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NATL61_040-047 03/08/2007 09:49 AM Page 45 Feature belief that a proactive approach is the way to go. Asking Questions, Getting Answers… In 2005,the multinational teamed up with other prominent corporations weigh in on climate change companies to send a letter to the prime minister requesting urgent action on climate change.And Alcan requires all sites operating under its umbrella to produce an inventory of all greenhouse gas emissions.It has also stated publicly that it aims Coping with climate change is top of mind for many executives to be climate neutral by 2020. In the past 15 years, it has these days. Local, national and global movements have brought reduced its direct smelter emissions by one-third even though greenhouse gases and other environmental concerns to the fore- production doubled. front. They are shared by ordinary citizens-and shareholders- “We want to do as much as possible all the time, across across Canada and around the world. the board, not only in jurisdictions where governments are The UN Global Compact is a prime example. The compact out- looking more closely at this question, but everywhere lines 10 principles that focus on human rights, the environment, around the globe,”says Annie Carpentier,chief counsel with labour standards and corruption. Companies that join the compact the Alcan primary metal group in Montreal. agree to be governed by those principles in the course of doing To be seen as an industry leader is good for business, she business. Since its launch in 2000, more than 2,500 companies from adds.“We enjoy a ’permit to operate’from different societies 90 countries around the world have signed on, including Canadian around the world-because we use resources-and we think giants as Alcan, BCE, Enbridge, HSBC, and Hydro Quebec. Big U.S. that long-term, nobody will allow us that right to operate if participants include household names such as DuPont, Gap Inc., we are not doing it in a sustainable fashion.” Hewlett-Packard, Nike, Starbucks and Coca-Cola. Carpentier points out that because Alcan is a company of Then there’s the Carbon Disclosure Project (CDP), a coalition some 70,000 employees, approaching sustainability proac- of global institutional investors with more than US $31.5 trillion in tively is also a matter of self-preservation.Sooner or later,she assets under management. Signatories include AIG, Goldman believes, the laggards will have to catch up.“I wouldn’t want Sachs, Morgan Stanley and Merrill Lynch. These prominent to imagine a company of this size that is suddenly faced with investors have joined forces under the CDP’s umbrella to demand changing regulations and a much more demanding environ- more information about the greenhouse gas emissions of 500 of ment.You cannot react to such a thing overnight.” the world’s largest quoted corporations. Four years ago, when the CDP first surveyed the FT500, the Shell: Public commitment to reduce emissions response rate was 47%. In 2006, the response rate jumped to an Shell Canada Ltd. is also on the sustainability bandwagon. It impressive 72%. American companies responding to the CDP for made a public commitment in 2000 to reduce its emissions the first time this year included American Express, Boeing, Home by 6 per cent below 1990 levels by 2008, and is on track to Depot, Disney and Wal-Mart. meet that target.The catch,explains Tim Bancroft,vice-pres- The Dow Jones Sustainability Index (DJSI), also illustrates how ident of sustainable development, technology and public sustainability is emerging as a core value in capital markets. Being affairs with Shell in Calgary, is that “unlike Canada, we listed as a DJSI company carries a certain cachet, conferring val- haven’t stood still. In 2000, after we made that commitment, ues [in the public’s mind] such as the honesty, integrity and sus- we started up a new business in the oil sands, and it puts out tainability of firms. 3.5 million tonnes of CO2 each year.” Last year’s Stern Review on “The Economics of Climate Shell’s goal is to cut those emissions in half by 2010.Aiming Change” (published October 2006) has been called the most com- to be carbon neutral is not realistic in his industry, says prehensive review ever carried out on the economics of climate Bancroft, but his company aspires to do “no worse” in terms change. Former World Bank Chief Economist Sir Nicholas Stern of greenhouse gases by producing oil from the tar sands than projected that unless something changes, “Our actions now and importing oil from places like Venezuela, the Middle East or over the coming decades could create risks of major disruption to the North Sea. economic and social activity, on a scale similar to those associ- Bancroft says Shell is proactive on climate change because ated with the great wars and the economic depression of the first it’s good for business, but also because it’s the right thing to half of the 20th century.” do.“If you save energy, you save costs,” he says.“But we also Taken together, the UN Global Compact, the CDP, the DJSI and believe that big companies, big emitters-and we’re in both the Stern Report are evidence that the environment is starting to those groups-should show a little leadership here.” matter to corporations and investors. People are waking up to the Still, taking the lead can be unnerving, he admits.“You get fact that if nothing changes, the planet could reach a tipping point worried, getting out ahead of the pack sometimes.You say from which it may not be able to recover. MARS 2007 CCCA Canadian Corporate Counsel Association 45