IPCC climate report: What are the implications for corporate ESG?

PR pros express urgency for companies to act on and measure their ESG activities in a more transparent way, following the bombshell global report released earlier this week.


The recently released report by the Intergovernmental Panel on Climate Change (IPCC) has added to mounting evidence that the impacts of climate change are catastrophic to the planet. The report details alarming findings, including the fact that the planet is warming at perilous levels and that the desecration of our planet is “unequivocally” caused by human activities.

These human activities primarily refer to fossil fuels which still supplies a majority of world energy. On Monday, United Nations Secretary-General Antonio Guterres said that the report "must sound a death knell" for coal, oil and gas.

"The alarm bells are deafening, and the evidence is irrefutable: greenhouse gas emissions from fossil fuel burning and deforestation are choking our planet and putting billions of people at immediate risk," he said. 

Antoine Calendrier, Edelman’s head of crisis and trust services for APAC told PRWeek Asia that this year’s IPCC report rings a different tone compared to previous years. He said that the call to “dramatically cut” greenhouse gas emissions in [this year’s] publication is direct, clear and unequivocal, echoing Guterres’ label of the report as a “code red for humanity”.

So will the report place increased pressure on large brands and organisations to rectify their impact on the planet more urgently?

“With the IPCC report, stakeholder expectations will undoubtedly rise further for them to not only gain a better understanding of what organisations are doing to decrease their emissions, but also—and more importantly—receive concrete and repeated evidence of the positive effect of those actions,” said Calendrier.

In the lead up to the UN Climate Change conference (COP26) in November, he added that businesses have made a number of public commitments and accelerated their engagements to deliver a net zero future.

“For organisations to ultimately preserve their license to operate, ESG strategies and related communications have little choice but to demonstrate unwavering corporate accountability, measurable environmental impact, and relentless commitment to be part of the solution,” said Calendrier.

“For brands to win in the marketplace and build trust in this context, they must get ahead of fast-coming climate risk disclosure requirements—such as the one currently discussed at the US SEC—by proactively ensuring that investors are equipped with highly qualitative and quantitative data. And communicate transparently about the good, the bad and the ugly.”

Kelly Johnston, COO and GM for Southeast Asia at Sandpiper Communications, told PRWeek Asia that companies have faced increasing pressure around ESG performance and disclosure for some time, particularly from investors.

“This report is certainly likely to increase scrutiny around emissions disclosure and management, including from consumers. We conducted a proprietary research study late last year and that shows that even prior to this report, climate change has been the ESG-related issue of most concern to consumers,” said Johnston, who also leads Sandpiper’s ESG and sustainability practice. 

However, companies view ESG as something of a double-edged sword, a similar conundrum when it comes to purpose. On one hand, the ability for a company to promote its achievements in ESG, and build reputation capital as a result, can encourage further investment. But on the other hand, as audiences become more educated, the bar for what constitutes ‘green-washing’ is continually being raised.

“Where brands are going wrong is that too many still see sustainability as a trend or strategic differentiator, when it is a fundamental and necessary shift in how they need to operate and how we all need to live,” said Johnston. 

“The companies that will fare best in the coming years are those that recognise this and are making sustainability a core, strategic pillar of their business. They are ahead of policymakers in self-regulation, have clear action plans for addressing sustainability challenges and achieving net zero emissions, and have strong support from stakeholders.”

Priyanka Bajpai, Southeast Asia regional head at SPAG, told PRWeek Asia that change can come by way of innovation. “Large organisations should take the lead in driving responsible business practices by innovating new and sustainable ways to create products and services, and carry out their business activities. By innovating more sustainable products and driving sustainable business practices, they can further inspire and share this expertise, knowledge and best practices for other companies to follow in their footsteps,” she said. 

But of course, innovation cannot take place without organisations first being transparent in communicating the impact of their business, and this includes regular reporting on their ESG activities.

Bajpai added that we shouldn’t forget about the pertinence of effective employee engagement in this matter, given that employees are also a company’s ambassadors. “It is important for employees to understand the initiatives organisations are doing in ESG, so that they are not only aware and proud (leading to purpose-led careers), but also become champions for the organisation,” she said.

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