CLIMATE CHANGE SUMMITS AND CONVENTIONS

In this post, we will know about the important summits and conventions related to fighting climate
change. As you know, climate change is a very crucial topic for Prelims as well as Mains since it
directly concerns the planet’s survival. For this reason questions are regularly asked on Climate
Change in Prelims as well as Mains.

Although climate change is a vast topic, it should be covered systematically. Climate Change topic can
be divided into the following sub-topics:

 What is climate change

 Effect of climate change

 Steps taken to halt and reverse climate change globally

 Indian response to climate change

In this post we will know about the steps taken to halt and reverse climate change in the form of
various summits and conventions.

United Nations Framework Convention on Climate Change (UNFCCC)

UNFCCC is also popularly known as the Rio Earth Summit since this summit was held at Rio de Janerio,
Brazil from 3rd to 14th June, 1992. The objective of the Rio Earth summit was to stabilize green house
gas (GHG) emissions since green house gases like Carbon dioxide, Chlorofluorocarbon, Methane etc.
are primarily responsible for global warming and resultant climate change.

However, the Rio treaty itself sets no mandatory limits on GHG emissions for individual countries and
contains no enforcement mechanisms. Thus, the treaty is legally non-binding. UNFCCC came into force
on 21st March 1994.

Parties to UNFCCC are classified as:

Annex-I countries – industrialized countries and economies in transition. There are 40 Annex I
countries and the European Union.
Annex-II countries – developed countries that pay for costs of developing countries. There are 23
Annex-II countries and the European Union.

Developing countries

Conference of Parties

The Conference of Parties (COP) is the prime authority of the convention. It is an association of all
member countries (or “parties”) and usually meets annually for a period of two weeks. These sessions
are attended by several thousand government delegates, observer organizations, and journalists.

The COP evaluates the status of climate change and the effectiveness of the UNFCCC treaty. Twenty
COP have taken place till 2014.

Kyoto Protocol

The negotiations in the 3rd COP resulted in a binding treaty known as the Kyoto Protocol in 1997 that
entered into force on 16th February 2005. It lays down binding quantified emission reduction targets
for all industrialized countries for the period 2008-2012, although the US, the world’s largest emitter
of GHG’s did not ratify the Protocol.

The Kyoto protocol lists specific emission reduction targets for each of the 37 industrialized countries
that are listed in Annex-I of the UNFCCC.

Recognizing places greater responsibility on developed countries for the current high levels of GHG
emissions and places a heavier burden on them to reduce GHG emissions under the principle of
“common but differentiated responsibilities”.

The three mechanisms through which Kyoto Protocol aims to reduce GHG emissions are:

1. Emissions trading known as the ‘carbon market’ or ‘carbon trading’

2. Clean development mechanism (CDM)

3. Joint implementation (JI)

The Kyoto Protocol also contains an Adaptation Fund to finance projects adaptation projects and
programmes in the developing countries that are parties to the Kyoto Protocol.

Kyoto Protocol is a breakthrough agreement to fight climate change containing innovative ideas and
tools. It treats GHG emissions as tradable commodity and sets up a carbon market where buying and
selling of carbon credits take place on the basis of actual GHG emission reduction projects.

Developed countries can also set up emission-reduction projects in developing countries and earn
certified emission reduction (CER) credits that count towards meeting Kyoto targets.

Doha Climate Change Conference

The 2012 United Nations Climate Change Conference was held in December 2012 at Doha, Qatar.

The conference reached an agreement to extend the life of the Kyoto Protocol, which had been due to
expire at the end of 2012, until 2020 meaning that a successor to the Kyoto Protocol is set to be
developed by 2015 and implemented by 2020. Wording adopted by the conference incorporated for
the first time the concept of “loss and damage”, an agreement in principle that richer nations could be
financially responsible to other nations for their failure to reduce carbon emissions.

United Nations Framework Convention on Climate Change (UNFCCC)

The United Nations Framework Convention on Climate Change (UNFCCC) is an international

environmental treaty (also known as a multilateral environmental agreement) that was opened for
signature at the Earth Summit held in Rio de Janeiro in 1992 and came into force in 1994.

The ultimate objective of the Convention is to “stabilise greenhouse gas concentrations in the
atmosphere at a level that will prevent dangerous human interference with the climate system." It
states that "such a level should be achieved within a time-frame sufficient to allow ecosystems to adapt
naturally to climate change, to ensure that food production is not threatened, and to enable economic
development to proceed in a sustainable manner.“ 194 countries signed the UNFCCC showing near
universal agreement that there is a problem and that action is required against climate change.

The treaty itself is not legally binding as it does not set mandatory limits on greenhouse gas emissions
for individual countries and doesn’t contain any enforcement mechanisms.

Kyoto Protocol

Kyoto Protocol
The Kyoto Protocol is an international agreement linked to the United Nations Framework
Convention on Climate Change, which commits its Parties by setting internationally binding
emission reduction targets.

Recognizing that developed countries are principally responsible for the current high levels of
GHG emissions in the atmosphere as a result of more than 150 years of industrial activity, the
Protocol places a heavier burden on developed nations under the principle of "common but
differentiated responsibilities."

