The accountant s guide to climate change Master · THE ACCOUNTANT’S GUIDE TO CLIMATE CHANGE And how to help the organisations your support Ross Maynard FCMA CLIMATE CHANGE IS REAL

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THE ACCOUNTANT’S GUIDE TO CLIMATE CHANGE

And how to help the organisations your support

Ross Maynard FCMA

CLIMATE CHANGE IS REAL

• Climate change is real and it’s happening now

• The global annual temperature has increased at an average rate of 0.07°C per decadesince 1880 and over twice that rate (+0.18°C) since 1981

Global Temperature rise since 1880• The significant increase inaccumulated heat is driving regionaland seasonal temperature extremes,reducing snow cover and sea ice,intensifying heavy rainfall, andchanging habitat ranges for plantsand animals

• Carbon dioxide levels today arehigher than at any point in at least thepast 800,000 years.

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SEA LEVELS ARE RISING• Average sea levels have risen around 23cm (8 inches) since 1880, with about 8cm of

that (3 inches) gained in the last 25 years. Every year, the sea rises another 3.2 mm

Sea Level rise since 1880

• The rising water level is mostly due toa combination of meltwater fromglaciers and ice sheets and thermalexpansion of seawater as it warms

• Even if the world follows a lowgreenhouse gas pathway, global sealevel will likely rise at least 30cmabove 2000 levels by 2100

• With high emissions, a worst-casescenario of 2.5 metres above 2000levels by 2100 cannot be ruled out

THE ROLE OF THE ACCOUNTANT IN CLIMATE CHANGE

• The finance team play a crucial role in any organisation’s management team:

The collectors, analysts and presenters of business data

The appraisers of the costs, benefits and feasibility of projects and investments

The managers of cashflow

• Accountants therefore play a crucial role in highlighting the likely costs that climate

change might bring; and the potential benefits that its opportunities present

“The accountancy profession can play a significant role in achieving both climate change mitigation and adaptation at individual business, industry sector and economy-wide levels.”

Statement from the Chief Executives of Global Accountants’ Bodies to the accountancy profession, February 2020

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AGENDA1. Climate Change Business Trends

2. The Circular Economy

3. Zero Carbon Living

4. Sustainable Investing

5. The Power of People and Values

6. Business as a Force for Change

7. New Technological Solutions

8. Government Policy and Regulation

9. Climate Adaptation

10. People and Habitats on the Move

11. Other Impacts of Climate Change

SOURCES:• https://earthobservatory.nasa.gov/world-of-change/global-temperatures

• https://www.climate.gov/news-features/understanding-climate/climate-change-global-temperature

• https://www.climate.gov/news-features/understanding-climate/climate-change-global-sea-level

• https://www.nationalgeographic.com/environment/global-warming/sea-level-rise/

And for the accountant’s angle:

• https://www.cimaglobal.com/Documents/Thought_leadership_docs/cid_accounting_for_climate_change_feb10.pdf

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CLIMATE CHANGE BUSINESS TRENDS

THE CLIMATE ACTIONS TREND WHEEL

• What strengths does your organisation have?

• Where are there gaps?

• What threats do you see?

• What opportunities might there be?

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BUSINESS ACTIONS FOR CLIMATE CHANGE

1. Anticipate and meet changing shareholder and customer demands

2. Strengthen investor confidence

3. Engage with the supply chain

4. Build resilience and ‘future proof’ operations

5. Demonstrate leadership and enhance reputation

6. Reduce climate impact

7. Increase innovation

8. Identify opportunities and mitigate risks

9. Improve operational efficiency and deliver cost savings

10. Protect revenues

11. Reduce regulatory risk

THE CIRCULAR ECONOMY

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THE CIRCULAR ECONOMY

Global use of materials has nearlyquadrupled in 50 years:

• from 26.7 billion tonnes in 1970,

• To 100 billion tonnes in 2020

• It is forecast to rise to 170-184 billiontonnes by 2050

Despite the massive rise inconsumption, reuse and recycling hasstalled.

