January 15, 2009
Today, many corporations view climate change as an issue that, properly managed, can be used to build competitive advantage and capitalize on business opportunities. Climate change is moving closer to the top of the agenda, where its impact will be felt across enterprises.
While there may be uncertainty around the various climate change guidelines and regulations across Canada's jurisdictions and in foreign countries, there is enough information, says Patricia Koval. "There’s already enough information out there for people to start making fairly thoughtful, prudent planning decisions. They can start by assessing what their costs of carbon will be. Are they going to be onside or offside the regulatory regimes in the places where they produce their products or services, or where they sell them, and will they be affected by the regulatory regimes in the places where their key suppliers operate? Secondly, they can measure their carbon footprint and decide whether they should reduce their emissions voluntarily, because there is a business opportunity in doing so, especially from reputational and competitive standpoints. Finally, climate change is creating tremendous opportunities, as well as risks. Senior management should be able to identify some of those opportunities and determine whether their company is going to be able to take advantage of them."
While companies await the final federal guidelines and regulations, managers can begin preparations by assessing their company’s aggregate climate risk, says Pat. "This assessment will be driven by a number of factors. First among them is the risk posed by the proliferating number of applicable, or soon-to-be applicable, greenhouse gas [GHG] emission regulation mechanisms, including emissions intensity reductions targets, emissions caps and carbon taxes. The cost of compliance for a company, particularly where that involves multilayered regulation [Canadian federal and provincial GHG emissions regulation regimes and carbon taxes] in multiple jurisdictions [i.e., including other jurisdictions in which the company owns assets, does business or sells its products, or in which its supply chain exists] may be significant," she says.
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