The Kyoto Protocol was adopted in Kyoto, Japan, on 11 December 1997 and entered into force
on 16 February 2005. The detailed rules for the implementation of the Protocol were adopted at
COP 7 in Marrakesh, Morocco, in 2001, and are referred to as the "Marrakesh Accords." Its first
commitment period started in 2008 and ended in 2012.

Doha Amendment

In Doha, Qatar, on 8 December 2012, the "Doha Amendment to the Kyoto Protocol" was
adopted. The amendment includes:

 New commitments for Annex I Parties to the Kyoto Protocol who agreed to take on
 commitments in a second commitment period from 1 January 2013 to 31 December
2020;

 A revised list of greenhouse gases (GHG) to be reported on by Parties in the second

commitment period; and

 Amendments to several articles of the Kyoto Protocol which specifically referenced

issues pertaining to the first commitment period and which needed to be updated
for the second commitment period.

On 21 December 2012, the amendment was circulated by the Secretary-General of the United
Nations, acting in his capacity as Depositary, to all Parties to the Kyoto Protocol in accordance
with Articles 20 and 21 of the Protocol.

During the first commitment period, 37 industrialized countries and the European Community
committed to reduce GHG emissions to an average of five percent against 1990 levels. During
the second commitment period, Parties committed to reduce GHG emissions by at least 18
percent below 1990 levels in the eight-year period from 2013 to 2020; however, the
composition of Parties in the second commitment period is different from the first.

The Kyoto mechanisms

Under the Protocol, countries must meet their targets primarily through national measures. However,
the Protocol also offers them an additional means to meet their targets by way of three market-
basedmechanisms.
The Kyoto mechanisms are:

 International Emissions Trading

 Clean Development Mechanism (CDM)

 Joint implementation (JI)

The mechanisms help to stimulate green investment and help Parties meet their emission targets in a
cost-effective way.

Monitoring emission targets

Under the Protocol, countries' actual emissions have to be monitored and precise records have to be
kept of the trades carried out.

Registry systems track and record transactions by Parties under the mechanisms. The UN Climate
Change Secretariat, based in Bonn, Germany, keeps an international transaction log to verify that
transactions are consistent with the rules of the Protocol.

Reporting is done by Parties by submitting annual emission inventories and national reports under the
Protocol at regular intervals.

A compliance system ensures that Parties are meeting their commitments and helps them to meet
their commitments if they have problems doing so.

Adaptation
The Kyoto Protocol, like the Convention, is also designed to assist countries in adapting to the adverse
effects of climate change. It facilitates the development and deployment of technologies that can help
increase resilience to the impacts of climate change.

The Adaptation Fund was established to finance adaptation projects and programmes in developing
countries that are Parties to the Kyoto Protocol. In the first commitment period, the Fund was
financed mainly with a share of proceeds from CDM project activities. In Doha, in 2012, it was decided
that for the second commitment period, international emissions trading and joint implementation
would also provide the Adaptation Fund with a 2 percent share of proceeds.

The road ahead

The Kyoto Protocol is seen as an important first step towards a truly global emission reduction regime
that will stabilize GHG emissions, and can provide the architecture for the future international
agreement on climate change.

In Durban, the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP) was
established to develop a protocol, another legal instrument or an agreed outcome with legal force
under the Convention, applicable to all Parties. The ADP is to complete its work as early as possible,
but no later than 2015, in order to adopt this protocol, legal instrument or agreed outcome with legal
force at the twenty-first session of the Conference of the Parties and for it to come into effect and be
implemented from 2020.

Conference of Parties

The Conference of the Parties (COP) is the "supreme body" of the Convention, that is, its highest
decision-making authority. It is an association of all the countries that are Parties to the Convention.

The COP is responsible for keeping international efforts to address climate change on track. It reviews
the implementation of the Convention and examines the commitments of Parties in light of the
Convention’s objective, new scientific findings and experience gained in implementing climate change
policies. A key task for the COP is to review the national communications and emission inventories
submitted by Parties. Based on this information, the COP assesses the effects of the measures taken by
Parties and the progress made in achieving the ultimate objective of the Convention.

The COP meets every year, unless the Parties decide otherwise. The COP meets in Bonn, the seat of the
secretariat, unless a Party offers to host the session. Just as the COP Presidency rotates among the five
recognized UN regions - that is, Africa, Asia, Latin America and the Caribbean, Central and Eastern
Europe and Western Europe and Others – there is a tendency for the venue of the COP to also shift
among these groups.

[Technical information] COP meetings

[More in depth information] about WMO’s attendance at the COPS (publications and papers) can be
found here.

Subsidiary Bodies

The Convention established two permanent subsidiary bodies: the Subsidiary Body for Scientific and
Technological Advice (SBSTA) and the Subsidiary Body for Implementation (SBI). These bodies give
advice to the COP and each has a specific mandate. They are both open to participation by any Party and
governments often send representatives who are experts in the fields of the respective bodies.

Subsidiary Body for Scientific and Technological Advice (SBSTA)

The Subsidiary Body for Scientific and Technological Advice (SBSTA) was created to provide UNFCCC's
Conference of the Parties with advice on scientific, technological and methodological matters. Two key
areas are promoting the development and transfer of environmentally-friendly technologies, and
conducting technical work to improve the guidelines for preparing national communications and
emission inventories. In addition, the SBSTA plays an important role as the link between the scientific
information provided by expert sources such as the IPCC on the one hand, and the policy-oriented needs
of the COP on the other. The SBSTA works closely with the IPCC, sometimes requesting specific
information or reports from it, and also collaborates with other relevant international organizations that
share the common objective of sustainable development.

