BINGO Day, Business and Industry NGOs @ UNFCCC

Warsaw, 15 November 2013

Speech by
Christiana Figueres, Executive Secretary, United Nations Framework Convention on Climate Change

Distinguished participants, Ladies and Gentlemen,

I am glad to help open BINGO Day here in Warsaw and thank the International Chamber of Commerce for inviting me to join you. Earlier this week, I spoke about two sobering realities:

• The science is clear.
• The impacts are upon us.

These two realities point to one conclusion for business:  Business as usual is history. 

Businesses face new risks from climate change and have new opportunities in addressing climate change, but our current business model is woefully inadequate to rise to the our new realities.

While much effort this week is being invested in rebuilding communities in South East Asia, the larger task ahead is to redesign our economies. This redesign must be guided by three trajectories:

• High resilience;
• Low carbon; and
• High growth.

The current and growing impacts of climate change expose business to a costly cycle of losing and rebuilding, disrupting the value chain.

The cost from extreme weather is evident, perhaps the most obvious example of economic impacts.

Perhaps the most evident example of disrupted supply chains were the floods in Thailand in 2011, which caused delays and huge losses for Toyota, Honda, GM, Sony, Canon, and Toshiba, to name some of the high-profile companies directly affected by the floods. This was in addition to the human cost Thailand. And even now, one year after Sandy in a country where one would think that rebuilding is not an issue, the boardwalk in New Jersey still has not been rebuilt, greatly affecting businesses there.

The costs of these events are in the billions, and the cost from slow onset events could be much greater. Coastal facilities will have to relocate due to rising seas, and heat and drought will affect agriculture and other sectors that need water. The financial costs of climate change will shake society to its core.

Business must invest in resilience as a strategy that hedges against future cost and ensures long-term continuation of operations. This includes investment in resilient infrastructure, in resilient operations and in resilient supply lines.

If resilience manages climate risk, then low carbon captures the rewards of climate opportunities. Worldwide, the demand for low-carbon good and services is up.

Low-carbon transportation is increasingly viable. The demand for green buildings that reduce operating and hold more value longer is on the rise. Diversification into climate-friendly financial products, even in the world’s largest sovereign wealth funds, is looking better and better for funds that want secure and stable returns.

Demand is up because awareness is up. Awareness is up among consumers who see low-carbon products as a responsible choice. Awareness is up among politicians who see low carbon as the responsible use of public funds. And awareness is up among investors who see low-carbon investment as a means to ensure better returns. We must capitalize on this progress and accelerate it to make low-carbon the new normal, where there is no question about whether we go low carbon, the question is: “how low will we go?”

Business must embrace this new normal, because it is the key to achieving high growth and zero-net emissions by the second half of the century. This is an immense and global challenge, a mega-challenge, perhaps the largest we have ever seen. History shows that meeting mega-challenges precedes strong and rapid economic growth, due largely to the human and financial capital that is mobilized by meeting these challenges.

We look back and see the industrial revolution, the period after the Second World War, the communication and technology revolution, and the energy revolution in the developing world have sparked the fastest and greatest cycles of growth in history.

The concurrent slowdown of growth and escalating climate effects is an opportunity to spark another, low-carbon growth cycle. We can reignite economic growth by transforming to high resilience and low carbon as an engine of new investment, new technology, new skills and new jobs in a high-growth green economy.

In order to do so, we must mobilize capital. Specifically the institutional frameworks and regulatory requirements that allocate capital must invest in an inclusive, green economy. The fact is they aren’t doing so. At least, they aren’t doing so at the scale and speed we need to truly go to high resilience and low carbon.

That is what makes this event important. This event brings the right players to the right venue to share knowledge, open the door for new business models and showcase commitment to market-based solutions. This venue gives business a voice in the international process, but this not the only way for business to stand up and be heard in the international process.

We need you here, yes, but then we need you out there, in boardrooms, recognizing risks and transforming corporate strategies; investing in resilient infrastructure, efficiency, and clean and secure energy; and bringing climate-friendly goods and services to market.

We need you to ask governments for regulatory clarity, for a level playing field that doesn’t subsidize carbon and for policy that provides a stable platform to develop strategy. We need your support for capitalization of the Green Climate Fund, which can open doors into new markets.We need your innovation to transform the energy landscape. You must act urgently, because next year is crucial.

2014 is the year to bring business voice to the conversation. 2014 is the year to let the world know that ambitious climate action can create steady, sustainable economic development. 2014 is the year when Parties will put a draft agreement on the table in Lima, so we must not wait for 2015, it will be too late.

For an ambitious and effective agreement, we must hear loudly and clearly that the private sector is willing to participate in markets, increase efficiency, capture technology gains and produce low-carbon products.

If you do not provide the context of confidence for the governments to take risky, courageous and bold decisions, those decisions become harder to make. Governments need to operate in a context of confidence that only the business sector can provide.

This is a new business paradigm, and one I hope you embrace because time is short and action speaks louder than words. We need that loud action – open communication, collaboration within industries and across industries – now more than ever.

We look to the BINGOs to help make that happen, and happen now because perhaps the greatest legacy that we need to leave behind us is not only a healthy planet, but the business model that will keep the planet healthy.

Thank you.

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