The urgency to address climate change and other environmental challenges has never been greater. And encouragingly, there seems to be a constant and increasing beat of corporate commitments that range from pledging to use more renewable energy to making products that are more environmentally responsible. These wide-ranging commitments provide a clear indication to who is leading, who is partnering, and who may be lagging. What may not be as clear though is the degree to which businesses as a collective force are taking action.
In a recent whitepaper with GreenBiz Media, Accountability for Climate Action: How Corporations Are Tackling Climate Change, we explored just that. This global research study looked at more than 5,300 companies and explored how businesses are managing their carbon footprint and what actions they are taking on climate change. The study answers questions around the types of commitments being made, the strategies companies are following and how these vary by size and type of company.
Taking action today
An overwhelming 90 percent of companies are taking steps to reduce their carbon footprint through commitments and strategies that increase energy efficiency, reduce greenhouse gas (GHG) emissions or increase the use of renewables. While energy efficiency is still taking the lead as a top method for managing footprints, we’re also seeing a strong number of companies committing to renewable energy. In fact, the survey found that 45 percent of the largest companies have public renewables commitments.
Not only are methods like these utilized for lowering operational impacts, but we know that companies are now looking to their products and services to unlock opportunities for lowering emissions. In addition to providing benefits around emissions reductions and increased efficiency, the survey found that many companies also expect revenue from sustainable products to grow faster than other offered products and services.
Ingersoll Rand’s innovative product lines, such as EcoWise™, a portfolio of products designed to lower environmental impact with next generation, low-global warming potential refrigerants and high-efficiency operation, are enabling customers to be conscious of their own footprint, increase efficiency, and ultimately lower GHG emissions. We know that our company and industry as a whole can make a big impact on industrial productivity and efficiency through these types of products and services.
Preparing for the future
So what do these commitments tell us about the future? For Ingersoll Rand specifically, it shows us that there are growing demands and opportunities for products that lower environmental footprints not only within an organization’s immediate operations, but also into the value chain. In addition to measuring carbon footprints, a similar amount of companies are also making energy or emissions reduction commitments that extend across the value chain. The survey found that 58 percent of the largest companies and 48 percent of large companies are doing so.
With companies taking the lead on managing their carbon footprint, they may also be in better position to see future regulations around carbon as an opportunity. For example, the survey found that 75% of the largest companies and 82% of all others say they will either be better off with a mandatory price on carbon or that it wouldn’t have much of an effect on their business.
While the future seems bright for organizational action on climate change, we know that there’s still more work to be done to ensure that we’re meeting the international agreements of COP21, last year’s United Nations conference on climate change, and collectively ensuring we don’t overstep the climate budget of 2 degrees Celsius – the internationally agreed upon limit for rising global temperatures. By taking note of what the wide-ranging commitments will accomplish, organizations can hopefully inspire further action that sets us on a path to a low-carbon, resilient economy.
About the report
In presenting our research findings, we use the phrase “largest organizations” to represent those with revenues greater than $10 billion and “large organizations” as those with annual revenues between $1 billion and $10 billion. Forty-eight percent of survey respondents are from organizations with revenue greater than $1 billion.