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FINDING SUSTAINABLE PATHWAYS

OUR PROCESS

Our process helps Canada achieve sustainable development solutions that integrate environmental and economic considerations to ensure the lasting prosperity and well-being of our nation.

RESEARCH

We rigorously research and conduct high quality analysis on issues of sustainable development. Our thinking is original and thought provoking.

CONVENE

We convene opinion leaders and experts from across Canada around our table to share their knowledge and diverse perspectives. We stimulate debate and integrate polarities. We create a context for possibilities to emerge.

ADVISE

We generate ideas and provide realistic solutions to advise governments, Parliament and Canadians. We proceed with resolve and optimism to bring Canada’s economy and environment closer together.

Business Primer – Chapter 4: How To Do It: Raise Awareness

Raise Awareness

STEP 1 : UNDERSTAND HOW A CHANGING CLIMATE CAN AFFECT YOUR BUSINESS.

Businesses demonstrate a clear understanding of the importance of GHG emissions mitigation and are adept at reporting their efforts to achieve emissions reductions and energy efficiencies. Progress on climate change adaptation, however, is less advanced. The first step in adapting to a changing climate is appraising the impacts of climate change on your business objectives.

// INVENTORY THE IMPACTS ON YOUR BUSINESS from past climate-related events, such as storms, droughts, and unusually hot or unusually cold seasons. What was your business’s response to these events? Are these events likely to increase in frequency and intensity in a changing climate? What operational, financial, strategic, or other kinds of risks could your business face as a result?

// SCAN THE AVAILABLE RESEARCH to learn how the climate is expected to change and the possible impacts in the regions where your business operates (see the toolkit at the end of this report for a list of information resources).

// LOOK BEYOND THE REGIONS where you operate to identify important physical impacts in the regions where your suppliers and customers are located.

LEVERAGE RESOURCES TO UNDERSTAND THE RISKS AND OPPORTUNITIES FACING YOUR SECTOR BY RAISING THESE ISSUES WITH YOUR INDUSTRY ASSOCIATION.

 

IN PRACTICE // HYDRO QUÉBEC

Hydro-Québec has developed a comprehensive program to tackle climate change. The firm started by identifying areas of activity that were sensitive to changing climate conditions, based on consultation with staff from different divisions. The figure below shows some of the areas identified.

Hydro Quebec In Practice

Since 2001, Hydro-Québec has made a considerable investment in research on climate change, business impacts, and adaptation, which the company believes has already paid off. Hydro-Québec’s accrued knowledge has improved planning, design, and operational decisions of the Equipment and Distribution divisions.37

Read the full Case Study
 

STEP 2 : HARNESS INTERNAL KNOWLEDGE AND EXPERTISE.

Formulating a business response to climate change tends to be assigned, at least initially, to environmental sustainability or corporate social responsibility officers. However, climate change impacts can have far-reaching consequences for businesses and require insight and engagement by employees across the enterprise to identify potential impacts of a changing climate within their own corner of the business. A successful response hinges on attracting the right people to the table to harness the business’s intellectual capacity and to cultivate awareness and ownership of the adaptation challenge.

// INVOLVE REPRESENTATIVES of a cross-section of business units, including the following:

  • Operations: operational risks can arise from increased scarcity of a resource that is an input to production
  • Legal counsel: liability risks can arise from damages to local communities as a result of climate-related infrastructure failures
  • Finance: the physical impacts of climate change can affect a business’s long-term financial performance, meriting disclosure to investors

// ESTABLISH A COMMON UNDERSTANDING of the issue based on information gathered in step 1.

// WORK TOGETHER to assess the links between business objectives, climate change, and its impacts.

// INVOLVE A SENIOR LEADER who can be an advocate at the executive and board levels.

 

IN PRACTICE // CAMECO

Cameco, a global uranium producer based in Saskatchewan, created an Environmental Leadership team in 2006. This team’s mandate includes scanning and studying environmental challenges that have the potential to become company liabilities, and assessing whether they warrant inclusion in the corporate risk register. Having identified the physical impacts of a changing climate as a potential company risk issue, four working groups comprising staff from different divisions of the company considered a broad range of climate change risks and opportunities, including the potential need for higher amounts of cooling water, increased fire risk, higher road maintenance costs, and possible supply-chain disruptions. This process provided senior management with confidence that no hidden liabilities existed because of climate change and helped the company improve its communication with stakeholders on the business risks and opportunities of a changing climate.

Read the full Case Study

 

STEP 3 : MAKE A BUSINESS CASE FOR GOING FURTHER.

The case for allocating scarce human and financial resources to assess and manage risks and opportunities of climate change can be a tough sell: the perception looms large that upfront costs are high and payback uncertain. How can managers apply intelligence acquired in steps 1 and 2 to raise awareness of the financial implications of climate change and develop a value proposition to further investigate this issue?

// IDENTIFY the costs of recent climate-related damages for your business and your competitors’.

// TAILOR the arguments from the business case presented in section 3 of this report to your own circumstances.

// ARTICULATE the direct impacts the business could face due to inevitable climate change that is already underway and future climate change. Consider the potential consequences for business reputation and the licence to operate.

// EMPHASIZE who can be an advocate at the executive and board levels.

// IDENTIFY who can be an advocate at the executive and board levels.

// HIGHLIGHT who can be an advocate at the executive and board levels.

 

IN PRACTICE // ENTERGY

Entergy, a Gulf Coast electric utility, witnessed first-hand the costly impact of climate-related events. In 2005, hurricanes Katrina and Rita cost the firm US$1.7 billion, spelling out a clear business case for action to assess and manage climate risks. Since that time, Entergy has worked with Swiss Re to assess the corporation’s asset exposure to wind-related damage, sea-level rise, and increased storminess by 2030 under three climate scenarios. They have also assessed the costeffectiveness of actions to protect the region from future climate damage. Entergy is now equipped with a sound financial basis from which to allocate resources and implement priority actions, such as improving standards for offshore platforms and enhancing levees for refineries.38

Read the full Case Study

 

[37] Unless otherwise indicated, the In Practice examples are taken from [case studies report].
[38] Williams October 27, 2011