Three key drivers underpin this negative trend in reuse and recycling:

• Extraction of virgin materials to fuel growth rather than making better use of existing resources.

• Adding more materials to meet the needs of a growing global population.

• Most products are not designed to be reused and there are limited facilities for reprocessing materials at the end of their life.

THE CIRCULAR ECONOMY IS BROKEN

“The global economy is consuming 100 billion tonnes of materials a year for the first time ever- but the reuse of resources has gone into reverse.”

The Circularity Gap Report 2020

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• Many companies are now moving towards using waste as source materials for themanufacture of new products and the development of new bio-materials

• Services are being redefined with a new generation of solutions that combineethical consumption with convenience

• In their report ‘Waste to Wealth’, Accenture identified that a global opportunityworth $4.5 trillion was up for grabs by redefining the concept of waste as avaluable resource

OPPORTUNITIES IN THE CIRCULAR ECONOMY

In every organisation, the finance team can be spotting the opportunities and doing the investment appraisal

• Review your sources of supply over the next 10 to 15 years using investmentappraisal

• Factor in the likely increasing costs of virgin materials and the risks of supply chaindisruption for these resources

• Project the likely decreasing costs of reprocessed materials and innovative newproducts

• Consider the possible marketing and revenue boost of creating an ethical supplychain

• Do the maths, and revisit the calculation as the future costs and benefits becomeclearer

THE CHALLENGE FOR ACCOUNTANTS

The tipping point is coming soon

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ZERO CARBON LIVING

ZERO CARBON LIVING• The energy we use – electricity,

heating and transport - accounts foraround two-thirds of globalgreenhouse gas emissions

• 81% of the global energy mix is stillbased on fossil fuels - the samepercentage as 30 years ago

• Governments are now looking todriving a faster transition to ‘Net Zero’to ensure a sustainable, affordable,and secure future that addressesclimate challenges

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The transition to Net Zero is projected to offer opportunities for every part of theeconomy:

• Global growth in low carbon industries and technologies is expected to be around$30tn by 2040

• The UK Government estimates that UK low carbon economy could grow 11%annually from 2015-2030, four times faster than the economy as a whole; andworth up to £170bn of export sales.

• In Scotland, low carbon industries have the potential to grow to over £30bn by2027

OPPORTUNITIES FOR ZERO CARBON LIVING

Companies are now shifting their business portfolios away from high carbon activities in operations, supply chains and product portfolios as a driver of

innovation, competitiveness, risk management and growth

• The most basic step is to review the opportunity for sourcing low carbon/renewable energy for the organisation

• Review your organisation’s vehicle fleet. Can it be de-carbonised?

• Appraise the costs and benefits of more proactive recycling and reuse policies

• In the 10 to 15 year investment appraisal of your supply chain, factor in theincreasing costs of high-carbon sources of supply and the reducing costs of low-carbon inputs. Also consider the likelihood of future carbon taxes/ duties

• Develop plans for a “zero carbon” business strategy


“The reason we should do a carbon tax is because it's the right thing to do. It's economics 101, elementary stuff.”

Elon Musk

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SUSTAINABLE INVESTINGThe ESG Investment Boom

SUSTAINABLE INVESTING

• Banks, pension funds and globalinvestment houses are now activelyscreening out companies involved incontroversial businesses

• They are shifting investment tocompanies with high ESG standardsand advocating for specific issueslike climate change

• Key drivers include culture shifts,new regulations and improvedfinancial returns

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The main drivers in the move to sustainable investing are:

• Ambitious net-zero greenhouse gas emissions targets: most sectors aresignificantly ramping up their de-carbonisation efforts to meet these goals

• Strong returns: nine of the eleven ethical funds in the Investment Association UKAll Companies sector outperformed the FTSE All Share index over the last 10-years

• Changing values: millennials are a particularly strong driving force with 52% sayingthey already invest sustainably

