Adopting climate change into Business

Climate change is generating a host of new strategic challenges and opportunities for business organizations. It has lead to a shift in competitive and regulatory environments both directly and indirectly; through the world wide political efforts to constrain the carbon emissions and directly through bio-physical impacts such as extreme weather conditions.

Companies, are under more pressure to act and react on the global danger of climate change and are required to do a lot more than earlier times. Global organizations are at a threshold where they are expected to minimize their negative impact on climate change and treat the phenomenon as the business problem rather than the corporate social responsibility. Having said so, it is extremely important to understand that there is no one common way to curb this issue. Every industry and every organization has to devise a special set of efforts that can fit in and can help in achieving the results.

Devising a unique set of strategies is not the only solution and the companies have to also develop a communication mechanism where it can educate and communicate all the stakeholders about the strategies that they are adopting and how does that impact them in a positive way. Both these aspects (of devising out strategies and developing a communication mechanism) depend largely on the resources available to sustain the value chain. It is also crucial that the companies remain vulnerable towards their human resources infrastructures and other supply chains.

Another important point to be taken into account is, if the businesses understand their impact of climate change then why there is no supporting research found in major journals and business columns? Also, why is that the companies not devising long term strategies that can put them in the forefront of curbing the threat? Why is there is no corporate communications mechanisms where the company is communicating to all its stakeholders and world at large about the efforts it is undertaking?

Serious questions….. In following paragraphs, I will try to reason with facts and opinions on these issues.

I feel following may be the driving forces behind the above key questions

  • The variability in the climate like floods/extreme heat/ volcanoes etc., have been fairly regional. These adversities affect a relatively small part of the region (country/countries) and thus, it becomes difficult to measure and comprehend the impact of the same at the global level. An organization that has made its presence felt at the global level finds it difficult as to how should it devise out its strategy at the central level and implement at the global level considering that the supply chains vary as per the regions.
  • The occurrence of the adversities and the extent of destruction from the same will always be different from those that have already occurred in the past. In other words, there is no pretext to follow regarding the climatic adversity since all have been different from those that have occurred in past. However, lessons can be learnt from all the occurrences in the past but, the response of the governments and the organizations needs to be different. There are two major reasons for such kind of responses:
  1. Change in the Earth’s temperature: This is one of the major reasons wherein between the two calamities, the temperature on Earth could have changed and thus, the actions that were suitable and appropriate for the first time may not hold good the next time. Reaction to any calamity depends largely on the temperature around us.
  2. Change in Human Behavior: This is also an important factor where there is a shift in human response between the two calamities leading to more devastating or may be less serious natural disaster.
  • Another important factor is the already existing business models that serve as the basis for running a business. These business models are based on basic assumption that the social and economic environment will flourish regardless of change in climate or may be change in the political scenarios. Being biased about the organizational science and the fear of understanding the negative impacts of climate change on the new policies, new strategies, new organizational systems, new communication strategies leads to virtually no or very less mention in the top journals.

There could be a variety of other factors as well but according to me these are some of the relevant ones that largely affects the organizational inability to adopt a policy that makes it competitive and socially responsible at the global level at the same time.

The business implications of climate change could be much worse than it is expected or it is much milder than what we are anticipating. The climate will continue to warm and as already discussed, it is important that we start taking this as a business strategy. However, adopting Climate Change as the long term structural change, the companies site huge uncertainties (cost-benefit analysis for short and medium term) for making a policy structures both at the national and at the international levels and also, preparing a mechanism for communicating the same in a unified manner to all the stakeholders that ultimately leads to achieving the MISSION & VISION.

Understanding this argument from organizations point of view, it becomes imperative that every organization whether large or small/ national or global begin to take or start the process of decision making that consider various levels of uncertainties in their businesses, that are in line with the long term trajectory of climate change policies and also, are robust and flexible enough to withstand the inevitable changes in their business processes.

I have always focused on establishing the phenomenon of climate change as the business strategy and also to create reforms where companies can communicate its initiatives and practices to all its stakeholders in a unified way. To establish climate change as a business strategy and to adopt a robust communication system that covers the length and breath of any organization is very challenging and requires alternations and modifications at the various levels.

My primary motive is to study the impact of climate change on organizations and on the strategies that are adopted or might be adopted in the future businesses to develop a strong corporate communication network. It is again and again said that adopting climate change as a business strategy and developing a communication system is a very difficult task; so I want to understand why these two are so difficult or looks to be an uphill task. Let’s understand why adopting as a business strategy is difficult:

