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Opinions and views from expert CFOZone members.

Tag >> climate change
Aug 04
2010

When it comes to fighting climate change, companies are leading the way

Posted by annearf in SustainabilityRisk, Intel, General MillsFrito Laycomplianceclimate change

annearf

General Mills recently announced that it installed enough solar panels for its yogurt production plant in Methuen, Mass., to provide most of the facility's power for the summer and 40 percent the rest of the year. It's also using everything from wind power to biomass to fuel plants in other areas.

In the wake of Congressional rejection of an energy bill, the General Mills announcement underscores an important point: It's business, not the federal government, that's taking the lead in addressing the effects of climate change.

Jul 23
2010

A bumper crop of shareholder resolutions about climate change

Posted by annearf in shareholder resolutionsinvestorscomplianceclimate change

annearf

Looks like shareholder resolutions about climate change and energy-related issues have finally made the big time. 

 In 2010, investors filed a record 101 climate and energy-related resolutions with 88 US and Canadian companies. That was almost 50 percent higher than last year, according to Ceres, a nonprofit group that works on sustainability issues.

Jun 22
2010

Why Keynes was only half right

Posted by Ron F in unemployment, SpendingRiskrecoveryrecession, Obama, jobsjoblessnessglobal economyGermanyeconomydemandconsumer spendingclimate change, clean energy, Careers/Managementcarbon emissionsCapitalcap and tradeBarry Ritholtzalternative energy

Ron F

At long last, one writer has seriously addressed the potential problems with more stimulus spending. (I sent Paul Krugman a question about this more than a week ago, via a comment on his blog, but from what I can see he has yet to address it. And Dean Baker too easily dismisses the issue, in my opinion.)

The problem is not the federal budget deficit, not at least in the short term, but the potential political fallout from bad decision making. That way, says Steve Randy Waldman, indeed lay a possible US currency crisis. And this is ultimately where Friedrich Hayek and his associates were coming from in blaming Weimar for the disasters that followed.

May 26
2010

Global banks, global problems

Posted by Ron F in unemployment, Riskjoblessnessfinancial crisisFederal ReserveFannie Maeeuropeeconomydemanddebtclimate changeCareers/ManagementbubblesBanksBanking

Ron F

Before I get to the news (which involves the problems of European banks), let me bury the lede and offer up a bit of perspective. Yes, that's totally bass ackwards, but indulge me for a few grafs. (Hey, this is the web.)

We've recently gotten grief from friends here and there about being too negative about the economy. So we've been doing our damndest of late to ensure a "balanced" approach, seeing the glass half full as often as empty, so to speak, or walking on the sunny side of the street in addition to the shady one. You get the picture. Well, sorry, folks, but sometimes reality won't budge.

May 26
2010

Business isn't waiting for Washington on climate change

Posted by SherylNash01 in Sustainabilityclimate changecareer/managementcarbon emissions

SherylNash01

Nearly one in five US companies expect to reduce carbon emissions in the next two to five years, according to a survey by PricewaterhouseCoopers. The survey found that 16 percent are bracing for that possibility, while 13 percent expect new climate regulation and 11 foresee new legislation in this area. And twelve percent expect to improve energy efficiency in general.

"Although federal climate change legislation is uncertain in the short term, there are plenty of government and private sector initiatives driving companies to start reducing emissions now," said Kathy Nieland, leader of the Sustainability and Climate Change practice at PricewaterhouseCoopers in a prepared statement.

Jan 28
2010

SEC requiring disclosure of climate change risk: It's a good thing

Posted by annearf in shareholdersSecurities and Exchange CommissionRiskdisclosureclimate change

annearf
The Securities and Exchange Commission just voted to require that public companies disclose to investors any risks to their businesses from climate change. And it's ultimately a good thing for corporations--really.
 
Up until now, the SEC has mandated that companies disclose risks posed by environmental problems without specifying climate-change-related issues. And, no surprise, few companies have made climate-change risk disclosures. A study by the organization Ceres of more than 6,000 SEC filings for S&P 500 companies from 1995 to 2008 showed that 5 percent of annual reports included information about managing climate change risks. And 80 percent disclosed nothing at all.
 
The move seems to have come in response to a rash of petitions from environmental and shareholder groups, certainly not from corporate pressure. But, while companies aren't wild about the rule, it's in their best interest.
 
While the obvious enterprises impacted by climate change are insurance companies and utilities (think of insurers that cover properties in coastal regions. Or don't cover. Many have abandoned that market), many, if not most companies face their own risks. That could be anything from an important plant in a hurricane-prone area or crops located in regions bedeviled by frequent drought to costs that might increase with cap and trade legislation. And, given the activism and ire of environmentally conscious investor groups, there's an increasing probability of lawsuits if a company experiences a financial hit and never adequately discloses those risks.

So, the heightened chance of both climate-change related problems and shareholder lawsuits means one thing: Companies need to protect themselves through better disclosure. Period.
 
Of course, disclosure has its own perils. Once you've revealed all those potential risks, you're obligated to do something about them. Boards would be wise to step up their oversight of any liability-prone climate-change issues. And they should do so sooner, not later.
 

 
 
 

Dec 29
2009

For now, it's business, not government, that's really fighting climate change

Posted by annearf in Wal-Martenvironmental policyclimate change

annearf

Is voluntary action by U.S. industry--and not government regulation--our best hope for combating climate change?

That's what a story in today's New York Times about the Carbon Disclosure Project , a London-based group that measures individual company carbon emissions, suggests. And, it's probably true, at least for now. 

Nov 05
2009

Hot air, but not so much CO2 from banks

Posted by RedConn in John Goffclimate change

RedConn

Banks may have done considerable harm to the global economy, but they apparently are doing less damage to the globe itself.

When Nasdaq released the latest version of its OMX CRD Global Sustainability 50 Index this week, financial services companies dominated the index. All told, 11 financials made the index, which Nasdaq rejiggers twice a year.

The eleven on the list: State Street, All-State, Deutsche Bank, Credit Suisse, J.P. Morgan Chase, Skotia Bank, HSBC, Westac, Citigroup, The Royal Bank of Canada, and Axa.

The Global Sustainability 50 is an equally weighted equity index that serves as a benchmark for stock or companies that are taking a leadership role in sustainability performance reporting. The businesses voluntarily disclose their current environmental, social and governance risks as well as their revenue opportunities and how it will affect future performance.

Typically, companies in industries that have smaller carbon footprints tend to be more willing to promote their sustainability programs. Heavy CO2 emitters are often less enthusiastic about discussing their efforts. That's doubly true now that some sort of cap-and-trade legislation appears likely to be passed by Congress.

Health-care companies are also well represented on the recalculated index, with ten pharmaceuticals making the grade. Similarly, eight of the constituent stocks came from the information technology sectors.

Not surprisingly, only three smokestack businesses made it onto the index: 3M, ABB and Siemens.

You won't find a car-maker on the list, nor any electricity producers which rely heavily on coal-burning power plants.

Oct 21
2009

Guess what? Climate change is real, according to CEOs

Posted by annearf in top executivesclimate changecap and trade

annearf

Looks like more and more top corporate chiefs are willing to acknowledge the obvious--that climate change is real and caused by us humans.

In the latest wrinkle, PG&E CEO Peter Darbee recently disclosed that many U.S. top executives now embrace the idea that climate change is an urgent issue and a man made problem.  





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