How climate change agreements can deliver transformational social impacts

Oct 12 2016

How climate change agreements can deliver transformational social impacts

China, India, the United States and the EU are among some of the countries that have signed up to the Paris Agreement negotiated during the United Nations 21st Conference of the Parties (COP21). This means that the agreement will formally come into effect next month with the aim of limiting global temperature increases to no more than 2.0ºC. This will have numerous implications for governments and industry sectors, particularly the energy sector.

The global transition towards a low-carbon economy is expected to accelerate as a result of the Paris Agreement and multiple initiatives have developed over the past two years to support private companies in specific sectors to move away from the carbon intensive industry or to simply reduce their greenhouse gas emissions. Examples include: the airline industry recently adopting a resolution through the International Civil Aviation Organisation (ICAO) to achieve carbon neutral growth from 2020; institutional investors increasingly required to disclose the carbon footprint of their investment and manage their risk exposure from carbon-intensive industries, and; many global corporations advocating for a clear, long-term policy signal such as carbon prices.

Carbon Clear, a world provider of carbon and energy management and sustainability services, carries out research each year into how well the 100 largest companies in the UK  by market capitalisation (FTSE 100) manage and report their environmental impacts. The research found this year that 14 companies offset their carbon emissions. This is interesting when considering offsetting as a complementary activity to reducing emissions and the useful role it can play in a wider emissions management strategy. For example, carbon offsets can be used as a benchmark for setting an internal price for carbon when a company is looking to use a price for their own reductions or to stimulate future investments and anticipate future regulation.

Offsetting can also help companies engage with their employees around the project, especially if the project contributes to not only funding carbon emissions reductions, but also to generating net positive social impacts.

This is the case of Carbon Clear’s award-winning Darfur Low-Smoke Stoves project in Sudan. The project enables women, in the post-conflict area of Darfur, to transition away from cooking with unsustainably sourced and harvested wood and charcoal, to adopt LPG as a cooking fuel. The project, implemented by local women-led NGOs, reduces carbon emissions through the more efficient stoves and has countless impacts on the beneficiaries:

  • Indoor air pollution is reduced, improving health. Cooking on open fires in the home causes 13,900 yearly deaths in Sudan.
  • The project reduces energy poverty due to the greater affordability of LPG and saving up of to 40% of household income on energy expenditure.
  • LPG cookstoves require less time to use, enabling more time to be spent with their children or on additional income generating activities.
  • The project trains and builds the entrepreneurial capacity of the women who manage the micro-finance scheme.

By signing the Paris Agreement, governments have signalled their willingness to address the impacts we face from a warming world and changing climate. Companies will have to play a role in meeting GHG reduction targets and this will require a strategic approach to managing emissions and reducing impacts. Projects such as Darfur Low-Smoke Stoves can help drive forward engagement and environmental strategy, whilst making a meaningful impact on the communities where they are based.

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