compensation for environmental costs how a medium sized company wants to re measure climate protection

compensation for environmental costs how a medium sized company wants to re measure climate protection

Introduction

The recent United Nations report on climate change delivers a sobering message: humanity has less than two decades to take significant action and limit global warming to 1.5 degrees Celsius. The report emphasizes the urgent need to prevent catastrophic consequences for the planet. In response, various recommendations have emerged, suggesting ways individuals can directly combat climate change, such as reducing meat consumption, carpooling, and using public transportation. However, some argue that individual changes are insignificant compared to the emissions produced by 100 major corporations, which account for 70% of global greenhouse gas emissions, according to the Climate Liability Institute’s “Carbon Majors” report in 2017.

While both perspectives hold validity, it is essential for individuals to feel empowered and take action towards preventing the worst-case climate catastrophe scenario. To shed light on this matter, I spoke with Richard Heede, the founder and co-director of the Environment Liability Institute, which produced the Carbon Majors report. Our conversation, edited for clarity, delves into the significant role that corporations play in our current environmental crisis and the potential for individuals to shape our future.

The Impact of Individual Actions

Gaby Del Valle: The recent UN report sparked discussions on how individual consumers can help mitigate the effects of climate change. What is the overall impact of individual actions?

Richard Heede: While it is possible to quantify the impact of individual actions, it is essential to recognize that the scale of global emissions involves billions of people. However, by making conscious choices, individuals can significantly reduce their carbon footprint. Take the average American household, for example, which produces around 24,000 pounds of carbon dioxide annually. By investing in energy efficiency and adopting simple habits like turning off unnecessary lights, air-drying clothes, and minimizing water and electricity usage, households can cut their emissions in half, saving hundreds of pounds of CO2 each year.

Furthermore, we can undertake renovations and retrofitting to make our homes more energy-efficient. Simple measures like changing showerheads, insulating water heaters, using more efficient lighting, and implementing automatic controls for thermostats make a substantial difference. Additionally, reducing air travel and exploring work-from-home options can further contribute to emissions reduction.

Gaby Del Valle: Some argue that these individual actions are futile, considering that a small number of companies are responsible for the majority of greenhouse gas emissions. What are your thoughts on this?

Richard Heede: It is true that these companies are the ones extracting and selling the fossil fuels that contribute to the majority of greenhouse gas emissions. However, it is crucial to remember that it is the consumers who demand and burn these fuels. While companies bear some responsibility for lobbying and advocating for carbon-based economies, the consumers, whether individuals, households, or businesses, are the ones generating the carbon dioxide emissions. Therefore, it is important to recognize that responsibility is shared.

From my research, I have found that emissions directly produced by oil, gas, and coal companies only account for approximately 10% of total fossil fuel emissions. The remaining 90% is generated through the usage of their products by consumers. These companies should take responsibility for ensuring their products do not harm humans and the environment. Unfortunately, no company has committed to reducing their emissions and aligning their production and sale of products with the science-based targets outlined in the new UN report, aiming to limit global warming to 1.5 °C.

The Role of Companies, Leaders, and Society

Gaby Del Valle: What actions are necessary to ensure we stay below the 1.5 °C temperature rise? How can companies, business leaders, and society contribute?

Richard Heede: Addressing climate change requires collective efforts from companies, business leaders, and communities. It involves maximizing energy efficiency in new constructions, including residential, commercial, and industrial buildings. Every sector of society needs to participate actively.

However, it is important to acknowledge that not everyone will willingly participate, so we need policies to facilitate change. Implementing a carbon tax, as even Exxon Mobil has supported, is a vital step in making individuals and companies accountable for the true cost of their carbon emissions.

Gaby Del Valle: It seems that some companies have been aware of the climate change risks for decades but have prioritized short-term profits over addressing the issue. What are your observations regarding this?

Richard Heede: Traditional capitalist principles prioritize short-term profitability for shareholders, often neglecting broader concerns. In the 1980s, Exxon Mobil’s own scientists warned management about the risks associated with their products and the urgent need for change. However, the company chose to ignore the warnings and instead promoted climate denial. Consequently, they bear responsibility for the delayed action on climate change. As a result, numerous communities have filed lawsuits against oil, gas, and coal companies.

These companies should have taken significant action in the 1980s or at least in the 1990s when the scientific evidence regarding climate change became undeniable. They should have not only invested in renewable energy but also transparently acknowledged the threats posed by climate change and advocated for political solutions. Unfortunately, they prioritized short-term profits and invested millions in climate denial.

Gaby Del Valle: The Carbon Majors report highlighted the power of investors in creating substantial change. What actions can investors take both for immediate impact and long-term sustainability?

Richard Heede: Investors have the power to choose not to invest in fossil fuel companies in the first place. Many investors are already voting in favor of shareholder resolutions that hold companies accountable to some extent. However, most of these resolutions are still not strong enough. Investors should demand transparent plans from corporate management regarding climate change, including their overall perspective on the oil and gas industry’s impact and their specific strategies to reduce production and investment in fossil fuels over the next few years.

Gaby Del Valle: Unfortunately, the percentage of people with the means to invest is relatively small compared to the general population. How can we overcome the feeling of powerlessness that individuals might experience?

Richard Heede: It is crucial to understand that every individual action matters, both symbolically and practically. By making small changes in our daily lives and consumption habits, we contribute to the broader movement. For instance, when making choices that involve energy efficiency or sustainable production, such as purchasing an energy-efficient dishwasher, we are making a positive impact. These choices matter morally, financially, and symbolically. Additionally, by engaging in conversations with our neighbors and communities, we can encourage collective action.

However, individual actions alone are not enough. It is equally important to make the right choices during elections and support leaders who prioritize climate change solutions. The collective effort of individuals, combined with strong leadership and policies, is crucial to addressing climate change effectively.

Looking Ahead: Divestment and the Way Forward

Gaby Del Valle: What role does divestment play in this context? We’ve seen student-led movements urging institutions to divest from fossil fuel companies.

Richard Heede: Divestment is a powerful symbol, indicating growing concerns among investors. However, despite divestment of around $6 trillion from various university funds and endowments in recent years, oil and gas companies continue to thrive. It is important for these companies to recognize investor concerns. It would also be beneficial for universities to not only divest but also actively implement energy efficiency measures and carbon retrofits on their campuses. While many universities have taken steps in this direction, there is still much room for improvement.

Gaby Del Valle: The conversation surrounding the recent UN report seems to be divided into two camps: those advocating for personal responsibility and consumption limitations and those questioning the impact of individual choices. What are your thoughts on this?

Richard Heede: Neither perspective alone is enough. While individual actions are significant, they cannot solve the problem on their own. Meaningful solutions require the active involvement of Congress and political leaders who recognize the threat climate change poses to our security, livelihoods, and future generations.

However, it is crucial for individuals to participate actively as well. It is not sufficient to make a single energy-efficient choice and then feel complacent. We need to make informed voting decisions and encourage our communities to do the same. Individual actions, coupled with systemic changes, will lead us toward a better future. Let’s remain optimistic and channel our collective intelligence and empathy to address this challenge.