Читать курсовая по экологии: "Climate change adaptation strategies for international energy companies" Страница 3

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corporations, however, take into account environmental issues because they consider climate change itself as a risk that should be assessed, managed and minimized.to Engel, Enkvist, and Henderson, climate change risks for companies can be divided into two major categories: value-chain risks and external stakeholder risks. The former include physical, prices and product risks which are mostly connected with extreme weather conditions and consequent damages to infrastructure, price volatility or losing market share of the product. In their research, Engel, Enkvist, and Henderson underline, that to minimize these risks the companies can either "design a sustainability approach” or change business strategy aligning its goals to climate change mitigation and adaptation. External stakeholder risks, in their turn, are divided into ratings, reputation and regulation risks. Ratings risks mean the probability of higher cost of capital due to carbon pricing. Regulation risks are connected with governmental and institutional climate policies affecting companies’ business activity. These policies will be reviewed in detail in the second part of this chapter. Finally, reputation risks are based on public opinion on the company’s activity. For instance, if the society considers the company’s actions to be harmful for the environment the company may lose its profits., Enkvist, and Henderson revealed the level of climate change risk that the companies from various sectors are exposed to. According to their evaluations, energy sector (oil and gas) companies are mostly exposed to regulation and reputation risks. These companies have moderate exposure in price and product risks and moderate-high exposure in physical and ratings risks. Furthermore, this evaluation proves that energy sector companies take more climate change risks than companies in any other industry. Thus, they are not only the world’s major producers of carbon dioxide emissions which forces climate change but the largest climate change risk-takers as well.and Nyberg considered the other differentiation and divided climate change risks in four categories: physical risks, regulatory risks, market risks and reputational risks. Let us revise all these types of risks in particular as well as suggest the possible corporate reactions to them.risk is a risk of extreme weather events provoked by climate change leading to threats to operations and infrastructure. For energy sector companies this risk might result in breaks in oil and gas pipelines, accidents at nuclear plants, etc. To manage this risk companies can use climate modelling, plan various scenarios for physical events, safeguard and relocate physical infrastructure, develop emergency strategies for extreme weather events or sell off physically vulnerable activities. Physical risk is probably the most addressed in all corporate climate change mitigation policies. It directly affects business operations leading to huge costs for companies. In 2015 the International Energy Agency even published "Making the energy sector more resilient to climate change” brochure in which the Agency provided various techniques for energy sector companies to prevent technical disruptions and infrastructure damages caused by extreme weather conditions and climate change consequences.risk is a risk of legislative regulation of carbon emissions via "carbon taxes”, pricing of greenhouse gas emissions in a carbon market or mandatory restrictions. Some examples of minimizing those risks can be: lobbying against carbon pollution regulation, building coalitions with opponents of action on climate change, investing in low-carbon technologies and renewable energy to reduce carbon emissions intensity, incorporating carbon pricing in investment decisions, adopting a ‘leadership’ position advocating market forms of carbon regulation, voluntary reporting of carbon emissions to avoid mandatory requirements.risk may happen when, for instance, competitors gain advantage via new "green" technologies and products. The majority of large international energy companies also embrace this type of risk because their customers might need low-carbon technologies or decrease in CO2 emissions. To mitigate this type of risk companies invest in R&D to identify and create "green" products and services, scan the market for competitive threats in order to mimic new technologies and products, takeover and acquire "green" companies.risk occurs when consumers view companies’ activities as environmentally harmful which may result in declining sales and reputation. The companies usually try to improve their image and reputation through "green" marketing and branding of products and services, developing alliances with environmental NGOs or focusing on job creation and various CSR programs emphasizing that a company is a responsible corporate citizen. However, for energy sector companies, who are historically considered as the major polluters it becomes rather hard and costly to cover reputational risks.translation of the issue into various types of risks has given energy companies to gain powerful advantages in engaging with climate change. It allowed to break the complex concept of climate change into smaller components with understandable probability which can be tackled in a short-term perspective with specific actions. In the second chapter we will see, how the companies can implement these risk-management strategies in their business activity responding on a particular type of climate change risk with a specific reaction However, Wright and Nyberg criticized such an approach as being not sustainable because the long-term risk of climate change activities for business is far greater than a simple "reaction” plan. They state, that climate uncertainties cannot be seen as manageable and regarded as opportunity for profit. According to them, such an approach closes off the possibility of the dramatic emissions reductions needed