By Paul Raeburn
When President Bush discarded the Kyoto Protocol--an international agreement to cut emissions of carbon dioxide and other global-warming gases--he blamed the decision on a slowing U.S. economy and an energy crisis. "The idea of placing caps on CO2 does not make economic sense for America," Bush said on Mar. 29.
Some of the world's largest companies disagree. DuPont, for example, has already made substantial cuts in its greenhouse-gas emissions and says it will continue to do so despite the Administration's reluctance.
"The announcements around Kyoto don't change our resolve," says Paul Tebo, corporate vice-president for safety, health, and environment at DuPont. Why? Because the company's environmental program pays off in enhanced shareholder value, says Tebo. "You can't measure this to the penny, but it is very real. Corporate reputation is a very valuable part of our company."
GOOD SENSE. Dupont is not alone. On Apr. 4, the Business Roundtable proposed various solutions to the global-warming problem in a report titled, "Unleashing Innovation: The Right Approach to Global Climate Change." Earnest W. Deavenport, chairman and chief executive of Eastman Chemical Co., who chaired the Business Roundtable's environment task force, said the report "represents the business community's interest in being part of the solution to concerns about global climate change."
Increasingly, corporations are deciding to join efforts to curb global warming because the strategy makes good business sense. Others include BP Amoco, Royal Dutch/Shell, Ford, and General Motors--all companies that would be expected to fight limits on greenhouse-gas emissions. Until recently, these four companies were members of the Global Climate Coalition, a group formed to oppose mandatory limits on greenhouse emissions. All have pulled out.
BP and Shell aren't stopping with that gesture. They have joined two dozen other companies--including Alcoa, Enron, Georgia-Pacific, and Toyota--in a new group called the Pew Center on Global Climate Change. The center brings companies together to search for solutions to the global-warming problem. "I think they are convinced that at one time or another there will be regulation of greenhouse gases because this is a real problem," says Pew Center President Eileen Claussen.
It's difficult to know whether the companies will keep their resolve when the time comes to act on their pledges to cut emissions. Some of them, however, have already begun to act. BP and Shell, for example, have each established internal emissions-trading schemes. The idea is to reduce emissions more than necessary where it is economical to do so, creating emissions "permits" to be sold to other units within the company. If emissions trading among companies becomes a reality, BP and Shell, unlike their competitors, will already know how to use it to advantage.
The Big Three auto makers have likewise jumped ahead of regulators with a game of one-upsmanship to boost vehicle mileage. Ford Motor Co. took the lead in 2000 when it publicly promised to improve the fuel economy of all its SUVs by 25% over five years. General Motors Corp. promised to beat Ford's improvements. And DaimlerChrysler has just joined the game, saying it will meet or beat any Ford SUV fuel-economy gains.
These moves represent a significant change in corporate behavior. So far, it has been mostly promises. But if those promises aren't kept, environmental groups, which are watching very closely, will do their best to stage a public flogging.
The Bush Administration, with its narrow view of the world's energy problems, sees boosts in oil exploration and production as nonnegotiable goals. Cheap energy is good for the economy, and boosting supply is one way to help bring down prices. But the Administration has given no hint that it perceives global warming as a serious problem. And such a stance carries a risk: While some uncertainty remains about the consequences of global warming, the overwhelming evidence suggests that the phenomenon is real. The probusiness Bush Administration should listen a little more closely to what some businesses are actually saying. Raeburn covers science and the environment from New York.