OREANDA-NEWS. March 18, 2010. According to the most comprehensive survey of its kind yet conducted, the PricewaterhouseCoopers Appetite for Change, business is looking to governments for leadership in establishing the behavioural change necessary to halt global warming. And it’s a mixture of penalties and rewards that is most likely to encourage business to reduce its impact on the environment, reported the press-centre of PwC.

The survey takes a close look at attitudes in the international business community towards environmental regulation, legislation and taxes. In almost 700 interviews in 15 countries, executives share their perspectives on issues such as the impact of climate change, the role of government, preferred environmental policy tools, and the essential ingredients for an effective global climate change deal.

Globally, 84% of executives accept that climate change will change the way they do business over the next 2–3 years; in France this figure rises to 100%, and it stands at over 90% in South Africa, the UK, Canada and Australia.

Russia is the only G20 country that has reduced its carbon intensity in 2000-2008 by more than their budgeted amount, directly attributable to rapid improvements in energy intensity over this period. However, it should be noted that efficiency was low. Therefore, Russia’s real emission reduction index is positive that suggests that business as usual can continue, at least for a few years. 47 per cent of Russian business leaders expect their businesses to experience no changes within three years as a result of climate change. The Russian executives are the most likely to look to government to lead the behavioural changes necessary to stop global warming.

Business leaders around the world recognize the need for meaningful emissions targets. Eighty eight per cent of businesses, including 93 per cent of Russian firms, believe national emissions targets will play an important role in a global climate change deal.

Again globally, 44% of executives feel it is primarily up to government to take the lead in bringing about a shift in behaviour regarding climate change. A country breakdown shows marked differences behind this figure, with more than 60% of executives questioned in the UK, China, Russia, Canada and Sweden citing government responsibility, whereas their colleagues in Germany and Brazil opt for more of a shared responsibility between government, business and individuals.

When it comes to the most effective way of getting business to reduce its impact on the environment, business clearly sees the answer to lie in a mixture of ‘carrot and stick’ — with 86% opting for tax incentives and 83% for regulation. The leading factors instrumental in influencing an organisation’s environmental behaviour were compliance (85%), corporate reputation (74%), cost savings (73%) and competitive advantage (67%). Interestingly, business people are saying that, done in the right way, regulation can be welcomed rather than seen as a constraint.

A massive 92% are in favour of more environmental tax incentives, but 55% feel the current criteria to qualify for these are too tough, and 71% consider current tax incentives do not sufficiently motivate to promote behaviour change.

The ploughing back of money raised from environmental taxes and regulation directly into green or environmental projects is seen as important by 88% — but only 31% are confident this will happen. And opinion is split as to the best way of encouraging responsible environmental behaviour, with European executives leaning slightly towards carbon tax, and their North American and BRIC (Brazil, Russia, India, China) colleagues keener on emissions trading schemes.

Mark Schofield, PricewaterhouseCoopers Global Sustainability and Climate Change Tax Leader, remains optimistic:
“This research contains a strong message of hope for those struggling to find a global consensus: incentives, emissions trading schemes and even carbon taxes could win support in the business community. Political leaders who activate that potential have a good chance of creating historic solutions to the unprecedented challenges facing our ecosystem.”