USCIB convened the North American Business Consultation on Climate Change on June 23 in Washington, D.C.; this session, organized with the International Chamber of Commerce, the Canadian Chamber of Commerce and the International Emissions Trading Association, highlighted U.S. and Canadian business priorities for the U.N. climate agreement to be finalized in Paris this December.
In his opening comments to the day-long conference, with over 80 participants including government officials, business leaders, United Nations delegates, and academics, USCIB’s President and CEO, Peter Robinson stated: “USCIB has followed climate change for 20 plus years, and while the issues have evolved, become broader, been through ups and downs in the U.N. negotiations, it has remained a priority for member companies. And en route to Paris, we see it evolving again, to include a strong element of corporate citizenship and social equity.”
2015 is a defining year for international climate change cooperation when governments will reach a new, long-term climate agreement on greenhouse gas reductions while pursuing global adaptation and resilience to the effects of climate change. Delivering on the UN’s far-reaching commitments will rely on business investment, innovation, new markets and engagement. The resulting economic and energy transformation will impact the business community across every sector, offering opportunities and posing challenges.
Ann Condon (GE), chair of USCIB’s Environment Committee, explained that climate, good governance and job creation are all issues that must be addressed together, and that the bigger picture of sustainability will rely on integration of the UN Post 2015 Development Agenda and the U.N. climate framework. Given the dynamic forces at work for businesses in the current global economy, Condon stressed the importance pursuing economic growth de-linked from carbon emissions.
The North American Public Private Dialogue is the second in a series of consultations organized by ICC to mobilize the voice of business ahead of the 21st UN Conference of the Parties (COP) in Paris in December, where member governments will finalize the international climate agreement. The inaugural dialogue took place in Mexico on April 15, to be followed by meetings in Asia later this year.
The Road to COP21 in Paris: Government, Business and NGO Perspectives
The event’s morning speakers presented U.S. and Canadian government positions for the Paris agreement, and talked about how the role of business could be reflected in Paris outcomes. A particular focus was on national emission reduction pledges, known as “Intended Nationally Determined Contribution” (INDCs) from the U.S. and Canada. USCIB has advocated involving business in the preparation and analysis of INDCs.
Karen Florini of the U.S. Department of State explained that the United States believes there should be a clear role for non-state actors in the climate agreement, and that Paris 2015 represents an opportunity for nations to cooperate and pursue a low carbon path to prosperity.
IPR protection is indispensable for technological progress, and Florini indicated that the UN climate agreement was not the right vehicle to address IP issues. She urged all stakeholders, including business, to show support for COP21 and the agreement, because inaction on climate change is not an option.
Other participants echoed Florini’s comments and said that the Paris 2015 agreement is not a silver bullet that will solve climate change, but it will set the stage for further international commitment to address a global problem.
In addition to Florini, other speakers included Lynn Monastesse, Environment Canada, Patricia Beneke, Executive Director of the U.N. Environment Programme’s North American Regional Office, and Helen Mountford, Senior Economist of the World Resources Institute. On the U.S. INDC, Christo Artusio, Director of the Office of Global Change, the U.S. Department of State explained that the U.S. communicated its pledge and other “up front” information to facilitate the clarity, transparency, and understanding of U.S. climate programs as part of its commitments under the UNFCCC. He said it is important for all countries to be as transparent as possible about their climate pledges. Finally, Artusio noted that the U.S. INDC does not envision the use of international market mechanisms at this time.
Panellists discussed the role of business in the UNFCCC, business experiences with market based approaches in North America and the role of private sector technology innovation and deployment. Main points included:
- the importance of government engaging with business across the entire horizon of UNFCCC policy and technical deliberation, including on the design, assessment and implementation of INDCs.
- Elisabeth Best of Qualcomm talked about the many uses of innovation for climate change, not just via energy technologies but in IT applications, which then support smart grids, energy efficiency and other related efforts.
- The experience of carbon markets at the state and provincial level in North America, along with voluntary efforts, have delivered reductions, along with experiences with how and where such market-based approaches make the best policy option. Katie Sullivan, IETA, placed strong emphasis on the need to maintain and strengthen carbon markets as a means for countries to meet their climate policy commitments, and give countries the option to link their markets where it made sense to do so.
Leonardo Martinez-Diaz, the U.S Department of Treasury, spoke about recent activities of the Green Climate Fund (GCF), intended to assist in mobilizing finance and investment for developing countries under the UNFCCC. Mr Martinz-Diaz indicated that the GCF is “open for business,” with a strong interest in reducing risk and working with business to mobilize financial resources to address mitigation and adaptation needs in the international community.
Fighting Climate Change with Trade
In addition to reviewing national and international climate policy from government and private sector perspectives, the meeting considered the role that other economic agreements and institutions will play in broadening and supporting climate policy and implementation.
ICC and USCIB Chairman Terry McGraw introduced William Craft, Deputy Assistant Secretary for Trade Policy and Programs in the Bureau of Economic and Business Affairs of the U.S. Department of State, who discussed the importance of using the U.S. trade agenda to help support ambitious climate policy and raise environmental standards. McGraw noted the timeliness of the discussion given recent developments on Trade Promotion Authority (TPA), also known as “Fast Track.”
Craft noted that modern trade deals will continue to include strong environmental standards. He said that the United States is taking the lead in pushing forward the World Trade Organization’s Environmental Goods Agreement (EGA), which will reduce and remove tariffs on green products, improving global access to technologies that will help reduce greenhouse gas emissions. The EGA will be a win-win for U.S. exporters and the global commons, Craft said.
He concluded by explaining that the intersection of trade and the environment lies at the heart of U.S. bilateral negotiations with China and Brazil, and that it is possible to secure trade deals with strong environmental standards while also creating economic opportunities for business.
James Bacchus, Greenberg Traurig and Chair of ICC’s Trade and Investment Commission, explained the challenges of addressing potential conflicts between trade rules and climate protection, including with regard to “like products.” He indicated that current trade rules would have to adapt to the diverse national approaches to climate policy that will arise from an INDC-based agreement to be finalized in Paris.
In her concluding remarks, USCIB’s Norine Kennedy stressed that all markets, including carbon markets, are important and necessary for a climate-friendly transformation of the global economy. “Governments must pledge to keep markets open so that cleaner technologies, energy and solutions can spread efficiently and profitably,” Kennedy said. Governments must also protect intellectual property rights, because the innovation needed for a climate-friendly transformation won’t occur if IPR protection is compromised in an international climate agreement.
Also on June 24, ICC unveiled the 2015 updated Business Charter for Sustainable Development, which sets out a framework to enable companies to place sustainability at the heart of their operations – from staff recruitment to the development of new products and services.
USCIB and its global network have been joined USCIB in arguing for recognized consultative business engagement in the UN climate talks. Earlier last month ICC Secretary General John Danilovich wrote a letter to the editor of the Financial Times explaining that a wide range of policy and market approaches will be needed to scale up the pace of reducing greenhouse gas emissions; there is no single bullet, and each country will tailor its “package” of actions to suit its environment and economic circumstances. And in another letter to the editor of the New York Times, USCIB President and CEO Peter Robinson argues that countries should offer trade incentives rather than punitive tariffs to reduce carbon emissions and spur the deployment and use of greener energy technologies.