Private Sector Climate Governance

Question 1

What is the priviliged position of business in climate change governance?

Answer 1

• Clusters of public and private sector actors connected to each other by resource tendencies, such as information, money, legitimacy (Carter, 2001)
• Policy outcomes are made up by decision-makers in government and interests of capital and labour; influenced by various interest groups

Question 2

How were private sector interests in climate change characterised in the 1990s?

Answer 2

• Fossil Fuels and related industries and finance industry were only corporate sector interested in climate change

Question 3

What are the six pillars of corporate strategy in regard to climate change?

Answer 3

1. Challenge climate science
2. Fund climate-sceptic NGOs and charities
3. Emphasize cost of action
4. Diplomacy to crate stalemate in internal negotiations
5. Using domestic politics to stall international talks
6. Directly influence climate change negotiations

Bulkeley and Newell, 2015

Question 4

What two models do Skjarseth and Skovin (2001) outline for influencing business attitude?

Answer 4

1. Corporate Actor Model
   
   • Environmental Risk
   • Company’s environmental reputation
   • Capacity for organisational learning
2. Domestic Politics Model
   
   • Societal demands for environment protection
   • Government supply of environmental policy
   • Political institutions linking demand for and supply of environmental policy

Question 5

How did private sector interests in 2000s?

Answer 5

• Rise of carbon markets
• Emergence of low carbon economy
• More diverse range of business sectors engaged

Question 6

How has emerging business engangement in the UK been characterised?

Answer 6

• Green technologies could help reconcile economic growth and ecological integrity in opening up policy agenda (Owens, 2010)
• Climate became seen as ‘good’ for business

Question 7

What is co-op’s approach to climate change?

Answer 7

• Co-op’s initiative seen as predominantly matter of business strategy rather than corporate social responsibility (Laufer, 2003)
• Portrayed engagement in CSR motivated by intrinsic factors (e.g. ethical values and moral leadership) rather than ‘extrinsic factors’ (Dhanesh, 2015)

Question 8

What are the critiques to co-op’s climate change approach?

Answer 8

• Disconnect between climate action and discursive sustainability published in its Annual Sustainability reports
• ‘What is good for business is good for the environment’ (Drake et al., 2004)
  
  • Geographical perspective critique this due to incompatibility of traditional business growth and environment concern
• Information in its annual sustainability is often cherry picked shown by lack of disclosed information on quantity and steps to reduce emissions
• Green washing and selective disclosure of positive information sows reports aimed at promoting ethical image and framing of CSR (Lyon and Maxwell, 2011)
• Co-op’s strategy of voluntarism raises complex issues of transparency and legitimacy within private sector governance

Question 9

What are Shell’s four contributions to tackling climate change?

Answer 9

1. Supplying natural gas to replace coal for power generation
2. Carbon capture and storage strategies
3. Developing alternative energies
4. Implementing energy-efficiency measures in their operations

Question 10

How did Shell’s stance change following the public uproar around Brent Spar debate?

Answer 10

• Shell moved from economic development stance towards sustainable development discourse
• Deconstruct boundaries between firm and nature (Livesey and Kearnis, 2002)

Question 11

How does Shell frame gas?

Answer 11

• Peddle gas as a ‘clean’ energy source
• Frame this though reports and documenting framing gas as ‘smart’ and ‘best’ solution

Question 12

What are shell scenarios?

Answer 12

• Explores features, insecurities and boundaries of future landscape with engagement of alternative viewpoints
• Influence policy and promote own agenda

Question 13

What are Shell’s two New Lens Scenarios?

Answer 13

• Mountains
• Oceans

Question 14

What is Shell’s Mountain scenario?

Answer 14

• Creation of new policies to unlock gas resources
• Stimulate global gas consumption to increase by more than 3/4 by 2035
• Become backbone of cleaner global energy system (Imeida, 2013)

Question 15

What do Shell need to change about their climate change strategy?

