The new decade has started with heightened global attention on the impact of climate change and biodiversity loss on business, finance and society – and vice versa.
The World Economic Forum’s Global Risks Report 2020 states definitively: “climate change is striking harder and more rapidly than many expected.” For the first time, climate dominated the report’s top-five likely risks over the next decade.
Combine the economic risks with the rise of youth climate activism and employee activism, conscious consumerism and the range of climate-related litigation increasing worldwide, and it is clear that business leaders must rapidly address climate risks in their overall corporate decision strategies.
While the public often sees businesses as an obstacle to combating climate change, many are leading the charge with radical ideas, ground-breaking innovations and new, greener business models. They are part of the solution. However, for many businesses, effectively communicating this good work remains almost as difficult as taking action.
Businesses in Scotland will have an excellent opportunity to communicate their ethical and sustainability credentials as the United Nations Framework Convention on Climate Change comes to Glasgow in November 2020.
The 26th session of the Conference of the Parties (handily shortened to COP 26) will bring thousands of delegates to the city to assess progress and make critical decisions amid a growing sense of crisis. The eyes of the world will be upon us – which brings both obvious corporate reputation benefits and potential risks for the Scottish business community.
So, what can your business do to do to navigate this long overdue focus on sustainability – and effectively communicate your corporate ambitions and activities? Our sustainability communications checklist outlines what you need to consider now.
Understand how climate risk is inherently linked to business strategy
Business leaders must answer two climate-related questions today: ‘how does my business impact climate, now and into the future’, and ‘how do climate risks impact my business now and into the future’. Responsible corporate governance requires that companies develop and implement rigorous climate assessments to evaluate and disclose risks across their entire business infrastructure, including supply chains, corporate reputation, long-term growth and profits. Climate risk is increasingly and consistently being priced into credit decisions and capital markets. There is now a multitude of data and analytical platforms available to benchmark, track, understand and predict climate impacts on business.
Lead from the top.
Climate action requires corporate leadership from boards, CEOs, COOs, and CFOs who must use their global platforms, credibility and networks to support internal change and a broader policy agenda. An isolated company-by-company approach is not enough. CEOs need to drive the global conversation, champion collaboration and communicate practical solutions that will reduce emissions and scale up investments in infrastructure, clean energy and technology.
Communicate and engage in meaningful ways with employees
Employee climate activism has emerged as a powerful social movement. Many employees believe they are right to speak up against their employers on climate by organising walkouts, protests, and raising consumer and media awareness of corporate policies. Younger workers increasingly prioritise a company’s social and environmental commitments when making career decisions. Business leaders need to listen and respond to their current and potential employees to attract and retain the best talent.
Tell your story
Corporate communications leaders, marketers and HR leads should share what businesses are doing to address and mitigate climate change, stimulating more ideas and promoting best practices for other companies to adopt. But storytelling cannot be grandstanding, greenwashing or purposewashing. Marketers need to find the right tone, show transparency, and find ways to let employees, vendors and consumers support the company’s sustainability efforts.
Watch consumer trends
Consumers are increasingly using their economic power to drive change. For many upscale and young ‘conscious’ consumers, shopping has become a political act grounded in values and purpose. Consumer activism is taking the shape of two diametrically opposed actions – buycotting (purchasing a company’s products to support their policies) and boycotting different brands and products. Both are after the same goal, but only one is business-positive.
Get ready for increased political, investor and media interest
This new decade is already being defined as the era of urgent acceleration on climate innovation, clean energy transitions and public-private collaboration. ESG (environmental, social and governance) factors are increasingly reshaping investment strategies. Climate risk is today a defining factor in every company’s long-term success – requiring bolder action, improved disclosures and higher impact stakeholder engagements. Regulators, civil society and media will pressure or shame companies that are moving too slowly. This is the new normal.
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