DRIVERS FOR SUSTAINABLE INVESTING

“Half of all global investors want to back businesses making positive change rather than simply exclude the controversial ones”

Schroders 2019

• Investors are re-evaluating traditional portfolio approaches, using investment as apositive lever to influence change

• Global sustainability challenges and complex increasing risks associated with“unreconstructed” projects and business are also driving investors in newdirections

• Sustainable investing has gained impressive traction in the last few years with totalassets more than doubling from $13tn to over $30tn in just 6 years

OPPORTUNITIES FOR SUSTAINABLE INVESTING

“With the impact of sustainability on investment returns increasing, we believe that sustainable investing is the strongest foundation for client portfolios going

forward”

Larry Fink, Chairman and CEO, BlackRock

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• Projects that do not place a strong emphasis on sustainability will face increasingdifficulties in attracting funds

• Tailoring business plans to maximise their environmental, social and governance(ESG) benefits will be more attractive to investors

• Projects specifically designed for sustainability and environmental, social andgovernance (ESG) benefits deliver stronger returns and, potentially, reduce risk

• Business plans, including financial projections, need to clearly show how they willenhance ESG factors


“You should be attacking the carbon emissions, period; and whether it's cap-and-trade or carbon tax or whatever: that's the realm in which we should be playing”

Joe Biden

THE POWER OF PEOPLE AND VALUES

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• Governments, businesses, organisations, cities andregions are facing unprecedented pressure from newantagonists - inspired, led and mobilised by new ‘do-it-together’ global environmental movements likeExtinction Rebellion

• Millions worldwide have rallied around a common senseof urgency, pressing for urgent action on climatechange; and influencing change through collectiveaction and public and consumer pressure

• A majority of the public now recognise the climate crisis as an “emergency” andsay politicians are failing to tackle the problem

• A majority of customers would pay more for sustainability. A survey of 6,000consumers across Europe, North America and Asia found:

Over 50% would pay more for sustainable products designed for reuse and recycling;

75% are buying more eco-friendly products than 5 years ago (with 80% planning to buymore);

83% saying it was “important” or “extremely important” for companies to design goods thatare meant for reuse and recycling.


“Real success can only come if there is a change in our societies and in our economics and in our politics”

David Attenborough

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• In 2018, UK consumers spent over £83bn on ‘ethical goods’ with growth driven byincreased environmental concern

• 49% of under 24’s avoided a product or service due to its negative environmentalimpact

• Investor sentiment is following, recognising the risk to shareholder value fromcompanies with high carbon exposure or poor environmental practices

THE PRESSURE FROM PEOPLE AND THEIR VALUES

“Citizen trust will be critical to business competitiveness in the next five years”

U.N. Global Strategy Study

• Organisations need to do a full review of their products, services, practices andsupply chains to identify any risk from environmental campaigns, and public andcustomer dissatisfaction

• The potential impact on revenues, returns and reputation of “risky” practices needsto be set against the costs and benefits of redesign

• New product and service development should focus on sustainability andminimising environmental impacts


“There is very little we can do now to stop the ice from disappearing from the North Pole in the summer. And we probably cannot prevent the melting of the

permafrost and the resulting release of methane. In addition, I fear that we may be too late to help the oceans maintain their ability to absorb carbon dioxide”

HRH Prince Charles

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BUSINESS AS A FORCE FOR CHANGE


• We Mean Business is a globalnonprofit coalition working with theworld’s most influential businesses totake action on climate change

• There are over 1,200 We MeanBusiness members representing$25tn in market value committed toclimate action

• Demand is growing around the world for a new type of business leadership focusedon creating long-term value rather than maximising short-term profits

https://www.wemeanbusinesscoalition.org/

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• Microsoft pledges to be “carbon negative” by 2030 with a $1bn innovation fund to combat theclimate crisis

• Amazon founder Jeff Bezos commits $10bn to fight climate change

• Nestle is to invest €1.68bn in sustainable packaging

• Starbucks announces aspiration to become “resource positive”

• Nestle, Enel, Novozymes, Cisco, Osram - listed in the Top 20 Sustainability Ranking for 2020

• Sainsbury’s will invest £1bn to become Net Zero by 2040

• 93% of the 250 largest corporations in 49 countries worldwide are now reporting onsustainability


“A question for every company, every financial institution, every asset manager, pension fund or insurer: what’s your plan?”

