Although the climate change conference in Copenhagen failed to achieve its objectives of a binding treaty around carbon emission reductions, sustainable business is here to stay and companies need to gear themselves towards a carbon constrained future. 

In the past couple of weeks, investors representing $13 trillion in assets issued a statement stressing the importance of concluding a legally-binding agreement including a global emission reduction target of between 50 and 85% by 2050.  The same group urged investors, businesses, and governments not to wait for a global treaty before taking action. Actions should be taken now to curb emissions.

In South Africa, due to the lack of binding legislation, measuring and voluntarily reporting on emissions has been left to the remit of companies on the JSE Top 100 as part of the Carbon Disclosure Project, as well as environmentally conscious companies recognising their responsibilities in this respect.  In 2009, 68% of the JSE Top 100 voluntarily disclosed their carbon emissions, ranking only behind Brazil in disclosure response globally.

Mid market businesses are now starting to recognise their social responsibilities in this regard as well and are starting to take action.  TheCarbonReport.com, an offering developed by local company sustainableIT, now allows companies, irrespective of size, to measure and report on emissions through validated processes.  “The solution is geared towards businesses wanting to establish their environmental impact and is the first step towards embracing a sustainable future”, explains Teresa Legg, Director at sustainableIT.  “The cost and complexity of emissions reporting has previously prohibited many businesses from participating in voluntary emissions reporting.  Through the tooling we have developed and our expertise we have been able to dramatically reduce costs to the client.  Every business, no matter how large or small contributes in some way to climate change and more accountability and responsible practice needs to be adopted ”, she elaborates.

Businesses are certainly starting to take action.  Puleng Technologies, a company of fewer than 100 staff has engaged sustainableIT to quantify their carbon footprint. “Although we are a services based company, we still produce emissions with the energy we consume, the paper we use and our travel, both commute and business related.  We recognise that we have an environmental impact and we need to measure it so that we can manage it”, explains Steve James, Director at Puleng.  “It is not just about being green, it is about developing a programme of energy efficiency and cost reductions and TheCarbonReport will provide us with the baseline we will use”, James states.

Aubrey Davies, Managing Director of Cape based ISP, I-Soft Net agrees.  “We are relatively small but measuring our impact has two benefits.  Firstly it allows us to concentrate on areas where we can become more efficient, with a baseline to measure against.  Secondly it allows us to create awareness with our staff which will result in downstream environmental benefits within their sphere of influence”.

With an estimated 900 000 small and medium enterprises in South Africa, the opportunities to reduce emissions within South Africa are exponential.  With energy costs continuing to rise, more businesses are expected to focus on energy and carbon reduction initiatives.  However, companies are encouraged to measure first to ensure that ROI is delivered and benefits are quantified.

 Government’s proposal to cut SA’s greenhouse gas emissions will force businesses to become more energy efficient, with IT leading the way to a low carbon economy.

 This is according to Tim James, founding director of Sustainable IT, who says government’s offer is very achievable, even with the current investment Eskom has in coal-based power.

The Presidency has offered to cut emissions by 34% below expected levels by 2020, and 42% by 2025, as climate negations get under way in Copenhagen. The pledge is conditional to a fair and effective agreement under the UN Framework Convention on Climate Change, as well as financial and technological support from developed countries.

“The offer is a reduction in emissions intensity, rather than a reduction from a stated baseline, which makes it less compelling. But it certainly is a massive help towards achieving a deal in Copenhagen,” says James.

He adds that organisations will need to become more energy efficient, with pricing levels dictating this, irrespective of the target that may or may not be set in Copenhagen.

“Setting aggressive targets for SA business will force a reduction in carbon intensity within manufacture, which will stand SA companies in very good stead in a carbon-competitive future landscape,” says James.

These reduction figures are in line with SA’s Long-Term Mitigation Scenarios, released last year to set a strategic direction for the country’s climate policy.

Angus Rowe and Siegfried Brits, from sustainability solutions provider impactChoice SA, say the reduction targets would bring future emission levels back to almost the current level, at around 450 million tons of CO2 per year. “It seems a very ambitious target, but not impossible to achieve given stringent regulations that need to be put into place,” they add.

“The execution of such an ambitious target will no doubt lead to a cap-and-trade system whereby emissions levels will have to be allocated to economic sectors and companies within these sectors,” add Brits and Rowe.

They explain that allocations under a cap-and-trade system will leave especially large emitters with an allowable cap of emissions, while the surplus will have to be made good by buying carbon credits.

“While burdensome on emitters, this system will facilitate funding and the impetus to grow green projects on a proliferated basis, which in turn will deliver green energy for the future.”

 James points out that energy has been very cheap, particularly for corporate and industrial SA, meaning there was no real incentive to adopt low carbon solutions. “It has to change in future – our very livelihoods depend on it.

“What many fail to realise is that the opportunity for SA is enormous. Because our economy is already energy constrained, embracing and investing in clean tech and clean energy now will give us a massive competitive advantage in the future.”

According to James, ICT has an enormous role to play in moving SA towards a low-carbon economy. “IT allows us to be smart. It allows us to measure, monitor and, ultimately, reduce.

“IT is all about innovation, being efficient and adaptation. The fight against climate change demands this and IT will be at the forefront of much of the new design and innovation that is required.”

Brits and Rowe add that several factors are converging to provide a strong impetus for energy transformation in the country. “Given that the South African targets be ratified in the new global warming treaty at Copenhagen, together with the current and expected future electricity crisis in SA, companies will have no choice but to adapt all of their strategies to incorporate sustainability objectives – else business as usual will be going out of business.”

President Jacob Zuma will head to the climate negotiations next week to meet with heads of state to broker a global climate deal beyond 2012, when the first commitment period of the Kyoto Protocol comes to an end.