Government long-term climate strategy should be ‘business friendly’, says Corporate Leaders Group

Launched on Wednesday (15 November) at the Marrakech climate conference, the CLG report states that detailed long-term plans can help strengthen the framework that allows businesses to act on climate change and deliver sustainable development.

Climate change will have real impacts for business, the CLG states, therefore companies must be able to rely on policies which provide fertile conditions for secure investment in products and services that help deliver a net zero-carbon future.

The report calls on collaborative government and business efforts to strengthen climate change policy. A secure policy environment allows businesses to deliver sustainable value in future investments, which can in turn help to provide market signals required to improve confidence in government plans.

The Prince of Wales’s Corporate Leaders Group’s deputy director Eliot Whittington said: “Setting out a credible, comprehensive, flexible long term plan for your economy offers countries the opportunity to create an investment prospectus that can unleash even more business energy behind a zero-carbon transition.”

Credible, comprehensive, flexible

The report outlines the three key characteristics of long-term plans which promote business sustainability. Firstly, government long-term plans should be set in line with the objectives set at both the Paris Agreement and Sustainable Development Goals (SDGs), in a similar vein to the growing trend of businesses adopting science-based targets.

The report calls for smart, flexible policy to help businesses benefit from confidence in the direction of travel and clarity in the investment signals received. Short-term review periods offer the opportunity to assess the viability of long-term climate change targets, the report states, in addition to fostering business innovation.

To gain credibility, long-term plans should be subject to transparency and accountable processes, according to the CLG. Robust evidence, provided by relevant government departments and businesses, in particular, can help to shape decisions on technology, investments and future markets.

“To make sense such long-term plans needs to deliver on the 2C goal while taking into account adaptation and sustainable development needs,” Whittington said. “They should also be flexible enough to enable, support and respond to innovation without trying to predict the future. Finally, to be credible with business, long-term plans need broad political support and should be developed through transparent and accountable processes.”

Climate collaboration

The report notes that many national governments, notably the UK, have already made some progress toward developing long-term plans. The UK’s Climate Change Act is cited as a good example of a policy that provides a long-term lens for emissions reduction planning.

Long-term policy can be developed and refined in partnership with businesses and institutions. On the private sector side, more than 200 companies have already committed to set “Paris Compliant” emissions reductions targets as part of the science-based targets initiative.

The International Air Transport Association’s engagement with the International Civil Aviation Organization (ICAO) has resulted in an initial commitment by countries to tackle aviation emissions.

The report echoes a call made by CLG director Jill Duggan, who recently told edie that policymakers should foster the creative thinking shown by the private sector in order to “unleash new business models and new motivations” that will act as catalysts to allow business to evolve beyond compliance mindsets.

George Ogleby