Acc620-Climate Change Impact On Business Assessment Answers

Question:

Discuss about the  Impact of Climate Change and Emissions on Business Strategies.

Answer:

Introduction:

Practical Motivation:

The attention of cost of the modern organizations is increasing regarding the environmental impact or carbon emission. Such attention is because of the association among climate changes and carbon emission that has persuaded the companies to be aware regarding carbon emission and environmental footprint. The area of developing business strategies is focused on all the supply chain levels such as transport distribution and production (Wahyuni, and Ratnatunga 2015). Certain legal regulations need to be maintained among several regulatory, liability as well as market approaches to attain a consistent, compatible as well as optimally efficient legal regime for responding to the climate change threat. Some inherent opportunities are driven by certain regulation changes which have potential to indicate a substantive variation within business operations, expenditure as well as revenue. “Climate change” itself can pose considerable direct threats with increased CO₂ emissions that are relied greatly relied on stable climactic conditions along with the ones that rely heavily on natural resources exploitation (Wahyuni, and Ratnatunga 2015).

Theoretical Motivation:

The societal issues of “climate change” have resulted in likely legitimacy gap. In order to deal with losses in business reputation, the organisations are involved in public relation activities as well as carbon disclosusres for reflecting their contributions to climate change mitigation, retaining business legitimacy along with keeping the social contract intact (Drake 2014). The organisations operating in carbon intensive industries are prone specifically to the demands of the shareholders as well as the stakeholders and they often display relatively greater involvement in affecting the policy procedures. Besides political lobbying and carbon disclosures, the formulation as well as labelling of low carbon products and services signifies another alternative to obtain legitimacy along with assuring competitiveness (Hahn, Reimsbach and Schiemann 2015).

Literature Review:

Legitimacy Theory Concept

Climate Change and Renewable Energy Consumption Relation with Business Strategy

Ioannou, Li and Serafeim (2015) indicated that the carbon footprint along with reduction strategies serves as the major corporate climate change approaches. Employing more renewable energy sources by the companies is observed to facilitate in decreasing the prices and demand for the coal and natural gas through increasing competition along with diversifying the energy supplies. Ioannou, Li and Serafeim (2015) also indicated that disclosure on carbon emissions and climate changes is deemed to incentivise the business innovation along with improving the environmental performance. Companies these days are held accountable for their own environmental performance and in addition to that the performance of contractors, suppliers and partners are also considered. 

Emission Reduction Initiatives and Related Risks Impact on Revenue

Hypotheses:

• Climate change along with consumption of renewable energy is integrated within business strategy developed by the organizations
• The emission reduction initiatives and related risks have impact on revenue and expenditure of companies 

References

Amran, A., Ooi, S.K., Wong, C.Y. and Hashim, F., 2016. Business strategy for climate change: An ASEAN perspective. Corporate Social Responsibility and Environmental Management, 23(4), pp.213-227.

Drake, F., 2014. Global warming: the science of climate change. Routledge.

Hahn, R., Reimsbach, D. and Schiemann, F., 2015. Organizations, climate change, and transparency: Reviewing the literature on carbon disclosure. Organization & Environment, 28(1), pp.80-102.

Wahyuni, D. and Ratnatunga, J., 2015. Carbon strategies and management practices in an uncertain carbonomic environment–lessons learned from the coal-face. Journal of Cleaner Production, 96, pp.397-406