a consensus and promises to keep

“Climate fatalism is increasingly unjustified. Climate voluntarism is becoming increasingly essential”† With these words, Laurent Fabius concluded the Business and Climate summit that was held in Paris on 20 and 21 May. For the Secretary of State, this summit, the first of its kind, is a “momentum”, a turning point. The head of French diplomacy showed himself “fairly optimistic” on obtaining an agreement at the end of COP21.

But to achieve this, he relies heavily on companies and calls on them to: “create a climate reflex in investment decisions”† He also wants them to make public their contribution to the fight against climate change and join coordination structures that act against global warming.

Laurent Fabius mischievously formulated his expectations and reminded his audience at UNESCO headquarters that the demands of the private sector regarding public authorities were numerous during this summit.

The great uncertainty about the price of carbon

All the CEOs in attendance, Indian, Chinese or French, called for the rise of carbon pricing. For Jean-Pierre Clamadieu, the boss of Solvay, the existence of such a prize would be an important element when making business decisions to make a transition to a low-carbon economy. “We need an ambitious agreement on this issue”in abundance Peter Bakker, chairman of the World Business Climate Council for sustainable development.

If the principle of a carbon price is unanimous, the conditions for its implementation are much less so. There were major divisions on the issue, particularly between the coal industry and those active in renewables, during a roundtable discussion on the issue. The details of its implementation, in particular through a tax or emissions trading system, but also the most effective and fair amount, is still much debated.

The fight against climate change, an opportunity for companies

For Saint-Gobain CEO Pierre-André de Chalendar, the need to fight climate change is not just a curse. It is also “an opportunity to grow”† Jean-Pascal Tricoire, the boss of Schneider Electric, even sees it as a factor of innovation.

In fact, companies believe that scientific targets to reach emissions by 2020 and a target of net zero emissions well before the end of the century “are feasible and compatible with continued economic growth and human development, if all actors come together in this urgent and protracted climate battle”† At least that is apparent from the official press release that was published at the end of the summit.

To this end, the signatory coalitions call on political leaders to step up national and international climate action, including, in addition to carbon pricing, the elimination of fossil fuel subsidies, an alliance between the private sector and governments to integrate climate policies into the economy, or the creation of a public fund exceeding the $100 billion pledged in Copenhagen, intended to attract private financing and reduce the risk of investment in low-carbon assets, especially in developed countries.

This declaration of good intentions has been signed by 25 coalitions of companies and investors, representing more than 6 million companies, from 130 countries (including the Consumer Goods Forum, the United Nations Global Compact, the International Chamber of Commerce, the IIGCC group of institutional investors on climate change -, the World Economic Council on Sustainable Development (Wbcsd), We mean business, but also BSR, the Shift Project, Afep, Medef, CDP, etc.). Negotiations continued until the last minute to reach a consensus on the terms to be adopted.

Another statement titled this time “The private sector proposals for an international agreement on climate change in Paris” calls again for an ambitious agreement and price setting for carbon, an enabling framework for the development of low-carbon solutions, and a public-private dialogue (officially launched this week at the initiative of the French government, under the title Business Dialogue). But this initiative, supported by 59 companies (Areva, Bouygues, Engie, Kering, Lafarge, Michelin, Nestlé or Kingfisher) and 7 organizations (Afep, Medef, le Cercle de l’Industrie, wbcsd…), remains essentially French. and does not seem to have been mentioned by all the Business leaders.

Undoubtedly a foretaste of the equally intense negotiations to take place on the side of the States during the COP in December…

North-south balance, a sine qua non of an agreement

Another highlight of this summit is the speech of the representatives of emerging countries. Specifically, if companies from China or India are visibly willing to commit, strong signals are expected from developed economies. In particular, the fact that from 2020 we will contribute 100 billion euros per year to the United Nations’ green fund.

Mahendra Singhi, the Indian CEO of the cement company Dalmia, said he was delighted to be invited to this Business and Climate Summit: he sees it as a sign that “Emerging economies are just as important as developed economies in the fight against global warming”† A sentence uttered with a smile, which clearly reflects the distrust of these actors before COP 21. Because “We are well aware of the UN mechanisms designed to combat global warming. They have so far not benefited Africa”emphasized Hakima El Haité, the Moroccan environment minister, as a warning to the countries of the north.

A similar summit is expected to take place next year. Although the location has yet to be determined, economic players will have to take stock of the implementation of their commitments.

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