The Hong Kong Stock Exchange announced this week it will require listed companies to strengthen reporting on environmental, social and governance (ESG) matters, responding to investor demand for greater transparency in these areas. Many changes will take effect January 1, 2016. A transition to mandatory reporting for key performance indicators such as greenhouse gas emissions will phase in by January 1, 2017.
On Saturday, December 12th, the 195 parties to the COP21 in Paris agreed to a historic agreement aimed at reducing greenhouse gas emissions from both developed and developing nations. The Paris Agreement aims to keep global temperatures to "well below 2 °C above preindustrial levels."
The agreement is an ambitious accomplishment, more than nine years in the making. However, many climate change activists are claiming it does not go far enough to prevent significant harms from climate change. For example, due to pressure from the United States, the agreement does not say that developed nations "shall" commit to reducing GHG emissions. Instead, the agreement states that developed nations "should" commit to reducing GHG emissions. In addition, the agreement discusses the need for $100 billion a year from developed nations to help developing nations mitigate and adapt to climate change impacts. However, in the final agreement, the $100 billion figure is only mentioned in the non-binding preamble. Many of these changes were pushed by the United States in an attempt to craft an agreement that will not need to be approved by the republican-lead Congress.
President Obama commented after the Paris Agreement was finalized, stating that “[t]his agreement sends a powerful signal that the world is fully committed to a low-carbon future. We’ve shown that the world has both the will and the ability to take on this challenge.” On the other side of the political spectrum, Senate Majority Leader Mitch McConnell stated that President Obama was "making promises he can't keep" and that the agreement was "subject to being shredded in 13 months."
HSBC Holdings PLC, the fourth largest bank by assets in the world, has issued its first green bonds this month. HSBC France raised $500M, offering instruments at an annual coupon rate of 0.625% for a period of five years. Proceeds of the green bond issue will be used to finance renewable energy, energy efficiency, energy conservation, and climate adaptation projects, among others. Green bonds and the financing of climate-related improvement projects have been a key topic during the ongoing COP21 discussions.
HSBC announced its own internal guidelines for green bonds earlier this year. Eligible projects also may include renewables, sustainable waste and water management, sustainable land use and clean buildings and transportation. The issue will prioritize activities in the Middle East and Africa as well as Europe, particularly France. The bank also has announced plans to invest $1B in a green bond portfolio and already has allocated $350M purchasing climate bonds from development banks.
Not only are countless businesses publicly supporting a global climate agreement from COP21 as we previously reported, several businesses and business coalitions are pledging to take operational and strategic actions in advance of such an agreement. As reported by Ceres, set out below here are a few of the business coalitions and their pledges:
Delegates from almost 200 nations worked through the night on Friday and into Saturday, working to create the 48-page “Draft Paris Agreement,” made public on Saturday, December 5th. The draft agreement will be the subject of continued negotiations this week in Paris, with the goal of finalizing a long-term climate change agreement among all parties by the end of the week.
The draft agreement lays out three broad goals:
"To hold the increase in the global average temperature [below 1.5 °C] [or] [well below 2 °C] above preindustrial levels by ensuring deep reductions in global greenhouse gas [net] emissions;
"To Increase their ability to adapt to the adverse impacts of climate change [and to effectively respond to the impacts of the implementation of response measures and to loss and damage];
"To pursue a transformation towards sustainable development that fosters climate resilient and low greenhouse gas emission societies and economies, and that does not threaten food production and distribution."
The draft agreement contains many options that will need to be agreed on by negotiators, including:
The precise goal of the agreement;
How countries are divided into developed verses developing nations; and
Whether the agreement’s GHG emissions reductions should be legally binding.
The last point represents a current difference between China and U.S. negotiators. China is pushing for an agreement that is legally binding in its entirety. The U.S. has argued that GHG emissions cuts should not be legally binding; perhaps a pragmatic position due to the fact that legally binding emissions cuts could require the U.S. submit the agreement for approval by the U.S. Senate, which would likely reject any such proposal.
The Corporate Environmental Lawyer blog will continue to track developments from Paris and provide insight and analysis over the week ahead.