  • It is important for any organization to broaden their horizons in terms of time zones (short term, medium term or long term) and have to create policies and strategies that it can follow for a fairly long period of time. The impacts of climate change are pretty long term and so it is important that organizations need to assess their corporate risks and the strategy processes more than medium or short term time frame.This is difficult since the strategies are generally adopted keeping in mind the consumer attitudes, political scenarios, legal regulations, advertising and publicity campaigns etc. Taking all this into account and analysis for the climate change, it is necessary that organizations draft policies and strategies that hold value for a fairly long period of time.
  • The capital investments that the organizations make also plays a significant role while adopting a new strategy. Any organization that intends to grow its business needs to invest and the investment can be in the form of upgradation in the product line or upgrading the equipment or investing in a new project or investing in fixed assets etc. etc. As a strategic part, if the climate change and its impact is not considered in these decisions, it will prove to be expensive affair for any organization in the long run.
  • Another important aspect is to develop corporate information system i.e., to have a set of people that has the knowledge and expertise about the climate change. To integrate climate change into the business strategy, it is important to emphasize how much time and effort is being investing any new technology or new technologies that are environmental friendly and at the same time are profitable for the business. This would mean that adopting a new technology or a new methodology into the system; the respective organization not only understands its financial implications of its decision but also takes into account the operational implications of the same so that they can achieve the targeted results.
  • The success or failure strongly depends on how strategically and impactful an organization communicates its initiatives to all its stakeholders. This means developing a strong corporate communications holds the key since the world today is all about communicating as what we are doing and how we are doing at the same time.

Whether we communicate internally through company portal or company magazines or we communicate externally through trade journals, company website, conferences or seminars (now webinars) or through social media or through various agencies that are related to the field of business….the key is to communicate and state the polices strategies and initiatives in great details with the public at large.

Keeping all these in mind while formulating a business strategy takes a lot of time, effort and knowledge at the same time so that the business strategies helps in attaining the desired goals.

Communicating climate change is increasingly getting complicated and when the communication is about adopting the same as a business strategy, it becomes even more troublesome. The companies across the industries recognize the dual threat and opportunity climate change creates and communicating the same (both internally & externally) with the same plan of action remains an uphill task to achieve. Companies that excel on integrating sustainability and social impact into their businesses, however, fails when it comes to communicating about their work in that respective field.

Achieving the two aspects of integrating climate change as business strategy and maintaining the robust corporate communication set up not only makes the company competitively stand out but also makes it as a force multiplier for achieving sustainability goals. Having discussed as to why it is a difficult task to make climate change a business strategy in the previous paragraphs… let’s now understand why having a strong corporate communication mechanism is an aweful difficult task as well. Difficult yet achievable…

  • The no “one-size-fits-all” approach makes it necessary for the organization while communicating about the strategies and its benefits. It is necessary that the companies must take into account as to whom are they targeting: the end consumer, the employees, the stakeholders, the government or legal systems or the experts that work in the respective field on the daily basis. To further make the corporate communications effective, it is imperative that the medium/ channel with which it is communicated is chosen wisely. This enables the message being communicated effectively and the response of the audience is receptive.
  • Climate change is a very hazy concept and to communicate effectively with the right of audience, it is necessary that companies communicate the impact/ (s) of actions/ inactions with the help of live examples. For example: the negative impact that floods/ droughts bring to farmers or the fishermen is well known and it then becomes necessary for the company to explain the steps it is taking as an initiative to minimize the effects on the farmers or the fishermen. These live examples can be in the form of short stories that are explained either with the help of pictures or some advertisement that has graphics and words both. This will help in getting the audience involved in the initiatives and stand with the company in the mission of minimizing the effect of climate change. Let’s take an example: TIMBERLAND (famous footwear brand) asked its consumers to put their best foot forward (tagline for the initiative) for the outdoors that they explore. The brand encourages the users to visit the cities (via trek) that it is making “green” (with the reduced carbon emissions) and encouraging renewable source of energies and also supporting nature-driven solutions for climate mitigation. This way company has made its efforts tangible and has also involved its end users in their efforts to sustain climate.
  • It is necessary to have a two-way dialogue as far as the adopting climate change strategy and its impact is concerned. The dialogue between the two parties helps in a healthy discussions, thus, incorporating ideas and suggesting and making the entire network authentic and more responsive.
  • An important aspect for an authentic corporate communication set up is relying and communicating with science-based facts only for a strong and a powerful message. For an organization that is already working towards environmental sustainability and want to or is already communicating to all its stakeholders; backing its marketing claims and sustainability related decisions or policies with real and relevant impact on figures must be a standard practice. This ensures a huge level of transparency and credibility amongst its target audience. An example to this is:“WE WORK” (an American commercial real-estate company) made a decision of cutting down on the consumption of meat completely on all its corporate events. The company received a lot of flak from its members and its staff regarding the decision. However, the company was considered a stand out in the environmental sustainability when it explained to everyone that the decision is based on the scientific research that observed the impact on the environment gets reduced drastically (by more than 445 million pounds of CO2) when the same is done collectively. Further, the company also explained the positive impact on saving of gallons of water in preparing of meat and lastly saving a large number of animal life.
  • A leader walks the talk and it works…. Any target audience gets convinced when the message is conveyed to them by the leader of the organization. A leader who initiates the change when speaks up, it becomes reliable, relevant, transparent and believable. Hence, it is extremely necessary for the leader to speak about the initiatives that its organization takes and leads with an example to achieve all that it intends to.

To my understanding, these are some of the factors that makes it easier for any organization to develop a sound corporate communication set up and adopt climate change as a business strategy. Also, at any given point in time, it is extremely important for any organization to be vulnerable enough and acknowledge the areas where there it lacks and sees the scope of improvement. To be able to discuss and communicate that are needed to fix the shortcomings with equal ease (as the success stories) will help win the trust of the society at large and environmental sustainability can become a reality.

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