrence of extreme weather events and that as a result the global community is now threatened by significant and potentially irreversible social, environmental, and economic repercussions.
Example 1: "We recognise scientific work undertaken by the Inter-Governmental Panel on Climate Change in its Fifth Assessment Report. Consequently, we accept that the global climate is changing due to human actions, principally the burning of fossil fuels, and that it will continue to change throughout the 21st century"4 (Old Mutual)
Example 2: "The accumulation of greenhouse gases (GHGs) in our atmosphere has led to noticeable changes in natural systems, including changes to migration patterns and growing seasons. Ocean acidification and increasing ocean temperatures are damaging marine ecosystems. Rising sea levels are increasing risks to coastal communities and commercial facilities. Further still, the increased frequency and severity of extreme weather events are putting many more at greater risk, irrespective of location"5 (Dell)
Example 3: "According to UN's Intergovernmental Panel on Climate Change (IPCC), the average surface temperature has risen 0.6-0.9 of a degree Celsius worldwide in the past century, and consequences have already been observed across continents and oceans. The International Monetary Fund estimates that further increases in temperature may pose the largest threat to the world economy in the 21st century, and scientists and organisations such as IPCC believe that only substantial and sustained reductions in greenhouse gases will stop global warming"6 (Danske Bank)
Going forward, we expect that climate position statements that do not explicitly acknowledge their acceptance of climate change and its impacts will be viewed with skepticism by stakeholders, including investors. Further, as more municipalities and nations declare climate emergencies, companies will face growing pressure to articulate a position on how they will respond.
Corporate sustainability leaders are clearly articulating their understanding of the pace at which climate action needs to be taken and the scale of the global transition required to achieve it. Companies now routinely reference the International Panel on Climate Change (IPCC) scenarios, the Paris Agreement, and/or national climate reduction targets when explaining their understanding of relevant limits. In late 2018, the IPCC7 announced scientific consensus on the need for a 1.5 °C target, noting that hitting the 2 °C threshold would put millions more people at risk of death, poverty, water and food shortages, and displacement from rising sea levels, while increasing the odds of irreversible changes in our climate system. In the wake of this announcement, leading companies are now committing to holding temperature rise below 1.5 °C, which includes reducing emissions from 2010 levels by 45% by 2030, and aiming to reach net zero by 2050.
Example 1: "To reduce the risks and impacts of climate change, 194 countries signed the Paris Agreement, including and since ratified by Australia, committing to strengthen the global response to climate change by "holding the increase in global average temperatures to well below two degrees Celsius above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 degrees Celsius… [We] recognize the importance of limiting global warming to two degrees and that to do this global emissions need to reach net zero in the second half of his century."8 (Westpac)
Example 2: "…[A] growing number of scientists point out that the safe upper limit of global warming is 1.5 degrees Celsius, or around 350 ppm. Scientific research has revealed that the damage caused at a temperature rise of 2 degrees Celsius or more may be much greater than previously assumed."9 (ASN Bank)
Example 3: "The Carlsberg Group has worked with Carbon Trust, the independent not-for-profit expert, to set science-based targets for emission reductions at a level that would contribute to limiting global warming to 1.5 °C, the higher level of ambition contained within the Paris Agreement… 'Just getting better is no longer good enough. Carlsberg's ambitions go above and beyond the levels of carbon reduction that science tells us are necessary to keep global warming below 2 degrees Celsius."10 (Carlsberg Group)
Ideally, your position statement should reference your climate scenario analyses work to explain how your company is conceptualising limits for climate change and to explain your rationale for the limits that you have selected.
The majority of climate policy statements acknowledge that action must be taken at a global level to reduce atmospheric CO2, with many companies calling upon governments to create policy frameworks or voicing the need for industry-wide action. We found that leading statements were more specific about the company's role in influencing and collaborating with communities, governments, partners, and competitors, both towards building capacity to address climate change (internally, and within their value chain) and in developing, implementing, sharing, and encouraging reduction plans.
Example 1: "To effectively address such a vast range of impacts, mitigation and adaptation strategies must link regional, national and sub-national efforts through collaboration with governments and policy bodies, public-private partnerships, and initiatives between commercial entities."11 (Dell)
Example 2: "Staying below a temperature rise of 2 °C will require a profound change in development models. This global challenge requires a multi-level approach combining governments, civil society and business efforts. Together we must cut emissions and work with farmers to build resilience to climate change."12 (Danone)
Example 3: "All African countries in which Nedbank operates have formally committed to addressing climate change as signatories to the Paris Agreement. South Africa in particular has unacceptably high carbon emissions and urgently needs to reduce its dependence on fossil fuels while adapting to unavoidable climate change impacts. It is the responsibility of all businesses - whether they are carbon-intensive or not - to collaborate with government and other stakeholders to help meet domestic and international objectives."13 (Nedbank)