We don’t know precisely how climate change will alter the planet, but two things are certain: its complex environmental impact will directly affect business, society, and ecosystems and governments will seek to mitigate its effects with far-reaching regulations. Extreme weather systems such as intense storms, floods and droughts are becoming more frequent, imposing real costs on companies and the communities they help support.

The recently released assessment report by the Intergovernmental Panel on Climate Change identifies that the level of future emissions will determine the future temperature rise and severity of future climate change and the associated impacts and risks.

Leading companies recognise climate change as both a risk and an opportunity. A growing number are taking steps to strengthen their resilience to climate impacts, reduce their greenhouse gas emissions, produce innovative low-carbon technologies and support policies enabling a smooth transition to a low-carbon economy. Companies are investing in renewable energy, setting and meeting emissions targets, incorporating a price on carbon into their business plans and greening their supply chains.

Addressing climate change as a business strategy also creates opportunities for companies to develop technologies, products and services that mitigate climate change and help customers adapt to the physical changes already underway.

Policy Support

A growing number of leading companies are also voicing support for national and global climate policies that help them plan for business growth. More than 1,500 organisations, which represent a $12.6 trillion market capitalisation and $150tr in assets, support science-based recommendations to restructure the world economy.

A number of top companies in Pakistan’s business sector, in particular those dealing with exports, have committed to the Race to Zero — and if these trends continue — Pakistan will be well on its way to achieving a 50 per cent reduction in CO2 emissions by 2030

These include a paradigm shift in the way we consume resources while there is increased emphasis on transition to renewable energy, sustainable food systems and product and process innovation in all industries. Effective climate policies give businesses more certainty for short- and long-term planning and investments and help them better anticipate regulatory risks and economic opportunities. State financial regulators as well as those in countries around the world are also encouraging companies to report climate change risks in their financial filings.

In this regard, efforts have been made by British High Commission in Islamabad in collaboration with industry associations to inform local industry about the importance of the Race To Zero initiative and why it is essential that business understand and commit to it. “As COP26 co-President, the UK is rallying leadership and support from businesses to transition to a healthy, resilient, zero-carbon growth pathway that prevents future climate threats, creates decent jobs, and unlocks inclusive sustainable growth,” explains Mike Nithavrianakis, British Deputy High Commissioner, in a webinar in collaboration with the Pakistan Business Council.

Science-Based Targets Initiative

Reducing greenhouse gas (GHG) emissions in line with climate science is good for the planet and companies. Science-based target setting makes business sense — it future-proofs growth, saves money, provides resilience against regulation, boosts investor confidence, spurs innovation and competitiveness — while also demonstrating concrete sustainability commitments to increasingly-conscious consumers. Companies going through the target validation process benefit from detailed feedback and support from the Science-Based Targets Initiative’s (SBTi) technical experts.

Science-based targets provide a clearly-defined pathway for companies to reduce GHG emissions, helping prevent the worst impacts of climate change and future-proof business growth. Targets are considered ‘science-based if they are in line with what the latest climate science deems necessary to meet the goals of the Paris Agreement — limiting global warming to well below 2°C above pre-industrial levels and pursuing efforts to limit warming to 1.5°C.

The SBTi is a partnership between CDP, the United Nations Global Compact, World Resources Institute and the World Wide Fund for Nature. The SBTi call to action is one of the We Mean Business Coalition commitments. Science-based targets show companies how much and how quickly they need to reduce their GHG emissions to prevent the worst effects of climate change. The SBTi is the lead partner of the Business Ambition for 1.5°C campaign — an urgent call to action from a global coalition of UN agencies, business and industry leaders, mobilising companies to set net-zero science-based targets in line with a 1.5°C future.

Climate ambition alliance

In the webinar series hosted by the Pakistan Business Council and the British High Commission, it became apparent that a number of companies view moving to net-zero emissions as a clear business case. “It presents an excellent opportunity to stocktake on how Pakistan’s business sector views both the risks and opportunities which exist in relation to climate change,” highlights Ehsan Malik, CEO Pakistan Business Council.

The Climate Ambition Alliance brings together countries, businesses, investors, cities and regions that are working towards achieving net-zero CO2 emissions by 2050. Currently, more than 4000 companies are signatories to the Climate Ambition Alliance, representing 45 sectors, six continents and 172 countries. A number of top companies in Pakistan’s business sector, in particular those dealing with exports — have committed to the Race to Zero — and if these trends continue — Pakistan will be well on its way to achieving 50 per cent reduction by 2030.

The writer is the programme manager for sustainable development at the Centre of Excellence in Responsible Business, the first outreach initiative of the Pakistan Business Council