* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Download Business and Climate Change Issues: Discussion on Awareness and Motivational Factors
Mitigation of global warming in Australia wikipedia , lookup
Myron Ebell wikipedia , lookup
Instrumental temperature record wikipedia , lookup
Economics of climate change mitigation wikipedia , lookup
Low-carbon economy wikipedia , lookup
Global warming controversy wikipedia , lookup
Michael E. Mann wikipedia , lookup
Soon and Baliunas controversy wikipedia , lookup
Climatic Research Unit email controversy wikipedia , lookup
2009 United Nations Climate Change Conference wikipedia , lookup
Fred Singer wikipedia , lookup
Global warming wikipedia , lookup
German Climate Action Plan 2050 wikipedia , lookup
Heaven and Earth (book) wikipedia , lookup
Effects of global warming on human health wikipedia , lookup
Climate change feedback wikipedia , lookup
Climatic Research Unit documents wikipedia , lookup
General circulation model wikipedia , lookup
Climate resilience wikipedia , lookup
ExxonMobil climate change controversy wikipedia , lookup
Climate sensitivity wikipedia , lookup
Climate change in Saskatchewan wikipedia , lookup
Economics of global warming wikipedia , lookup
Climate change denial wikipedia , lookup
Politics of global warming wikipedia , lookup
United Nations Framework Convention on Climate Change wikipedia , lookup
Climate change in Australia wikipedia , lookup
Effects of global warming wikipedia , lookup
Climate change adaptation wikipedia , lookup
Climate engineering wikipedia , lookup
Climate change and agriculture wikipedia , lookup
Attribution of recent climate change wikipedia , lookup
Climate governance wikipedia , lookup
Solar radiation management wikipedia , lookup
Climate change in Tuvalu wikipedia , lookup
Citizens' Climate Lobby wikipedia , lookup
Climate change in the United States wikipedia , lookup
Media coverage of global warming wikipedia , lookup
Scientific opinion on climate change wikipedia , lookup
Carbon Pollution Reduction Scheme wikipedia , lookup
Public opinion on global warming wikipedia , lookup
Effects of global warming on humans wikipedia , lookup
Climate change and poverty wikipedia , lookup
IPCC Fourth Assessment Report wikipedia , lookup
Climate change, industry and society wikipedia , lookup
Surveys of scientists' views on climate change wikipedia , lookup
BUSINESS AND CLIMATE CHANGE ISSUES: DISCUSSION ON AWARENESS AND MOTIVATIONAL FACTORS Rawshan Ara Begum and Joy Jacqueline Pereira Abstract Climate change and its implications on businesses are receiving greater attention and recognition, with investors and other stakeholders in the business sector and this has already become a reputational and strategic issue for businesses. The article presents how corporate managers view about climate change, their level of awareness and its sources. It also discusses important motivational factors to address climate change issues at the company level. This article is part of a survey on the issue of climate change, business and sustainability, conducted by the Institute for Environment and Development (LESTARI) through Malaysian Network for Research on Climate, Environment and Development (MyCLIMATE), with support from the Ministry of Natural Resources and Environment in Malaysia. The survey was conducted through interviews with senior managers and management officers of the respective companies, who were members of the Malaysian International Chambers and Commerce Industry (MICCI) and Federation of Malaysia Manufacturers (FMM). The findings of the survey could be useful for policy and decision makers in formulating national climate change action plans in Malaysia. Field of Research: Environmental economics and management Dr Rawshan Ara Begum, Institute for Environment and Development (LESTARI) & South East Asia Disaster Prevention Research Institute (SEADPRI), Universiti Kebangsaan Malaysia, email: [email protected] Prof. Dr. Joy Jacqueline Pereira, Institute for Environment and Development (LESTARI) & South East Asia Disaster Prevention Research Institute (SEADPRI), Universiti Kebangsaan Malaysia, email: [email protected] 1 1. Introduction Climate change and its implications on businesses are receiving greater attention and recognition, with investors and other stakeholders in the business sector (Kolk and Pinkse, 2004) which is already become a reputational and strategic issue for businesses. Therefore, there has been an increase of business responses to climate change in terms of market and political strategies such as economic and policy responses for tackling climate change. For example, the Carbon Disclosure Project (CDP) operates worldwide to collect and distribute high quality information that motivates investors, corporations and governments to take action to prevent dangerous climate change (CDP, 2009). There is a concern for socio-economic issues related to climate change including business opportunities and threats, vulnerability of economies and market conditions as well as co-benefits and risks of climate change mitigation actions (Begum & Pereira, 2011). Many businesses have already started to recognise that climate change poses both risks and opportunities, but in most cases there is lack of effective frameworks in place for understanding and managing those long-term risks and opportunities. The risks from climate change can be significant and that not all companies in the same sector will be affected to the same degree. It is also raised concerns over the potential for litigation if business and financial organisations fail to consider the impacts of climate change (POST, 2004). This article is part of a survey on the issue of climate change, business and sustainability, conducted by the Institute for Environment and Development (LESTARI) through Malaysian Network for Research on Climate, Environment and Development (MyCLIMATE), with support from the Ministry of Natural Resources and Environment. The article presents how corporate managers view about climate change, their level of awareness and its sources. It also discusses important motivational factors to address climate change issues at the company level. 2. Sampling, Survey and Analysis The survey was conducted through interviews with senior managers and management officers of the respective companies, who were members of the Malaysian International Chambers and Commerce Industry (MICCI) and Federation of Malaysia Manufacturers (FMM). Interviews were based on a set of questionnaires comprising the issue of business, awareness and perception of climate change as well as factors to motivate and other environmental concerns. Purposive random sampling method was used for data collection and the data was collected from 54 senior managers and management officers during the month of July to September in 2008. Initially, simple descriptive statistics such as averages, ranges and percentages were used to analyze the data obtained and then the study adopted a modified method of weighted average and coefficient of variation models that was employed the previous research on waste minimization factors (Begum, 2007). The following 2 weighted average model was used to examine the relative level of importance among the factors that motivate the respondent to address climate change issues. AISi = 4j=1 XjNij / N Where, AISi is the average importance score to the factor i, Xj the importance grade, to be assumed Grades I–IV. Grade I indicates not important at all and Grade IV indicates most important and the middle Grades II–III indicate important and least important to motivate the companies, Nij the number of respondents who give the factor i for the grade Xj and N is the total number of respondents. For calculating AISi, the four grade scales for X need to be converted into numerical scales, such as Grade IV carries a value of 4, Grade III of 3 and so on are taken for the purpose of simplicity. To rank the importance among all the factors, the combined value of the weighted average and coefficient of variation has taken into account. The coefficient of variation measured by the model of factors index value (FIV) as below: FIVi = ASSi + ASSi/δi Where, FIVi is the coefficient of variation of the factor i, AISi the average impotance score of the factor i and δi is the standard deviation of the importace score for factor i. After calculating FIV, the study showed the ranks of the importance between factors (RFIV). The Statistical Package for Social Sciences (SPSS) software was used for data analysis. 3. Survey Findings The survey respondents reflect a wide range of corporate types and sectoral businesses in which most of them are from multi-national companies (41%) while the rests are from small and medium enterprises (26%), large corporations (24%) and the government-linked companies (9%). In order to the types of sectoral businesses, again a majority of them (41%) represents manufacturing sectors such as electrical and electronics industry, food processing & beverages, rubber processing and products, wood and plastic products while service sectors such as hotel and resorts, environmental management or pollution control, recycling and recovery consist of 24 % and the rests of 13% represent oil and gas and 10% of other sectors such as banking, finance and insurance, respectively. The subsequent sections discusses the survey findings on corporate managers view about climate change, level of awareness and its sources as well as motivational factors to address climate change issues. 