Subsidiary Body for Implementation (SBI)

The SBI gives advice to the COP on all matters concerning the implementation of the Convention. A
particularly important task in this respect is to examine the information in the national communications
and emission inventories submitted by Parties in order to assess the Convention’s overall effectiveness.
The SBI reviews the financial assistance given to developing country Parties to help them implement
their Convention commitments, and provides advice to the COP on guidance to the financial mechanism
(operated by the Global Environment Facility (GEF)). The SBI also advises the COP on budgetary and
administrative matters.

The SBSTA and SBI work together on cross-cutting issues that touch on both their areas of expertise.
These include capacity building, the vulnerability of developing countries to climate change and
response measures, and the Kyoto Protocol mechanisms.

The SBSTA and the SBI have traditionally met in parallel, at least twice a year. When they are not
meeting in conjunction with the COP, the subsidiary bodies usually convene at the seat of the
secretariat.

Convention Amendments and Additions

The Convention recognizes that it is a "framework" document - something to be amended or augmented

over time so that efforts to deal with global warming and climate change can be focused and made
more effective. Some of these amendments or additions are described below:

Bali Action Plan

The thirteenth session of the Conference of the Parties (COP 13) in Bali, December 2007 Adopted the
Bali Action Plan (BAP), a two-year process designed to finalize a binding agreement at the COP15 in
Copenhagen in 2009. The BAP identifies five key building blocks required (shared vision, mitigation,
adaptation, technology and financial resources) for a strengthened future response to climate change
and to enable the full, effective and sustained implementation of the Convention, now, up to and
beyond 2012.

[Technical information] The Bail Action Plan

Nairobi Work Programme

In 2004, in Buenos Aires, UNFCCC Parties decided to elaborate a five-year work Programme under the
Subsidiary Body for Scientific and Technological Advice (SBSTA). Details of the work programme were
finalized in 2006 in Nairobi, where the programme was renamed the Nairobi work programme on
impacts, vulnerability and adaptation to climate change.
The aim of the Nairobi work programme is to assist all Parties, in particular developing countries,
including the least developed countries and small island developing states, to: improve their
understanding and assessment of impacts, vulnerability and adaptation; make informed decisions on
practical adaptation actions and measures to respond to climate change on a sound scientific, technical
and socio-economic basis, taking into account current and future climate change and variability.

[Technical information] The Nairobi Work Programme

[More in depth information] Concept Paper on WMO’s Role in the Nairobi work plan

National Adaptation Programmes of Action (NAPAs)

In 2001, the 7th COP of the UNFCCC recognised that developing countries needed assistance in
developing plans to address the adverse effects of climate change. In particular, the COP decided that
the Least Developed Countries (LDCs) “should be assisted in preparing National Adaptation Programs of
Action (NAPAs) to address urgent and immediate needs and concerns related to adaptation to the
adverse effects of climate change.”

“NAPA” should be considered as a process and not as a single document. It is a mean for LDCs to
communicate and disseminate their proposed programmes to address their adaptation needs. Support
for priority activities identified in the NAPA is available through the Global Environment Facility (GEF)'s
LDC Fund.

[Technical information] on NAPAs for each country can be found in the NAPA Priorities database

2014 Climate Change Summary – Chair’s Summary

The purpose of the 2014 Climate Summit was to raise political momentum for a meaningful universal
climate agreement in Paris in 2015 and to galvanize transformative action in all countries to reduce
emissions and build resilience to the adverse impacts of climate change.

I asked leaders from government, business, finance and civil society to crystallize a global vision for low-
carbon economic growth and to advance climate action on five fronts: cutting emissions; mobilizing
money and markets; pricing carbon; strengthening resilience; and mobilizing new coalitions.

An unprecedented number of world leaders attended the Summit, including 100 Heads of State and
Government. They were joined by more than 800 leaders from business, finance and civil society. This
Summary details their most significant announcements.

Convergence on a Long-Term Vision

A comprehensive global vision on climate change emerged from the statements of leaders at the
Summit:

 World leaders agreed that climate change is a defining issue of our time and that bold action is
needed today to reduce emissions and build resilience and that they would lead this effort.
  Leaders acknowledged that climate action should be undertaken within the context of efforts to
eradicate extreme poverty and promote sustainable development.

 Leaders committed to limit global temperature rise to less than 2 degrees Celsius from pre-
industrial levels.

 Many leaders called for all countries to take national actions consistent with a less than 2 degree
pathway and a number of countries committed to doing so.

 Leaders committed to finalise a meaningful, universal new agreement under the United Nations
Framework Convention on Climate Change (UNFCCC) at COP-21, in Paris in 2015, and to arrive at
the first draft of such an agreement at COP-20 in Lima, in December 2014.

 Leaders concurred that the new agreement should be effective, durable and comprehensive and
that it should balance support for mitigation and adaptation. Many underlined the importance
of addressing loss and damage.

 Many leaders affirmed their commitment to submit their Intended Nationally Determined
Contributions (INDCs) for the new agreement in the first quarter of 2015.

