Group10_C | SDG 13: Climate Action

Authors: Jugal Dave-BJ20135 | Harsha Bhatia-BJ20139 | Kunjika Bhasin-BJ20146 | Pranaya Jain-BJ20156 |

Rachit Chandra-BJ20160 | Saloni Agrawal-BJ20183

Introduction to SDG

The 2030 agenda of Sustainable Development, adopted in September 2015 by world leaders in the UN summit in New York, officially came into force on January 1, 2016.[1] The 17 Sustainable Development Goals (SDGs) have been adopted with the objective of eradicating poverty, protecting the planet, and ensuring peace and prosperity of the people by 2030. These SDGs act as a universal appeal to all nations, whether big or small, to take necessary actions for the betterment of society. The interlinkage of these SDGs ensures that the success in one SDG has a positive impact on others; for example, good health and well-being, and quality education could lead to decent work and economic growth. The SDG 13: Climate Action aims to combat climate change and its adverse impacts.

Climate change not only has an effect on the environment but also has major implications on nearly everything, caused due to a chain reaction of changes within the ecosystem. The 2030 agenda identifies climate change as "one of the greatest challenges of our time".[2] Rising sea water levels and shifting weather patterns caused primarily due to greenhouse gas emissions, have increased the risk of catastrophes and natural disasters with severe adversities. Tackling climate change has now become a necessity to ensure survival of mankind and other forms of life on earth.

SDG 13 aims to blend climate change measures into national policies, raising awareness on mitigation of climate change and reducing its impact. The alphabetical targets also call for implementation of the "commitment undertaken by developed nations at the UNFCCC" and for promoting "mechanisms for raising capacity for effective climate change- related planning and management in least developed countries". [3]

Actions must be taken as an individual, group, and country to tackle this crisis and have a sustainable future.

Relevance of SDG to India

India is one of the fastest-growing major global economy. It produces 75 % of its energy needs from sources like Coal, Gas & Oil [4], which is a major source of CO2, thus, to meet its growing energy requirements & at the same time achieving its SDG goal by 2030 i.e., 33-35% reduced emission intensity of its GDP [5]. Furthermore, India being the 2nd most populated country and the 3rd largest producer of CO2, producing about 7% [5] of the world’s total CO2 emissions, would require it to switch to greener energy sources & phase out greenhouse chemicals on an enormous scale. Thus, the requirement for capital and technological investment would remain paramount.

Climate change is relevant to India, as most of the country is agrarian, and millions of lives depend upon the climate for primary resources like water, food & employment. For example, 40% of the country’s GDP is generated from the Ganges river basin [6] & about 600 million people reside along the banks of such glacier-fed rivers. Any change in glacier sizes would impact river water flow & thus, severely affect the population as it is the primary source of water for drinking, daily household chores, and about 90% of agricultural water requirements [6].

Apart from rivers, India has a massive coastline of around 7500 Km, with 14.2 % of its population residing in these coastal districts [7]. Certain models suggest that about 36 million people would get directly affected [8] by rising sea levels by 2050. Also, increasing ocean temperatures is causing an imbalance in the natural eco-system. There has been an increase in jellyfish swamps encounters along the coast. Also, there have been reports of fish population changes due to change in the water temperature, thus affecting millions of fishermen across the coast [9]!

Adverse weather occurrence has increased off lately, and with many experts linking these to climate change. Last year, India lost 16 /million lives due to adverse weather, while smaller states like Arunachal Pradesh lives lost were as high as 362 /million [10], thus highlighting their vulnerability to climate change

Business Implication & Responses

Climate change has a growing impact on the existence of a business and its future operations not just in an operational or physical sense but also from a transitional perspective. Firstly, it is exposed to the most obvious risk in the form of operational inefficiencies caused by weather changes, scarcity of non-renewable resources causing shortage of supplies, wastage of resources etc. These operational issues clubbed with rising emissions by firms lead to increased costs and additional burden for them. [11] Secondly, the external environment within which the business operates is undergoing a transitional phase where the society is becoming more receptive to changes in technology and responsible buying behaviour. Failing to keep up with the societal changes clubbed with the threat from environmental regulations further exposes the business to transitional risks by way of increased costs.

However, proactive measures to deal with climate change can have a positive impact on companies by helping them reduce reliance on fossil fuels, the price volatility of which tends to increase costs. It also helps businesses thrive through innovative products and services which help them in reducing their carbon footprint. Many businesses have taken up the challenge to adopt a climate friendly approach and use the same to increase competitiveness and explore new market opportunities. [12] Some examples for the same are mentioned below:

ITC

ITC has adopted a comprehensive approach towards the triple bottom line (Economic, Environmental and Social Performance). The company meets 40.9% of its energy requirements from renewable sources (majorly biomass) and has been carbon positive since the last 14 years. It believes in life cycle assessment to monitor their value chain and find niches for improvement and encourages its supply partners to do the same. [13]

