In a new report, CEOs and top management of some of the leading companies in the five Nordic countries respond to questions of how climate efforts and competitiveness are connected and provide opportunities for the Nordic region and the international community.
In total, 38 interviews were conducted (27 CEOs, 3 chairs and 8 others from top-level management in the five Nordic countries: Denmark, Sweden, Norway, Finland, Iceland) in order to investigate the connection between climate efforts and competitiveness. Their answers have been summarized and analysed in a new report financed by the Nordic Council of Ministers.
Together, the respondents represent companies with approximately 540,000 employees across the globe. The aggregated revenue of the companies is around 200 billion EUR, corresponding to approximately 17 percent of the GDP of the Nordic region.
Climate change action as a business strategy
Out of the 38 interviews conducted in this project, every single company said that climate responsibility strengthens competitiveness. Some say this has not yet happened, but that future competitiveness depends on climate responsibility. Several examples were given as to why this is the case. In many instances, companies see that demand has shifted towards more sustainable products.
Many of the companies say that climate change action is part of what will drive innovation and competitiveness in the years to come. By investing in green technology and climate efficient production, they believe that they have a better position to meet the demands of the future. One of the interviewees Pia Yasuko Rask, Senior Engagement and Responsibility Manager of Grundfos stated:
– As a global leader in efficient pump solutions, we see business opportunity in pioneering solutions addressing the global water and climate challenges. This is where doing well and doing good can meet.
According to the company leaders, the main reasons for why climate efforts are also good for business and can boost competitiveness are:
• New business opportunities are created
• Energy and resource efficiency reduces costs
• Employer branding is strengthened, and employees are more satisfied
• Increased customer demand leads to increased sales • Environmental requirements in public procurement
The most important factors to succeed in making good business out of climate efforts are:
• Legislation and policy instruments that provide clear long-term frameworks for business
• Access to renewable energy
• High level of innovation
The interviewed company leaders say that the Nordic region can contribute to reaching the goals of the Paris Agreement, and the Nordic impact can be greater than what is proportional for this small region.
The following aspects describe how Nordic companies see that they and the Nordic countries can contribute internationally:
• Showing global leadership
• Promoting cooperation between countries
• Spreading innovations
• Exporting solutions
• Being a role-model
Climate targets and policies
At present, many companies have ambitious climate targets. Still, more than half say they could (or could possibly) have even more ambitious targets if the right policies were in place. More than 75 percent of companies say they could theoretically reach net zero greenhouse gas (GHG) emissions, given the right policy and more than half of those believe they can reach net zero GHG emissions before 2050 and some even before 2030.
Three important opinions can be identified from the interviews, regarding what governments should do:
1) Strong support for the Nordic region to be frontrunners in global climate efforts.
• Increase opportunities for collaboration, networks and joint-policy schemes.
• Be transparent and inspire others.
2) The Nordic countries should act together to push the EU to adopt more ambitious climate policies.
• Push for higher ambitions and stricter targets.
• Put a price on externalities and aim for a higher price on ETS allowances.
• Implement long-term energy policies.
3) The Nordics can be a strong force in the international community
• Cooperation for global leadership.
• Take an active role in the United Nations and other international organs.
• Constitute common policies (e.g. a price on carbon) and raise the global standards.
The report is produced by the Haga Initiative (SWE), Fossil Free Sweden (SWE), Climate Leadership Coalition (FIN), Icelandic New Energy (ISL) and Norway 203040 (NOR). It is financed by the Nordic Council of Ministers.
According to the report, the most important finding are:
• Climate change and the transition to a greener economy is a top priority for CEOs, chairs and top-level management in Nordic companies.
• There is a strong commitment from leading Nordic export companies to reduce both their own emissions and be part of the global solution to climate change.
• A clear connection between GHG emission reductions and profitability and competitiveness.
• Companies welcome higher targets for speeding up the climate transition.