 Many leaders reaffirmed the objectives and principles of the UNFCCC, including the principles of
equity and common but differentiated responsibilities. In addition, others highlighted that the
global effort to meet the climate challenge should reflect evolving realities and circumstances.

Cutting Emissions

Without significant cuts in emissions by all countries, and in key sectors, the window of opportunity to
stay within less than 2 degrees will soon close forever:

 Many leaders, from all regions and all levels of economic development advocated for a peak in
greenhouse gas emissions before 2020, dramatically reduced emissions thereafter, and climate
neutrality in the second half of the century.

 European Union countries committed to a target of reducing emissions to 40 per cent below
1990 levels by 2030.

 Leaders from more than 40 countries, 30 cities and dozens of corporations launched large-scale
commitment to double the rate of global energy efficiency by 2030 through vehicle fuel
efficiency, lighting, appliances, buildings and district energy.

 The New York Declaration on Forests, launched and supported by more than 150 partners,
including 32 government, 20 subnational governments, 40 companies, 16 indigenous peoples
groups, and 49 NGO and civil society groups, aims to halve the loss of natural forests globally by
2020, and strive to end it by 2030.
  Twenty-four leading global producers of palm oil as well as commodities traders committed to
contribute to the goal of zero net deforestation by 2020 and to work with Governments, private
sector partners and indigenous peoples to ensure a sustainable supply chain.

 The transport sector brought substantial emissions reduction commitments linked to trains,
public transportation, freight, aviation and electric cars, which together could save $70 trillion
by 2050 with lower spending on vehicles, fuel and transport infrastructure.

 Some of the world’s largest food producers and retailers committed to help farmers reduce
emissions and build resilience to climate change.

Moving markets and mobilizing money

Moving markets across a wide range of sectors is essential for transforming economies at scale.
Mobilizing sufficient public and private funds for low carbon, climate resilient growth is essential to keep
within a less than 2 degree Celsius pathway. A new coalition of governments, business, finance,
multilateral development banks and civil society leaders announced their intent to mobilise over $200
billion for financing low-carbon and climate-resilient development:

 Countries strongly reaffirmed their support for mobilising public and private finance to meet the
$100 billion dollar goal per annum by 2020.

 Leaders expressed strong support for the Green Climate Fund and many called for the Fund’s
initial capitalization at an amount no less than $10 billion. There was a total of $2.3 billion in
pledges to the Fund’s initial capitalization from six countries. Six others committed to allocate
contributions by November 2014.

 The European Union committed $18 billion for mitigation efforts in developing countries
between 2014 and 2020.

 The International Development Finance Club (IDFC) announced that it is on track to increase
direct green/climate financing to $100 billion a year for new climate finance activities by the end
of 2015.

 Significant new announcements were made on support for South-South cooperation on climate
change.

 Leaders from private finance called for the creation of an enabling environment to undertake
the required investments in low-carbon climate resilient growth. They announced the following
commitments:

o Leading commercial banks announced their plans to issue $30 billion of Green Bonds by
2015
 o A coalition of institutional investors, committed to decarbonizing $100 billion by
December 2015 and to measure and disclose the carbon footprint of at least $500
billion in investments.

o The insurance industry committed to double its green investments to $84 billion by the
end of 2015, and announced their intention to increase the amount placed in climate-
smart development to 10 times the current amount by 2020.

o Three major pension funds from North America and Europe announced plans to
accelerate their investments in low-carbon investments across asset classes up to more
than $31 billion by 2020.

Pricing carbon

Putting a price on carbon will provide markets with the policy signals needed to invest in climate
solutions.

 Seventy-three national Governments, 11 regional governments and more than 1,000 businesses
and investors signalled their support for pricing carbon. Together these leaders represent 52
per cent of global GDP, 54 per cent of global greenhouse gas emissions and almost half of the
world’s population.

 Some leaders agreed to join a new Carbon Pricing Leadership Coalition to drive action aimed at
strengthening carbon pricing policies and redirecting investment

 More than 30 leading companies announced their alignment with the Caring for Climate
Business Leadership Criteria on Carbon Pricing.

Strengthening resilience

Strengthening both climate and financial resilience is a smart investment in a safer, more prosperous
future.

 A variety of innovative resilience initiatives were announced at the Summit, including many that
will strengthen countries and communities on the climate front lines. These include an initiative
to provide user-friendly “news you can use” climate information for countries around the world.

 Leaders agreed to strengthen and scale up the risk financing mechanisms for Africa and the
Caribbean.

 The African Risk Capacity announced an expansion of its services and coverage, including the
introduction of Catastrophe Bonds.

 An initiative to integrate climate risk into the financial system by 2020 was launched by a
coalition of investors, credit ratings agencies, insurers and financial regulators in response to the
growing number of extreme weather events.
  Leaders from the insurance industry, representing $30 trillion in assets and investments
committed to creating a Climate Risk Investment Framework by Paris in 2015.

Mobilizing New Coalitions

Governments, business and civil society are creating the coalitions needed to meet the full scope of
climate challenge.

 Leaders welcomed multilateral and multi-stakeholder actions between Governments, finance,

the private sector, and civil society to address emissions in critical sectors and support
adaptation and resilience, especially in Small Island Developing States, Africa and the Least
Developed Countries.

