It's been a week since the Stern Review on the Economics of Climate Change was unleashed upon the world, and the report has become a lightning rod on both sides of the climate change issue. For advocates of climate action -- that is, most people -- it was a call to arms, a sobering reality check about what will happen if we don't take bold action, fast.
For the small number of non-believers, it was just another alarmist, sky-is-falling plea, no more credible than those that came before it. Bjorn Lomborg, author of the controversial anti-environmental-movement screed, "The Skeptical Environmentalist," reviewing the report in The Wall Street Journal, complained that "Its fear-mongering arguments have been sensationalized, which is ultimately only likely to make the world worse off." And so it goes.
For the uninitiated, the Stern Review was commissioned by the British government last July. It was carried out by Sir Nicholas Stern, head of the U.K.'s Government Economic Service and former World Bank Chief Economist. In essence, Stern's team took climate models and number-crunched them into economic models.
The Review (download the full report here) focuses on the impacts and risks arising from uncontrolled climate change, and on the costs and opportunities associated with action to tackle it. It found that all countries will be affected by climate change, "but it is the poorest countries that will suffer earliest and most."
Unabated climate change risks raising average temperatures by over 5°C from pre-industrial levels. Such changes would transform the physical geography of our planet, as well as the human geography -- how and where we live our lives.
The Review calculated that the dangers of unabated climate change would be equivalent to at least 5% of global gross domestic product each year, and as high as 20% of GDP. That's far more severe than any previous calculation and reflects numbers that are nothing short of a global economic depression. In contrast, stabilizing greenhouse gases at manageable levels would cost about 1% of GDP.
The full 700-page tome is not likely to be read by many mere mortals, but I recommend at least its executive summary (there's both a short and long version) -- as well as any of several well-done analyses (such as Alan AtKisson's on Worldchanging, or the review by The Economist). It will likely be a topic of conversation for some time, and professionals dealing with climate change issues would be wise to be conversant about its key points.
Another topic of growing discussion is that of "stabilization wedges," the notion promulgated by Princeton scientists Robert Socolow and Stephen Pacala that climate emissions can be stabilized by a series of bold actions over the next fifty years. Their original paper (download - PDF) is more than two years old, but it has been gaining currency over the past several months, culminating, perhaps, in a well-written piece in September's Scientific American (downloadable for a fee). I've heard it discussed several times at this fall's conference circuit, as well as in more casual conversations with colleagues and clients, and have been integrating it into my own speeches and presentations about business and the environment.
Socolow and Pacala argue that stabilizing greenhouse gas concentrations will require reducing emissions by 7 billion tons a year by 2054. To make this more understandable, they identified 15 potential "wedges," each of which could handle one billion tons of the total. Thus, it will take seven such "wedges" to accomplish their goal.
The wedges are sobering in their scale and scope. Here are just five examples of things we must do worldwide, each of which, when phased in over the next fifty years, will prevent the release of 25 billion tons of carbon:
Keep in mind that this isn't an either/or proposition. We'd have to do ALL these things -- plus two more -- to keep greenhouse gas levels stable in check below 550 parts per million, double pre-industrial levels.
Like the Stern Review, it's another sobering reality check on the challenges ahead. Increasingly, companies are not merely going to be asked what they're doing on climate change, or to simply disclose the full complement of their climate footprint. They'll be asked, "Are you doing enough to truly stem the worst effects of climate change?"
And increasingly, companies will find that they better have an answer, and that it better be good.