Mark Carney, U.N. Special Envoy for Climate Action and Finance

• CDP is a not-for-profit charity that runs the global disclosure system for investors,companies, cities, states and regions to manage their environmental impacts

• CDP estimated the global market for low carbon goods and services at $5.5tn in 2015.They forecast that $4tn worth of assets will be at risk from climate change by 2030

• The 2018 Report of the Global Commission on the Economy and Climate (“The NewClimate Economy” - https://newclimateeconomy.report/2018/) predicts:

$90tn in infrastructure investment by 2030 – more than the whole current stock

Low carbon opportunities of up to US$26 trillion through to 2030

65 million new jobs in the low carbon economy worldwide by 2030

BUSINESSES AS A FORCE FOR CHANGE: OPPORTUNITIES

“The opportunities are great, but so too is the potential for stranded assets, stranded communities, and stranded workers”

The New Climate Economy

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The 2018 New Climate Economy report identifies four urgent priorities forgovernments and businesses:

1. Pricing carbon and moving toward mandatory disclosure of climate-relatedfinancial risks, as part of a broader policy package

2. Accelerating investment in sustainable infrastructure, supported by clear nationaland regional strategies and programmes

3. Harnessing the power of the private sector, including to unleash innovation andadvance supply chain transparency

4. Ensuring a people-centred approach, such that the gains are shared equitably,and the transition is just

NEW CLIMATE ECONOMY PRIORITIES

• The opportunities are out there but they require more innovative thinking thansimply repeating approaches from the past.

• All organisations can expect to feel pressure to act across their supply chains

• Repurposing old spreadsheets will not work - the old standard assumptions nolonger apply! New models are needed

• Finance teams need to invest more effort, and more research, into preparing thebusiness plans and investment projects for the next decade and beyond


“Leaders are already seizing the exciting economic and market opportunities of the new growth approach. The laggards are not only missing out on these

opportunities but are also putting us all at greater risk”

The New Climate Economy

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NEW TECHNOLOGICAL SOLUTIONS

NEW TECHNOLOGICAL SOLUTIONS

• The challenge of climate change isspurring innovation in newtechnologies by businesses andscientists

• There are great potential rewardsfor companies who take the lead

• However, technologicaldevelopments are not a “magicbullet” and better use of existingtechnologies and other mitigatingactions are more likely to deliverresults quickly

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Supported by a recent increased flow of investment, global start-ups are working to fix climate change with new technologies:

• Carbon Engineering - a Bill Gates-backed Canadian company that "pulls carbon dioxide out of the air by running it

through specially formulated chemicals,". It recently raised $88mn to build its first commercial facility

• Charm Industrial - "burns plant biomass to create hydrogen, capturing the greenhouse gases that are produced in the

process"

• Newlight and Carbicrete - manufacture bioplastics and cement-free concrete, respectively, that are carbon negative,

meaning the process to manufacture them removes carbon from the atmosphere

• Ocean-Based Climate Solutions - has "created a device that stirs up water in the ocean to promote the growth of

phytoplankton, an algae that can take carbon dioxide out of the air and deliver it to the bottom of the sea in solid form"

• Project Vesta – "covering shelf seas with volcanic rock, the weathering of which will remove carbon from the

atmosphere”

• Prometheus – building a machine "that creates usable gas from thin air - rather than the oil deposits deep underground"

• Silicon Kingdom Holdings – is building "a pilot project that can capture 100 metric tons of carbon dioxide per day, and

eventually develop full-scale plants capable of removing nearly 4 million tons each year"