Nestle

To align the organisation with the UN Climate Change pledge, Nestle is aiming to achieve zero net GHGs emission by the year 2050. One third of Nestle production houses and factories are already meeting 100% of its energy needs from renewable sources. In 2019, the company scored a 94 out of 100 in the Dow Jones Sustainability Index and a full 100 in water conservation. In 2020, Nestle has achieved its objective of reducing GHGs by 10% per tonne of product in the top 100 warehouses by 100% (are compared to 2014). [14]

Aditya Birla Group

Ultratech Cement, an ABG company, recycles waste heat to generate electricity through the Waste Heat Recovery System (WHRS), with a current installed capacity of 59 MW. Birla carbon has made 75% of their production plants net energy positive and repurposed 60% of their material waste in the year 2019-20. Hindalco was ranked 3rd globally on the Dow Jones Sustainability Index (Emerging Markets) under the Materials Sector in Aluminium Industry. Aditya Birla Fashion and Retail Ltd has set up India’s first Platinum certified Apparel Warehouse, which adheres to the highest grade of green ratings- IGBC Platinum. [15][16][17][18]

Bain and Company

Bain and Company who attained a Carbon neutral status nine years ago is amongst one of the first few firms to do so. While it has already reduced emissions by 68%, it plans to take the number up to 100% as its target for the year 2030. The company has not only adopted an inward-looking approach but also an outward approach by including sustainability as a criterion for supplier evaluation and by helping its client firms become more responsible towards Sustainability and Climate change. The company has committed to invest $1B towards social initiatives as a part of which it collaborates with several NGO’s on initiatives related to climate change. [19]

Standard Chartered

Standard Chartered as a firm has taken initiatives to work towards the issue of climate change by developing sustainable and innovative financial solutions. They have accelerated their efforts at reducing emissions by taking a major step towards reducing their financing of coal. In 2019, it also came up with creative solutions alongside the “Centre for Climate Finance & Investment at the UK’s Imperial College Business School” by introducing a competition that involved identification of untapped opportunities for climate finance and creation of new financial frameworks to enhance bankability of climate investments. [20]

Analysis

The SDG of limiting the rise of global mean temperature to 1.5 degree C and meeting other SDGs along the way can be realised by strong will and actions of leaders and leveraging existing technology. Recently, ex-president Trump withdrew from the Paris Agreement in 2017, business leaders opposed this move openly leading to the formation of the “We Are Still In” coalition of US leaders to vow their support to responsible global competitiveness and climate action.

Companies have also come forth with more concrete, rather than simply vocal, steps for SDG 13, such as McDonald’s Scale for Good initiative and signed deals to purchase 380MW of power from renewable sources and encouraging other restaurants to do the same. Similarly, Microsoft updated its renewable portfolio to more than 1900MW, Google signed a 1.6GW deal.

These steps are majorly being driven by the voices and issues raised by the employees of these firms and they are pushing harder to ensure that these steps have a domino effect and coerce other partnering firms to take up positive Climate Action as a priority.

However, there is a “dark-side” to this resistance as well, with GM, Fiat Chrysler and Toyota, chiming in with ex-president Trump and demanded autonomous pollution standards. Their voices fortunately were drowned out by public and other manufacturers such as Ford, Honda, Volkswagen and BMW who argued for stronger clean car standards in favour of a more stable climate.

These movements are not simply philanthropic in ideals; it has been studied that over a span of 15 years, over 35 countries have seen economic growth while curbing emissions. According to New Climate Economy’s report [21], there is an untapped market opportunity of over $26 trillion in the next 10 years till 2030 with the potential to create 65 million low-carbon jobs. [22]

Suggested Path Forward

There is an increase in awareness and actions taken at global level to combat climate change. Organizations and agreements like IPCC, UNEP, WMO, and UNFCCC are the guiding lights for this mission. However, the efforts are not enough to meet the targets. There is a need for countries to build ‘green infrastructure’ and invest in low-carbon and energy-efficient technologies. Governments need to cooperate and be on the same page regarding financing climate action and the carbon trading markets. [23]

India’s stance on achieving SDG 13 is shaped majorly by the Paris Agreement, and the NDC submitted to UNFCCC. While the overall rank in the Climate Change Performance Index has been reasonably well for India, it needs to focus on renewable energy usage and its climate policy. [24] As per IRENA, decarbonizing and non-fossil fuel technologies can potentially boost the cumulative global GDP and create more jobs per unit of energy. [25] As such, India should engage in public-private partnerships to develop long-term action plans. India must strike a balance between the energy requirements and its renewable energy capacity. [26]

Tax havens, special economic zones, and subsidies for entities developing energy-efficient technologies should be provided. Tax and other exemptions could also be extended to companies with a benchmark level of sustainable practices. Further, to attract investors for such companies, specific mandates, and tax reductions can be provided.

A push and pull approach could be adopted where a push from societal actors and pull from decision-makers leads to better policy decisions for the fulfillment of the common goal.

Companies need to ‘fully integrate’ the SDGs in their business processes. Standardization of key performance indicators and investment indices is necessary for better measurement and monitoring. Reporting guidelines need to be formulated to encourage sustainable practices and increase accountability. Clear policy level commitments by the government are essential in this process. [27]

In the long-term, investments in R&D for innovative solutions and technological breakthroughs will be the fulcrum for achieving the SDG.

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