It sounds like a clarion call from a politician: “The world faces an incredible climate challenge and we need a bold response to match.” But the message is coming from someone else: the CEO of Saudi Aramco, one of the largest energy companies in the world.
While political leaders are meeting in Madrid for another round of negotiations over the 2015 Paris Agreement, a host of business leaders aren’t waiting for them to make changes. Unilever, for instance, recently announced plans to slash its annual use of new plastics by half—or nearly 400,000 tons per year—over the next five years. And earlier this year, 17 leading automakers wrote a letter asking the US government to reinstate stricter vehicle emissions standards after they were rolled back.
Shelly Fust, a senior client partner with Korn Ferry’s Global Energy and Industrial practice who specializes in clean tech, renewable energy, and sustainability, says business leaders recognize that they need to move faster than the speed of government in switching to energy sources with a lower carbon footprint. “We are seeing increased focus of business leaders in proactively creating policies and strategies to battle climate change,” says Fust.
The inability of governments to negotiate new carbon trading rules—a major agenda item for the two-week-long climate summit—is part of what is driving some of the business leaders. But, as with many other matters lately, consumers are driving the business community too. One recent survey showed that nearly 70% of US consumers consider sustainability when buying products, for instance. That same survey also found that 47% of consumers said they would pay more for sustainable goods.
Kate Shattuck, a senior client partner at Korn Ferry and coleader of the firm’s Impact Investing practice, says business leaders and consumers don’t have the patience to wait for a policy solution anymore. “People are swiping right on climate,” says Shattuck, likening their desire for faster action to social media’s expectations of instant gratification. To be sure, several major protests demanding that governments take bolder action to fight climate change are planned to coincide with the Madrid meeting. The activists are pushing governments to submit proposals to significantly reduce greenhouse and other gas emissions over the next two decades.
Shattuck says people have already lost trust in political leaders to take action on climate change in a meaningful way. To win back that trust, she says, political leaders need to pay attention to how business leaders are tackling the issue. “Companies are going directly to consumers with sustainability initiatives to create deeper, more meaningful relationships,” says Shattuck.