Answer 15

• Need to bring energy and climate change tracks together to produce one synergistic approach (Hoffman, 2006)
• Currently focused on energy strategy

Question 16

How do HSBC frame climate change?

Answer 16

• For HSBC climate business is a new aspect of business for them to capitalize on the long term commercial opportunities arising from the transition
• Are their interests ecological based or fundamentally business orientated?

Question 17

What are avenues for private sector involvement?

Answer 17

• Emissions trading
• Carbon offset market
• Investment in technologies
• CSR tools
• Investment strategies

Bulkeley and Newell (2015)

Question 18

How is voice of industry cautioning against hasty action?

Answer 18

• Challenge science behind climate change
• Creation of “astroturf organizations” -> persuade anxious public that fears of climate change were misplaced and emphasize crucial role of fossil fuels in economic development
• Emphasize economic costs of tackling climate change
• Directly fed into the sixth pillar of firm’s political strategy

Bulkeley and Newell (2015)

Question 19

Self-regulation of private firms?

Answer 19

• BP and Shell have established their own intra-firm trading system which encourage competitive reductions between different parts of the firm
• Saving money through reduced use of energy
• First-mover advantage from developing new technologies and production processes
• Emerged ahead of even the EU’s own emission trading scheme

Bulkeley and Newell (2015)

Question 20

What is the general difference in the outlook of climate change between US and European industries?

Answer 20

• European have an outlook of inevitable climate action are keen to gorge role for themselves in playing constructive part in policy debate, e.g. Shell
• US due to state of domestic politics concerning climate debate have been able to tackle the issue with much depth

Newell (2010)

Question 21

What are the role of states for Newell (2010)

Answer 21

• States acts as gatekeepers of demands, respecting some and neglecting others
  
  • Notable how governments filter demands is favourable to certain actors and agendas
  • Does not suggest corporations are more powerful than states in international politics of global warming

Newell (2010)

Question 22

How have carbon markets become invovled with climate change governance?

Answer 22

• Carbon markets have become dominant feature of global climate change governance
• Raises questions about changing nature of power and authority in global environmental governance

Bernstein et al. (2010)

Question 23

What is the role of tCO₂e in carbon markets?

Answer 23

• Market-mechanisms path created ‘unit of account’ called tonne of CO₂equivalent (tCO₂e)
• Basis for almost all existing carbon markets to date and therefore in effect is the currency of carbon markets

Bernstein et al. (2010)

Question 24

What will be the result of development of carbon markets?

Answer 24

Generate friction and pressure for cooperation (particularly at global level) because:

• Global carbon market requires political action to exist – without GHG emissions, there is no commodity to trade and there will be massively reduced demand for offsets
  
  • Without certainty at global level, attention will shift to national and sub-national emissions trading systems to drive global demand
• Markets more likely to be built up nationally or regionally, on basis of domestic politics, and questions about linkage between markets will be decided after

Bernstein et al. (2010)

Question 25

What is the traditional governing mode of climate change?

Answer 25

* Legally binding global treaty engages all states in common purpose * International law translates to national regulation, which directs domestic actions at more local levels ## Footnote **Bernstein et al. (2010)**

Question 26

How does the development of carbon market defy traditional governing modes?

Answer 26

* Diverse carbon markets and infrastructure elements develop on their own * Rather than driving a response, multilateral cooperation more likely to guide and regulate response driven by existing practices in carbon markets ## Footnote **Bernstein et al. (2010)**

Question 27

How have the insurance industry become involved with climate change

Answer 27

* Since 1993, insurance companies have made announcements of serious risks of large-scale collapse of insurance business due to increases in pay-out for large-scale weather-related disasters * Started to lobby governments to reduce emissions and examine own practices to reduce emissions ## Footnote **Newell and Paterson (1998)**

Question 28

Why are insurance companies potentially important to climate change governance?

Answer 28

Insurance companies provide 22% of investment in stock markets, large role in global capital markets, problems to the industry would have knock-on effects for global economy as a whole ## Footnote **Newell and Paterson (1998)**