Leaders from 19 countries and 32 partners from Government, regional organisations, development
institutions and private investors committed to creating an 8,000 kilometre-long African Clean Energy
Corridor.

The Global Alliance for Climate-Smart Agriculture, comprised of 16 countries and 37 organisations, was
launched to enable 500 million farmers worldwide to practice climate-smart agriculture by 2030.

Leaders of the oil and gas industry, along with national Governments and civil society organisations,
made an historic commitment to identify and reduce methane emissions by 2020. A second industry-led
initiative was launched by leading producers of petroleum who committed to address methane as well
as other key climate challenges, followed by regular reporting on ongoing efforts.

Industry leaders and Governments also committed to reduce HFCs in refrigeration and food storage. In
addition, public and private coalitions announced initiatives to reduce methane and black carbon in the
global freight supply chains and municipal solid waste.

A new Compact of Mayors, representing well over 2,000 cities pledged new commitments on climate
action supported by new funding from public and private sources — 228 cities have voluntary targets
and strategies for greenhouse gas reductions, that could avoid up to 3 gigatonnes of greenhouse gas
emissions per year by 2030.


A new coalition of more than 160 institutions and local Governments and more than 500 individuals
committed to divesting $50 billion from fossil fuel investments within the next three-five years and
reinvest in new energy sources.

Panels comprised of eminent global leaders, policy experts and citizen activists discussed the need for,
and multiple benefits of, accelerated climate action. Panellists focussed on the need for science-based
decision making; strengthening economic performance while cutting emissions, generating jobs and
enhancing resilience; pricing and reducing pollution for improved health; mobilizing new coalitions to
help move markets; and ensuring that the most affected are at the centre of the global response to
climate change.

The Way Forward to Lima, Paris and beyond

I thank all the leaders from Government, business, finance and civil society who came to New York with
ambition and commitment.

 If we want the vision laid out by leaders from Government, finance, business, and civil society
throughout the day, we must fulfil and expand on all the pledges and initiatives announced
today.

 We must maintain the spirit of commitment and action that characterized the Summit.

 As we look forward to Lima, later this year, and Paris in December 2015, let us look back on
today as the day when we decided – as a human family – to put our house in order to make it
sustainable, safe and prosperous for future generations.

 Today’s Summit has shown that we can rise to the climate challenge.

Why Take Action? The Impact on Businesses

It is generally accepted that the earth's climate is changing due to emissions of green house gasses into
the atmosphere, caused by human activity. If the resulting temperature increase is more than 2°C, any
damage will be irreversible, scientists believe. To combat climate change, governments all over the
world have committed themselves to emission targets and enacted policies accordingly. Although the
main policy instrument has been the introduction of carbon emission markets, many other policies are
in place, including eco-taxes, building regulation, tax credits, technology-specific incentives (for instance,
technology-dependant feed-in tariffs), or laws on recycling.

In practice, business decisions are driven by government policy, changes in consumer demand and the
technology innovation that enables businesses to comply with regulation and seek new opportunities.
Climate-smart companies adapt quickly to gain a competitive advantage.
Risks for Businesses
Climate Change Policy Risk
With climage change mitigation driven by
lawmakers, the risk of politically motivated
changes to public policy towards climate change
is high. Businesses that are in a carbon-intensive
industry or reliant on climate change-motivated
Actions
Adaptation
As climate change policy has many facets, so has
its impact on businesses. Mandatory activities
range from completing surveys, paying taxes,
implementing health & safety regulations to
participating in the carbon market.
subsidies or other favourable regulation are
particularly vulnerable. Conversely, most
investors avoid projects with high policy risk due
to its unpredictability.
Market Risk
Naturally, businesses face the risk of changes in
the prices of oil, gas, electricity and, where
required, carbon. To mitigate these risks,
companies can either reduce their exposure or
hedge the risk. At 2009 levels of carbon price, the
cost of carbon is almost negligible. However:
At $60 per ton carbon price, 10% of total cash
flow of listed companies will be transferred from
companies with below average carbon efficiency
to those with above average efficiency.
Climate Change Impact
With adverse weather conditions, changes in
climate may cause damages to buildings,
interruptions to infrastructure and supply chains
(for instance food). It may also change travel and
migration patterns.
Reputational Risk
Since climate change issues are high in the public
mind, not to engage in the debate could cause a
public backlash.
Credit Risk
Due to increased business risk exposure to carbon
price, credit rating of such entities may be at risk.
For instance, Drax Power, which operates a coal
fired power plant in the UK, has
beendowngraded in 2009 to below investment
grade, thus increasing the cost of borrrowing and
making it unsuitable for institutional funds to
invest.
The real challenge is in keeping up-to-date with
often fast-moving legislation. Where businesses
operate in multiple locations, they will also face
the daunting task of learning about the
differences between countries, states and even
councils.
Over and above the minimum compliance
activities, all companies can modify internal
processes, supply contracts, products and
services to drive down costs while going "green"
at the same time.
Corporations can take a much more pro-active
approach by creating and publishing a
sustainability report alongside their annual report
to explain how the business' objectives are
consistent with sustainability principles. As part of
the sustainability strategy the business may
implement
 Carbon strategy: to measure, monitor
and reduce the footprint
 Eco-efficiency: to become more resource-
efficient.
 Full cost accounting - encapsulate
environmental effects within the financial
measures used to make decisions.
New Investment Opportunities
Companies seek specific market opportunities,
often backed by venture capital, in developing
new technologies. Some of those companies have
grown into publicly traded, large organisations
such as , SolarWorld, First Solar, or Q-Cells. Other
investors seek specific opportunities in renewable
energy assets - solar and wind farms, promising
more stable cash flow.
Financial Risk New Revenue Streams

