Mobilising Business Behind The Climate Action Plan

21 Apr 2021 | 09.44 am

Mobilising Business Behind The Climate Action Plan

Susan Rossney wonders how realistic are Climate Action Bill targets

21 Apr 2021 | 09.44 am

Business is largely ready to get serious about global heating and climate action, says Susan Rossney of Chartered Accountants Ireland, but current and future governments need to lead with unswerving commitment

We all remember the surreal sense of calm of the first lockdown. Rivers ran clearer, the air was cleaner, and cities more peaceful. Despite a global pandemic, there was a sense that out of adversity might come a change to the status quo.

It’s now clear that even the crippling economic impact of a pandemic didn’t inadvertently deliver the desired carbon emissions reductions. We were probably being hugely ambitious.    

No one could argue that the government’s Climate Action and Low Carbon Development (Amendment) Bill 2021 is not ambitious. Indeed, the government described it as the most ambitious legislation of its type in any country to date.

Likewise, no one could argue with the need for ambition. The 2021 Climate Change Performance Index of almost 60 states ranked Ireland as a ‘Low Performer’ when it comes to climate action. This was a slight improvement on ‘Very Low’ the year before.

Ireland remains the joint-worst country for emissions of greenhouse gases.

The International Energy Agency just this week expressed its hope that 2019 would prove to be the year that emissions peaked, so international pressure is no doubt adding to the government’s determination.

Ireland achieved only a 6% reduction in its GHG emissions in 2020 compared to 2019. While this reduction is six times larger than that experienced during the 2009 global financial crisis, we risk a rebound in emissions once restrictions ease.

Individuals can only shoulder so much

So, it makes sense that Ireland’s Climate Action Bill sets historic targets. But how realistic are these targets?

Individuals can only shoulder so much of the burden. They can retrofit their homes, switch to renewable-energy providers, and invest in EVs, but with the enterprise sector accounting for 13% of Ireland’s emissions, the buy-in and effective participation of businesses all around the county is desperately needed to deliver the changes needed. For businesses grappling with the devastating impact of Covid-19, reducing their carbon footprint might be low on their priority list.

That said, investors, suppliers, consumers and employees are demanding more, and businesses of all sizes can’t ignore these demands. The SME and micro-business sectors are the backbone of the Irish economy, and even small businesses around Ireland can embrace positive environmental action and build it into their operations quickly and without incurring significant costs — start small, plan and keep going.

Chartered Accountants Ireland represents almost 30,000 members, 63% of whom work in business, a large proportion in small businesses. Accountants are uniquely placed to drive climate action from within organisations. They make critical financial decisions daily about purchasing, procurement and many other things and the information they provide is vital to wider decision-making. We anticipate playing a significant role in helping businesses make the adjustment required under this plan.

Democracy by its nature sees churn, with a new government – and more importantly, a new programme for government – every few years. It’s extremely encouraging that the new Bill embeds binding and ambitious emissions-reductions targets in law. Equally welcome is the annual updating of actions for each sector as proposed in the plan, and crucially the requirement for government ministers to account for their performance towards achieving the legally-binding targets before the Oireachtas Climate Committee each year.

Faithful adherence from government is essential

If businesses, large and small, are going to be asked to play a progressive and effective role in this effort, in most cases redirecting time and energy from the day job, we have to see ongoing commitment and faithful adherence to the Climate Action Plan by this government, and governments to come.

A challenge of this magnitude requires seamless adherence to climate policy objectives, through election campaigns, government formation discussions, and the myriad other political considerations that arise for elected representatives.

Encouragingly, 60% of accountants reported that sustainability already forms a key part of their organisation’s business strategy, so the goodwill is there. If the government’s ambition can be matched by action, and continued action, its vision for the Irish economy of the future will become more tangible and attractive to the business community.

The success of the Climate Action Plan will also depend on fairness, and the perception of fairness. It is the prerogative of the government to decide on the trajectories for different sectors within the plan and it will determine, following consultation, how to apply the carbon budget across the relevant sectors, and what each sector will contribute in a given five-year period.

Transparency and continuity in approach will further help to build the confidence and buy-in of businesses.

It is to be hoped that the Climate Action Plan that emerges from the consultation process, and the Bill once signed into law, have real teeth. 2050 is not far away and we have a lot of work to do. Businesses will be ready, and the government needs to be ready to support them.

Susan Rossney (pictured) is  Public Policy Officer and Sustainability Expert with Chartered Accountants Ireland

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