• Visolis – is “working on creating carbon-eating microbes

TECHNOLOGICAL OPPORTUNITIES

• Investment opportunities in new technologies have high potential returns, but alsohigh risks

• Every organisation should review and renew its efforts for innovation and newproduct development

• Assess the costs and benefits of increased investment in innovation

• The professional development of accountants should include coverage of newtechnologies and new approaches to project appraisal


“Bacterium is able to break down polyurethane, which is widely used but rarely recycled”

The Guardian, 27th March 2020

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GOVERNMENT POLICY AND REGULATION


• Although the climate emergency routinely makesheadlines, the international response has been mixed withmany governments actively downplaying the problem

• Many political leaders are acutely aware of the tensionbetween economic interests and climate politics

• Growing pressure for bolder and faster action onGovernments worldwide is likely to accelerate policy,legislative and regulatory developments

“How dare you pretend that this can be solved with just 'business as usual' and some technical solutions?”

Greta Thunberg, U.N. Climate Summit, Sept 2019

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National governments’ responses to the need for climate action are decidedly mixed:

• Only a small number of nations have passed laws to curtail carbon emissions –

Sweden, France, New Zealand, the UK and Scotland

• Two countries have already declared themselves carbon negative - Suriname and

Bhutan

• Around 50 nations are still discussing their targets

• Nine others have stated their climate commitments in policy documents, and

around 15 have a government minister with responsibility for climate concerns

• The world’s second largest emitter of CO2 - responsible for 14% of the global total

- has reversed some of its climate protections


• The UK has committed to get to net zero carbon emissions by 2050; Scotland hasset its target at 2045

• As climate impacts affect more and more people and the political pressure growsmore governments will take action

• There is potential for governments to respond in a disorderly way with heavy-handed policy changes, unexpected regulation, and disruptive interventions thatimpose significant costs on individuals, companies and supply chains

• Businesses need to monitor developments and prepare to make dramatic changesto how they operate and create value

THE CHALLENGE FOR BUSINESSES

“I think we need to price carbon; there's no question about it”

Justin Trudeau

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• The Financial Reporting Council (FRC) will review the extent to which UKcompanies and auditors are responding to the impact of climate change on theirbusinesses to ensure reporting requirements are being met

• Audit and accounting standards around climate change and the environment arelikely to become more demanding

• Finance teams need to ensure their organisations are compliant with currentstandards as well as plan for future reporting demands

• Finance teams need to scenario-plan the potential impact of regulatory changes orthe introduction of climate taxes


“Auditors have been put on notice that they need to consider their clients’ climate-related risks and, if material, determine whether those risks are

adequately disclosed in the financial statements”

Joint bulletin issued by the Australian Accounting Standards Board (AASB) and the Auditing and Assurance Standards Board (AUASB)

CLIMATE ADAPTATION

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CLIMATE ADAPTATION

For three years in a row, the WorldEconomic Forum’s Global Risk Report hasidentified climate change as the gravestthreat for global business and industry

“Failure in climate change mitigation and adaptation will impact business and industry worldwide”

World Economic Forum

• The long-term impacts of climate change - temperature and sea level rises, and

extreme weather events - are compromising critical infrastructure, crop production,

and human populations

• Climate-related risks are also amplifying tensions stemming from trade,

geopolitical, and domestic conflicts

• Worldwide economic stress and damage from natural disasters in 2018 totalled

$165bn - 50% of which was uninsured

• Over 200 of the world’s largest firms have estimated that climate change could

cost them a combined total of nearly $1tn if they don’t take action

CLIMATE ADAPTATION

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• There are significant investment, innovation and growth opportunities for businessprovided the right strategies are put in place

• The Global Commission on Adaptation, launched by the U.N. in 2018, encouragesthe development of measures to manage the effects of climate change throughtechnology, planning and investment

• Analysis by the Global Commission on Adaptation suggests that investing $1.8trillion over the next decade in measures to adapt to climate change could producea ‘triple dividend’ of net benefits worth more than $7 trillion by avoiding futurelosses; generating positive economic gains through innovation; and deliveringsocial and environmental benefits

