There is no longer any debate about climate change, or more importantly, human culpability in the recent rapid rise in global temperatures. The overwhelming scientific consensus is that global temperatures have risen 1° C in the past 40 years, the ten hottest years on record have occurred since 2005, and human activities are the root cause of most of this phenomenon.
So we can only hope it’s not too late for action. But short of immediately closing down all 850 U.S. coal mines and 135 U.S. petroleum refineries, there is little U.S. President Joe Biden alone can do in the short run. The president has no control over China and India, which together have well over twice the annual CO2 emissions as America—and who since 2000 have seen faster increases in greenhouse gas (GHG) emissions than any other nations on the planet.
Considering the enormity of the challenge, governments can’t solve this problem alone. Even with the U.S. rejoining the Paris Climate Accord, current goals are inadequate to the task at hand. With both U.S. political action and international coordination presently inadequate, all the more reason for American business to take a larger leadership role on the issue. As the top executive at the nonpartisan climate research group Project Drawdown observed, “For many years … we assumed that the federal government or international bodies would really be taking the lead on climate change…. So what’s interesting is you’re seeing the focus of leadership shift mainly to states and cities on one end, and corporations on the other.” And on the business side, manufacturers are ideally suited to play a central role because their interactions in the global marketplace cut across international boundaries far more effectively than any single government’s policies. Magnanimity isn’t the only incentive for manufacturers here: there’s more tailwind than ever before as companies now see financial interests align with ESG.
We’re now seeing such efforts in the sector pick up steam, especially in the U.S. and Europe. General Motors has pledged to develop an all-electric fleet and achieve carbon neutrality in the next two decades. Boeing announced that its entire fleet would be 100% reliant on biofuel by 2030. And Apple, which says each of its products will have net-zero climate impact by 2030, plans to reduce emissions by 75% in its manufacturing chain by recycling more components of its products and encouraging its suppliers to use renewable energy.
Hundreds of other manufacturers are also pledging to reduce their carbon footprint. The “Carbon Clean 200” initiative of As You Sow, an advocate for corporate social responsibility, includes a sizeable number of U.S. manufacturers, such as Parker Hannifin, Ingersoll Rand, Eaton, Emerson Electric, Johnson Controls, Evoqua Water, and Ball Corporation. So does RE100, a corporate renewable energy initiative for companies committed to 100% renewable electricity, from B2C firms like General Mills, P&G, and Mars to B2B companies like Danfoss, Trane Technologies, and Crown Holdings. And manufacturers make up a sizable portion of the almost 400 companies that have signed the U.N. Global Compact’s Business Ambition for 1.5°C commitment, including firms like Ford Motor, PepsiCo, Levi Strauss, Crown Holdings, Ecolab, and Thor Industries.
Moreover, manufacturers are going beyond individual pledges. Supply chain emissions often represent a major portion of corporate carbon footprints. LEGO recently announced its plans to reduce these by making all its plastic-based building blocks with plant-based materials by 2030. The first phase includes making its plastic leaves, bushes, and trees from a polyethylene produced with ethanol from sugarcane.
Unilever – owner of such brands as Ben & Jerry’s, Dove, and Seventh Generation – is investing $1 billion into a “climate and nature fund” to address reforestation, water preservation, and wildlife protection. It will also begin disclosing the amount of carbon used to produce its 70,000 products, all of which it says will be biodegradable by the 2030s.
Anheuser-Busch established the 100+ Accelerator initiative to fund start-ups for entrepreneurs developing solutions for energy efficiency and renewable energy – to help the company solve its sustainability challenges and make progress toward its 2025 climate goals.
And a coalition of 11 global companies – bringing together businesses invested in all links of the hydrogen value chain, including U.S. manufacturers like Chart Industries, Cummins, and McDermott – formed Hydrogen Forward to accelerate investment in hydrogen solutions. The ultimate goal is to decarbonize a broad range of industries, from shipping and transportation to power generation and refining to steelmaking and chemical production. (Along those same lines, three European steel companies – ArcelorMittal, ThyssenKrupp, and SSAB – are turning to hydrogen to significantly reduce CO2 emissions in their operations.)
Clearly, we’ve reached a tipping point in the battle against climate change. And if the pandemic taught us anything, it’s the significant consequences of not addressing crises before they occur. Manufacturers must continue putting the issue at the top of their agenda.
Stephen Gold is president and CEO of MAPI, the Manufacturers Alliance for Productivity and Innovation.