Lise Kingo, CEO and Executive Director of United Nations Global Compact writes that 2018 marked an unprecedented rise in the number of companies aligning with the Paris Agreement. One-fifth of Global Fortune 500 companies have now committed to set science-based targets. Specifically, the New Climate Economy report suggests that all Fortune 500 companies set science-based targets by 2020. As these companies recognize that greater ambition reaps greater benefits, some are now also pursuing 1.5°C aligned emissions reductions targets and committing to be net-zero by 2050.
Moreover, the Global Opportunity Explorer 2019 Insights report recently brought the attention on climate change risks pinpointing the need to manage such risks, and far from it, explore their inherent opportunities which can be truly transformational.
Specifically, it is stated that:
- Climate change calls for systemic innovation; new partnerships and market clusters.
- Climate change is a risk multiplier; the aforesaid report mentions. Indeed, although climate action is just number 13 among the global goals it interferes with the rest of them.
Mindset, strategies, and leadership needed for the years to come
Climate change is one of the most urgent risks to be tackled, and is already determining how markets are evolving
the report further outlines.
As Kristalina Georgieva, CEO of the World Bank, well said earlier this year at the 49th World Economic Forum Annual Meeting, “Climate change is happening faster than we thought it would.” Which is therefore the secret ingredient to win the climate game?
Well, the answer is written in the Global Opportunity Explorer 2019 Insights. Any company having the 17 Sustainable Development Goals as a top board priority and decide the overall strategy of the company and its core values, is a potential winner. However, any company failing to meet these criteria will be among the losers. Indeed, companies and leaders that have understood the rules of the game of the new market reality are said to have turned climate risks into climate opportunities and can serve as best practice examples, demonstrating how to make the seemingly impossible possible.
Winning the game is about innovative solutions, daring strategies, and new mindsets
- Erik Rasmussen Founder of Sustainia & Co-Founder of the Global Opportunity Explorer adds.
Here are 7 reasons why organizations need to change mindset:
- New consumer and employees’ preferences
- New regulations
- Increasing demand for crucial resources
- Changing investors’ focus
- Shift in market prices
- Time pressure
The Pulitzer Prize winning, New York Times columnist, Thomas Friedman, has a quite radical opinion with respect to the type of leadership required today: “We need greedy leaders,” he says.
4 potential industry driven approaches of climate risk
- Reinvent business models
- Develop public-private partnerships
- Scale up research and development,
- Motivate governments and businesses to develop innovative regulations and support new types of solutions
6 steps for individual organizations to turn climate risks into opportunities
- Put risk front and center and work with it
- Invest ahead of regulation
- Use technology and big data to innovate and disrupt
- Identify a strategy to mitigate potential reputational risks
- Work out a strategy for resilience
- Communicate the benefits of planning around risk, internally and externally
We are part of the solution
- Inge Jan Henjesand, President of BI Norwegian Business School.
Did you know?
The Global Opportunity Explorer 2019 Insights exemplifies the work of Sustainia’s mission of turning global risks into new opportunities. In 2019 Sustainia celebrates our 10-year anniversary as the catalyst for turning risks into opportunities and solutions. The organisation has served that purpose by building a platform with sustainable solutions, already featuring 1,000 sustainable breakthrough solutions.
Best Practices in several fields
Examining how selected companies have turned climate risks into climate opportunities the report asserts that today’s climate reality relies on connectivity, energy, finance, built environment, mobility and food sector. It is of great interest that Scandinavian countries are dominating the initiatives below, with 15 out of 33 being undergoing by Norwegian, Swedish, Danish or Finish organizations.
- Meeting the initiators in the connectivity era
- Telenor, Norway, developed an android app for mobile birth registration, giving millions of children an official identity and a passport to education and health services, crucial in the aftermath of climate-related disasters.
- Ignitia, Ghana & Sweden, delivered SMS-based, short-term weather forecasts to smallholder farmers in tropical areas, in order to help them make well-informed decisions and optimise their farming practices.
- Regen Network, USA, a global community and platform focused on ecological monitoring and regeneration, aims to catalyze the regeneration of ecosystems.
- DNV GL, Norway, has developed a digital mapping tool to aid communities vulnerable to natural disasters such as floods or earthquakes
- Bluetown, Denmark, provides affordable, adaptable and solar-powered internet stations in rural and remote areas, delivering a number of benefits for health, education and governance.
- Taking Root, Canada is putting a face on the smallholder farmers in Nicaragua who are reforesting their land. Through sales of carbon credits and traceable forest products, they can connect farmers who choose to reforest parts of their land with access to additional income streams.
- Meeting the initiators in the energy era
For us, and for many of our customers, the energy transition itself is the greatest source of risk – and opportunity
- Remi Eriksen Group President & CEO DNV GL.
- Developed by LO3 called Exergy, USA, The Brooklyn Microgrid, is a small-scale energy system whereby households can trade their excess renewable energy capacity with their neighbours using a secure blockchain platform.
- Bombora Wave Energy, Australia, has developed a technology for harnessing the consistent energy in waves. The mWave sits on the ocean floor, making it resilient in storms and unobtrusive to other marine activity.
- Climeon, Sweden, improves the efficiency of primary energy production by using waste heat to generate electricity, cutting bills and emissions for those with excess heat.
- Enersize, Finland, used sensors to collect data about the usage of compressed air systems. Their software analyses the data, identifies trends, and assists industry in optimising their energy consumption.
