The Governance of Corporate Responses to Climate Change: An International Comparison

In response to pressures from governments, investors, non-governmental organisations and other stakeholders, many large corporations have adopted a variety of carbon and energy management practices, taken action to reduce their emissions and set targets to reduce their greenhouse gas emissions. Using the case of international retailers, this article examines whether, and under what conditions, non-state actors might be capable of assuming the governance roles that have historically been played by national governments. This article concludes that external governance pressures can, if they are aligned, robust and of sufficient duration, have a significant influence on internal governance processes and on corporate strategies and actions. However, the specific actions that are taken by companies – in particular those that require significant capital investments – are constrained by the ‘business case’. That is, companies will generally only invest capital in situations when there is a clear financial case (i.e. where the benefits outweigh the costs, when the rate of return meets or exceeds company targets) for action. That is, the extent to which external governance pressures can force companies to take action, in particular challenging or transformative actions that go beyond the boundaries of the business case, is not at all clear. This is particularly the case if the business case weakens, or if the opportunities for incremental change are exhausted. In that context, the power of non-state actors to force them to consider radical changes in their business processes and their use of energy therefore seems to be very limited

Reducing Greenhouse Gas Emissions in the Queensland Electricity Supply Industry: Gas and Carbon Tax Scenarios

This article examines various greenhouse gas scenarios for the electricity supply industry in the coal-rich state of Queensland. The authors use a dynamic partial equilibrium model of the Queensland electricity system to examine the effects of four alternate policy scenarios: a business-as-usual case, a centrally planned gas-fired case, and two carbon tax scenarios - the first in which the merit order of coal and gas plant is reversed, and the second in which fuel switching is undertaken. The results indicate that no scenario is capable of delivering sufficient cuts in emissions to meet a 'Kyoto equivalent' industry target. While fuel switching brought about the greatest reduction in emissions, the high cost of this scenario indicates that a more efficient outcome for the electricity supply industry in Queensland would be a broad-based Australia-wide approach to emissions abatement, so that carbon reductions can be accessed from industries capable of achieving lower cost emissions abatement