Induced by regulation on carbon emission targets,
the cost of capital for projects that are not
carbon-reducing may increase in line with
expectation of a carbon price.
Climate change leaders develop new offerings
based on their core capabilities and infrastructure
to pursue new revenue streams:
 HSBC created a number of climate change
indices (e.g. Low Carbon Energy
Production Index, Energy Efficiency Index)
that can be invested in through the bank.

 IBM has launched the IBM Big

Green project to reduce data centre
energy consumption with the help of IBM
products and services.

The Impact Of Climate Change On Business

TUESDAY, JANUARY 22, 2013 - 00:00 -- BY DR ALEX AWITI

Thinking about our addiction to carbon reminds me of the king of Phrygia and his request to the Greek
god Dionysus. King Midas asked that whatever he touched turn into gold. His wish was granted. But the
king soon realized that it was a curse.

The industrial revolution, powered by fossil fuels has granted our wishes for health, wealth and power
on a scale that now threatens to transform our planet into something profoundly inhospitable,
especially for posterity. Climate change caused by our insatiable appetite for carbon and its impact –
current and projected – is now almost incontrovertible.

There is compelling scientific evidence that climate change is a serious existential issue, which demands
urgent action to forestall the risk of damaging and potentially irreversible impacts on ecosystems,
societies and economies. Nicholas Stern, author of “The Economics of Climate Change”, popularly
known as the Stern Review, described climate change as “the greatest market failure the world has
seen”.

It is widely acknowledged that climate change will have a broad-ranging impact on economies and
financial markets over the coming decades. The impact of climate change has been accentuated by the
tens of billions of dollars in losses due to recent climate-related natural disasters such as the floods and
wildfires in Australia, Pakistan and Russia; droughts the Sahel and the Horn of Africa. A new draft federal
report on the current and anticipated impacts from greenhouse-driven global warning admits, “Climate
change is already affecting the American people”.

The evidence for climate change driven resource constraints is compelling. Climate change induced
constraints such as water scarcity will have direct local impacts. National, regional and global impacts
will be propagated through supply chains and through second order effects such as increased food
prices and instability. Moreover, rising global temperatures and extreme weather events that are likely
to become more frequent and severe are testing the Earth’s resilience. Put simply, resilience is the
capacity to adapt to change, withstand or recover from shock while still maintaining critical structures
and performing essential functions.

The Global Risks 2013, a report of the World Economic Forum, identified failure of climate change
adaptation and rising greenhouse gas emissions as among those global risks considered to be the most
likely to materialize within a decade. The limitations in our ability to transform our production and
consumption patterns will have a far more severe impact on our lives than climate change, especially
given the strong positive correlation between greenhouse gas emission and economic growth.

Global economic output and gains in human wellbeing is driven by big industry – heavy manufacturing
and agribusiness – and the allied services that drive their global supply chains. Similarly, Africa’s private
sector business accounts for 65-85% of the continent’s annual GDP growth. According to the Kenya Joint
Assessment Strategy 2007-2012, the private sector accounts for more than 80% of GDP and most
government revenues.

Climate-smart and resilient business must therefore be a key plank in Africa’s climate change adaptation
strategy. However, conversation on climate change has been limited to resilience and adaptive capacity
for smallholder farmers. Colossal diplomatic capital has been expended on how to protect vulnerable
agricultural and pastoral communities in Africa. I seldom hear global conversations about how climate
change will affect Africa’s business sector or how to “climate proof” Africa’s business.

Do not get me wrong. This is not to suggest that smallholder agricultural and pastoral communities do
not matter. They matter hugely. But smallholders thrive when they are nested in supply and value
chains of medium and large business, which are climate compatible. The resilience and adaptive
capacity of private sector businesses is inextricably bound to that of vulnerable smallholder farmers and
pastoral communities.

Climate change will have impacts on companies’ financial and social performance, with huge
implications of their ecological footprint. However, very little attention has been given to understanding
what climate change means for long-term investment risks and opportunities in the context of strategic
asset allocation, financing for investment and national economic growth. Very few private sector
businesses in Africa, particularly those that are in climate sensitive sectors, have the capacity and
resources to produce such evidence.

Multilateral organizations, which move large capital for private sector investment in Africa such as
International Finance Cooperation (IFC) should work with local universities and policy research
organizations to develop methods for evaluating climate risk and adaptation needs and responses, both
policy and technical, for the private sector.
Resilient Dynamism is the theme for this year’s World Economic Forum. In a world fraught with change
and uncertainty, vital institutions such private business must marshal prudent agility to build resilience
to the impacts of climate change.

China and India’s response to climate change!

