It is a given that all sectors of society will have to make substantial contributions to limiting the damage of climate change – something that was driven home, yet again, by the recent International Panel on Climate Change report.
Unfortunately, the recent report by the European Investment Bank (EIB) shows that not only is the Irish business sector not pulling its weight, it is actually dragging all of us down.
The EIB’s European Firms and Climate Change Survey 2020/2021 assesses the level of investment EU businesses have undertaken to make themselves ‘climate-ready’. How many have assessed climate risks to their business and invested to address those risks; conducted energy audits and intend to invest in energy efficiency; have staff dedicated to increasing the company’s climate-resilience: these are some of the questions the EIB’s survey put to over 13,000 EU businesses.
Let’s look at some of the headline survey results before going to some practical proposals. First up, what is the percentage of companies that have ‘invested to address climate risks’?
45 percent of businesses throughout the EU have invested to address climate change. The league leader is Finland with 62 percent. Where’s Irish business? At the bottom of the table, marginally above Greece: only 19 percent of Irish businesses have invested to address climate change. Whatever the reasons or excuses, this is a pretty dismal performance.
Irish business regularly features well behind the EU average in the EIB’s action-based categories. They are consistently at or near the bottom of the table.
It is noteworthy that two-thirds of Irish firms have energy cost concerns, more than the EU average. Yet, only a little over a third have conducted an energy audit, never mind invested in energy efficiency. Irish business concerns don’t seem to lead to action across the board.
The EIB survey explores the reasons why businesses don’t invest – but only produce results at the EU-wide level. So we don’t have specific data for Ireland. Nonetheless, it can help explain the Irish deficits.
43 percent of EU businesses stated that uncertainty about regulation and taxation was the biggest barrier to climate investment following closely by cost of investments. While the Irish government should identify the reasons for business reluctance to invest, and do everything to help businesses overcome those barriers, we can’t rely on voluntary action or a series of carrots (usually tax subsidies).
Like so much in business life, we need a greater role for the stakeholders in putting companies on a sustainable course – whether that be environmental, social or financial. This requires intervention tools for employees, the state and consumers.
1) Employees: currently, all workers are allowed to select a ‘safety representative’ to liaise with employers over health and safety issues. Safety Representatives are entitled to carry out inspections, receive key information from the employer and receive training necessary for them to carry out their role. This could be the basis for a new workplace innovation.
All workplaces over a certain size should be required to establish a ‘Climate Action Committee’ within the workplace with Climate Action Representatives elect on to the committee by the workforce. This would be given a statutory basis. It would provide for consultation on all climate-related issues. The Government should keep a database of all representatives in order to provide information, training and allow for sharing idea on the best ways to reduce greenhouse gases.
2) State: the State should require all businesses over a certain size to (a) conduct regular energy audits (which could be, with additional resources, overseen by the SEI (Sustainable Energy Ireland); and (b) annually publish a Climate Audit which would, based on the energy audits, explain both what they had done over the previous year and what they intend to do in the future.
3) Consumers: we can use the marketplace to our advantage. But consumer action can only be taken on the basis of information. Therefore, the state should publish the companies’ energy audits, and the annual Climate Audits. This would allow organisations and individuals to assess which companies are activing responsibly and sustainably and, so, base their purchase decisions on these results.
These are only some of the steps that will need to be taken to ensure a resilient business sector. Others will no doubt have better ideas. There will be some good ideas thrown up by this trade union initiative next month (September).
But we need to start these actions now. As the IPCC report stated: this is Code Red for humanity.
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