South Africa to move to low-carbon economy

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Johannesburg - South Africa aims to make a transition to a low-carbon economy that is also able to promote job creation and development in a carbon-constrained future, Environmental Affairs and Tourism minister Marthinus van Schalkwyk said on Wednesday.

Commenting of the findings of the South African Carbon Disclosure Project report for 2008, Van Schalkwyk said the South African government understood that the country’s new competitive advantage lay in becoming world leaders in climate-friendly technology.

“If we continue with business-as-usual, we will go out of business,” the minister said, adding that South Africa seeks first-mover advantage despite grappling with the challenge of re-orientating domestic strategy in a future global economy that will be constrained in terms of carbon.

“Climate change mitigation is seen as a pro-growth, pro-job and pro-development strategy of the future,” said Van Schalkwyk.

The South African Carbon Disclosure Project report for 2008, showed that there is a greater awareness of, and engagement in, government policy on climate issues.

South Africa’s second report on the project achieved a response rate of 59 percent this year with double the number of companies reporting in comparison with last year.

This response rate is relatively high by international standards and suggests that local companies are largely willing to engage on climate change issues, the project research team said in a statement accompanying the report.

Latest findings show that more of the JSE Top 100 companies consider climate change to present physical risks (89 percent) than the Global 500 (74 percent), while the percentage for regulatory risks is similar (76 percent and 74 percent for the JSE Top 100 and the Global 500 respectively).

There is also a similar response with regard to regulatory and physical opportunities, with 85 percent of the JSE Top 100 identifying regulatory opportunities and 64 percent highlighting physical opportunities.

But the study found that while most responding companies have developed, or are implementing, formal systems for measuring and reporting on their Green House Gas emissions, some important gaps remained in their governance systems for climate change, and in the nature and extent of executive board oversight on this issue.

In addition, the report noted that although there have been improvements since last year, there is still insufficient evidence to suggest that mainstream South African investors fully appreciate the business implications of climate change, or that they are exerting meaningful influence on the corporate sector on this issue.

The South African Carbon Disclosure Project report revealed that most companies believe that the South African government will introduce regulations on climate change in the near future.

Many of the responding companies acknowledged that while regulations impose potentially significant risks, they would also level the playing field and hence make efficiency and environmental best practice more attractive.

“In the context of competing social and economic priorities, comparatively high per capita greenhouse gas emissions and high vulnerability to the impacts of climate change,

“South African policy-makers face a particular challenge in developing a national policy response to climate change and preparing their negotiation position for the post-Kyoto climate,” said South African Carbon Disclosure Project report managing author Jonathan Hanks of Incite Sustainability.

“It is hoped that this CDP survey will contribute both to an improved understanding of current emissions levels and of the possible impacts of reduction targets, as well as encouraging the development of further leadership within the South African business sector,” Hanks said.