• Once again, accountants need to develop new approaches to investment analysis,scenario planning, and strategy planning


PEOPLE AND HABITATS ON THE MOVE

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• The residents of the village of Fairbourne inWales are set to become the first climaterefugees in the UK with the announcement thatthe area will be abandoned to rising sea levelsfrom 2054

• Indonesia has announced plans to move itscapital Jakarta to the island of Borneo, 800miles away. Jakarta itself could be lost to thesea by 2050

• The UNHCR predicts that, in the next 50 years,between 250 million and 1 billion humans willleave their homes because of climate change

• Changes in climate and weather are also forcing flora and fauna to

migrate to new areas. Many species are threatened with extinction

• A quarter of Europe’s butterfly species and a third of bumblebee

species are at risk as they cannot tolerate warming conditions

• Species’ ranges are shifting as a result of changing conditions, with

serious implications for individual extinctions and the balance of our

natural world, sustainable food webs and healthy ecosystems

• Understanding the implications for the future location of customers,

markets and sources of critical raw materials will be a key challenge for

businesses


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• Accountants can play a key role in marketing planning and revenue projection

• The pace of change caused by climate impacts will increase and accountants needto be flexible

• Organisations need to regularly review potential changes in consumers, marketsand sources of supply, and update project plans and project appraisals asnecessary


“Whilst we are often the ballast providing the stability, calm and assurance to the enterprise and stakeholders, we must equally be innovative and venture

our ideas into dimensions outside our comfort zone. We have to start thinking very differently”

Christopher Wong, Partner, Deputy Head of Assurance, Ernst & Young LLP

OTHER IMPACTS OF CLIMATE CHANGESevere water stress

Coastal erosion and flooding

Carbon capture and storage

Sustainable Tourism

The Sixth Mass Extinction

Food production

Global pandemics

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• Demand for freshwater has more thandoubled since the 1960s

• Domestic water demand grew 600% from1960-2014

• One-quarter of the world now faces extremewater stress, where more than 80% of theavailable supply is withdrawn every year

• The World Bank estimates that the number ofpeople living in countries with water scarcitywill rise from 1.6bn in 2016 to 4bn by 2050

SEVERE WATER STRESS

Without a change in approach, the world will face a serious water deficit by 2030, with knock-on effects for sanitation and health, energy generation, and

agricultural production

• Coastal erosion and flooding threaten £400m of assets in Scotland alone

• The UK National Coastal Change Assessment projects that 30,000 buildings,

including many business premises, are sited close to potentially erodible coasts

COASTAL EROSION AND FLOODING

“When you think where our sewage sites are, they are close to sea level, where our railways and roads that hug the coast, they are going to be jeopardised,

many are going to be under threat in 30 or 40 years’ time”

Professor Jim Hansom, research fellow at the University of Glasgow's School of Geographical and Earth Sciences

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• To prevent a dangerous rise in temperatures, the UN’s climate panel says the

world needs to remove 1 trillion tonnes of carbon dioxide from the atmosphere this

century

• Pulling CO2 out of the air is one of the most difficult and expensive ways of dealing

with climate change

• The technology is untested at scale and questions remains about how sites will

contain the injected carbon for thousands even millions of years

• Costain has won the design contract for the first carbon capture and storage

project in the UK, in Aberdeenshire. It also aims to convert North Sea natural gas

into clean hydrogen

CARBON CAPTURE AND STORAGE

• Travel and tourism markets, products andservices are changing as individuals maketheir travel and tourism choices morecritically and expect companies to makechange their approach

• There are 1.4 billion tourists in the worldeach year, and the social, political,economic, and environmental impacts of“overtourism” are becoming more visible

• Pressures from communities to correct theimbalances of excess tourism are increasing

SUSTAINABLE TOURISM

Tourism is responsible for 8% of CO2 emissions – estimated at 4.5 gigatonnes in 2013 rising to 6.5Gt by 2025, driven by rising incomes

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• The Earth may be at beginning of its sixthmass extinction event: the most rapid loss ofspecies since dinosaurs were wiped out 65million years ago.