3.1. Awareness of Climate Change From the survey, it reveals that all the respondents are generally aware of climate change issues meaning that all of them knew or heard about any of the following terms related to climate change such as ‘climate change’, ‘global warming’ 3 ‘greenhouse effect’ or ‘sea level rising’. From the survey, it was asked to the respondents that how did they become to know or aware of climate change issues and found that the most two common sources of awareness are newspapers (87%) and television (82%) (Table 1). The other common sources include seminars, conferences and workshops (69%); internet (65%); own company (56%); and radio (33%); followed by the industry association (22%) and among others. Table 1: Sources of awareness about climate change Sources of awareness % of respondents Newspapers 87 Television 82 Seminars, conferences and workshops 69 Internet 65 Own company 56 Radio 33 Industry Association 22 Others sources 17 Other companies 6 Source: Begum & Pereira, 2011 3.2. Motivational Factors In the survey, respondents were asked what factors would motivate them to actively address the issue of climate change at their companies rather than of business profit. Here we call these factors as motivational factors meaning that these factors can contribute or capable to incite the corporate managers to undertake actions for tackling climate change issues at their company. The survey presents six major factors to be considered as motivational factors in addressing climate change issues at the corporate level indentified from a wide range of literatures (Okereke, 2007; Hoffman, 2006; Ko¨hler et al., 2006; Kolk and Pinkse, 2004; Nieuwenhuis et al., 2004;Skjaerseth and Skodvin, 2003; Ko¨hler, 2003). It is common that business community or company managers feel economic gain or profit which is the only way to communicate the need for climate action to their employees. The survey conducted by Okereke (2007) also found that nearly 100% of the FTSE companies that report on climate change actions on their websites make a link between profit and carbon management. This is why this survey exclude the profit factor as motivational factors because it is always be there for business and obviously have a greatest motivation to underpine business or corporate’s action for tackling climate change issues specially for reducing carbon emissions. 4 These factors might have a different level of importance to motivate the respondents at the company level. For each factor, the respondents were asked to give their opinion of importance of motivational factors by selecting one of four grades, namely, Grades I–IV. Grade I indicates not important at all and Grade IV indicates most important and the middle Grades II–III indicate important and least important to motivate them. The survey results are summarised in Table 2. Table 2 shows the number and percentage of respondents who gave a specific grade to each factor. For the factor of education and awareness building, 74% respondents indicate that education and awareness building is the most important factor to motivate them, thus the importance of Grade IV is given where 24% respondents considered that this factor is important to motivate, thus the importance of Grade III is given. In addition, only 2% of the respondents considered the importance of Grades II for least important and none of them considered of Grade I means ‘not important at all’ to motivate them. The respondents followed the same procedure to give the importance grade for the rest factors, which are presented in Table 2. It should be noted that 4% respondents were perceived two factors such as guidelines and training support; and research and development; as ‘not important at all’ as motivational factors. Table 2: Survey response: level of importance among motivational factors Not important at all Total response % No. % No. % 1 2 - - 54 100 35 1 2 - - 54 100 26 48 5 9 - - 54 100 40 28 52 2 4 2 4 54 100 31 57 19 35 4 8 - - 54 100 25 46 20 37 7 13 2 4 54 100 Least Most important Important No. % No. % No. Education and awareness building 40 74 13 24 Legislation and regulation 34 63 19 Financial incentives 23 43 Guidelines and training support 22 Appropriate technology Research and development Factors important Table 3 summarises the estimated results of the weighted average and factor index value (FIV) model. The average importance score (AIS) shows the relative levels of importance among 54 respondents to each motivational factor. The result found that the highest AIS is 3.72 for the factor of education and awareness building indicating that education and awareness building is the most important factor contributing to motivate them for addressing climate change issues. On the other hand, the lowest AIS is 3.26 for the factor of research and development, which indicates the least important factor contributing to motivate them. The rest of the AIS values of the motivational factors are between 3.61 and 3.30 that show the importance level 5 neither exactly most important (Grade IV) nor important (Grade III) among motivational factors. To examine and rank a clear and relative importance level, this study has been calculated the ranking profile of the importance of motivational factors by using a combined value of the weighted average and coefficient of variation. Although a weighted average measure here AIS can be used to rank all the factors, however, the commonly recognised weakness of using this measure is that it does not consider the degree of variation between individual responses. In fact, a smaller variation between individual responses can give better quality to the weighted average value. Therefore, when two factors carry the same or very close