- Agility Fuel Solutions, USA, has developed long-range, lightweight gas storage systems, in order to make compressed natural gas (CNG) and biogas more attractive alternatives to diesel and reduce emissions from heavy-duty vehicles.
6 highlights from the DNV GL Energy Transition Outlook 2018
- The world will need less energy from the 2030s onwards owing to rapid energy efficiency gains; we forecast that primary energy supply will peak in 2032.
- The world’s energy system will decarbonise, with the 2050 primary energy mix split equally between fossil and non-fossil sources.
- Oil demand will peak in the 2020s and natural gas will take over as the biggest energy source in 2026. Existing fields will deplete at a faster rate than the decrease in oil demand. New oil fields will be required through to 2040.
- Electricity consumption will more than double by mid-century to meet45% of world energy demand, and solar PV and wind energy will supply more than two-thirds of that electricity.
- The energy transition is affordable. As a proportion of world GDP, expenditure on energy will be lower in 2050 than today. Big shifts in investments are expected: more capex will go into grids and renewables than into fossil projects from 2029 onwards.
- The rapid transition we forecast will not be sufficient to achieve the less than 2°C climate goal. A combination of more energy efficiency, more renewables and more carbon capture and storage (CCS) is needed to meet the ambitions of the Paris Agreement.
- Meeting the initiators in the finance era
- Storebrand PLUS Fund, Norway, is a sustainability-driven, low risk alternative to traditional equity fund management for ecologically-conscious capital.
- Engaged Tracking, UK, is incentivising companies to reduce their carbon footprints by shifting investor capital towards low-carbon companies using a financial market mechanism.
- Loudspring, Finland, is a financial capital can boost natural capital. By growing companies that preserve natural resources, buying a share in Loudspring means showing support for sustainable companies and finance.
- Wave Money, Telenor, Norway & Myanmar, is a mobile-based financial service that facilitates secure, realtime transactions, with the aim of improving financial inclusion in Myanmar.
- TRINE’s, Sweden, financing model makes it easy to invest private capital in solar projects in the developing world.
- Meeting the initiators in the built environment
- Sustainer Homes, The Netherlands, designs and constructs unique buildings through innovative sustainable design principles and a focus on renewable energy. Their buildings are modular, customisable and self-contained to suit a variety of needs, including residential and commercial property.
- Everimpact, Denmark, provides the technology to measure greenhouse gas emissions and air quality in cities and regions. Their platform provides real-time data, allowing users to measure policy effectiveness and participate in emissions trading.
- Ecovative, USA, uses mycelium, the ‘roots’ of mushrooms, as a natural binding agent for packaging and building materials. Using agricultural byproducts as a base, they can literally grow new materials for a range of industries.
- Climate Recovery, Sweden, provides a full assortment of responsibly constructed parts for the heating, ventilation and air conditioning market to save emissions and costs.
- The Smog Free Tower, The Netherlands, is a seven-metre-tall smog vacuum cleaner. Using ionisation technology, it filters 30,000m³ of air each hour, removing particulates and crushing the particulate carbon to make thought-provoking gemstones.
- Miniwiz’s Trash Lab, Taiwan, is reinventing waste into new materials for architecture, fashion, and consumer goods, hopping to turn problematic waste streams into the key materials in a more circular economy.
- Meeting the initiators in the mobility era
- Geotab, Canada, is working with cities’ transportation networks to collect and analyse data from air pollution to collision risk, helping to make cities smarter and safer.
- SHV Energy, The Netherlands and Finland, has paired with Neste to produce Europe’s first BioLPG, made from waste and residues from industry, and renewable vegetable oils.
- Golden Gate Zero Emission Marine & Hydrogenics, USA, introduce the world’s first high-speed, hydrogen-powered ferry will be built in the San Francisco Bay area and will be financed by the state’s cap-andtrade emissions reduction scheme.
- Ubitricity, Germany, has developed a simple, easy-to-install electric vehicle (EV) charging port to increase access to power for drivers. Their intelligent design also helps manage demand for variable renewable energy sources.
- Ecosubsea, Norway uses remotely controlled mini-submarines to clean large vessels while at port to reduce subsurface pollution, fuel costs, and spread of invasive species.
- Brisk Synergies’ Lumina software, USA, utilises artificial intelligence and machine learning to analyse thousands of traffic interactions and help design safer roads for all users.
- Meeting the initiators in the food era
- Regrained’s, USA, Supergrain+ is a flour made from the ‘spent grain’, a byproduct of brewing beers. This fibre- and protein-rich flour is converted into nutritious snack bars wrapped in biodegradable packaging.
- Aqutonix, USA is a water efficiency enhancement technology that facilitates the absorption of the water in plants’ roots, reducing water consumption and boosting yields.
- The Leafy Green Machine, USA, is a fully assembled, vertical hydroponic farming system built inside a 12m shipping container, allowing any individual, community, or organisation to grow fresh produce all year round.
- Futurepump’s, Kenya, solar-powered irrigation systems provide clean and cost-effective water management solutions for farmers operating on a small scale.
- Snact, UK, has developed a range of fruitbased snacks made from produce that would otherwise have been wasted, helping to reduce food waste and provide healthy snack options.
- Beyond Coffee, Denmark, has put together a kit that allows people to reuse their coffee grounds to grow edible mushrooms in a small bucket in just four weeks.