I often hear the comment “whatever Australia does domestically to reduce its emissions, it will have no
real impact on global temperatures” and get asked the question “what are countries like China and India
doing to reduce their emissions”

Now while it’s true that Australia’s emissions are very low on a per country basis (though we are the
highest per capita) and whatever we do will not have a significant impact globally, under the Kyoto
protocol, we are one of 37 industrialised countries working together and it’s this combined effort that is
important as we respond to a changing climate.

As for China, the China Climate Change Info-Net is a good source of information on what China is doing
in response to climate change. The website outlines China’s policy on climate change, what action is
being taken on the ground to reduce emissions, China’s green energy goals and reports and
communications relative to climate change.

India’s Ministry of Environment and Forests Climate Change website lists initiatives such as increasing
significantly, the capacity of renewable energy installations, improving the air quality in major cities (the
world’s largest fleet of vehicles fuelled by compressed natural gas has been introduced in New Delhi);
and enhancing afforestation.

The Intergovernmental Panel on Climate Change (IPCC) is

the leading international body for the assessment of climate change. It was established by the United
Nations Environment Programme (UNEP) and the World Meteorological Organization (WMO) in 1988 to
provide the world with a clear scientific view on the current state of knowledge in climate change and its
potential environmental and socio-economic impacts. In the same year, the UN General
Assembly endorsed the action by WMO and UNEP in jointly establishing the IPCC.

The IPCC is a scientific body under the auspices of the United Nations (UN). It reviews and assesses the
most recent scientific, technical and socio-economic information produced worldwide relevant to the
understanding of climate change. It does not conduct any research nor does it monitor climate related
data or parameters.

Thousands of scientists from all over the world contribute to the work of the IPCC on a voluntary basis.
Review is an essential part of the IPCC process, to ensure an objective and complete assessment of
current information. IPCC aims to reflect a range of views and expertise. The Secretariat coordinates all
the IPCC work and liaises with Governments. It is supported by WMO and UNEP and hosted at WMO
headquarters in Geneva.
The IPCC is an intergovernmental body. It is open to all member countries of the United Nations (UN)
and WMO. Currently 195 countries are members of the IPCC. Governments participate in the review
process and the plenary Sessions, where main decisions about the IPCC work programme are taken and
reports are accepted, adopted and approved. The IPCC Bureau Members, including the Chair, are also
elected during the plenary Sessions.

Because of its scientific and intergovernmental nature, the IPCC embodies a unique opportunity to
provide rigorous and balanced scientific information to decision makers. By endorsing the IPCC reports,
governments acknowledge the authority of their scientific content. The work of the organization is
therefore policy-relevant and yet policy-neutral, never policy-prescriptive.

How does the IPCC work?

The Intergovernmental Panel on Climate Change is a huge and yet very small organization. Thousands
of scientists from all over the world contribute to the work of the IPCC on a voluntary basis as authors,
contributors and reviewers. None of them is paid by the IPCC. The work of the IPCC is guided by a set
of principles and procedures.

The Panel takes major decisions at Plenary Sessions of government representatives. A central IPCC
Secretariat supports the work of the IPCC.

The IPCC is currently organized in 3 Working Groups and a Task Force. They are assisted by Technical
Support Units (TSUs), which are hosted and financially supported by the government of the developed
country Co-Chair of that Working Group/Task Force. A TSU may also be established to support the IPCC
Chair in preparing the Synthesis Report for an assessment report.

Working Group I deals with "The Physical Science Basis of Climate Change", Working Group II with
"Climate Change Impacts, Adaptation and Vulnerability" and Working Group III with "Mitigation of
Climate Change". Working Groups meet in Plenary session at the level of government representatives.
The main objective of the Task Force on National Greenhouse Gas Inventories is to develop and refine a
methodology for the calculation and reporting of national greenhouse gas emissions and removals.

Besides the Working Groups and Task Force, further Task Groups and Steering Groups may be
established for a limited or longer duration to consider a specific topic or question. One example is the
Task Group on Data and Scenario Support for Impact and Climate Analysis (TGICA).
Management and Governance

In 2010 the IPCC Chair and the Secretary-General of the UN asked the InterAcademy Council (IAC) to
carry out a review of the IPCC's processes and procedures. The IPCC responded to the recommendations
made in the IAC report with a number of changes in its governance structure and procedures, agreed at
the 32nd, 33rd, 34th and 35th Sessions. For more information on this process and its results, see Review
of Processes and Procedures.

The Panel and the Plenary Sessions

The Panel meets in Plenary Sessions at the level of government representatives for all member
countries. Currently, the IPCC has 195 members. The Panel meets approximately once a year at the
plenary level. These Sessions are attended by hundreds of officials and experts from relevant ministries,
agencies and research institutions from member countries and from observer organizations. Major
decisions are taken by the Panel during the Plenary Session. For example;

1. the election of the IPCC Chair, IPCC Bureau and the Task Force Bureau;

2. the structure and mandate of IPCC Working Groups and Task Forces;

3. IPCC Principles and Procedures;

4. the work plan of the IPCC;

5. the budget;

6. the scope and outline of IPCC reports; and

7. the approval, adoption and acceptance of reports.

Role of IPCC Focal Points

Each IPCC Member country has a Focal Point which has been identified by the relevant authorities in the
country. IPCC Focal Points prepare and update the list of national experts to help implement the IPCC
work programme. The Focal Points also arrange for the provision of integrated comments on the
accuracy and completeness of the scientific and/or technical content and the overall scientific and/or
technical balance of drafts of reports.

