More than 130 major companies press world leaders to phase out fossil fuels by 2035
More than 130 major companies press world leaders to phase out fossil fuels by 2035
We’re already dealing with the costs of the climate crisis — that’s the message from the more than 130 companies who signed onto a letter urging world leaders to ditch fossil fuels, at least when it comes to energy production.
The companies — which include Ikea, Nestle, Unilever and Volvo — want them to do so by 2035. Next month, those leaders will gather in Dubai for COP28, the latest United Nations Climate Summit, and the companies are urging quick action from the world’s richest economies.
Right now, those economies are likely to miss emissions targets by 2035, so companies are sounding the alarm.
Gernot Wagner, a climate economist at Columbia Business School, points to signatories — such as consumer goods giant Unilever, which has previously warned of potential hits to its bottom line because of lower crop yields and water scarcity that climate change can bring.
“This is essentially business management with fiduciary responsibility to shareholders saying, ‘We can only see this going in one direction, so let’s get on with it,’” Wagner said.
Some 200 of the world’s biggest companies could face climate change-related costs of $1 trillion over several decades if more is not done to avert the worst outcomes.
Of bigger concern for businesses is uncertainty, per Harvard’s James Stock.
“There’s trillions of dollars of investment that need to be made,” he said. “And if you’re going to be making those investments, you need to be able to be sure that they’re going to pay off in the future.”
So, companies need policy certainty from governments, but Christian Leuz at the University of Chicago says major corporations could make a big difference if the biggest polluters among them — in industries such as utilities, transportation and energy extraction –—clean up their acts.
If the top polluters become simply average polluters, that could lower emissions overall by 35 to 50 percent, Leuz says.
“For that, I’m actually optimistic that we can see some very significant carbon reductions,” he said.
If, he added, governments require public corporations to disclose their carbon footprints, which is something U.S. regulators are considering.
Correction (Oct. 24, 2023): Previous versions of this story misidentified where Gernot Wagner works.
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