As the President and other top officials participate in climate change negotiations at the COP21 in Paris, lawmakers back home are pushing to maintain a role in determining U.S. climate policy. Specifically, House Republicans have proposed a resolution regarding the President’s authority in the COP21 negotiations. House Concurrent Resolution 97, introduced on Nov. 19th by Rep. Mike Kelly (R-Pa.), expresses the view that “the President should submit to the Senate for advice and consent the climate change agreement proposed for adoption at [COP21].” The resolution expresses concerns that the agreement coming out of COP21 will contain enforceable targets and timetables for GHG emissions reductions and that the U.S. will be expected to “commit billions of dollars in taxpayer money to fund the Green Climate Fund and other financial mechanisms to fund mitigation and adaptation projects in developing countries.” Thus, the resolution would establish that Congress believes that any commitments made by the U.S. at COP21 will have no effect until submitted to the Senate for advice and comment. The resolutions goes further to suggest that Congress would refuse to consider any funding for the Green Climate Fund until all agreements are submitted to the Senate for advice and consent. The resolution has been referred to the House Committee on Foreign Affairs.
In a related action, on Dec. 1st, the House passed two resolutions (S.J.Res. 23 and S.J.Res. 24) disapproving of the Administration’s GHG regulations applicable to existing and new power plants. The Senate voted last month to approve identical motions. The President is expected to veto these resolutions.
Meanwhile, the American Sustainable Business Council (ASBC), a group of 200,000 businesses and 325,000 business executives, owners, and investors, has drafted a letter to Congress expressing the group’s support for climate negotiations in Paris and calling on Congress to not interfere. They urge Congress to “allow the climate experts, business and civic leaders and negotiators to craft an effective agreement in Paris.” ASBC is encouraging members of the public to sign on in support of their letter.
CERES is urging world governments meeting now at the COP21 this week in Paris to produce a strong climate agreement. CERES believes that recent actions confirm that the business and financial communities support clean energy and a low-carbon transition. The actions cited by CERES include:
World leaders and delegates from over 150 nations have converged in Paris, France for the United Nations Climate Change Conference (also referred to as COP21). The conference, which is scheduled to run from November 30th through December 11th, has as its goal achieving a legally binding agreement intended to limit greenhouse gas emissions in order to ensure that global average temperatures do not increase in excess of two degrees Celsius over pre-industrial global temperatures.
Leaders of both the United States and China addressed the conference attendees. President Obama noted that recent economic growth in the United States has come despite a lack of growth in carbon emissions, proving that climate advancements need not come at the expense of the economy or individual livelihoods. Chinese President Xi Jinping struck a somewhat different tone, saying that the conference "is not a finish line, but a new starting point" and that "any agreement must take into account the differences among nations” and that “countries should be allowed to seek their own solutions, according to their national interest."
Prior to the conference, countries had voluntarily submitted climate action plans referred to as Intended Nationally Determined Contributions (“INDCs”) that are intended to form the basis for any agreement that might be reached over the next two weeks. According to the United Nations Secretary General, more than 180 countries have submitted their INDCs which covers almost 100% of global greenhouse gas emissions. However, in order to reach the above-referenced goal of less than a two degree temperature increase, the Secretary General noted that developed countries would need to be prepared to expend $100 billion dollars by 2020. What if anything the developing countries would need to contribute is much more nebulous but is a topic that is certain to be discussed at the conference.
We will continue to blog on COP21 over the next several weeks while the conference is in session.
The 2015 United Nations Climate Change Conference, COP21, will be held in Paris, from November 30th to December 11th. It will be the 21st yearly session of the Conference of the Parties to the 1992 United Nations Framework Convention on Climate Change (UNFCCC) and the 11th session of the Meeting of the Parties to the 1997 Kyoto Protocol.
President Obama will be in attendance for the initial few days of the talks and Secretary of State John F. Kerry, Energy Secretary Ernest Moniz and others will continue negotiations after the President leaves.
The advanced agenda for the talks is available here.
In recognition of the Paris Climate talks, The Corporate Environmental Lawyer blog will feature a series of blogs over the next two weeks focused on climate change and developments from the negotiations. Please follow our blog to learn more about these issues and developments.
Fourteen major corporations based or operating in the U.S. have voiced strong support for the adoption of a new global settlement agreement. The companies endorsed a statement organized by the Center for Climate and Energy Solutions (C2ES) calling for negotiators at the UN Climate Change Conference in Paris to adopt “a more balanced and durable multilateral framework guiding and strengthening national efforts to address climate change.” The corporations supporting the C2ES statement include Alcoa, Alstrom, BHP Billiton, BP, Calpine, HP, Intel, Lafargeholcim, National Grid, PG&E, Rio Tinto, Schneider Electric, Shell, and Siemens Corporation.
