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Durban dynamics: navigating for progress on climate change - Beyond Durban - where do we go from here? - EY - Global

Durban dynamics: navigating for progress on climate changeBeyond Durban - where do we go from here?

Without a global agreement, tackling climate change will become more expensive, fragmented and complex.

Climate change is not just an environmental issue but a fundamental economic one.

Meeting the needs of a growing economy against a backdrop of finite resources and a more extreme, unpredictable climate will be one of the key challenges of the 21st century.

High stakes for business

The outcome of the Durban meeting will determine the future of the Kyoto process, the development of forestry markets and how the Green Climate Fund will operate and to a certain extent, the prospects for carbon markets.

These are vital issues that will potentially affect not only the business model and strategy of many organizations, but even their future viability. So will everything be lost if policy-makers cannot agree a global climate deal?

The lack of a deal will certainly undermine the low-carbon agenda and tackling climate change will become much more challenging. There may be a retreat from global approaches to addressing a global problem and instead a renewed push to identify local solutions.

Potential consequences of no agreement

Without a global agreement, tackling climate change will become more expensive, fragmented and complex.

Society will need to prepare for a world in which temperatures increase by more than 2°C. In these circumstances, businesses need to start focusing on how they, their suppliers and their customers will adapt to a changed environment.

‘’Rather than working out how to live in a carbon-constrained world, the emphasis may need to be on living in a climate-constrained world. This will have enormous consequences for businesses and make adaptation a key priority in addition to mitigation,’’ says Juan Costa Climent, Global leader, Climate Change and Sustainability Services, EY.

Reason for optimism: role of business and private sector

Despite the challenges ahead, there is still some cause for optimism. While policy-makers have struggled to agree a joint approach and clear market signals have been lacking, business pioneers have embraced the climate change agenda.

Responsible investors have shown that it is possible to be committed to environmental and social value creation at the same time as securing financial returns. And new industries that offer significant growth opportunities, as well as environmental benefits have started to develop.

In the face of continuing policy uncertainty, the private sector will play a critical role in shaping solutions and developing economically viable approaches to addressing climate change and sustainability.

By adopting a proactive approach to both mitigation and adaptation, business can set an important example to society at large. While a lack of international agreement at Durban will certainly set back efforts to address climate change, businesses are not stalling their efforts.

In any case, we have not reached that stage and need to wait for the outcomes from the COP summit.

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