In the last few years, many major corporations like Mexico’s Cemex (BMV:CEMEXCPO), Spain’s Iberdrola S.A. (Madrid Stock Exchange: IBE) and Belgium’s Anheuser-Busch InBev (EBR:ABI) have started to view their environmental and climate change policies as part of their broader strategies for long-term sustainability. Environmental advocates are definitely paying attention. At a recent event on sustainability at the Americas Society (click link for webcast) in New York City, Zoe Tcholak-Antitch, the director of the Carbon Disclosure Project’s global investor program explained that “it’s up to business to provide solutions because climate change won’t wait for governments to get their acts together.” Around the world, people are starting to realize, that unless companies in dirty sectors start getting serious about reducing the negative impact of their operations, efforts to fight pollution and climate change will never pack much of a punch.
It is therefore important that global companies take action to implement solid environmental programs. Many of the world’s leading companies have already adopted high-tech environmental management systems and offer the public detailed descriptions on their pollution levels, carbon
dioxide output, and energy use. For this reason, GMI tracks which companies publish specific targets for reducing energy use, CO2 emissions, and the negative environmental impact of their operations.
GMI research shows that there is still a lot more work to be done in this area. After all, less than one
third of the world’s 4,200 largest publicly traded companies disclose their environmental performance records to the public. Less than a quarter of these 4,200 corporations disclose their greenhouse gas emissions levels. Furthermore, less than a fifth of these companies have disclosed specific targets for their pollution and greenhouse gas emission reduction programs.
Although corporate environmental initiatives have sometimes been dismissed by critics as superficial “greenwashing,” corporate PR to mask dirty operations, other analysts are now arguing that companies that are placing environmental management and corporate social responsibility at the center of their business plans, are actually helping to generate value for shareholders.
For instance, Japan’s Canon Inc (Tokyo Stock Exchange:7751) has implemented an Environment Planning Center and Environment Promotion Center at its corporate headquarters. Canon publishes a comprehensive annual sustainability report, available in both Japanese and English, and offers the public extensive disclosure on its greenhouse gas and CO2 emissions levels. In a recent article, Maureen Baird, a business development executive at IBM South Africa explained that “being green has implications on the financials of an organization – especially for those organizations which are heavy energy users- they not only save costs, but also meet their green targets and move in- line with governance requirements.” Far from being a superfluous PR game, green initiatives are now becoming a “business imperative,” she added.
[This article was orginally published in the 2011.2 edition of InFocus, GovernanceMetrics' research publication.]