Look beyond business’s hot air

With COP27 in full swing, it’s worth remembering that the corporates sounding off so piously about the environment have for years stood in the way of climate change mitigation efforts.

The 27th Conference of the Parties to the UN Framework Convention on Climate Change, or COP27, began this week in Egypt.

The annual gathering of heads of state, ministers, negotiators, civil society representatives, climate activists and business leaders aims to take stock of commitments made under the Paris Agreement, and to try (27th time lucky?) to agree on how to end the relentless rise of global emissions and adapt to the associated human and environmental devastation.

We were way off target even before the war in Ukraine sparked a chain of events that has led to record-breaking fossil fuel profits and the “coal comeback” that has so delighted many local asset managers.

In a move that must have irritated the Intergovernmental Panel on Climate Change (IPCC), The Economist’s cover story last week called on readers to “Say goodbye to 1.5°C”.

The less-understood irony is that policy failure on climate is to a large extent attributable to the very entities that are making a killing from the war. It is well documented (including in the IPCC reports) that the fossil fuel industry has played a huge role in spreading misinformation and influencing political officials to weaken and delay climate-related policy and regulation.

Had countries taken the urgent action that scientists have for decades warned is necessary, their economies would not now be so reliant on fossil fuels from powers that use that dependency as a geopolitical weapon.

You would never guess this from the industry’s messaging, which is all about how committed it is to tackling climate change. Just look at the sponsors of South Africa’s pavilion at COP27 — they include greenhouse gas behemoths Sasol, Thungela and Exxaro, and Standard Bank, Africa’s largest lender to the oil and gas industry.

However, this high-level public support for climate action is not matched by what these companies say when it comes to regulation that, if enacted, would force them to reduce emissions. Organised business submissions to parliament this year on the Climate Change Bill and proposed amendments to the Carbon Tax Act demonstrate this duplicity.

Presentations by the Minerals Council South Africa, Business Unity South Africa (BUSA) and the Chemical & Allied Industries’ Association all started in much the same way: with assertions of how crucial climate action is and how much they support a robust policy approach from local regulators. Then each association went on to outline the reasons why regulation that affects their members is a bad idea with dire economic implications.

In arguments to back up their claims, they largely accused the government of failing to “align” the carbon tax and carbon budgets under the Climate Change Bill; of exposing businesses to “double jeopardy” by seeking to limit emissions through a carbon budget and by taxing those emissions; and of unreasonably expecting industry to reduce emissions where there has been voluntary mitigation and further reduction is not “feasible or available” (a nonsense argument — all emissions are mitigable).

BUSA has also taken the staggering view that the Climate Change Bill should not be permitted to limit emissions from any existing authorised operations.

Speaking with forked tongue

If these objections sound rational to you, bear this in mind: the same associations have been intimately involved, for more than a decade, in engaging (aka lobbying) the government on these proposed laws — a process that has time and again resulted in the weakening of the proposals.

The bottom line is that it doesn’t matter what the government does or how far it bends to accommodate it, business will always resist to the full extent of its power any attempt to regulate it effectively.

And this is precisely why we have laws: because humans do not voluntarily change behaviour that benefits them.

In objecting repeatedly to legislated emission reduction requirements and an effective carbon tax, business eloquently makes the case for exactly why regulation is crucial if we expect to make any progress on climate change.

Imagine a world in which organised business coalesced around positive climate action, rather than deploying so much energy and capital in resisting it. The many non-fossil fuel members of these business associations that have silently endorsed a regressive collective position on climate regulation should be ashamed of themselves.

This article was first published in the Financial Mail on 10 November 2022.

By Tracey Davies

IMAGE: 123RF / heiness

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