2Sustain

Despite challenging economic conditions and regulatory uncertainty, a majority of corporate executives expect to increase spending on climate change initiatives between 2010 and 2012, according to new survey results from Ernst & Young.

The survey, conducted in the spring of 2010, polled 300 global corporate executives from 16 countries with at least US$1b in annual revenue. Among these respondents, 70 percent plan to increase spending on climate change initiatives over the next two years. Nearly half plan to spend between 0.5 percent to more than 5 percent of their revenue on climate change initiatives. (As a frame of reference, for a US$1b company, this represents an anticipated spend of US$5 million to US$50 million annually.)

Here are a few other key finding from Ernst & Young’s new research:

• 89 percent of survey respondents said corporate climate change activities are being driven by evolving customer demands.

• More than 40 percent of those polled believe that equity analysts currently include climate change-related factors in company valuations.

• 82 percent of respondents plan to invest in energy efficiency initiatives over the next 12 months. About half of the respondents confirm new ventures, such as spin-offs or start-up businesses, as an area for focus.   65 percent say they intend to focus investments on new products and services.

• About two-thirds (66 percent) of respondents are discussing climate change programs with their suppliers and 36 percent of respondents are already working directly with these stakeholders to decrease the carbon in their supply chains. It’s great to see that the environmental impact of the supply chain is finally getting the attention it deserves. Like Walmart , many companies now recognize that the  environmental footprint of a global supply chain is many times larger than an operational footprint –and most importantly, these companies are starting to take action to minimize impacts throughout the supplier network.

• 94 percent of respondents see national policies as important or very important in shaping their climate change strategies, although 81 percent recognize the importance of global or international policies.

The full report, Action amid uncertainty: the business response to climate change, is available here.