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    Why your business should take action

     

    September 29, 2023

     

    It’s time for companies to take a leading role in climate responsibility

     

    Seemingly continuous weather events—sometimes accompanied by rolling blackouts-- have stimulated greater public interest in climate responsibility. Companies that invest in green technologies –technologies and sciences that reduce human impacts on the natural environment--can reduce energy consumption, and have a direct impact where it is highly visible—for example, in the reliability and resilience of the electrical grid.

    In addition to investing in green technologies, companies taking their responsibility build toward sustainable operations by adopting policies and practices taking environmental benefits into account and by concentrating their efforts on cutting waste, reducing carbon emissions, recycling materials, and using renewable energy resources. Corporate actions like this are absolutely necessary to provoke the kind of changes needed in taking steps to meet global carbon agreements—and to keep their employees focused and engaged.

    Climate responsibility as a corporate driver

     

    The emphasis on sustainability and energy efficiency reduces energy costs and creates a work environment that attracts the best employees and boosts employee morale. Studies have shown that leadership teams increase financial value and have a greater impact on stakeholders by pursuing sustainable management practices. In addition, profitability increases because many current and prospective customers seek out companies that have prioritized environmentally friendly practices. Indeed, many companies that have reinvented business models by embedding top-tier sustainability and innovation within their corporate fabric outperform the competition.

    Companies that combine top-tier innovation with top-tier sustainability and trust outperform their industry peers on operational and market metrics.”

    Companies that combine top-tier innovation with top-tier sustainability and trust outperform their industry peers on operational and market metrics,” finds a 2020 report on responsible leadership jointly authored by The Forum of Young Global Leaders, The Global Shapers Community, and Accenture. The estimated operating profits of these companies “are 3.1% higher on average, and they deliver a higher annual total return to shareholders.” Those companies that haven’t achieved “sufficient levels of sustainability and trust to steer positive results or prevent its negative consequences,” on the other hand, “saw a negligible impact on operational performance.”

    As a result, an increasing number of large-to-small companies have established—and often surpassed—environmental, social, and governance (ESG) targets and have used those actions to drive corporate responsibility programs and financial decisions. A September 2020 BlackRock Global Sustainability Survey shows that climate change and climate protection have become the largest factors in driving investors to double their portfolios of sustainable assets. Although businesses have different GHG emission challenges, achieving net zero emissions has become a core component of many corporations’ mission and vision statements.

    Moving to net zero requires corporate leadership, teamwork, and innovation

     

    Meeting and surpassing corporate sustainability goals requires leaders who have the organizational skills and fortitude to reverse traditional business and financial practices. Company strategies now depend on data and modeling to provide a sophisticated perspective about the impact of sustainability on both the bottom line and the health and well-being of employees.

     

    While many different technology solutions for cutting emissions and achieving energy efficiencies exist, leaders committed to achieving sustainability objectives also must rely on project teams that understand the technologies and can align technology objectives with sustainability strategies. Along with understanding and deploying green technologies, project teams must use standardized metrics to monitor environmental performance and compliance.

     

    Even with the emergence of renewable energy resources that enhance grid reliability and resilience, leaders and teams must also seek innovative methods for mitigating climate change, creating value, and guarding against risk. Innovation sometimes means integrating existing technologies in new ways rather than developing new technologies. New business paradigms built around LED lighting and connected systems, for example, offer structured, cost-effective methods for achieving profitability while conserving energy and reducing emissions. Connected systems that integrate lighting, smart devices, and environmental control systems with the IoT can establish methods for attaining long-term sustainability objectives and optimizing workspaces that support productivity and well-being.

    Wind farm of turbines delivering clean energy
    Other cost-effective methods include insulating office and workspaces, converting to heat pump technologies, and replacing energy-consuming equipment. While some types of insulation lower heating and cooling costs by slowing conductive and convective flow, radiant barriers and reflective insulation decrease radiant heat gain. Heat pumps offer good coefficient of performance (COP) ratings by using low amounts of energy to produce relatively high levels of heating and cooling for greater energy efficiency. Because heat pumps depend on electrical energy to run a compressor, carbon emissions remain low. Replacing aging equipment with newer energy-efficient equipment conserves energy and cuts operating costs.

    Businesses can drive climate protection and climate responsibility

     

    A number of countries have taken important steps towards mitigating climate change through policies and mandates. Without those steps, individuals and businesses may lack incentives to move away from age-old practices that harm the environment.

     

    However, policies and mandates have limits; countries may lack the will to either enforce policies or comply with agreements. Despite leaders from nearly every nation signing the Paris Agreement in 2015, no country has met the emission-cutting goals required to curb increases in global temperatures.

    Because of this shortfall, businesses of all sizes must assume a greater share of responsibility for mitigating climate change.11 Businesses drive 70% of the global GDP, giving them the leverage they need to provoke change. Groups of businesses can work together to establish standards and metrics for connectivity and communication. They can take advantage of opportunities to create public/private sector partnerships based on sustainable objectives, leadership, teamwork, and innovation. The collaboration resulting from such partnerships can potentially drive policy and financial success while establishing long-term benefits for stakeholders, communities, and consumers.

     

    Discover how your business can make the Green Switch, and help meet your carbon reduction targets.

    Listen to this article, and discover other topic related blog podcasts, here.

    About the author:

    Jonathan Weinert

    Jonathan Weinert

    IoT and connected lighting, Signify

    For further information, please contact:

    Signify Global Media relations - Professional Lighting
    Claire Phillips

    Tel: +44 7956 489081

    Email: claire.phillips@signify.com

    For commercial enquiries:

    About Signify

     

    Signify (Euronext: LIGHT) is the world leader in lighting for professionals, consumers and the Internet of Things. Our Philips products, Interact systems and data-enabled services, deliver business value and transform life in homes, buildings and public spaces. In 2023, we had sales of EUR 6.7 billion, approximately 32,000 employees and a presence in over 70 countries. We unlock the extraordinary potential of light for brighter lives and a better world. We have been in the Dow Jones Sustainability World Index since our IPO for seven consecutive years and have achieved the EcoVadis Platinum rating for four consecutive years, placing Signify in the top one percent of companies assessed. News from Signify can be found in the Newsroom, on X, LinkedIn and Instagram. Information for investors is located on the Investor Relations page.

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