Corporate Sustainability in a Carbon-Constrained Economy

The strategies of successful corporations are increasingly being shaped by environmental and social issues. Climate change is a multi-faceted issue and the inclusion of climate change imperatives into full cost accounting and corporate sustainability is rapidly gaining momentum in a world where a shift towards a low-carbon economy is already taking place. Media pressure is high and there is intense political debate in the buildup towards the UN Climate Change Conference, to be held in Copenhagen in December 2009, where the successor to the Kyoto Protocol is likely to be determined.

Climate change presents both risks and opportunities for businesses. Reputational and market risks, such as shareholder and consumer expectation; physical risks associated with the impacts on climate, and regulatory risks, such as emission caps and carbon taxes, pose significant threats to carbon-intensive industries. Similarly, considerable opportunities exist and there is strong incentive for companies to develop robust carbon strategies in order to capitalise on the rapidly-growing carbon market and to reduce energy consumption costs. Quantifying the carbon footprint has become a hot topic among senior executives as has the need for strategies to improve energy efficiency, shift to renewable energy, and develop new low-carbon solutions, which take advantage of such financing mechanisms as the clean development mechanism (CDM). Companies that reposition themselves to take advantage of the opportunities presented by a low-carbon future stand to gain competitive advantage, exceed shareholder expectations, and project a positive environmental image.

SRK, globally, has experience and currently provides climate change-related services that range from carbon accounting and greenhouse gas inventory development, to strategy development and mitigation and adaptation planning, as well as disaster management planning. Carbon accounting and assessing the impact of climate change already constitute a component of EIAs in many countries, and the importance of including climate change risk and carbon liability assessment in due diligence work is increasingly being recognised. SRK has both the technical and project management skills required for CDM project identification and development. The firm also boasts a cross-disciplinary approach to climate change, placing SRK as a leader in carbon consulting.

Nikki Fisher: nfisher@srk.co.za

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