The statement speaks to how a meaningful agreement could strengthen the role of and minimize risks to the private sector in the following ways:
Thomson Reuters’ Sustainability blog provides a wealth of information and resources on this important topic. I like to review the Editors’ Picks to get see the latest and most interesting sustainability developments.
EPA’s Safer Choice program (formerly Design for the Environment) recognizes products that meet stringent ingredient and product level criteria. Safer Choice products do not contain carcinogens or reproductive or developmental toxins. The program helps consumers and commercial buyers identify and select products with safer chemical ingredients without sacrificing quality or performance.
According to EPA, there are over 2,000 products that currently qualify for the Safer Choice label. This summer, EPA’s new Safer Choice labels began appearing on consumer products such as household soaps and cleaners. To qualify for the Safer Choice label, a product must meet stringent human and environmental health criteria.
In the first year of the Safer Choice Partner of the Year awards, the Chicago/Region V area has more winners than any other part of the country. Local award winners include: AkzoNobel/Chicago; ISSA, The Worldwide Cleaning Industry Association/Northbrook; Jelmar, LLC/Skokie; Loyola University Chicago, Institute of Environmental Sustainability/Chicago; and Stepan Company/Northfield. Nationwide, 21 entities won EPA Safer Choice Partner of the Year awards. EPA confirms there are nearly 500 formulator-manufacturer partners that make more than 2,000 products for retail and institutional customers.
A new EPA report, Climate Change in the United States: Benefits of Global Action, estimates the physical and monetary benefits to the U.S. of reducing global greenhouse gas emissions. The report summarizes results from the Climate Change Impacts and Risks Analysis (CIRA) project, a peer-reviewed study comparing impacts in a future with significant global action on climate change to a future in which current greenhouse gas emissions to continue to rise.
The report shows that global action on climate change will significantly benefit Americans by saving lives and avoiding costly damages across the U.S. economy. The report and its finding perhaps foreshadow the U.S. participation in the upcoming United Nations Climate Change Conference to be held in Paris, France later this year, from November 30 through December 11. This will be the 21st yearly session of the Conference of the Parties (COP 21) to the 1992 United Nations Framework Convention on Climate Change (UNFCCC) and the 11th session of the Meeting of the Parties (CMP 11) to the 1997 Kyoto Protocol. Once again, the conference objective is to achieve a legally binding and universal agreement on climate from all of the nations of the world.
Below is a video developed by EPA discussing the report and its findings.
Masses of small red tuna crabs have been washing up along San Diego, California area beaches from Ocean Beach to La Jolla. The species, Pleuroncodes planipes, is unique in that it can live its entire life cycle, from larva to adulthood, in the water column from surface to seafloor. Accordingly, it can be particularly vulnerable to being carried along by winds, tides, and currents.
In a rule signed on June 10, 2015, EPA proposed to find that greenhouse gas (GHG) emissions from engines used in certain types of aircraft contribute to air pollution that endangers health and welfare under section 231(a) of the Clean Air Act. Further, anticipating that the International Civil Aviation Organization (ICAO) will adopt a final CO2 emissions standard for aircraft in February 2016, EPA also issued an Advance Notice of Proposed Rulemaking seeking input on the potential use of section 231 to adopt and implement the international aircraft engine CO2 emissions standard domestically.
In the rule, EPA states that it is relying primarily on the scientific and technical evidence in the record supporting the 2009 Endangerment and Cause or Contribute Findings for Greenhouse Gases under section 202(a) (the “2009 finding”), though it also includes subsequent work. It also follows the rationale it previously used with respect to the 2009 finding. For example, EPA proposes to define the air pollution referred to in section 231 to be the mix of the following six well-mixed GHGs: CO2, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, and sulfur hexafluoride – the same definition used for the 2009 finding for the purposes of section 202(a).
The rule has been submitted for publication in the Federal Register; the internet version of the rule is available here. Comments will be due within 60 days after publication in the Federal Register. A public hearing will be held in Washington, D.C., on August 11, 2015.
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