Companies – change agents in a new climate economy

The historic Paris conference resulted in over 10 000 climate commitments by companies, investors, cities and regions determined to work towards sustainable business models and climate friendly financial markets. Swedwatch welcomes the forerunners who are showing climate leadership – even before governments have had time to start ratifying the Paris agreement.

Ikea, Stockholm City, and ICA Gruppen are among the 347 Swedish actors who have made pledges to action under a number of strategic climate initiatives. On a global scale the pledges are 10,773, coordinated under platforms such as CDP, Caring for Climate, and We Mean Business*. Swedwatch is pleased to note that many of the pledges are visionary yet measurable and they target areas of paramount importance like investments in climate solutions and initiatives to halt deforestation linked to supply chains. Below are some examples worth highlighting.

Companies set scientific, hard target

In contrast to the COP agreement which sets an aggregate emission pathway for a universal climate under 2°C., a small but increasing number of companies aim for harder targets. The Swedish companies BillerudKorsnäs AB, H&M, Stora Enso, ICA Gruppen, and IKEA are amongst a total of 116 companies world-wide who have tied themselves down to scientifically based, time bound targets to make substantial cuts in their carbon emissions under the initiative ‘Science Based Targets’.

100% Renewable Energy

Promoting solutions and alternatives to fossil fuels such as investing in research, development and upscaling of renewable energy is another paramount role of the private sector. IKEA has committed to procuring 100% of their energy from renewable sources by 2020. At the COP21 seminar ‘Fossil-free Sweden’ IKEA's Head of European Affairs Katarina Maaskant stated, according to the web page of the Government Offices of Sweden, that "Having a goal of 100% is a simple approach; it is clear what everyone must do."

Cities and municipalities lead the way

At the same time cities, municipalities and regions are increasingly taking climate initiatives, which put them ahead of their own national governments in the race towards creating climate smart societies. For example the city of Stockholm has promised to cut carbon emissions by 80% by 2050. At the COP21, Stockholm City's Vice Mayor for the Environment Katarina Luhr stated that “Cities account for 70% of global carbon dioxide emissions. Stockholm has an important role to play in lowering our emissions and showing other cities that it is possible if we set ambitious targets", according to a press release of the Stockholm Green Party.

In addition, over fourty local leaders across Sweden have committed to reducing greenhouse gas emissions by at least 20% already by 2020 as apart of the Covenant of Mayors, which requires biannual reporting on progress under the Sustainable Energy Action Plan.

Stop deforestation

To be able to stabilize the global climate, the world needs to stop destruction of both tropical and temperate forests. In Paris, the Swedish government signed the 'New York Forest Declaration', and H&M showed its support by – as the only Swedish company to date - pledging to stop commodity driven deforestation in all their supply chains by 2020 under a CDP initiative.

Carbon Pricing

The realization of effective carbon pricing schemes is key to creating a level playing field where climate smart companies can outcompete polluting, fossil-based businesses and create financial markets, which provide financing for a “2 degrees economy”.

In order to push towards binding carbon price schemes, a group of companies have signed on to several carbon price pledges. The Swedish government, which is among 20 nations and regions in the ‘Carbon Pricing Leadership Coalition’, is backed up by proactive companies such as SAS, Boliden Group and Tetra Pak who have already developed their own internal carbon pricing. Globally, a total of 875 companies and investors are further increasing the pressure by committing to set their own price on carbon over the coming few years.

The Swedish forerunner companies have shown ambition and leadership to act on climate change. Swedwatch looks forward to many more businesses, banks, investors, foundations, municipalities, and universities to be inspired by their bold commitments and follow in their footsteps. In our coming research, reports and media pieces we will analyse how the private sector’s Paris commitments are transformed into tangible climate action, innovation, and investment in solutions.

Unless otherwise stated in the article, the numbers and examples of companies are taken from Nazca, the UN data-base for climate commitments.

 * The CDP in collaboration with investors, companies, cities and governments offer a platform to act and be recognized through the disclosure of environmental impacts. Through the use of measurement, transparency, and accountability the CDP aims to drive positive change in business, investment, and policy. 

The coalition We Mean Business represent the voices of thousands of businesses and investors who recognize the importance of transitioning to a low carbon economy as a way to secure sustainable economic growth and prosperity for all. Amongst the founding partners are organisations such as Ceres, The Climate Group, the Prince of  Wales’s Corporate Leaders Group (CLG) and WBCSD: the World Business Council for Sustainable Development.

Caring for Climate is a partnership between the UN Global Compact (UNGC), the UN Principles for Responsible Investments (UNPRI), the UN Environmental Programme (UNEP), and the UNFCCC, with the main purpose to promote climate initiatives amongst its company and investor signatories.