Ethical Performance
inside intelligence for responsible business


business challenged on fixation with technology

April 2007

Heads of dozens of international companies have come under fire from a prominent institutional investor for drawing up a statement on climate change that largely confines itself to discussion of how technology alone can curb global warming.

The statement, produced by the Global Roundtable on Climate Change and signed by Allianz, Bayer, Citigroup, DuPont, General Electric and Volvo, among others, says businesses need to switch to non-fossil fuels, increase energy efficiency, and develop technology such as carbon capture and sequestration that can bury the carbon dioxide produced by burning fossil fuels beneath the earth’s surface.

The roundtable calls its statement ‘a bold post-Kyoto framework for effecting change at the levels of policy and industry’, but Rory Sullivan, head of investor responsibility at Insight Investment, told EP he was surprised that it ‘seems to completely ignore the question of increased consumption as a driver of climate change, relying instead simply on technology as a solution’.

Sullivan said the statement ‘makes sensible policy proposals for improving energy efficiency and reducing greenhouse gas emissions per unit of production,’ but he argued it was shortsighted of business leaders to ‘neglect the fundamental issue of how increased consumption and economic growth impact on greenhouse gas emissions’.

He added: ‘All of the available evidence is that, despite the many improvements we have made in greenhouse gas emissions intensity in our economies, emissions in most countries have continued on an upward path.’

Sullivan’s comments were supported by Mark Lee, chief executive of the SustainAbility consultancy, who warned that technology alone was not the solution.

Lee told EP: ‘We welcome the strong statement on efforts the business community must take to mitigate and then reverse the impacts of climate change. But in addition to technological solutions, we hope both business and government will look at the issues of consumption and economic growth.’

Lee added: ‘We need to examine whether we can unlock the creativity required to develop and maintain thriving economies without ever-increasing consumption as the key driver.’

The statement, which is also signed by heads of international organizations, is the main outcome of the roundtable set up three years ago by the Earth Institute at Columbia University to act as a discussion forum for business and civil society leaders.

Signatories also undertake to increase public awareness of climate change risks, report on their greenhouse gas emissions and ‘support public policy efforts to mitigate climate change’.

However, there is no mention of reining back on consumption or growth.

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