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The business case for climate change - Outcomes of the Copenhagen Accord - EY - Global

Outcomes and implications of the Copenhagen AccordOutcomes of the Copenhagen Accord

With or without an agreement, organizations need to maintain momentum in implementing their climate change agenda.

For two weeks in December 2009 the world watched as nations gathered in Copenhagen to discuss responses to climate change.

One hundred and nineteen1 heads of state and government, as well as ministers from 1942 countries represented at Copenhagen, sought to agree on a post-2012 climate change framework.

The goal was to have an agreement in place that could be implemented following the end of the first commitment period of the Kyoto Protocol on 31 December 2012. The result was the Copenhagen Accord (the Accord).3

All developed countries and the majority of developing countries accepted the Accord. However, opposition from a few developing countries could not be countered in the limited timeframe. With global consensus beyond reach, the Accord was only “noted” by participants of COP15 and is not legally binding.

Still, the presence of so many heads of state and government proves that there is political will and commitment to stay the course on what is undoubtedly a long and complex journey.

Key elements of the Accord

  • Limit dangerous global temperature change increases to below two degrees Celsius.
  • Stabilize and then reduce GHG emissions.
  • Tackle forestry-related GHG emissions, which currently account for approximately 18% of global GHG emissions.4
  • Invest in climate change mitigation and adaptation. Developed countries have pledged fast-start funding of “approaching US $30 billion” for developing countries from 2010 to 2012 and a target of US $100 billion a year by 2020.
  • Launch a technology development and transfer mechanism that focuses on national circumstances and priorities.

Timeline of key international climate change treaties

No global agreement? Keep moving forward

With or without a binding global agreement, organizations need to keep driving forward. They need to meet national and regional legislation. They also need to consider the ever-increasing demands of shareholders, investors and other stakeholders, including customers. In an already complex and uncertain environment, organizations need to stay focused and act now.

There will be both risks and opportunities. Organizations will need to:

  • Use well-executed plans to gain competitive advantage, like investing in cleantech.
  • Take advantage of available tax incentives, grants and stimulus packages.
  • Be aware of increased risks as the harmonization of conflicting reporting standards takes longer than desired; implement systems to track the patchwork of requirements.
  • Prepare for potential litigation that may arise from increased regulations, policy and laws around climate change at regional and national levels.
  • Remain focused on current regulations, as well as future national, regional and global energy and climate change regulations.
  • Execute a low-carbon strategy that optimizes opportunities and mitigates risks of new regulations. Efforts will need to focus on:
    • Developing a strategy that delivers sustainable business in the long term
    • Identifying and building efficiencies into the entire value chain
    • Managing sustainable supply chains by taking steps to realize operational efficiencies
    • Climate change framework

    • Innovating to meet increasing consumer demand for products and services with a lower impact on climate change

When developing a strategy, consider using a framework to anchor climate change efforts. For more information regarding this framework, please refer to EY’s The business response to climate change: choosing the right path.

1 “Copenhagen United Nations Climate Change Conference ends with political agreement to cap temperature rise, reduce emissions and raise finance,” United Nations press release, 19 December 2009, PDF.

2 Ibid.

3 Copenhagen Accord (PDF).

4 Design Document for the Forest Investment Program (PDF).


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