India Inc recognising climate change risks

India Inc has started recognising the risks associated with climate change, with the software and services sector taking the lead in monitoring their emissions and formulating plans for reducing carbon footprint, according to a survey released on Thursday.

Though out of 200 firms approached, only 44 responded, nevertheless the 'Carbon Disclosure Project Report 2009' noted the response reflects that not only they were adopting more accurate methodologies but also providing break-down of their greenhouse gas emissions.

"The software and services sector has taken the lead in mapping its GHG emissions and designing mitigation steps. About 38 per cent of the firms approached in this sector are reportedly monitoring their emissions and have plans in place to mitigate their GHG footprint," the report said.

The report has been prepared by Confederation of Indian Industry-International Trade Centre in collaboration with the British High Commission and World Wildlife Fund based on the analysis of the responses received from the participating Indian firms.

"Increasing, board level managerial resources are spearheading the execution of climate change strategies within their organisations," the report said.

The report said not many respondents perceive climate change regulations as a risk and acknowledge the emergence of new opportunities due to regulatory changes focussed on it.

"Only 34 per cent (13 firms) of the companies recognised regulatory risks. This can be fairly attributed to increasing level of interaction between government and industry directly, as well as through industry associations on India's position towards climate change," the report said.

However, with the formulation of the Prime Minister's National Action Plan for Climate Change, Indian companies recognise that the government is serious about addressing climate change, it added.

"This could mean that regulatory pressure is going to mount in the near future. Already emissions norms are in the pipeline for key energy intensive sectors while energy efficiency standards are being formulated," Ravi Singh, CEO of World Wildlife Fund, said.

A positive factor, the survey said, is that companies were also formulating targets and setting standards to reduce their energy consumption and thereby their GHG emissions. "At least 26 firms said they have reduction plans in place for slashing either their energy or GHG emissions. The targets they had set were mostly quantitative.

"Many of the companies have already moved fast to tap this potential market with as many as 32 firms anticipating climate change regulation as an opportunity for their business," the report said.

However, it noted that despite recognising significance of climate change, Indian companies are yet to incorporate it in their investment decisions.