Release Date: 11 August, 2023
Business body commits to confront climate emergency
By Maurice Radebe
Wits Business School was proud to host the launch of Chapter Zero Southern Africa (CZSA) this week, attended by more than 40 eminent non-executive and executive directors of some of the Johannesburg Stock Exchange’s top-100 companies and non-listed businesses.
This was a rare opportunity for some of the region’s board chairpersons and directors to come together under one roof with a common purpose, and the event marked a seminal moment for business climate action in southern Africa.
CZSA is a timely response to a clarion call by the World Economic Forum and the Climate Governance Initiative for urgent business action to confront the looming climate emergency. The leaders whom I was proud to welcome to WBS this week included founding directors of the board and patrons of Chapter Zero Southern Africa.
The new regional organisation is the 28th chapter around the globe and the second in Africa, following the launch of Chapter Zero Egypt two weeks ago. The global Chapter Zero network has over 100,000 members across 58 countries.
Climate change is upon us, and business must act to ensure a sustainable future for our precious planet and future generations. In the past two years, southern Africa has borne the brunt of extreme weather events resulting in ruinous natural disasters. Floods, cyclones and droughts have claimed lives and livelihoods and devastated hard-built economies, reversing the social gains of the past few decades.
Closer to home, the 2022 floods in KwaZulu-Natal (KZN) were the most catastrophic natural disaster yet recorded in the province in collective terms of lives lost, infrastructure damaged and destroyed, as well as economic and environmental impact. The damage is estimated at R25 billion.
To date, KZN’s social and economic infrastructure has not yet recovered to its pre-flood status. As if that were not enough, research indicates flooding events in the province have doubled over the last century.
Climate change is an emergency. Business has a catalyst role to play in leading climate action in the boardroom. The boards of directors are uniquely positioned to steer their organisations by asking the right questions and connecting their non-executive and executive directors with Chapter Zero’s global network of business sustainability-conscious peers with invaluable tools, resources and experience.
Evolving business climate ambition into climate action is a strategic imperative. Doing little or nothing is not an option. With humility and resolve, our mandate is to mobilise boards across the region to accelerate the net zero transition.
Chapter Zero has been targeted at reducing fossil carbon emissions to zero. The implementation of the Chapter Zero programmes, in conjunction with the successful rollout of just transition initiatives will deliver on many of the United Nations’17 Sustainable Development Goals.
Chapter Zero’s accelerated global growth is attributable to its differentiators below:
The next three years are critical when it comes to business response to climate change. The 2021 Intergovernmental Panel on Climate Change report flagged a “code red” for humanity. It warned that emissions globally needed to be halved by 2030 to ensure average temperature increase does not exceed 1.5 degrees by 2050.
The business community must act now, turning pledges into action. Boards are uniquely positioned to steer business climate action. They should ask the right questions and provide robust solutions for the long-term resilience of the organisations they lead.
Boards should transform their organisations by applying the World Economic Forum’s Principles for Effective Climate Governance. Progress should be measured by evidence of companies whose governing bodies are active members of Chapter Zero over the next three years. Key to climate business action is a significant increase in the number of corporates executing just transition plans to achieve the 1.5 degree milestone.
It delights me that Chapter Zero turns ambition into action. As we know, it is all very well to make an appearance at one of the COP conferences, rub shoulders with influential global “who’s who” and to make politically-correct pledges towards lofty ideals. These pledges often amount to nothing more than empty promises.
Chapter Zero Southern Africa is about concrete, lasting change – but with a difference. We consider our unique contextual challenges in southern Africa. While the Global North prioritises decarbonisation to address climate change, for our region, climate change must be approached in the context of the deeper imperatives of environmental, social and corporate governance (ESG) and drive a just transition away from fossil fuels.
ESG in Southern Africa should be seen against a background of poverty, inequality and inclusive economic growth. To us, ESG is not insularly focused on environmental protection – it is sustainable development.
The question is, how do we address climate change while at the same time ensuring the social and economic wellbeing of our people, especially the most vulnerable groups? How do we build climate change resilience across Africa to mitigate the perpetual risk of mass fatalities in the face of a natural disaster?
These are difficult questions, and business must step up and become a dependable partner, of course, alongside the public sector, civil society and other actors. This societal immersion of business is guided by non-executive and executive directors of their boards, whether pension funds, investment houses or the owner-managers driving our SME sectors.
Directors are accountable for their organisation’s net-zero strategy. They have crucial oversight in monitoring and holding management accountable. Boards need to identify the risks associated with carbon neutrality – including financial and reputational. Pursuing ESG and exposing the company to risk is irresponsible.
Crucially, boards also need to be well-informed about their organisations’ strategy toward a net-zero transition. They need to be aware of external coalitions and initiatives and how these are relevant to the company’s industry and sustainability objectives. Finally, boards need to be actively involved in such initiatives, rather than standing idly by as passive observers.
This is where Chapter Zero steps in and steps up.