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Governments Need a Businesslike Strategy to Tackle Global Warming

Juan Carlo Pascua | Tuesday 20th October 2009

This past weekend the MEF (Major Economies Forum) met in the UK. Seventeen of the major greenhouse gas emitting countries discussed strategies for the upcoming climate conference in Denmark. Maybe they should have invited the bosses of major businesses, also. In a separate and recent conference in London, businessmen from major companies put forth their view that governments cannot come to a deal because they aren't run like businesses.

Kent, Coke's President, proclaims that world leaders needs to start thinking in terms of a business and think long term; he suggests the shortsightedness of many leaders is due to their short term goals driven by upcoming elections. Businesses, however, are built to last.

All the executives agree that green consumerism is underestimated as a solution. Often, it is easy to write off such ideas as impractical. One haunting example being pop-singer Sheryl Crow's toilet paper scheme; she proposed we use reusable toilet paper. Thankfully, that is nothing near what the men suggest. They believe current consumer behavior can be "greened" instead of being restricted. As Lord Stern repeatedly writes: increasing energy efficiency is part of the first step toward carbon stabilization (in fact it would be profitable). Another CEO, Leahy of Tesco, stated: "It is only by realizing our potential as people, citizens, consumers, as users that we can turn targets into reality. It will be a transition achieved not by some great invention or some great act of parliament, but through the billions of choices made by consumers every day all over the world."

Choices, however, have been manipulated by industry in the past. Not a decade ago, General Motors received notoriety when they pulled their groundbreaking electric car, the EV1, from production (and into the garbage heap) only to then introduce the world to their SUV line. Tobacco companies were sued in the 80's for targeting children with cartoon ads, advertising that the "cool choice" was to smoke a pack. The history of business is long and dirty.

And yet, things change all the time. If industrialized medicine got us here, and by here I mean the rate of carbon consumption, then industrialized medicine can get us out. Continuing with the health care metaphor, there are three ingredients to the climate change vaccine: government, industry, and consumers. They are all interconnected, but when it comes down to money, industry is amply supplied. Ultimately, the deal regarding a new climate change treaty is a deal about money: how much rich countries will help poor countries, how much will be taxed on emissions, and where this money will come from. Circulating money makes the world go 'round- undistributed money will make the world go hot. It will be up to businesses to come up with sustainable models of production and consumption (armed with their CSR teams, of course) to invest in effective solutions.

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Juan Carlo Pascua | Posted: 20 October 2009

I was thinking in terms of choices. I trust consumers to make sound decisions, after all it is their money representing a real portion of their time/life, but the companies control our choices, e.g. If biofuels aren't offered, I'll have to buy regular gasoline. The third option being walking, but we can't reverse development.

Kent (Coke) does goes on to say that in all of his companies consumer surveys, the environment is the top priority, even in developing nations like Brazil. For the CSR reader: he'll commit to a 40% cut of Coke's refrigerators globally (millions) and focus 70% of his companies advertising to the environment.