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Why Going Green -- And The Climate Negotiations In Copenhagen -- Matter Now More Than Ever

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For the past few years, the business world has been swept up in a green wave -- a rising tide of interest and concern about environmental issues. The Great Recession has not stopped the pressure pushing this wave. Environmental crises such as climate change and water shortages continue to evolve. Mega-forces such as technology-driven transparency and the rise of the consumer in India and China -- which will force the price of oil and other resources up over time -- continue to advance. Closer to home, key stakeholders are demanding more of companies than ever, especially corporate customers greening their supply chains. For business, going green is ultimately unavoidable.

Through this long, hard recession, while many have put their environmental initiatives to the side (a big strategic mistake given the pressures), the leading companies--giants such as Wal-Mart, GE, and IBM--have actually accelerated their green efforts. Using the environmental lens, they've found new growth opportunities and significant cost-savings. They, and many of their peers, are aggressively cutting back on carbon emissions--over half the largest 500 companies in the world now have specific greenhouse gas reduction targets.

But no matter how great the benefits of going green, the private sector can, and will, only go so far without a strong policy framework. And this is why the global climate negotiations in "Hopenhagen" are so critical, for the world and for the United States.

With the right policies in place, the most innovative companies and countries will help solve this great challenge and grab a chunk of what HSBC estimates will be a $2 trillion market by 2020. But the U.S. is not positioned well in this competition.

Recently, two of America's most prominent capitalists, John Doerr from Kleiner Perkins and Jeff Immelt, CEO of General Electric, wrote an op-ed in the Washington Post.

They told us that we're falling behind other countries in the race to a multi-trillion dollar market for environmental solutions. Only one in ten of the largest solar and wind producers are in the U.S. We're losing to China, Germany, and other countries. Doerr and Immelt's conclusion was this: we need a cap and price on carbon so we can compete and innovate. And whether or not you want the U.S. to "win" doesn't really matter--it helps everyone innovate if they have the right economic signals.

Without a cost on carbon and some restrictions on total emissions, the "externality" that is climate change won't be priced into our investment decisions. On top of the environmental and moral imperatives of tackling our multi-generational existential threat, this somewhat wonky, economic externality argument is at the core of what's at stake in Copenhagen. The beginning of perhaps the most important global conversation in history begins in a just a few weeks. Is your company a part of the discussion and ready for what's to come?

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Help turn Copenhagen into Hopenhagen at hopenhagen.org.

andrewwinston_finalAndrew Winston is a globally recognized expert on how businesses can profit from thinking green and the co-author of the best-seller Green to Gold.

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