average values, the factor carrying smaller variation should be given a higher rank. So, the typical technique is used to mitigate this weakness of ranking attributes by weighted average value that is to apply a measure called the coefficient of variation, which can be obtained through dividing the weighted average by standard deviation. That is why this calculation considers both the weighted average and the coefficient of variation measure for effective assessment of ranking attributes or factors. The coefficients of variation are measured by the model of factor index value (FIV). Table 3: Calculations of parameter values of motivational factors for RFIV Average Important Score/AIS Standard Deviation, Factors Index Value (FIV) Education and awareness building 3.72 0.49 11.31 1 Legislation and regulation 3.61 0.53 10.42 2 Financial incentives 3.33 0.64 8.53 4 Guidelines and training support 3.30 0.72 7.88 5 Appropriate technology 3.5 0.64 9.0 3 Research and development 3.26 0.83 7.19 6 Factors Rank of Factors Index Value (RFIV) Table 3 shows the results of FIV and the ranks of relative importance motivational factors (RFIV) based on FIV value. The highest FIV is 11.31 for the motivational factor education and awareness building and the lowest FIV is 7.19 for the motivational factor research and development. The fact is that that the ranks of the relative importance between motivational factors did not change much by the measures of AIS and FIV but it is fair enough to consider the ranks established by both measures which provide an effective indication of relative importance between 6 factors in terms of motivating the respondents for tackling climate change issues of their respective companies. The results of the ranking profile show empirical evidence of relative importance of motivational factors and found that three factors such as education and awareness building; legislation and regulation; and 6 appropriate technology are perceived to be the most important factors to contribute to motivate the senior managers and management officers of the companies while the other three factors such as Financial incentives; Guidelines and training support; and research and development are perceived as important factors that also contribute to motivate them. 4. Discussion and Conclusion The corporate managers surveyed in Malaysia are well aware about climate change, demonstrating a high concerned of the issues. The main source of awareness regarding climate change issues is the mass media, particularly newspapers and television. Other important sources are technical meetings such as seminars, conferences and workshops, the internet, own company and the industry association. The implications of climate change may vary across the types of corporate and businesses for example some businesses, individual companies and sectors may face increasing threats, while others may be less affected and some may even get opportunities and benefits (Begum & Pereira, 2011; Okereke, C., 2007). The Stern review (2007) also stresses that climate change and weather events can disrupt businesses and indirectly alter market demand and supply. Therefore, businesses should take into account climate change impacts specially when making long term investment decisions, as well as taking advantages of the opportunities. The survey also provides empirical evidence on the level of importance among the six motivational factors from the view of corporate managers and their companies. The most important motivational factor is education and awareness building whilst the factor research and development is the least important that contribute to motivate the corporate managers in addressing climate change at the company level. The corporate managers perceived that education and awareness building; legislation and regulation; and appropriate technology are the most important factors and financial incentives; guidelines and training support; and research and development are the important factors to contribute to motivate them to take climate change actions at their company. However, better understanding of motivational factors provides a great extent of value to the business or corporate sectors for developing their strategies and actions in line with global and national climate change policies. Corporate support for mitigation and adaptation measures became evident to the initiatives and activities of reducing GHG emissions through product and process improvements, cooperation with other companies, government and non-government agencies to exchange technologies and expertise, and the exploration of options such as emission trading (Kolk and Pinkse, 2004; Dunn, 2002; Rosenzweig et al., 2002; Whittaker et al., 2003). More obviously, business or corporate sector is well known about the adverse effect of climate change and that’s why some of the international and multi-national companies are being proactive and pioneers in undertaking climate activities; they would gain credibility and the leverage that enables them to play active roles in deciding the exact direction of change (Okereke, 2007; Hoffman, 2006; Begum and Pereira, 2011). Okereke (2007) has shown an example of Shell (2007), in its website, Shell emphasizes that it is uniquely equipped to contribute to the development of effective climate policy both nationally and at the 7 international level because of its experience in ‘‘in-house emissions trading scheme’’ and also reported that it actively supported the establishment of the European Union Emission Trading Scheme (EU ETS) and offered valuable advice in the process. In Malaysia, one example is the effort of YTL Corporation in building capacity of Malaysian corporate sector with respect to disseminating information on business strategies for managing climate change and sustainability (Tang and Yeoh, 2007). However, such effort needs to be mainstreamed in the country. As there is a sizeable private and corporate sector presence in Malaysia, public-private partnership could play a significant role to the climate action that allows government to implement climate change and green technology policies (Begum et al. 2011; Begum and Pereira 2011). However, the survey findings could be useful in formulating appropriate policy interventions and implementing national policies and action plans in addressing climate change issues in Malaysia. There is also an urgent need for further researches on corporate responses and business approaches in identifying effective strategies and proactive practices due to the issues of climate change in Malaysia. 5. ACKNOWLEDGEMENTS The authors are grateful to the Malaysian International Chambers and Commerce Industry and Federation of Malaysia Manufacturers for their assistance during data collection. Respondents of the survey are also acknowledged for their cooperation. The support of Tan Ching Tiong and Shahriman bin Samsudin in the research team is gratefully acknowledged. 6. REFERENCES Begum, R. A. and Pereira, J. J. 2011. Corporate perceptions of climate change in Malaysia. African Journal of Business Management. 5(11): 4299-4305. Begum, R. A., Abedin, R.D.Z.R.Z. and Periera, J.J. 2011 Initiatives and market mechanisms for climate change in Malaysia. Journal of Environmental Scinece and technology. 4(1): 31-40 Begum, R. A., Siwar, C., Pereira, J. J and Jaafar, A.H.. 2007. Implementation of waste management and minimisation in the construction industry of Malaysia. Resources, Conservation and Recycling, 51(1):190-202 CDP, 2009. CARBON DISCLOSURE PROJECT (CDP). https://www.cdproject.net/en-US/WhatWeDo/Pages/overview.aspx Dunn, S. 2002. Down to business on climate change: An overview of corporate strategies. Greener Management International 39(Autumn): 27–41. Hoffman, A.J. (2006) Getting ahead of the curve: Corporate strategies that address climate change. Prepared for the Pew Centre on Global Climate Change. Cited in Okereke, C. 2007. An Exploration of Motivations, Drivers and Barriers to Carbon Management: The UK FTSE 100. European Management Journal, 25(6): 475–486. 8 Ko¨ hler, J. 2003. Long run technical change in an energyenvironment- economy (E3) model for an IA system: A model of Kondratiev Waves. Integrated Assessment 4(2), 126–133. Ko¨ hler, J., M. Grubb, D. Popp, and Edenhofer, O. 2006. The transition to endogenous technical change in climate-economy models: A Technical overview to the Innovation Modeling Comparison Project. The Energy Journal Special Issue, Endogenous Technological Change and the Economics of Atmospheric Stabilization, 17-55. Kolk, A. and Pinkse, J. 2004. Market strategies for climate change. European Management Journal. 22(3): 304-314. John, D. 2008 Opportunities for economic and community development in energy and climate change. Economic Development Quarterly. 22(2): 107-111. DOI: 10.1177/0891242408315579. Nieuwenhuis, P., Vergragt, P.J. and Wells, P. 2004. Technological change and regulation in the car industry. Greener Management International (GMI)(Autumn), 5–11. Okereke, C. 2007. An Exploration of Motivations, Drivers and Barriers to Carbon Management: The UK FTSE 100. European Management Journal, 25(6): 475–486. POST, 2004. Climate change and business. postnote January 2004 Number 213. London: Parliamentary Office of Science and Technology (POST). http:// www.parliament.uk/post Rosenzweig, R., Varilek, M. and Janssen, J. 2002. The emerging international greenhouse gas market. Pew Center on Global Climate Change, Arlington, VA. Skjaerseth, J. and Skodvin, T. 2003. Climate Change and Oil Industry: Common problems varying strategies. Manchester University Press, Manchester. Shell, 2007. Environment and Participating in the Debates. Available at: http://www.shell.com/home/ PrintFramework?siteId=envandsocen&FC3=/home/ envandsoc.pdf. Stern, N. 2007. Stern Review: Economics of Climate Change. Cambridge University Press, Cambridge. Tang, K. and Yeoh, R. 2007.. Cut carbon, grow profits - business strategies for managing climate change and sustainability. London: Middlesex University Press. Whittaker M, Kiernan M, Dickinson P 2003. Carbon finance and the global equity markets. Innovest/Carbon Disclosure Project, Richmond Hill/London. 9