Plenty of information on climate change but little action
Finnish companies have good knowledge of climate change. Although it is known that climate change will have a major impact on the operations of businesses, such as the competitive situation and corporate images, concrete actions to control climate change take place slowly. Fortunately, there are exceptions.
The Carbon Disclosure Project (CDP) is a global community of 315 institutional investors. These investors have assets under management of nearly 28 billion euros, which is about 178 times the gross domestic product of Finland. CDP has studied the effects of climate change from the point of view of investors. The global report published by CDP consists of answers to questions posed by CDP to companies on The Financial Times' FT500 list. This year's report was already the organisation’s fifth, but this time the study included countries in the Nordic region. In Finland the Nordic climate report for 2007 was launched at the climate change seminar on 4 October at Ilmarinen.
In the Nordic region, the survey was sent to a total of 125 companies. In Finland, 25 large corporations received the survey, of which 18 companies answered it. The response rate of Finnish companies was 72 percent, which can be considered a high percentage.
The study sought to find out, among other things, whether companies have a climate strategy and plan, how central issues of climate change are within companies, and how aware companies are of their own decisions. For the purposes of the study, answers were scored and companies were placed in order in the Climate Disclosure Leadership Index.
Finnish companies have a high level of knowledge
The answers revealed that most Finnish companies are well educated on issues of climate change, but setting related and concrete goals and developing related products is still in the initial stages. Almost 90 percent of Finnish corporations see issues surrounding climate change as risks, but as many see potential in them. Of the companies that answered the survey, more than three out of four companies have a climate strategy, less than third have developed products or services with a focus on climate change and rather less than fifth have set goals with a time limit to curb the company's own emissions.
Amanda Haworth Wiklund, who heads CDP's Nordic office, is pleased with the high level of knowledge among companies. "Although there is a difference between knowledge and action, climate work begins with measuring the company's own emissions and recognising the risks. I’m happy to see that so many companies have become aware of this," she says.
According to her the Finnish companies that participated in the study have been divided into two categories: low-emission and high-emission sectors. These sectors include companies that have openly reported their climate-related issues and acted ambitiously in order to control climate change.
In the high-emission category, the best ranking companies included Fortum, Outokumpu, Neste Oil, Huhtamäki and M-Real. In this category, Fortum had no equals. With the points scored, Fortum also placed among the top Nordic companies.
The top Finnish companies in the low-emission category are Nokia, Kesko, Metso, SanomaWSOY and Stockmann.
Investments become less predictable
The Speaker of the Parliament SauliNiinistö looked at the climate change issues from the economic policy point of view. Mikko Mursula, The Head of Listed Securities at Ilmarinen, considered risks related to climate change when valuating investment opportunities. He also stated that the number of investors involved in CDP has grown rapidly as has the number of signatories of UN Principles for Responsible Investment. According to Mursula these are good examples of investors' awareness regarding environmental matters.
"An investor must be able to assess the general variables which affect all industries, as well as the industry-specific variables. However, climate change weakens the predictability of investments." says Mursula.
The Carbon Disclosure Project aims to identify the effect of climate change on share values and the operation of companies and to facilitate the dialogue between investors and companies. CDP, which was set up in 2000, currently has the most extensive database in the world on the climate strategies of large companies.
For more information on the Carbon Disclosure Project, see www.cdproject.net. The CDP process has been applauded by Tony Blair and Angela Merkel amongst others.
Ethix and U&W were responsible for writing up the Nordic report.
For more information, please contact:
- Director Amanda Haworth Wiklund, CDP Scandinavian Secretariat, +46 (0)8 314 206, firstname.lastname@cdproject.net
- Head of Listed Securities Mikko Mursula, Ilmarinen, + 358 10 284 3869, + 358 50 380 3016, firstname.lastname@ilmarinen.fi
- Senior Vice President Satu Mehtälä, Ilmarinen, + 358 10 284 3590, + 358 50 539 8590, firstname.lastname@ilmarinen.fi