In cases where no Focal Point has been identified, all correspondence is directed to the Ministry of
Foreign Affairs. For the list of IPCC Focal Points, please see here.

The IPCC Bureau

Go to Portal Current Bureau Previous Bureau (2002-2008)

The IPCC Bureau comprises the IPCC Chair, the IPCC Vice-Chairs, the Co-Chairs and Vice-Chairs of the
Working Groups and the Co-Chairs of the Task Force. The IPCC Bureau is chaired by the IPCC Chair. There
are currently 31 members.

The purpose of the Bureau is to provide guidance to the Panel on the scientific and technical aspects of
its work, to advise on related management and strategic issues, and to take decisions on specific issues
within its mandate, in accordance with the Principles Governing IPCC Work. For more details on the role
of the Bureau see the Terms of Reference of the Bureau agreed by the IPCC at its 33rd Session.

Members of the Bureau are elected by the Panel for the duration of an assessment cycle following
procedures laid down in Appendix C of the Principles Governing the IPCC Work. The Bureau shall reflect a
balanced geographic representation with due consideration for scientific and technical requirements.
IPCC Bureau members are grouped according to the six regions of the World Meteorological
Organization. None of them is paid by the IPCC.

The Panel at its 33rd Session decided to limit the term of office for the IPCC Chair, IPCC Vice-Chairs and
the Co-Chairs of the Working Groups and Task Force on National Greenhouse Gas Inventories, to one
term in the same position, to be applied for the next and subsequent terms.

The Task Force Bureau (TFB)

Current Bureau

The Task Force on National Greenhouse Gas Inventories (TFI) has its own Task Force Bureau (TFB)
composed of 12 members and the 2 Co-Chairs of the TFI. The TFB overseas the National Greenhouse Gas
Inventories Programme. The current TFB was elected in September 2008 according to the procedures
in Appendix C to the Principles Governing IPCC Work - Rules of Procedures for the Election of the IPCC
Bureau and any Task Force Bureau.

The term of the TFB is normally the same as the term of the IPCC Bureau, and its members are elected at
the same Session at which the IPCC Bureau is elected, unless decided otherwise by the Panel.

Executive Committee

Current Executive Committee

In response to recommendations made by the IAC, the Panel decided to establish an Executive
Committee to strengthen and facilitate timely and effective implementation of the IPCC programme of
work, strengthen coordination between Working Groups and Task Forces and to address urgent issues
that require prompt attention by the IPCC between Panel sessions.

Terms of reference, composition and mode of operation of the Executive Committee are described here.

IPCC Authors and Experts

Authors

Hundreds of experts are involved on a voluntary basis in the preparation of IPCC reports. Coordinating
Lead Authors and Lead Authors for IPCC reports are selected by the relevant Working Group/Task Force
Bureau, under general guidance provided by the Session of the Working Group (or by the Panel in case
of reports prepared by the Task Force on National Greenhouse Gas Inventories) from among experts
listed by governments and participating organizations, and other experts known through their
publications and works. None of them is paid by the IPCC.

The composition of the group of Coordinating Lead Authors (CLAs) and Lead Authors (LAs) for a chapter,
a report or its summary aims to reflect a range of scientific, technical and socio-economic views and
expertise; geographical representation; a mixture of experts with and without previous experience in
IPCC; and gender balance.

The CLAs coordinate the content of the chapter they are responsible for. There are usually two CLAs per
chapter, one from a developing country and one from a developed one. The LAs work in teams to
produce the content of the chapter on the basis of the best scientific, technical and socio-economic
information available.

In the course of the assessment process Lead Authors may also enlist Contributing Authors. Contributing
Authors provide Lead Authors more technical information on specific subjects covered by the chapter.

Review Editors

The role of Review Editors in the IPCC assessment process is to assist the Working Group/Task Force
Bureaux in identifying reviewers for the expert review process, ensure that all substantive expert and
government review comments are afforded appropriate consideration by the author teams, advise Lead
Authors on how to handle contentious/controversial issues and ensure genuine controversies are
reflected adequately in the text of the report. There will be two to four Review Editors per chapter
(including their executive summaries) and per technical summary of any IPCC assessment report.

Expert Reviewers

Expert reviewers review an IPCC draft report either by invitation or at their own request. Their role is to
comment on the accuracy and completeness of the scientific, technical or socio-economic contents and
the overall scientific, technical or social economic balance of draft reports.

IPCC reports undergo a multi-stage review process. During the first review, First Order Drafts are widely
circulated to independent experts all over the world that have significant expertise and/or publications
in particular areas of the report, and to experts nominated earlier by governments and participating
organizations. Those not selected to serve as a Lead Author or Review Editor for a given report
traditionally serve as an expert reviewer for the particular report. During the second review by
government and experts, Second Order Drafts and a first draft of the Summary for Policymakers will be
distributed through the government focal points to all governments, all authors, reviewers involved in
the previous expert review and further experts registering for the review. Thousands of scientists from
all over the world participate in the IPCC review process as an expert reviewer. For more details
see Principles and Procedures.

Observer organizations have the opportunity of involving their experts in the expert review stages. Such
experts provide reviews in their own name; they do not represent these observer organizations.