• The disappearance of plant and animalspecies, caused almost entirely by humanactivity, will have serious ecological,economic and social consequences

• Food supplies, tourism incomes, drugavailability and many other activities will beaffected

THE SIXTH MASS EXTINCTION

More than 40% of amphibian species; a third of marine mammals; a third of sharks; and a third of corals are threatened

• The food supply chain accounts for 26% ofglobal greenhouse gas emissions

• Half of the world’s habitable land is used foragriculture and 70% of global freshwaterwithdrawals

• Food production creates water stress,pollution, loss of habitat, and loss ofbiodiversity

• Producers adopting best farm and landmanagement practices will mitigate thehighest impacts of production

FOOD PRODUCTION

If consumers replace 15% of the meat they consume with alternative proteins by 2030, greenhouse emissions could drop by 8%

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• SARS, MERS, Ebola, swine flu, bird flu, andnow Covid19

• The frequency and impact of globalpandemics seems set to increase

• Human encroachment on wild habitats,intensified factory farming of animals, andincreased global travel seem to be a largepart of the cause

• The economic impacts are immense

• The current Covid19 crisis seems likely to putmany economies into recession

GLOBAL PANDEMICS

The OECD warn that the world's economy could grow at its slowest rate since 2009 due to the coronavirus outbreak

THE ACCOUNTANT’S ACTION LIST

WHAT CAN YOU DO?

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1. Work on your CPD

Not just technical skills

Review the environmental, social and governance risks in your industry

2. Review your Supply Chain

Consider potential future costs as ESG issues come to the fore and the potentialrevenue boost of creating an ethical supply chain

Appraise renewable sources of energy and develop recycling/ reuse plans

3. Rework your Finance Processes

Focus business plans on moving to zero carbon within 15 to 20 years

Scenario-plan the potential impact of regulatory changes or climate taxes

Prepare investment plans to adapt the organisation to climate change

Consider the climate and environmental impacts of your finance processes

WHAT CAN YOU DO?

4. Develop New Methods of Investment Appraisal

Investors will be increasingly focused on projects that maximise environmental, socialand governance (ESG) benefits

5. Contribute to Business Practice Review

Facilitate the creation of cross-functional teams to review the organisation’s products,services, and practices to identify ESG risks

Regularly review potential changes in consumers, markets and sources of supply

6. Support the transition to the New Climate Economy

Encourage the organisation to identify and model the potential economic and marketopportunities of the new growth approach

Assess the costs and benefits of increased investment in innovation and newtechnologies

WHAT CAN YOU DO?

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STAY FLEXIBLE AS THE PACE OF CHANGE INCREASES

“Accountants and finance professionals play a crucial role in keeping boardroom conversations on climate change informed”

Sunita Rajakumar, Malaysian chapter of Climate Governance Initiative

“We have an opportunity to look beyond profitability and managing traditional resources. We also need to look at managing environmental resources”

Terence Tan, EY Australia

WHAT DO THE ACCOUNTING INSTITUTES SAY ON CLIMATE CHANGE?

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Chartered Professional Accountants Canada

CPA Australia

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Chartered Accountants Ireland

Chartered Institute of Management Accountants

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ACCA

Institute of Management Accountants

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Institute of Chartered Accountants in England and Wales

Financial Management Magazine

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THANK YOU

ROSS MAYNARD

STAY FLEXIBLE AS THE PACE OF CHANGE INCREASES

“Accountants and finance professionals play a crucial role in keeping boardroom conversations on climate change informed”

Sunita Rajakumar, Malaysian chapter of Climate Governance Initiative

“We have an opportunity to look beyond profitability and managing traditional resources. We also need to look at managing environmental resources”

Terence Tan, EY Australia

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